Texas Windstorm Insurance Association
5700 S. Mopac Expressway, Building E, Suite 530, Austin, Texas 78749
Phone (512) 899-4900
Fax (512) 899-4950
Dear Mr. Wrather,
Congratulations on your Safeco appointment to the Board of the Texas Windstorm Insurance Association.
As a consumer, and construction professional, I have noticed disturbing TWIA claim settlement practices being used towards consumers in South Texas in the Rio Grande Valley area. Consumers are being set up to pay construction business costs that insurers reasonably, and intrinsically, owe.
Please consider the following concerns and questions.
TWIA claims adjusters are arbitrarily removing Roofing trade investment costs from G.C. (General Contractor) quantified [two trades+ needed] estimates AND THEN adding G.C. mark-up (business overhead and profit) of 10% / 10% to an estimates total. These estimates are then being given to policyholders so as to be able to present the estimate values to a G.C.
This â€Ŕunique†G.C. estimating methodology is consistently and unfairly underpaying claims [en masse] to unsuspecting Texas consumers, and creates / assumes a built-in financial hardship for those consumers. G.C.’s, Builder’s, Remodelers, etc. apply estimated business overhead costs toward ALL trades supported, and anticipate a reasonable [e.g.10%] profit on the value of the WHOLE estimated construction investment risk, not a partial piece of it.
Many, many TWIA claims “estimated” this way produce greatly reduced / unrealistic business overhead and ZERO G.C. profit margins. Contractors and Insurers are well aware of estimating norms. However, most consumers are not construction estimators or accountants, and until informed, are usually unaware of TWIA’s undervalued estimating practices.
1. Why does TWIA, and its contributing members Allstate, Safeco, USAA, etc., feel this [artificial G.C. estimating methodology] is fair and reasonable G.C. estimating methodology?
2. Do they all normally practice this [distorted] estimating methodology inside and outside of Texas?
Even the MS/B IntegriClaim construction business estimating program / construction business data TWIA is using, and its program functions, allow for claim adjusters to easily duplicate G.C. commensurate / fair overhead and profit estimating norms.
Please note that the hurricane season is almost here. Should consumers need general reconstruction contractors [en masse], TWIA’s estimating practice will show up for many people / consumers to see…and experience.
3. All said, why is TWIA avoiding actual, sound and basic G.C. construction business / claim estimating norms…at consumers’ expense?
4. How do TWIA and insurance agents / brokers justify-explain those estimating practices to policy shopping or premium paying, and educated, consumers and [G.C., etc.] construction business investors?
Please respond. Consumers need clarification regarding such financially critical issues.
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4-26-2004
Texas Windstorm Insurance Association
5700 S. Mopac Expressway, Building E, Suite 530, Austin, Texas 78749
Phone (512) 899-4900
Fax (512) 899-4950
Dear Mr. Wrather,
Congratulations on your Safeco appointment to the Board of the Texas Windstorm Insurance Association.
As a consumer, and construction professional, I have noticed disturbing TWIA claim settlement practices being used towards consumers in South Texas in the Rio Grande Valley area. Consumers are being set up to pay construction business costs that insurers reasonably, and intrinsically, owe.
Please consider the following concerns and questions.
TWIA claims adjusters are arbitrarily removing Roofing trade investment costs from G.C. (General Contractor) quantified [two trades+ needed] estimates AND THEN adding G.C. mark-up (business overhead and profit) of 10% / 10% to an estimates total. These estimates are then being given to policyholders so as to be able to present the estimate values to a G.C.
This â€Ŕunique†G.C. estimating methodology is consistently and unfairly underpaying claims [en masse] to unsuspecting Texas consumers, and creates / assumes a built-in financial hardship for those consumers. G.C.’s, Builder’s, Remodelers, etc. apply estimated business overhead costs toward ALL trades supported, and anticipate a reasonable [e.g.10%] profit on the value of the WHOLE estimated construction investment risk, not a partial piece of it.
Many, many TWIA claims “estimated” this way produce greatly reduced / unrealistic business overhead and ZERO G.C. profit margins. Contractors and Insurers are well aware of estimating norms. However, most consumers are not construction estimators or accountants, and until informed, are usually unaware of TWIA’s undervalued estimating practices.
1. Why does TWIA, and its contributing members Allstate, Safeco, USAA, etc., feel this [artificial G.C. estimating methodology] is fair and reasonable G.C. estimating methodology?
2. Do they all normally practice this [distorted] estimating methodology inside and outside of Texas?
Even the MS/B IntegriClaim construction business estimating program / construction business data TWIA is using, and its program functions, allow for claim adjusters to easily duplicate G.C. commensurate / fair overhead and profit estimating norms.
Please note that the hurricane season is almost here. Should consumers need general reconstruction contractors [en masse], TWIA’s estimating practice will show up for many people / consumers to see…and experience.
3. All said, why is TWIA avoiding actual, sound and basic G.C. construction business / claim estimating norms…at consumers’ expense?
4. How do TWIA and insurance agents / brokers justify-explain those estimating practices to policy shopping or premium paying, and educated, consumers and [G.C., etc.] construction business investors?
Please respond. Consumers need clarification regarding such financially critical issues.
Sincerly,
Roger Poe G.C. (956)-969-4454 rogerpoe@acnet.net