What Is A Claim To Insurance Companies?

       

I am working with Mitchell on a claim, and his claim and my post yesterday got me thinking about claims from the insurance company’s perspective. By way of some background, in the claim that Mitchell is working on the supervising adjuster is being very aggressive and demanding to the point of being insulting and demeaning to both him and the insured. Needless to say it’s gotten off to a bad start and letters have been flying back and forth. But still it got me to thinking about what a claim is to an insurance company.

Now a lot of you may be thinking that a claim is an expense and you’d be right, but I think it’s much more than the money that’s going to be paid out. It gets back to understanding why people buy insurance in the first place. Yes, I know you have to buy insurance if you own a car or mortgage a house, but why purchase from one company as opposed to another? Why do folks say I’ve got State Farm Insurance or Allstate Insurance as opposed to just saying I’ve got homeowner’s insurance or auto insurance? I think it’s because there is a perceived value in the company who sold them the policy and a hope that value will be expressed at the time the claim is made. So when I think of claims, I am thinking of opportunity.

A claim is an opportunity from the company’s vantage point to deliver upon that perceived value. To deliver value in the adjustment, to deliver value in the evaluation of damages, to deliver value in the payment of the claim, to deliver value in the relationship that is established between the parties. However, Mitchell’s experience seems to indicate that the insurance company doesn’t look at a claim as a way to deliver value. They are just pissed off at having to pay. In reality what occurred is that the insured is being perceived by the company as trying to get something they don’t deserve.

And that mindset is a wasted opportunity to deliver on that perceived value.

Imagine how different the relationship between insurance company and insured would be if the insurance company fostered and nurtured the concept that a claim is an opportunity to deliver value in the adjustment process. Imagine if the adjuster were more concerned with building a relationship instead of letting the policyholder know what wasn’t covered and what the insurance company couldn’t do. Imagine if they brought to the table solutions rather than objections. I think the bottom line would actually improve. Sure indemnity might increase slightly, but legal and experts expense would certainly drop.

“Would you like a latte with that drywall?”

Bill

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Pre-Storm Preparation

While TS Bertha (7/6/08) has prompted me to expound upon storm preparation, this advice is good for any storm, hurricane, flood, winter storm, earthquake etc… Following a major catastrophe, reports of losses are made in staggering numbers prompting insurance companies to begin hiring contract adjusters to handle the increased claim volume. Most of this staffing increase takes the form of contracts with independent adjusting firms who begin the mad and sometimes frantic search for bodies. I use the term bodies intentionally in that every company has their “A” list adjusters and their “D” adjusters as well as all categories in between. As you can imagine, “A” list adjusters are the best and the independent adjusting firms try and keep them busy all year long so as not to loose them to the competition. “D” list adjusters are called upon only as a last resort, but on major events they are going to be called in to adjust claims. As the policyholder, you have no idea whether the adjuster assigned to your claim is top notch or an also ran. You won’t get this information even if you ask for it. Let’s face it, who would be willing to admit they were marginal. Don’t waste your time asking it’s not material.

What is material is your ability to demonstrate your loss: be able to prove the extent of damage and document that damage.

Before and after pictures are great for this type of proof. The difficulty arises with the before component of this equation. Most people never think about loss before it happens and are caught unawares and unprepared for loss after the fact. This lack of planning is compounded because the policyholder calls the insurance company to report the loss and for all intents and purposes abandons the determination of their loss to the insurance company adjuster: who may be an “A” adjuster but more likely is something else.

This company adjuster arrives on scene with their camera and tape measure to determine the loss. You show the adjuster the damage and the adjuster only includes a fraction of what is shown in their report to the insurance company. In the interim, you begin the clean up and repair process. Then the much anticipated check arrives in the mail and bingo you’re not satisfied. What happened?

In a nutshell, lack of preparation and naivety combine with incomplete reporting to create the perfect post loss financial storm.

Now consider this scenario. Pre-loss photographs are taken and post loss photographs are taken utilizing the identical views. Additionally, post loss photographs are taken of close ups of the property damaged by the storm. Before shots are contrasted with after shots and the differences labeled. The whole package is then given to the adjuster with a letter requesting these photographs be forwarded to the insurance company. You have a much better chance at getting a reasonable recovery than simple hoping for one. Obviously the better the photograph the greater the ability to distinguish and document the differences between the pre and post storm conditions.

This action will not substitute for having the right tools to prove loss, but will greatly aid you in obtaining a recovery as compared to abandoning your claim to the insurance company adjuster.

Tools of The Insurrance Company Adjuster

The next time your home or business is damaged by catastrophe give this your consideration: watch what the insurance company adjuster brings with them to the scene. I’ll bet you will be able to put the tools into a couple of buckets, camera and tape measure. The camera is used to document the open and obvious damage and the tape measure is used to quantify the areas damaged. Ok, I forgot something, a flashlight. They need to be able to see what they are looking at.

My question to you is this: What happens if your damage is not open and obvious? Take a look at the photo below. This is a photo of a wall taken to a hurricane damaged house. What’s wrong with the wall?





You can’t tell. The damage is not open and obvious. A camera and tape measure is not going to help you recover money from the insurance company. You can have all the opinions you want as to whether the wall is damaged, but unless you can prove it, you’re SOL. “Sorry about that the adjuster says. I just don’t see what your talking about.” Remember they can always tell you what isn’t covered by the policy and damage which can not be proven is not covered.

Having the right tool on the other hand can mean the difference between a recovery and no recovery. Here is that very same photograph where I am taking a moisture reading. The moisture meter is pegged. It doesn’t take a genius to figure out the wall is wet. The result? The insurance company paid for the water damaged wall.







There is no substitute for having the right tool for the right job. If the insurance company adjuster doesn't have the right tools at their disposal what makes you think they are equipped to adjust your loss?