I Am A Convert To Using Public Adjusters!!! Observations Of A Restoration Contractor

When the construction industry in Arizona turned in 2008, I found myself changing from commercial ground up construction of retail buildings to mostly residential insurance repairs. This field would not have been my first choice at the time, but since flood and fire do not really care if there is a recession, it seemed like a great place to be until things got better.

One of my first assignments was to make an estimate for a family who had suffered a fire. The quick details of their claim are that they left an electric appliance to cook their dinner one Sunday while they went off to church and when they came home their home was burning. They called their insurance company to report the fire and were told that “someone would contact them within 48 hours.”

There they were, on the sidewalk of their destroyed house and their insurance company was of absolutely NO immediate help. Unfortunately, things just got worse from there. This family was fortunate enough to have relatives in town with which they could seek shelter.

After reviewing the site, I created a scope of repairs using an industry standard estimating program which by coincidence was the same one that the insurance company used. When my scope was complete, it was sent to the insurance company and the insurance company simultaneously forwarded their scope to my company. Imagine my surprise when the insurance company scope of repairs came in at $82,000 and my scope was at $350,000. I had visions of being called a scoundrel or of being fired for gross incompetence.

As I looked through the insurance scope, it began to occur to me that their scope would only cover up damage and not come close to addressing the problems associated with the fire that had occurred in this home. During the ensuing weeks, the insurance company suggested to the policy holder, that we were “gouging” them. In addition, they intimated that if the policy holder stuck with the notice of claim that we provided, their claim would be paid slowly and or not at all, their rates may increase proportionally, even insurance fraud was mentioned.

All the time the insurance adjusters scope left damaged electrical wiring unrepaired, smoke charged drywall painted over and ruined contents being left out and undervalued. I watched in disillusionment, as the insurance company stuck to their position realizing that the paradigm I had held, that the insurance company would protect its policy holders, (that’s their job right?) faded into the realization that they would argue to keep the costs as low as possible, so that they will reduce the cost of the claim.

Finally, the owner hired a public adjuster. Then everything changed. All of a sudden the insurance company was responsive. Where phone calls took days or weeks to be returned they were talking to the public adjuster when he called. After months of stonewalling, payments for undisputed amounts of the claim arrived in the mail, so that repairs could begin after waiting six months.

Then a “large Loss” adjuster from the insurance company was assigned to the claim. Turns out that the adjuster the insurance company had making the valuation and scope of repairs for the claim, didn’t really know anything about construction. I’m not just saying that she wasn’t or hadn’t been a licensed contractor, she literally did not know anything about construction or even how the repairs were to be made to the house. I could not help but wonder how in the world a large legitimate insurance company could have possibly allowed her to be in charge of the scope of repair of this family’s most important asset.

The large loss inspector came into town (Phoenix, AZ) from Washington State, I am not sure why they had to send someone from so far. When we finally went through the house with the new insurance company adjuster and the public adjuster, all of the items on my previous scope were accepted, as well as some new ones that had come to light during the process. The grand total on the structure only was finally settled out at $362,000.

The family told me that they had come close many times to accepting the insurance company’s first offer of $82,000. They figured that the insurance company surely couldn’t be making that big of a mistake, but they stuck to the course and all ended well for them. The repairs of the home were finished 5 months later.

They received a fair settlement for their lost items and are now living happily in the same home with their 5 children. They even got paid for their living expenses as their policy stated. I have no doubt that had they not allowed a public adjuster to help them negotiate their claim that they would have been cheated by their insurance company.

Maybe you are thinking that this was a one-time occurrence, but you would be wrong if you did. I am happy to say that in the last four years it has not happened on all of the hundreds of claims that I have handled since then, but it happens enough to where it is my opinion that there is a lot more insurance fraud (if you choose to call it that as I do) that runs from the insurance carrier to the policy holder than I ever imagine goes the other way.