The first storm has come and gone.
Posted on Tue, Dec 01, 2009
The first storm has come and gone. The trauma, confusion, and stress of dealing with the debris, the cramped living conditions, and the loss of personal property remains. Your insurance company adjusters may have already inspected your loss, but you don’t know the outcome. What do you do? You’re running out of cash fast, the atms have no power. But the restaurants are all shut down anyway – any remaining food was ruined when the power went out. The traffic signals are down. Nails and debris are in the roads – everybody has flat tires – no compressors to fill them since gas stations have no electricity. Hundreds of street signs are missing, so you painted your house numbers and policy number on the front of your damaged home to help adjusters and contractors find you. You probably even painted your cell phone number on a wall inside the vacant home. Familiar landmarks are shambles. When you got to your home, there were no lights and no air conditioning. The missing shingles and shattered windows let in so much rain that everything is cooking in the humidity – mold will begin in a few days. Mold – probably excluded from your insurance policy, but there’s nothing you can do, since it will take weeks for the utility company to string power lines back to your neighborhood. But of course, you can’t turn on the power until your home is inspected and repaired. You’ve got to find rental property. The hotels that are still open are already full. Rents increase rapidly as displaced homeowners compete for housing. You now have a commute from a strange neighborhood. Your kids will be in a different school until yours is rebuilt. Churches, schools, neighbors ? all are shut down. Sporadic cell phone service is all there is ? there are no working land lines in your old neighborhood. You had never eaten a Red Cross-prepared meal before, but now it’s delicious. You join the line with the relief workers. You look for contractors in the line ? do they know what they are doing? Where are the qualified contractors? How do you obtain the materials? How do you get the insurance company to pay the costs that have escalated due to shortages? Now comes the flurry of paperwork – the negotiations with the adjusters, the forwarding of quotes and bids. You finally get your check from your insurance company, but it’s only a third of the quotes you’re getting from contractors. You think you can spend it to at least begin repairs then notice your mortgage company’s name is included on the check. You call them to get them to sign it, but instead, they insist you sign it and forward the check to them. They may apply it to your unpaid balance. They may release it to you in
installments after you have completed part of the repairs. It is their option. After complaining to your local state officials, you discover it’s legal – there’s nothing you can do about it. Your contractors won’t begin work without a deposit. They’ve been through this before. Their crews want to be paid each week. There aren’t enough local crews, so they all have to pay for temporary housing too, in addition to their homes wherever they are from. Everything takes extra time, such as waiting in line at the one home improvement store that is open running on backup generator power. So you negotiate a bank loan to rebuild your home, hoping you can get more insurance money later. It doesn’t feel like the storm is over. Building codes have stiffened. The additional costs are excluded since you did not have “code upgrade” coverage. Your agent sold you “inflation coverage.” Sorry, that doesn’t cover code changes, only market changes. Thankfully, your claim is simple. It’s probably a wind policy claim, or if you are inland, a regular homeowner claim. If you were near the coast or a bay, your problems are worse. You had flood insurance, but many things are excluded from both flood and wind coverage. Your deductible is only part of the story. But it’s worse – your wind adjuster and your flood adjuster disagree over the cause of the major damage to your home. Each one says the other should cover it. One is covered by Federal law and the other is under State insurance laws. Different rules apply for appealing the loss decisions. You learn that even state legislators or US Senators are suing their own insurance companies. Federal Judges’ homes are destroyed. Courts are backlogged with lawsuits that will take years to reach a decision. Meanwhile… your home must be restored. After attempted appeals, you learn that the adjusters sent in estimates that were modified downward by the regional offices before the checks were issued. The regional offices of the insurance companies feel the independent adjusters have been too generous. You learn that the insurance company blames the independent adjusters for the estimate and refuses to change it. They assure you that you can find a contractor that can do it for that price. Do you hire an Attorney? Do you hire a Public Adjuster? Do you demand Arbitration? Do you use Mediation? Do you get additional bids from General Contractors? How do you put the claim together? How do you cut through the red tape? There are only three kinds of Adjusters – Company Staff Adjusters, Independent Adjusters, and Public Adjusters. Who will settle your claim? Who has your best interest in mind? People work for money. Staff adjusters are on salary. Independent adjusters work for a fee per claim. Only Public Adjusters are motivated to obtain the highest claim possible for you, since they work on commission in most states. All of them are trained, licensed, and hopefully, regulated by the state where they work. Only one has a fiduciary interest to represent you. All of them are experienced. Only one of them is usually grey-haired with experience and broad-based skills. Most public adjusters have been company or independent adjusters before becoming exclusively public adjusters. Many have construction experience, either
commercial or residential. But not even the title “Public Adjuster” is good enough. Get references and check them. Some even have professional estimating skills. Some have completed hundreds of hours of extra training. The license designation is not enough. The qualifications must also be there. Finding the right one is made more difficult by rules, promoted by the insurance industry, prohibiting public adjusters from advertising during a declared catastrophe. You have to rely on referrals. Maybe that is actually a good idea. An attorney can sue your insurance carrier. Sometimes it is needed. But your policy states you agree not to sue until you have complied with the terms of your policy. There’s a lot of fine print to comply with. An attorney can handle your home purchase – but he can’t put a value on it, tell you how to advertise it, or tell you how to make it more presentable for the purchaser. You need a Realtor for that. A Public Adjuster should be able to put a value on your loss. He should be able to negotiate the fine print of the policy to help you comply with its provisions to reach a settlement. He should be able to inform you about additional coverages that may have been overlooked. He should be more than just a negotiator or a loud voice at the bargaining table. He should know what he is doing and be qualified for the type of claim he is handling. A mediator can help the two parties reach agreement. Arbitration can bring about a settlement. However, neither are necessarily in compliance with the policy provisions for disputes regarding the value of a loss. Neither process involves anyone assisting you who is motivated by your success. Call a public adjuster. Let him or her evaluate your loss against the terms of your policy. If you find a good one, tell your friends. Don’t let the second storm be worse than the first. Smooth Sailing!