The Independent Insurance Claim Adjuster Resource

Scenario: Even before I began working with Peak Claims 5 years ago something was on the forefront of my mind and now more than ever seems like a great time to bring it up.

Why now? Primarily because Peak and other adjusting companies are being asked to handle files at the same fee schedule rates for 5 years; with an expanded list of responsibilities for each claim. The mere thought of such a request is disgusting; are insurers paying the same rates for roofing repairs they were 5 years ago?  What about paint?  Even the clean-up guy has seen a raise.  Unless I missed my last rate decrease , insurers have certainly given themselves some lee-way with rate increases.

The reason for this is simple:  Independent Adjusting Associations and companies have failed to put any pressure on insurers or produce any real efforts to mitigate this situation; mostly because they fear their clients.

Independent Adjusters are not dispensable and deserve to be treated with respect and dignity for their experience.  Based on the foregoing information and experience it’s quite clear that I need to drop this client like a hot box of rocks, not only for the 5 year inflation that I’m eating but also for the lost time that would likely be better spent marketing to other businesses.

Have you been in this situation before as an adjuster or adjusting company? We would love to know your thoughts on unionizing Independent Adjusters – feel free to leave a comment…

We discussed and defined neighboritis in this post, in hopes to create awareness for a condition that should be alarming to all independent adjusting companies and adjusters alike.

Neighboritis occurs when a roofing salesman convinces one property owner in a neighborhood that their home was damaged by hail and then gives that property owner an incentive to “spread the word” to others in the area.   Often times the damages are not caused by hail or the hail had no effect on the condition of the subject structure components.  In some cases roofing sales people have been known to intentionally inflict mechanical damage the to roof while conducting a review of the roof condition.

The effect on adjusting companies and independent adjusters occurs in the following parts:

1. Generally, insurance professionals are paid on a flat rate to conduct surveys and adjustments of structural roof related insurance files or claims.  This occurs on a rising agreed fee schedule that motivates the surveyor or adjuster to seek out all damages.  The more damages found, the more likely that the reporting party will be able to bill a higher amount because the monetary value will climb to the next level on the fee schedule.
2. The insurance professionals who do not recommend replacement (deny a claim) of a roof for lack of damages are not immediately trusted by their clients and asked to re-visit the same property based on a contractor/salesman claiming that damages do exist.  Often times the reporting party is not allowed to request additional billing and is asked to re-visit on the principal that damages may have been overlook.  The reporting party wishes to service their client well and therefore provides an exemplary service by re-opening the file at no little or no cost, all in hopes to keep business from their client.
3. In the time lapsed between the initial survey and re-opening of the file, more than one roofer has likely set foot on the roof, or neighboritis has occurred; generally.  Perhaps a neighbor has had a roof replaced or a sales person had an opportunity to create mechanical damages.
4. The insurer fails to take a interest in hiring a forensic engineer primarily due to the cost of such a service.
5. The costs associated with creating supplement reports and re-opening files is never accounted for in the fee schedule.

This pattern, no matter how far a claim might be over-indemnified, has become the standard for all roofing claim scenarios.  More often than not, we are finding patters where insurers actually had a roofing sales person on their roof but that they did not admit it when initially asked or even in person.  The foregoing conditions are a direct result of neighboritis and insurers, along with the general public should be made aware of these facts.

Insurance carriers and third party administrators rely on independent adjusting companies in their growth stages, particularly if they wish to abstain from growing beyond a certain percentage of the market share (e.g, to not compete with large competitors).  Small adjusting companies provide a personalized level of service that small and start up property insurers require to maintain retention rates.  Carriers that discourage additional time and expense billing to affirm or deny previous findings are posing a risk to themselves in the future because small adjusting companies cannot consume the lost time spent on these issues and this results in a direct loss for the reporting/adjusting party.  In order for those adjusting and reporting companies to grow into sustainable businesses they must spend that time elsewhere (marketing, etc), or convert it into billable time; even if only breaking even.

An easy and responsible solution would be for insurance carriers to set a new billing standard for handling the re-opening of files which were initially denied.  First, these carriers would have to trust that independent adjusting companies would have no interest in falsely denying claims just to obtain additional billing.  One way to help support this would be to only allow additional billing at the actual cost rate (no profit) of providing a second survey, rather than at a normal T&E rate which is more profitable.  It keeps the adjuster paid for his time which allows insurers to require a different adjuster from the same company attend the re-inspection.  These ideas help keep small adjusting companies in business and prevents the larger ones from taking too much of the market share; all at a minimal expense to the insurer.

Do you have thoughts on this subject? Please leave a comment!

If you have worked with more than ten claims resulting from any kind of hail storm you’ve probably been exposed to what is commonly known as “neighboritis”.  Neighboritis is practically like a bad case of the flu; it spreads easily. The only logical cure is awareness of this costly and time consuming problem.

Neighboritis is a serious condition that needs to be addressed because it is damaging to independent adjusting companies and independent adjusters. The effects of neighboritis in relation to independent adjusting companies are discussed in this separate post.

Neighboritis happens in following stages:

1. A roofing sales person claims to be a hail expert and finds a neighborhood that was never really exposed to hail damage, or was exposed to hail that did not caused damages.  The sales person knocks on a door and claims to be a roofing expert, explaining to the homeowner / insured that they were exposed to hail and that they have damages on their roof.  The roofing sales person then offers the homeowner a new roof at NO COST, but only if he can inspect their roof right away and usually before the insurer is even notified of any potential claim.
2. The roofing sales person then works to smooth out any skepticism the property owner has by explaining the various values of a new roof in relation to property value.  Homeowners catch on to the concept that they could end up with a new roof at no cost and it takes little convincing that hail may have fallen and damaged their roof when they weren’t aware.
3. The salesman convinces the homeowner that they need to conduct a brief roof inspection to see the hail damages.
4. The salesman pushes the homeowner to sign a “contingency agreement”, although usually unenforceable by law.
5. The roofing sales person gives the property owner incentives to “spread the word” (neighboritis) by offering $500.00, $1,000.00 and larger referrals if neighbors sign on for their roof at no cost.
6. In the worst case scenario, the roofing salesman tells a story of his or her working with neighbor John Doe on his roof for hail related damages; all of which are a result of only having a contingency agreement.
7. One or two inexperienced property insurers pay for roof replacement when it was completely not necessary or by having mistaken mechanical damages for those caused by hail, thereby initiating one roofing salesman to claim that other roofs were replaced because of hail damage.  In extreme circumstances, a roofing company may have been hired outside of an insurance settlement to replace an aged roof and the same company comes back several months later, after hail occurred in a remote area, advertising that a nearby neighbor had their roof replaced (not indicating why) and thereby starting a frenzy in the area.

As you can imagine, the question has and continues to remain about what happens when said roofing salesperson is up on the that roof with no supervision? What is the viewpoint of a profitable insurance adjusting company on neighboritis?

Eight years ago I was on a roof with a roofing salesman named Mike who would bend down towards the shingles every time I turned around to take a photo or put my eye up to the viewfinder.  I couldn’t help but notice the little yellow lighter Mike was clutching from the corner of my eye.  Just as I suspected he was making his own damages hoping I would mistake them as those caused by hail.  Mike wasn’t the first nor the last but these salesman have wised up to creating false damages in front on insurance claim professionals.  Since then I’ve personally witnessed and documents familiar conditions on 8 other occasions; most of which occurred prior to the times we were expected to meet for a survey.

So, to answer the question of what could happen when a roofing sales person is on a roof with no supervision or oversight – let’s just say the potential for mechanical damages not caused by hail exists.  Neighboritis is a deceiving tactic used by roofing sales persons and companies to extract money for claims that do not legitimately exist.

Neighboritis can be prevented with awareness.  One way to help prevent this condition is for insurers to notify their clients in high-hail areas that roofing salesmen are out and to be aware of their sales-roof inspection tactics.  The general population in hail and storm chasing contractor areas can get used to the idea of joint roofing surveys prior to allowing a financially motivated roofing salesman on a roof.

What do you think about changing the ways that insurers and property owners work with roofing companies?  We’d love to hear your input – leave a comment!

Lately we’ve had quite a few requests for information about Oil Spill Adjusters and oil-spill related damage surveyors.  We’ve even noticed that a few Underwriters at one particular Error and Omission Insurer have taken the time to briefly scout this extremely new and uncharted territory of insurance risk.

The Exxon Valdex oil spill that plagued Alaska in 1989 would be a great place to start in terms of developing some logic toward this discussion but from what we can tell most of the claims were handled internally by Exxon and in Civil Litigation.

Independent-Adjuster.com does not extend any support toward BP or TransOcean, or any other parties responsible for the Gulf of Mexico Deep Water Horizon Spill in handling their own claims or oil damage surveys.  Simply put, BP is in the business of profiting from various oil and energy related ventures.  These companies have an intelligent group of folks working to resolve these claims but one has to ask what their experience is in dealing with the unknown.  How can a company who is loosing millions by the day possibly have any interest in fair settlements of their claims?  Of course, we all know that fair settlements prevent legal woes and that the Plaintiff’s bar is veracious for lawsuits right now but that doesn’t mean their claims team is experienced in dealing with the general public, or that their own legal counsel is going to make any rational decision, or that the boards of directors are going to approve anything they receive. Will these companies

BP and TransOcean also know that the people in general are going to have a difficult time obtaining Plaintiff’s counsel with the right experience to defend against their own counsel in legal disputes.

BP and TransOcean’s interest, despite their wealth of advertisements about helping the community recover, is to raise their shareholder value.  If the company remotely cared about anything else then I would not be writing this article in the first place, especially considering the recent news of failed emergency alarms and other disgusting practices.  It should be noted that most corporations only interest is to survive and increase shareholder value.  We firmly believe that the interest of the responsible companies only interest now, if not at all the times previous to the Deep Water Horizon Spill is to increase shareholder value.

Based on the foregoing it is clear that an impartial or unbiased and fair settlements cannot be created in having the responsible parties handle their own losses. BP and the responsible parties should be inviting experienced claim professionals, including those with residential & mechanical experience, and a group of common working class from the area to form a committee for the betterment of handling these losses. If anything, the National Association of Independent Adjusters should be using their political leverage (or lack of) to force this issue into court.

We do know for a fact that a lot of working class fishermen and others took settlement offers related to the ’89 Valdez spill.  What we fail to recognize is the financial disaster inflicted upon the people, business and economy of that region by accepting settlements far short of what was truly required to make up for so many lost years of fishing and other affected industries.

BP has a right to try and settle their own claims but the responsible parties for the loss know well and good that the Civil Courts are going to be inundated with suits.

There are so many points to be made in discussing the various issues and coverages surrounding Oil Claims that we are going to divide them up into the following categories:

• Residential Property Claims (the potential for them combined with wind and oil in hurricane or greater gale force winds)
• Commercial Business Losses from Oil Claims
• Subrogation in Oil Claim related Losses
• Potential for Litigation
• General Oil Damage Survey Information

We are currently working on the above captioned articles and will post them throughout the next two weeks.  Thanks and stay tuned – we’d love to see your comments below!

by Phillip Crimaldi – Editor & Insurance Claim Analyst – May 19th, 2010

On any given day my office is prepared to remind inland residential property owners how much worse their $5,000 claim for water damage could have been.  While we are sympathetic to the average homeowners property claim, one mention of Hurricane Katrina will usually save us several minutes of ranting from the common property owner.  I always tell them “it could have been much worse”.

It is easy to remind these these folks about how much worse it could have been because I was there in Slidell, Marrero, Chalmette and dozens of other cities and towns for the months following Hurricane Katrina.  Witnessing the interiors of people’s homes and lives is an image that will be permanently etched in my mind forever.

That’s exactly why I think this oil spill poses a serious threat to all property owners along the Gulf Coast.


If you’re not following my thoughts just yet, let me drop this one on you:

“Wind Driven Oil”

Just in case you’re out of the loop, dozens of insurers had Civil and Regulatory Complaints filed against them for failing to recognize that some interior water damage was caused by rain;  we’ll have to spare you the details of these cases for another post.

Wind driven oil might become a reality for insurers, property owners and every living thing on the Gulf Coast line.

We’re not talking about requiring the heartless destruction that Mother Nature rained down on the Gulf in late summer of 2005, but rather only needing ~70 mph gusts to drive that oil right off the coast line and up into the air.  How far it travels likely depends on how fast the wind is moving and several other factors, but one thing is for sure; if cinder-block buildings couldn’t stand the wind, neither will the oil.  It’s true that we’re here attempting to calculate the potential risk to property late on a Wednesday night, but what about the rest of the Gulf?  We’ll just have to leave that up to the scientists and engineers, but if our calculations are correct it could be devastating to vegetation, nature and property.



While the news headlines, scientists, meteorologists and everyone else is talking about how hurricane season might carry the oil around the Gulf, it seems almost foolish to doubt that mother nature couldn’t put an unpredictable amount of that oil on land.  Even if Hurricane season doesn’t make a full on strike against the Gulf. I’m willing to bet insurers will have a hard time denying the window cleaning bill, at minimum. Leave a comment!

Phillip Crimaldi is the Director and majority shareholder of Peak Claims, Inc. -  A Denver, Colorado based cargo damage surveying and claim services company.