Subject: Market Conduct Check List For Allstate-Travelers-State Farm
Posted On: May 18, 2006, 3:42 pm CDT
Posted By: Roger Poe
Comment:
5-18-2006
Synthetic Claim Settlement Check List
1. Are labor dollars needed for all materials installed missing from roofing, dry-wall, etc. trade labor costs?
Allstate believes that a 3000 SF shingled roof that needs 3300 SF of materials AND 3300 labor costs for the completed project, should only show 3000 SF labor costs in their \”fair trade\” estimates.
By the way Allstate, the extra labor line that the MS/B IntegriClaim program data has for clean-up work is VERY different cost wise from the unit labor costs that should apply to the 300 SF production costs.
Job site clean-up work costs throughout a projects\’ duration is QUITE different from ACTUAL trade production installation work unit costs.
2. Cross reference actual regional material and labor costs, especially in early estimate paperwork put out to claimants.
MS/B\’s storm damaged property reconstruction costs surge databases verses \”new\” construction costs data, and Craftsman Publishing\’s \’2006 National Renovation & Insurance Repair Estimator\’ should give pretty close [post-catastrophe] reconstruction costs in a given region.
If [Allstate] used new construction costs as an estimation base, then MS/B data costs for different regions in Louisiana should be easily proven by referencing a copy of MS/B\’s software version used by the general construction public, not necessarily the version that Allstate had designed for their own use.
Since both Allstate and MS/B realize actual (before hurricanes Katrina / Rita) new construction price data for Louisiana, any synthetically LOW, or missing, MS/B construction COMPONENT costs for REconstruction labor, materials, sales tax, and primary-general-subtrade contractors overhead and profit, etc. values will show up throughout their estimates.
Be aware though that, from the start of forming a construction estimate, \”NEW\” construction labor, materials and overhead unit costs are going to be QUITE LOWER than historical REconstruction unit work costs, especially after a storm).
Reconstruction costs can easily be 30-50%+ higher than new construction costs, plus post storm materials, labor and business overhead cost market increases add even higher costs to reconstruction costs.
3. See if ALL Contractor Overhead and profit line items are missing from estimates. Replacement Costs depreciated = Actual Cash Value, and still have those collective loss value costs woven in.
4. If not line itemed seperately, have them prove that roofing, fencing, carpeting, etc. specialty trade contractors business overhead and profit costs are in the unit costs of each specialty trade.
Allstate has been using a basic 29% contractor\’s overhead and profit margin line item that some adjusters are touting as being THE primary-general Contractors business overhead and profit line item.
Actually, an additional 10%and10% (20%)overhead and profit factor is recognized by Allstate, if one\’s would, perchance, know to ask about those [basic] primary-general contractor mark-up factors.
5. See if Allstate claims that primary-general contractors are only \”necessary\” if there is structural damage included in the loss.
6. See if either company expects that premiums paid them for replacement procedures and costs of a structure anticipate the general public to act as their own contractor, OR does MS/B type data, used in part for actuarially estimating future replacement costs of a structure, at an insurance agents desk, historically accounts for primary-general contractor involvement first and foremost, with their own staff and sub-contractors support.
6. See if Allstate claims that 2-3 or more specialty trades work is required before a primary-general contractor is \”necessary\”.
7. See how many field adjusters were required during the life of a claim.
(Was Pilot Claim Service involved?)
8. Audit claim estimates from the nicer neighborhoods verses claims from the less well off neighborhoods. See if just roofing damage was accounted for, and if said damage was only damage if roofing material was missing.
9. Interview a mix of claimants to see how they were treated in person, or by mail / e-mail, or over the phone.
Did the adjuster dismiss or play down legitimate exterior and interior (wind / wind driven rain) damage?
10. Interview Allstate / Pilot Claim Service, Saint Paul Travelers and State Farm adjusters, and contrast their claim handling views with other [independent adjusters] views.
11. Publish specific examination results based in part on the above check-list so as to benefit the general public.
12. Resist anyones notion that such [publically known] construction data, and/or insurers market conduct is a \”trade secret\” somehow.
Claim Hawk, I have been wondering how many decent adjusters have said,\” No more falseness, dishonesty to close to me — I\’ll be sullied sooner or later! –I quit!\” Also , how does the individual claiment \”fight\” the multi-billion dollar insurer that insists that Katrina did not cause ANY loss as there was flooding at, by or on your property..??? After inquiring abaout my small claim, $10,000 was told on the phone that \”If it got wet you not getting a \”dime\” [or penny, perhaps!]. I do not see how after over 20 years and no problems, I can do any more business with State Farm….and neighbors and friends tell me of similar experiences. After discust with no action, I , for one, badgered the \”AUTHORITIES\” [read…Insurance Commissiioner and Attorney, seem only to be able to travel about 300 miles, meet State Farm employees? in madiation or arbitration??? Even then how can I or State Farm PROOVE there was WINDSTORM damage [called Katrina] PRIOR to any water [read flood]damage. When I examined the scene of the missing or destroyed building and contents it seemed OBVIOUS there was EVIDENCE of extreme wind destruction….I do not think the claims folks had ever been to a Cat site, let alone the subject property—-but I have little in the way of proof other than photos of the area that was totally devistated–literally nothing of a building and ZERO contents. Please anyone, give us some ideas or tips on how to handle this travesty. Thanks, Charles
1. Security cameras, throughout the city, that functioned through Katrina / Rita may have recorded the events.
2. Did any storm reporting news crews, residents, or storm chasers, stay and video record the event?
Did any one stay in a safe, high, place and record how the wind was affecting structures before, during, and after the tidal surge came?
3. Weather / military satellite records.
Remote sensing image devices, from space, may be very helpful on a case-by-case basis.
Was infrared, or structural / topographic monitoring type technology, or other technology, in place to record (from space) the wind cause and effect on structures, before, during, and after any tidal surge occured?
Can they even do that, down to a license plate on a car, during a storm?
Even empty concrete slabs and lots may have had their previous structures\’ storm generated deconstruction \”history\” witnessed and recorded, in space.
While your opinion is noted and quite appreciated, it would seem to me that you are the one who \”fell down\” on the job. You stated that you had a 3 week course that (to paraphrase) taught you the in\’s and out\’s of the policy. If it took you three weeks to learn this, then you should have been able to interpret the policy fairly clearly after this length of time.
Having said this, it would seem that there may be issues of \”good faith\” that can be raised with the company you were working for.
My question is, did the company you were being paid by (the independent adjusting firm) tell you to provide less coverage, or did the assigning company (the insurance company)? If it was the insurance company, why didn\’t you raise the topic at hand while you were working for them? It is rather easy to bad mouth someone when you will gain from it, rather then when they are signing your paycheck.
Seems kinda self-serving to me, but what do I know?
By the way, I am guessing that those who have posted on this thread will truly appreciate your apologizing for them to Mr. Poe. Especially now that you have no interest whatsoever on the fiduciary outcome of the claim (Di you mention, that you receive a portion of the claim amount from the insurance company? I believe 10% of what the insurance company pays to the Insured is due you under standard contract in Florida. Who is going to pay the additional 10% to get the work done?)?
Roger,
Of course what I and others have to say doesn\’t bother you………. You have your opinion (God Bless America that you have that right) and to Hades with those who have the temerity to side against you.
To echo NK\’s thoughts, why didn\’t Martha speak up when she was getting paid by the insurer? If fraudulent, deceptive or unfair claim practices were going on, then she should have notified the local authorities (what state, I am no sure as there is no mention) and done something about it then. Seems to me that Martha is rather self-serving in that NOW she has a problem with what is going on, but didn\’t mention it when her paycheck was being signed by the insurance company.
BTW, I am not condemning you Martha, just wondering why you didn\’t do the right thing (whistleblowing) when you had the opportunity. I know that if the company I worked for did something illegal, I would certainly mention it. My morals wouldn\’t let me do anything else.
Some wonderful thoughts. Maybe Charles can get the Department of Defense to place a spy satellite in a geo-stationary orbit during the next hurricane.
Charles,
The best thing I can say is that whenever I am on a claim, I look for coverage, not exclusions. If you can prove to me (so I could take it to my supervisor) that the damage was from wind and not flood, I will write you a check so fast your heart will stop. The big issue here is what is provable. I have said it before, that if one can show/prove damages (as required by the policy) then they should be paid for it. Having said that, the person I work for has quoted to me (and I live by the mantra) the benefit of the doubt goes to the insured.
I have seen what 150+mph winds can do to a house and they are nothing compared to what a 20ft. storm surge can do.
My suggestion to you would be to have the adjuster and/the supervisor show/tell you why they believe there is an excluded event that damaged your property.
I realize you have suffered a loss, and I am truly sorry that you did, but being realistic, if it was flood and you didn\’t have a flood policy to save th $1500 per year, that is a decision you made. And, like I am trying to get through my 16 year olds head, we all have to live with our decisions.
NKN,
While your thoughts are valid and due consideration, my main thought that you didn\’t address is: As any adjuster knows, a \”Bad Faith\” claim to the Insurance Commisioner is something to be avoided at nearly all costs. If ClaimHawks company was abusing the customers, why did ClaimHawk not stand up for them? I realize that it is difficult to \”cut one\’s own throat\”, but if there was truly abuse or fraud going on, why did ClaimHawk wait until she was a Public Adjuster to make this information known. Like the man says, \”What\’s right is right, no matter who says/does it\”.
Posted On: May 7, 2006, 5:53 pm CDT
Posted By: Martha Kirwin
Comment:Federal Judge in Mississippi \’Storm Surge\’ Case Upholds Home Insurance Flood Exclusion
Gentlemen,
I have been an adjuster for six years. Having grown up with a homebuilder and insurance agent for parents, it was a natural choice after grad school.
Until December \’05, I worked for a large catastrophe adjusting firm. My husband and I worked together while traveling the country, earning a fabulous income, and meeting extraordinary people.
Prior to 2004 I experienced very few instances of practices by insurers that I would have labeled negligent, illegal, or deceptive.
In general, most insurers appeared to have an interest in settling claims quickly and fairly within the boundaries of their contracts. In order to achieve good will, I have seen insurers pay for losses(food replacement, etc.) that were not legitimatly covered under the policy.
During this period, one of the most difficult aspects of my job was explaining coverage to the insureds.
After grad school, I took a three week, 120-hour course on policy coverage, after which I felt as though I had obtained an acceptable level of understanding on how to interpret property coverage language.
Yet, on many occasions thereafter, I made mistakes. It soon became evident that the vast majority of policy holders had an extremely limited knowledge of their coverages.
Not surprising, given that they do not take three week courses.
In 100% of the scenarios in which I have adjusted losses, the insureds were either surprised to learn that some portion of their property was not covered or limited to some degree below that which they understood to be limited.
Prior to 2004 however, these situations did not typically result in tragic outcomes for the insureds. In each instance, I encouraged the insureds to contact their agents for clarification and recommendations for updating or upgrading their coverages.
Unfortunately, beginning with the four hurricanes in 2004, claims adjusting practices have changed dramatically. Suddenly, roofs, carpets, awnings, and a litany of other trades are no longer allowed to be considered for Overhead and Profit by many insurers.
Taxes and O&P are no longer are part of the calculation for ACV. We \”negotiate\” different prices with individual insureds as if we were purchasing an automobile.
My neighbor might have been paid $1400 per Square for the same roof that I was only allowed $900 from the same insurer.
To my astonishment, I have come to know that most of the claims that I have adjusted were estimated with a price database that is 70-110% below actual market pricing.
And worse, these people who I left \”knowing\” that I had worked diligently to find all the coverage available to them, were taking the proceeds of those claims and settling for those amounts.
The majority had no inclination that they had alternatives or could file supplements or dispute in any manner, the amounts of the settlements.
Needless to say, after two years of struggling with the ever increasing restraints and borderline illegal practices to which I was forced to impose on these uninformed consumers, I resigned my position as an independent adjuster.
In December of 2005, I opened a public adjusting firm in South Florida. Now, we experience on a daily basis the abhorrent practices of insurance companies and those adjusters who represent them.
Understand that it is my position that there are companies that handle their claims quickly, precisely, and professional in total compliance with the contract.
However, those companies are in the vast minority.
Last week, we filed a Civil Remedy on behalf of one of our clents siting 19 violations of statutes by one of the largest insurers in the state. My firm is representing over 300 clients currently and this is our current statistical compilation:
287 claims open in excess of 180 days.
143 in violation of at least five Florida statutes relating to adjusting practices.
These numbers represent staggering figures. On the average, we collect 293% more money from the insurance companies than was estimated originally and we achieve this by using the same adjusting practices that I have used for six years.
Mr. Poe, on behalf of those in this profession who take pride in said profession, I will apologize on behalf of these representatives of our industry, who with obvious disdain and disregard for the wide-spread consequences of their arrogance and flagrantly, biased disrespect for their insureds, contractors, attorneys or any others who oppose or even call into question their righteousness, honor, or the finality of their opinions.
Their defensive, territorial chest-beating and sophomoric, belittling statements are a clear indication of exactly why consumers need protection. Whether or not your business practices are ethical is completely beyond my discernment; however, I appreciate your seemingly sincere interest and dedication to making a difference in our industry.
\”Unfortunately, beginning with the four hurricanes in 2004, claims adjusting practices have changed dramatically. Suddenly, roofs, carpets, awnings, and a litany of other trades are no longer allowed to be considered for Overhead and Profit by many insurers.
Taxes and O&P are no longer are part of the calculation for ACV. We \”negotiate\” different prices with individual insureds as if we were purchasing an automobile.\”
and,
\”Mr. Poe, on behalf of those in this profession who take pride in said profession, I will apologize on behalf of these representatives of our industry, who with obvious disdain and disregard for the wide-spread consequences of their arrogance and flagrantly, biased disrespect for their insureds, contractors, attorneys or any others who oppose or even call into question their righteousness, honor, or the finality of their opinions.
Their defensive, territorial chest-beating and sophomoric, belittling statements are a clear indication of exactly why consumers need protection.\”
__________
Thank you Martha for your frank commentary. What Tony and others like him have to say does not bother me.
What bothers me is that naive consumers and others, even in regualtory, and other governmental authority positions, would believe their half truths and misinformation, if left up to them alone to explain their conduct.
It seems that Texas is the testing ground for such unfair conduct, and then the rest of the nation receives the polished results. The claim handling conduct you described has been going on here hot and heavy since 2002.
From my client records, Allstate, State Farm, Farmers, Safeco, USAA and the Texas Wind Storm Association have treated their insureds, and contractors, quite interestingly since 2002.
I truly believe the DOJ and FBI are going to investigate such matters, as they have become too large, and too obvious, to go on unaddressed.
By the way Martha, \”From Good Hands To Boxing Gloves\” is being published shortly.
Allstate tried to keep it from being published. Hmmmmm….Their explanation, to a judge, was not \”convincing\”.
You might \”Google\” search the book title, and too, please feel free to contact me.
Mrs. Kirwin\’s comments were republished, in smaller bites, for clarity sake.
Your comments about her observations are noticeably selective.
Your comments about Mr. Poe\’s observations are also quite selective.
Considering their commentary, with objective precision, and then contrasting their observations with other\’s comments in return, makes for some interesting and thought provoking reading.
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Subject: Market Conduct Check List For Allstate-Travelers-State Farm
Posted On: May 18, 2006, 3:42 pm CDT
Posted By: Roger Poe
Comment:
5-18-2006
Synthetic Claim Settlement Check List
1. Are labor dollars needed for all materials installed missing from roofing, dry-wall, etc. trade labor costs?
Allstate believes that a 3000 SF shingled roof that needs 3300 SF of materials AND 3300 labor costs for the completed project, should only show 3000 SF labor costs in their \”fair trade\” estimates.
By the way Allstate, the extra labor line that the MS/B IntegriClaim program data has for clean-up work is VERY different cost wise from the unit labor costs that should apply to the 300 SF production costs.
Job site clean-up work costs throughout a projects\’ duration is QUITE different from ACTUAL trade production installation work unit costs.
2. Cross reference actual regional material and labor costs, especially in early estimate paperwork put out to claimants.
MS/B\’s storm damaged property reconstruction costs surge databases verses \”new\” construction costs data, and Craftsman Publishing\’s \’2006 National Renovation & Insurance Repair Estimator\’ should give pretty close [post-catastrophe] reconstruction costs in a given region.
If [Allstate] used new construction costs as an estimation base, then MS/B data costs for different regions in Louisiana should be easily proven by referencing a copy of MS/B\’s software version used by the general construction public, not necessarily the version that Allstate had designed for their own use.
Since both Allstate and MS/B realize actual (before hurricanes Katrina / Rita) new construction price data for Louisiana, any synthetically LOW, or missing, MS/B construction COMPONENT costs for REconstruction labor, materials, sales tax, and primary-general-subtrade contractors overhead and profit, etc. values will show up throughout their estimates.
Be aware though that, from the start of forming a construction estimate, \”NEW\” construction labor, materials and overhead unit costs are going to be QUITE LOWER than historical REconstruction unit work costs, especially after a storm).
Reconstruction costs can easily be 30-50%+ higher than new construction costs, plus post storm materials, labor and business overhead cost market increases add even higher costs to reconstruction costs.
3. See if ALL Contractor Overhead and profit line items are missing from estimates. Replacement Costs depreciated = Actual Cash Value, and still have those collective loss value costs woven in.
4. If not line itemed seperately, have them prove that roofing, fencing, carpeting, etc. specialty trade contractors business overhead and profit costs are in the unit costs of each specialty trade.
Allstate has been using a basic 29% contractor\’s overhead and profit margin line item that some adjusters are touting as being THE primary-general Contractors business overhead and profit line item.
Actually, an additional 10%and10% (20%)overhead and profit factor is recognized by Allstate, if one\’s would, perchance, know to ask about those [basic] primary-general contractor mark-up factors.
5. See if Allstate claims that primary-general contractors are only \”necessary\” if there is structural damage included in the loss.
6. See if either company expects that premiums paid them for replacement procedures and costs of a structure anticipate the general public to act as their own contractor, OR does MS/B type data, used in part for actuarially estimating future replacement costs of a structure, at an insurance agents desk, historically accounts for primary-general contractor involvement first and foremost, with their own staff and sub-contractors support.
6. See if Allstate claims that 2-3 or more specialty trades work is required before a primary-general contractor is \”necessary\”.
7. See how many field adjusters were required during the life of a claim.
(Was Pilot Claim Service involved?)
8. Audit claim estimates from the nicer neighborhoods verses claims from the less well off neighborhoods. See if just roofing damage was accounted for, and if said damage was only damage if roofing material was missing.
9. Interview a mix of claimants to see how they were treated in person, or by mail / e-mail, or over the phone.
Did the adjuster dismiss or play down legitimate exterior and interior (wind / wind driven rain) damage?
10. Interview Allstate / Pilot Claim Service, Saint Paul Travelers and State Farm adjusters, and contrast their claim handling views with other [independent adjusters] views.
11. Publish specific examination results based in part on the above check-list so as to benefit the general public.
12. Resist anyones notion that such [publically known] construction data, and/or insurers market conduct is a \”trade secret\” somehow.
rogerpoegc@yahoo.com
Claim Hawk, I have been wondering how many decent adjusters have said,\” No more falseness, dishonesty to close to me — I\’ll be sullied sooner or later! –I quit!\” Also , how does the individual claiment \”fight\” the multi-billion dollar insurer that insists that Katrina did not cause ANY loss as there was flooding at, by or on your property..??? After inquiring abaout my small claim, $10,000 was told on the phone that \”If it got wet you not getting a \”dime\” [or penny, perhaps!]. I do not see how after over 20 years and no problems, I can do any more business with State Farm….and neighbors and friends tell me of similar experiences. After discust with no action, I , for one, badgered the \”AUTHORITIES\” [read…Insurance Commissiioner and Attorney, seem only to be able to travel about 300 miles, meet State Farm employees? in madiation or arbitration??? Even then how can I or State Farm PROOVE there was WINDSTORM damage [called Katrina] PRIOR to any water [read flood]damage. When I examined the scene of the missing or destroyed building and contents it seemed OBVIOUS there was EVIDENCE of extreme wind destruction….I do not think the claims folks had ever been to a Cat site, let alone the subject property—-but I have little in the way of proof other than photos of the area that was totally devistated–literally nothing of a building and ZERO contents. Please anyone, give us some ideas or tips on how to handle this travesty. Thanks, Charles
5-18-2006
1. Security cameras, throughout the city, that functioned through Katrina / Rita may have recorded the events.
2. Did any storm reporting news crews, residents, or storm chasers, stay and video record the event?
Did any one stay in a safe, high, place and record how the wind was affecting structures before, during, and after the tidal surge came?
3. Weather / military satellite records.
Remote sensing image devices, from space, may be very helpful on a case-by-case basis.
Was infrared, or structural / topographic monitoring type technology, or other technology, in place to record (from space) the wind cause and effect on structures, before, during, and after any tidal surge occured?
Can they even do that, down to a license plate on a car, during a storm?
Even empty concrete slabs and lots may have had their previous structures\’ storm generated deconstruction \”history\” witnessed and recorded, in space.
rogerpoegc@yahoo.com
ClaimHawk,
While your opinion is noted and quite appreciated, it would seem to me that you are the one who \”fell down\” on the job. You stated that you had a 3 week course that (to paraphrase) taught you the in\’s and out\’s of the policy. If it took you three weeks to learn this, then you should have been able to interpret the policy fairly clearly after this length of time.
Having said this, it would seem that there may be issues of \”good faith\” that can be raised with the company you were working for.
My question is, did the company you were being paid by (the independent adjusting firm) tell you to provide less coverage, or did the assigning company (the insurance company)? If it was the insurance company, why didn\’t you raise the topic at hand while you were working for them? It is rather easy to bad mouth someone when you will gain from it, rather then when they are signing your paycheck.
Seems kinda self-serving to me, but what do I know?
By the way, I am guessing that those who have posted on this thread will truly appreciate your apologizing for them to Mr. Poe. Especially now that you have no interest whatsoever on the fiduciary outcome of the claim (Di you mention, that you receive a portion of the claim amount from the insurance company? I believe 10% of what the insurance company pays to the Insured is due you under standard contract in Florida. Who is going to pay the additional 10% to get the work done?)?
Just random thoughts……….
Roger,
Of course what I and others have to say doesn\’t bother you………. You have your opinion (God Bless America that you have that right) and to Hades with those who have the temerity to side against you.
To echo NK\’s thoughts, why didn\’t Martha speak up when she was getting paid by the insurer? If fraudulent, deceptive or unfair claim practices were going on, then she should have notified the local authorities (what state, I am no sure as there is no mention) and done something about it then. Seems to me that Martha is rather self-serving in that NOW she has a problem with what is going on, but didn\’t mention it when her paycheck was being signed by the insurance company.
BTW, I am not condemning you Martha, just wondering why you didn\’t do the right thing (whistleblowing) when you had the opportunity. I know that if the company I worked for did something illegal, I would certainly mention it. My morals wouldn\’t let me do anything else.
Roger,
Some wonderful thoughts. Maybe Charles can get the Department of Defense to place a spy satellite in a geo-stationary orbit during the next hurricane.
Charles,
The best thing I can say is that whenever I am on a claim, I look for coverage, not exclusions. If you can prove to me (so I could take it to my supervisor) that the damage was from wind and not flood, I will write you a check so fast your heart will stop. The big issue here is what is provable. I have said it before, that if one can show/prove damages (as required by the policy) then they should be paid for it. Having said that, the person I work for has quoted to me (and I live by the mantra) the benefit of the doubt goes to the insured.
I have seen what 150+mph winds can do to a house and they are nothing compared to what a 20ft. storm surge can do.
My suggestion to you would be to have the adjuster and/the supervisor show/tell you why they believe there is an excluded event that damaged your property.
I realize you have suffered a loss, and I am truly sorry that you did, but being realistic, if it was flood and you didn\’t have a flood policy to save th $1500 per year, that is a decision you made. And, like I am trying to get through my 16 year olds head, we all have to live with our decisions.
NKN,
While your thoughts are valid and due consideration, my main thought that you didn\’t address is: As any adjuster knows, a \”Bad Faith\” claim to the Insurance Commisioner is something to be avoided at nearly all costs. If ClaimHawks company was abusing the customers, why did ClaimHawk not stand up for them? I realize that it is difficult to \”cut one\’s own throat\”, but if there was truly abuse or fraud going on, why did ClaimHawk wait until she was a Public Adjuster to make this information known. Like the man says, \”What\’s right is right, no matter who says/does it\”.
Posted On: May 7, 2006, 5:53 pm CDT
Posted By: Martha Kirwin
Comment:Federal Judge in Mississippi \’Storm Surge\’ Case Upholds Home Insurance Flood Exclusion
Gentlemen,
I have been an adjuster for six years. Having grown up with a homebuilder and insurance agent for parents, it was a natural choice after grad school.
Until December \’05, I worked for a large catastrophe adjusting firm. My husband and I worked together while traveling the country, earning a fabulous income, and meeting extraordinary people.
Prior to 2004 I experienced very few instances of practices by insurers that I would have labeled negligent, illegal, or deceptive.
In general, most insurers appeared to have an interest in settling claims quickly and fairly within the boundaries of their contracts. In order to achieve good will, I have seen insurers pay for losses(food replacement, etc.) that were not legitimatly covered under the policy.
During this period, one of the most difficult aspects of my job was explaining coverage to the insureds.
After grad school, I took a three week, 120-hour course on policy coverage, after which I felt as though I had obtained an acceptable level of understanding on how to interpret property coverage language.
Yet, on many occasions thereafter, I made mistakes. It soon became evident that the vast majority of policy holders had an extremely limited knowledge of their coverages.
Not surprising, given that they do not take three week courses.
In 100% of the scenarios in which I have adjusted losses, the insureds were either surprised to learn that some portion of their property was not covered or limited to some degree below that which they understood to be limited.
Prior to 2004 however, these situations did not typically result in tragic outcomes for the insureds. In each instance, I encouraged the insureds to contact their agents for clarification and recommendations for updating or upgrading their coverages.
Unfortunately, beginning with the four hurricanes in 2004, claims adjusting practices have changed dramatically. Suddenly, roofs, carpets, awnings, and a litany of other trades are no longer allowed to be considered for Overhead and Profit by many insurers.
Taxes and O&P are no longer are part of the calculation for ACV. We \”negotiate\” different prices with individual insureds as if we were purchasing an automobile.
My neighbor might have been paid $1400 per Square for the same roof that I was only allowed $900 from the same insurer.
To my astonishment, I have come to know that most of the claims that I have adjusted were estimated with a price database that is 70-110% below actual market pricing.
And worse, these people who I left \”knowing\” that I had worked diligently to find all the coverage available to them, were taking the proceeds of those claims and settling for those amounts.
The majority had no inclination that they had alternatives or could file supplements or dispute in any manner, the amounts of the settlements.
Needless to say, after two years of struggling with the ever increasing restraints and borderline illegal practices to which I was forced to impose on these uninformed consumers, I resigned my position as an independent adjuster.
In December of 2005, I opened a public adjusting firm in South Florida. Now, we experience on a daily basis the abhorrent practices of insurance companies and those adjusters who represent them.
Understand that it is my position that there are companies that handle their claims quickly, precisely, and professional in total compliance with the contract.
However, those companies are in the vast minority.
Last week, we filed a Civil Remedy on behalf of one of our clents siting 19 violations of statutes by one of the largest insurers in the state. My firm is representing over 300 clients currently and this is our current statistical compilation:
287 claims open in excess of 180 days.
143 in violation of at least five Florida statutes relating to adjusting practices.
These numbers represent staggering figures. On the average, we collect 293% more money from the insurance companies than was estimated originally and we achieve this by using the same adjusting practices that I have used for six years.
Mr. Poe, on behalf of those in this profession who take pride in said profession, I will apologize on behalf of these representatives of our industry, who with obvious disdain and disregard for the wide-spread consequences of their arrogance and flagrantly, biased disrespect for their insureds, contractors, attorneys or any others who oppose or even call into question their righteousness, honor, or the finality of their opinions.
Their defensive, territorial chest-beating and sophomoric, belittling statements are a clear indication of exactly why consumers need protection. Whether or not your business practices are ethical is completely beyond my discernment; however, I appreciate your seemingly sincere interest and dedication to making a difference in our industry.
5-18-2006
Martha,
You commented:
\”Unfortunately, beginning with the four hurricanes in 2004, claims adjusting practices have changed dramatically. Suddenly, roofs, carpets, awnings, and a litany of other trades are no longer allowed to be considered for Overhead and Profit by many insurers.
Taxes and O&P are no longer are part of the calculation for ACV. We \”negotiate\” different prices with individual insureds as if we were purchasing an automobile.\”
and,
\”Mr. Poe, on behalf of those in this profession who take pride in said profession, I will apologize on behalf of these representatives of our industry, who with obvious disdain and disregard for the wide-spread consequences of their arrogance and flagrantly, biased disrespect for their insureds, contractors, attorneys or any others who oppose or even call into question their righteousness, honor, or the finality of their opinions.
Their defensive, territorial chest-beating and sophomoric, belittling statements are a clear indication of exactly why consumers need protection.\”
__________
Thank you Martha for your frank commentary. What Tony and others like him have to say does not bother me.
What bothers me is that naive consumers and others, even in regualtory, and other governmental authority positions, would believe their half truths and misinformation, if left up to them alone to explain their conduct.
It seems that Texas is the testing ground for such unfair conduct, and then the rest of the nation receives the polished results. The claim handling conduct you described has been going on here hot and heavy since 2002.
From my client records, Allstate, State Farm, Farmers, Safeco, USAA and the Texas Wind Storm Association have treated their insureds, and contractors, quite interestingly since 2002.
I truly believe the DOJ and FBI are going to investigate such matters, as they have become too large, and too obvious, to go on unaddressed.
By the way Martha, \”From Good Hands To Boxing Gloves\” is being published shortly.
Allstate tried to keep it from being published. Hmmmmm….Their explanation, to a judge, was not \”convincing\”.
You might \”Google\” search the book title, and too, please feel free to contact me.
rogerpoegc@yahoo.com
Mrs. Kirwin\’s comments were republished, in smaller bites, for clarity sake.
Your comments about her observations are noticeably selective.
Your comments about Mr. Poe\’s observations are also quite selective.
Considering their commentary, with objective precision, and then contrasting their observations with other\’s comments in return, makes for some interesting and thought provoking reading.