This Time It’s Personal

By Mark Goldwich

Image courtesy of GoldstarAdjusters.com

As a licensed adjuster for 30 years, I am more familiar with insurance claims than most people will ever be. I have personally handled thousands of insurance claim
s of all kinds  in many states around the country, and I have managed or overseen the handling of hundreds of thousands of claims by others. I have stood with people whose homes or businesses were ruined, and those who suffered no damage at all, but just wanted to be sure.  I have spoken to many, many others by phone. I’ve heard their stories of loss, and of the trials of the claim process, as well as the repair and recovery processes. And I have witnessed both the despair when claims go poorly, and the joyous relief when claims go well. It is safe to say I’ve seen and heard just about everything when it comes to claims.

But it’s different when the claim is MINE, right? Well, yes and no. You see, my own home was damaged recently when on Friday, October 7, 2016, Hurricane Matthew skirted the eastern seaboard of the United States. It was not an extreme amount of damage, but more than enough to file a claim. My roof was badly damaged, as was my fence, and a few other smaller items. No big deal, I thought, at least the roof wasn’t leaking, and no large trees had fallen on the house. So, as far as storm damage,  we were luckier than many. But just to be sure, I followed the advice I have given to others – I got out a pad of paper, noting all of the damages, and began logging all claim related activities. I also took photos and videos of the damages. Then on Monday morning, I called my claim in, once I was certain my covered damages would exceed my hurricane deductible.

After that, we waited to hear something from our insurance company. About a week later, my agent called, and said he was just checking to see how the claim was going. I’m not sure, I replied, because aside from his call, we had not heard anything from the insurance company at all. Not a big deal, I told him, there are plenty of people with much more severe damage, I’m sure they’ll get to me soon enough. A week later, my in-laws’ claim for similar damage was being finalized by the very same insurance company, even though we had submitted their claim for them several days after calling in our own claim. I was beginning to think this insurance company was giving me extra slow treatment, but the next day an adjuster called my wife to schedule his inspection of our damages.

Fill out the form below to get your FREE copy.

In the meantime, we began gathering estimates from different contractors just as anyone would, while waiting for the adjuster to get back to us with his estimate of the damages. When the estimate came back about a week later, I guess I should not have been too surprised that it came without a check, because I’m accustomed to this particular insurance company depreciating heavily, and making small up-front payments until the work is done, and then the recoverable depreciation is claimed and paid. 

Still, I couldn’t help but compare my estimate (with no payment) to that of my in-laws. My estimate was nearly twice that of my in-laws, yet they received an up-front payment (albeit a small one), and I received no up-front payment at all. Again, same insurance company, same geographic area. It just seemed there was some disparity in our treatment. Could it be because my father-in-law retired from that insurance company after decades of service, whereas I resigned from that insurance company to represent policyholders with claims against that insurance company? Or was it all just coincidental?  Either way, I was starting to feel slighted. I talked to an attorney – not because of what I perceived as delays in handling my claim, or even the disparity in the handling of my claim versus the claim of my in-laws, but because I was anticipating what might come next, and I wanted to be ready.

Image courtesy of commons.wikimedia.org

From repeated experiences with this insurance company, I knew that when an insured asks for more money than the adjuster estimates, this company goes on the offensive and demands what is called an “Appraisal”. This is a process in many homeowners policies which was initially intended to reduce the number of claims being litigated. The Appraisal process basically states that if either party (the insured or the insurance company) feels there is a dispute as to the amount of the loss being claimed, either party may demand an Appraisal to resolve the perceived dispute. In doing so, each party would have to hire (and pay for) an appraiser, and the two appraisers would select an umpire, whose job would be to help resolve the dispute if the two appraisers were unable to agree on their own. The cost of the umpire is split between the parties. In other words, if you don’t agree with their estimate (and we find very few of their estimates to be agreeable), you have to pay – generally over $1,000 – in order to get the insurance company to pay the full claim. Nice, huh?

So when we were done collecting estimates from the various contractors, I starting looking for a Proof of Loss form in order to submit the estimates. Because I am an adjuster, and because I used to work for this particular insurance company, I knew the policy contained a “Condition” which required I submit a Proof of Loss (POL) within 60 days of the date of loss. I was surprised when I could not find this form online. Then I checked the insurance company website. Not there. Then I remembered this insurance company allows clients to create an online profile and track claim progress online. I did this, and I must say, it was pretty slick. I could check the status, upload documents, correspond with the claims department and my agent, even look at all my policies. Cool! 

But, no POL, not even in the sections marked “Resources” or “Documents”. 

So I called the claim representative designated right there on my claim status page. She answered the very first time I called. Sweet. I gave her my information, and she asked how she could help me. Not needing to discuss the claim, I simply asked for a Proof of Loss form. She said she did not complete one. I told her I know that, but I needed to complete one now that I have all my estimates together. 

She said no, I didn’t need to complete one, I could just send in the estimates. When I said I would

Image courtesy of pixabay.com

rather submit the POL as required by the policy, she proceeded to argue with me about whether or not the policy in fact required me to send a POL, unless she requested one from me. Even when we both pulled up the policy on our respective computers, she continued to argue the policy language, because she was reading from a section above the section in question. Even after pointing this out to her, she would not agree. Finally, I simply insisted she send me the form, even if she didn’t think I needed it. She said she would, and we hung up. Hours later she called me back and left a message saying she would NOT send me the form, stating, “That is not something we routinely send out to customers.” Again, having worked there for 17 years, I know that form is sent to customers on a very regular basis.

So, was I being intentionally lied to? If so, why? Or, was this adjuster so poorly trained that in addition to being unable to read and interpret the policy, she did not understand what this form was, or that is was required as a condition of payment? Either way, now it became personal for me. I promptly filed off complaints with the company, my agent, and the Department of Insurance in my State. All I wanted was a form – one that was required by my policy, and the company not only made it impossible for me to find this form online, but was actively refusing to provide it to me upon request. I couldn’t help but think, how many millions of people are they doing this to every year? And how often do they deny claims for failing to submit a form they don’t tell people about, don’t provide access to, and even tell people it is not required?

I may never know the answers to those questions, but just today I received a call from some supervisor in Atlanta. They received my complaint. He apologized, agreed the policy says exactly what I already know it to say, and he said they would send me a blank form. We’ll see. It just goes to show, no matter how experienced you are, things are different when they happen to you. Luckily, as upset as I may be that it happened to me, I am much more upset that this (and worse) is currently happening to untold numbers of other people far less equipped than myself at dealing with insurance company bureaucracy. Good luck to us all!

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.        

How the Grinches Steal Christmas

by Mark Goldwich

 The sad reality is that thousands of grinches steal thousands of Christmases, every single year. They always have, and they always will. It is very unfortunate when it happens to others, and devastating when it happens to you. I’m going to try to point out the ways I have personally seen this happen in my career as an insurance adjuster, and some ways you can either reduce the risk of this happening to you, or at least ways to minimize your losses should it happen despite your best efforts.

Image courtesy of keith-quintanilla.deviantart.com

When can grinches strike? Anytime from when you are shopping for gifts, to after they are given. Thieves know the malls are full of people with extra cash and valuable gifts walking around, often distracted by sights, sounds, and smells (invariably,cinnamon). You can be targeted by pick-pockets if you are not careful, or people who are quick to snatch up a package being set down for a second, or those who will grab things right out of your arms. There are also those who scour parking lots looking for easy targets loaded with bags and boxes. A common ploy is to watch someone load up their car trunk full of gifts and return to the mall for more shopping. There’s more than one way to get into the trunk or car, and off they go with your goodies – receipts and all!

From the mall, you can be followed home (or to your next destination) for another chance to abscond with the gifts before you get them in the home, or they can simply make note of the address and return another time. And since most homes have new purchases under the trees this time of year, it is not difficult to look in windows and see which homes make the best targets. Or, thieves can even wait until after Christmas, and drive around looking at all the empty boxes being left at the curb, too large for trash cans.

I have handled all kinds of these holiday theft claims over the years, and it is always sad when someone loses all their presents (or their family’s presents). And as an adjuster, I also know they are probably not getting the claim paid before the New Year, and not until long after their Christmas has been ruined.

Image courtesy of makinbacon.hubpages.com

So what’s the best ways to stop these grinches from stealing your Christmas? Common sense, mostly. First, know that the threat is out there. That alone will make you more aware of your surroundings when you are walking around the mall, or in stores. Consider purchasing gifts with credit cards, especially those that offer theft insurance protection. You will not only document your purchase this way, but you may get reimbursed easier than going to your insurance company, and without as large a deductible.

If you need to drop off gifts at the car and go back for more, I recommend getting in the car after placing the gifts in the trunk, and then driving around to the other side of the mall, so it looks like you are just arriving to shop. When you are leaving the mall for home, beware of cars following you, and drive past your home and go around the block, then double back to see if anyone is following.

Once home, be aware of anyone watching you bring presents inside, and don’t leave the car unattended or out of sight for any length of time. Close your trunk and lock your doors every time you have to take a load of gifts into the house. In the home, be sure to lock all doors and windows, and use an alarm if you have one. Take pictures of the gifts before they are wrapped, and make copies of your receipts, just in case. After Christmas, don’t put empty gift boxes at the curb – take and dispose of them somewhere else, or cut them up so they can fit inside your garbage cans. All of these things can reduce the size of the target, and since not everyone will do this, people other than you will likely present an easier target for crooks looking for the surest victims.

Image courtesy of flickr.com

And if despite all your care, a grinch makes off with your Jing Tinglers, Flu Floopers, your Tar Tinkers and Who Hoovers, just know if you can document what you purchased, and that it was stolen, your insurance claim will go that much easier. Call the police right away, and give them a complete list of everything stolen (if they don’t get everything listed right away, be sure to provide them with a supplemental list that includes absolutely everything).

Adjusters hear stories every year of people using Christmas bonuses (cash, of course) to buy expensive items that are well above their means, with no proof of purchase whatsoever. Because of this, they expect people will throw in a few extra items from their “wish list”, even if they did really suffer a holiday theft, and they may be extra suspicious when it comes to paying these types of claims. Oftentimes these cynical and callous adjusters seem as cold-hearted as the grinch that actually stole the gifts. The better you can document your claim (receipts, invoices, credit card statements, photos, police report, etc.), the faster your claim should be settled, with as little hassle as possible.

Image courtesy of www.blu-raydefinition.com

Like it or not, the grinches are out there, and we may not be able to stop them all by singing a heartwarming (and3-times heart-growing) rendition of The Who Song (Fahoo Fores, Dahoo Dores), but we can take a number of steps to reduce our chances of falling victim, and if it happens anyway, learn ways to make the recovery process go smoother. Welcome Christmas, one and all.

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.  

Unimaginative Denial, Creative Solution

by Mark Goldwich

This week I wanted to write about a claim my firm agreed to take on in the past few days. To me, this claim exemplifies why it is so important to have access to professional claim representation when it comes to property insurance claims, and why you can’t trust your insurance company to answer the question “is it covered?”

In this case, the homeowners live in a planned development, in what’s called a “zero-lot-line” home. This basically means that at least on one side of their property, the exterior wall of their home marks the boundary line of their property, so they have no yard at all on that side. The property is also unusual in that they have an atrium on one side of their home, with no roof above it. This atrium is literally a room inside their home’s footprint – it just has no roof covering it. Inside they have smooth pea-rock, and a few larger decorative rocks, statues and crystals, making it a tranquil space to relax.

What happens when it rains, you might ask. The floor of this atrium room (under the pea-rock) is poured concrete, and the concrete slopes towards the exterior wall of the home. Water then passes through a pair of “scupper” holes, about 4 inches squared (leading to a drain on the other side of the wall), and there is also a drain in the outside corner of the room that connects to an underground pipe leading to the side of the front driveway, where it is supposed to flow harmlessly into the street, towards a larger drain. It sounds like a mess, but for years, this system of holes and drains worked fine.

Image courtesy of wikimedia.org

You can almost guess what’s coming next, can’t you? We had some particularly heavy rains recently, and the drain system did not work fast enough. Rain water falling into the atrium could not escape faster than it was falling, and the atrium room soon filled with enough water that it entered the adjoining rooms of the home on all three sides. Water went everywhere.

The owners quickly called their insurance company, who told them to call a water extraction company and get the home dried out. Shortly after that, an “independent” adjuster working for a firm owned by the insurance company itself, came out to the property, spent 20 minutes taking a recorded “interview” of the homeowner, and another 10 minutes looking around and taking photos.

Now you may really be able to guess what happened next. The homeowner got a letter from the insurance company saying the loss was being denied. The letter noted that according to their “investigation” (if it can be called that), “the atrium was inundated with rising flood water, which entered your home causing water damage to your dwelling and personal property.” The letter kindly suggested they report the “Flood” claim directly to their flood insurance carrier. If they would have asked whether there was flood insurance (and they probably did), they would have known there was no flood policy in effect. They then included the section of the policy titled, “EXCLUSIONS” which says they don’t cover for “water damage, meaning: flood, surface water, waves,…” and also included exclusionary language which was actually removed from the policy by an endorsement the owners purchased (this would lead most people to believe certain events were not covered, when they actually are covered).  So the insurance company adjuster spent 30 minutes “investigating”, and just as quickly sent a letter denying the claim.

Fill out the form below for your Free Copy.

On the other hand, I spent 2 hours at the property, in the home, the atrium, the neighbor’s property, in the front yard, the street in front of the home, and down the street looking at the drainage situation, and I determined this is not a “flood” loss, nor is it “surface water”. You see, real flooding occurs when rain accumulates as a result of “overflow of inland or tidal waters; unusual and rapid accumulation or runoff of surface waters from any source; or mudflow. I think we can safely eliminate mudflow and overflow of inland or tidal waters, which leaves us with the surface water exclusion attempt.

I would (and I will) argue that the water that fell in the atrium in this case is not surface water, it is simply rain water. Surface water is most simply defined as ”water on the surface of the ground”. For the purposes of insurance claims, courts have ruled differently, but generally define surface water as “water which is derived from falling rain, and is diffused over the surface of the ground, while it remains in such a diffused state, and which follows no defined course or channel, which does not gather into or form a natural body of water, and which is lost by evaporation, percolation, or natural drainage.” A bit more complex, but the way I see it, the rain never touched the “ground”, it was not allowed to “diffuse”, and it was forced to follow a course defined by the walls of the atrium.

Image courtesy of commons.wikipedia.org

If this occurred on the enclosed balcony of a 10^th floor condo (and I have handled similar claims in ^th floor condo balcony. The water from the neighbor’s yard did not enter this atrium. Instead, at some point, the water in the atrium simply could not escape to the neighbor’s yard fast enough. Also, the drains were so full of water they were not allowing water to escape fast enough either, and this policy contained an endorsement that could provide limited coverage for such a loss (but the insurance company never mentioned this).
the past), it would not be considered surface water by most adjusters (although I would not put it past a few to try). To me, there is not much difference between this situation and the 10

According to the insurance company, this loss was caused by flooding, or perhaps surface water, and is not covered. In my opinion, the loss was not caused by flooding or surface water, and should be fully covered (the damages could ultimately exceed $20,000). They spent 30 minutes “investigating” the claim, found what they say are 2 reasons why it should not be paid, and apparently could not find, or did not look for, any way to make a payment. On the other hand, I spent 2 hours on just my first inspection, and found their conclusions to be inaccurate and reached in haste. Time will tell, as they say, but I’m betting we’ll be successful in recovering an appropriate payment for our insureds.

In this article I used a real case to highlight the difference between an adjuster that simply goes through the motions of handling a claim with minimal effort or thought (and possibly with an objective of not finding coverage), versus an adjuster who aggressively seeks a way to find the maximum coverage, even when initial evidence suggests no coverage exists.

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.   

A Little Summer Reading

by Mark Goldwich

At breakfast this morning my kids were talking about going to the library today with their grandma to pick out some books to read over the summer. They talked about some of the books they might get, or even the types of books. Naturally, they wanted to read books that were “fun”, and I thought they should read books that were more educational.  In any event, it got me thinking about books, reading, and school, so I thought I would take this opportunity to write about what I first learned on the subject of insurance in school – which for me would have been in college.

People sometimes ask how I started working in insurance, and when I tell them I graduated from the University of Florida with a Bachelor of Science degree in Insurance, they ask how that happened. It was a bit of a fluke, actually. When I went to register at UF, I met with an administrator who was helping me fill out forms, and she asked what I wanted to major in. I said, “Business”. She said, “OK, so you want to enroll in the Business Administration program, but what about your major?” Again I replied, “Business?” not sure what I had missed the first time around. She then explained, “Business Administration is the college program, but you need to tell me what specific degree you want.” Clearly, I had not put a lot of thought into this, so I gave up on trying to not appear ignorant and replied in defeat, “I don’t know, what are my choices?” She began to quickly rattle off a list as if I wasn’t the only knucklehead who didn’t know what degree he was seeking, “Marketing, Management, Economics, Finance, Insurance, Accounting,…”

“Insurance” I promptly quipped, interrupting her as if I knew this all along. She didn’t need to know I only said this because my dad was an insurance agent, and I had no clue what the others entailed (I didn’t have much of a clue what insurance entailed either, but that was just something else she didn’t need to know, and at least it was a word I recognized). “OK, Insurance it is…and don’t worry, you can change your major at any time” she said as if most people who first choose Insurance end up switching.

And the rest is history.

Image courtesy of pixabay.com

But before the rest, came several fairly boring courses on Risk Management and Insurance. And

while I don’t remember a whole lot directly from those classes (it was the 80s, after all), I remember enough to help me understand some key concepts, and to see how insurance has changed over the decades.  Insurance (in one form or another) has been around for a long, long time, since about 2000 BC, and while the policies today are very complex, the basic concept is very simple: Insurance is the transfer of risk of loss from one entity to another in exchange for money. Insurance is a form of risk management.

In life, there are always risks. There is a chance you will get sick, or your property will be damaged, or you will die, etc. For each of these risks, there are really only a few ways to deal with them:

Avoid the risk – just as it sounds, you avoid the activities associated with the risk. If you don’t want to die in a plane crash, you avoid flying. If you don’t want to lose a home to fire or foreclosure, you rent. Avoidance is a fairly certain method of managing risk, but it is not always practical. Also, by avoiding flying to a work conference, you may be more likely to die in a traffic accident. Avoidance is the most effective, but the most extreme method of risk management.

Reduce the risk – this method takes into consideration that you can’t simply avoid everything, so instead you merely seek to reduce the chances of the risk in question. Examples would include doing research to fly on only those airlines with the best safety records, taking better care of yourself in terms of nutrition, sleep and exercise, completing a safe driving course, having working smoke detectors and fire extinguishers in the home.

Image courtesy of en.wikipedia.org

Share the risk – this method includes insurance, and involves an agreement to share the loss (or

gain) with one or more parties. As populations have grown, so have the potential pools of parties looking to minimize risks by sharing the risks with others. Instead of placing all of their goods on a single ship, early merchants would place smaller amounts of goods on multiple ships (alongside other merchants), in the event one of the ships were to sink. Insurance typically involves a concept called “risk transfer”, where the policyholder transfers the risk of financial loss to the insurance company, in exchange for a fee (called premium), alongside many other policyholders seeking similar risk protection. Technically, they are not transferring the risk of the specific loss to the insurance company, because the insurance company does not literally go through the loss, but instead they are merely entering a contract to be reimbursed or compensated following a covered event.

Retain the risk – this involves accepting the loss from a risk, and is what is commonly known as self-insurance. Basically, any risk that cannot be avoided, and is not shared or transferred, is retained. Often, there is a combination of risk transfer and risk retention when it comes to insurance. The deductible, co-payment, and any loss in excess of what the policy pays, is retained. Why would someone retain the risk? Maybe the potential loss is so small that the cost to transfer that risk is high compared to the cost of paying for the loss itself. Or maybe the potential loss is so large, that it is either uninsurable, or the cost of insuring it is just not feasible.

So let’s delve a bit deeper into the guiding principles of insurance. The 4 principles are:

Insurable interest – this simply means that the person taking out the insurance would suffer a monetary loss upon the occurrence of the insured event. This is essential. Otherwise, one could insure property they have no interest in, and does not benefit by the safety of the property, and they could cause harm just to receive the policy’s financial benefit. 

Image courtesy of en.wikipedia.org

Utmost good faith – the insurance contract, like other contracts, must be based in good faith, and

would not be valid if the parties obtained the policy by way of fraud or misrepresentation. This is why you must answer policy application questions truthfully and accurately, and be sure to read the entire application prior to signing it, especially if someone other than yourself answers any of the questions. Why? If you misrepresent an answer on an insurance policy question, the insurance company can not only decline to pay your claim, even if the claim is completely unrelated to the application question, and even if the claim was otherwise covered by the terms of the policy, by rescinding the policy altogether. I call this “denial by rescission” and find some companies specifically and actively use this as a strategy to reduce claim payments (a little bit of risk reduction of their own).

Material facts disclosure – similar to utmost good faith, the person taking out the insurance has a duty to disclose material facts relevant to the subject property. This duty may even extend to material facts you are supposed to know about. Obvious examples would including disclosing your correct age and health condition on a life insurance policy, or the distance to a fire hydrant on a policy that insures against the risk of fire.

Fill out the form below to receive a Free Copy.

Principle of indemnity – this principle states the insurance policy should be a contract of indemnity, and nothing more, so the person receiving the policy benefits after an insured loss would be no better off, nor worse off, than they would be had the loss never occurred. The idea here is that the person taking out the insurance should not be able to use the policy for “speculation”, or to profit from a loss.

In my experience, it is this last principle that insurance companies have deviated the most from in the past several decades, and they have done this to themselves in order to market their products more effectively as competition has increased. Replacement Cost coverage is one example, where the insurance company promises to pay you for a brand new item to replace your old item. Or maybe you have seen commercials recently for car insurance that promises to replace your old car with one that is a model year newer. These may be great concepts for marketing and sales, but they just don’t conform to the principle of indemnity.

Congratulations on completing your summer reading for today. I sure hope it was more interesting than the textbooks I had to read in college, and that you learned a bit in the process. Class dismissed!

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.  

It’s Like Pulling Teeth

by Mark Goldwich

Today, my 13-year old son is getting 4 teeth extracted to make room for wisdom teeth and braces, and to be perfectly honest, I don’t really know all the reasons why, that is just what both the dentist and the oral surgeon say needs to be done, so I am trusting their advanced degrees.  I have no doubt it will be an extremely unpleasant experience for all involved, especially for my son. We have known about it for some time, it has even been postponed at least once, yet everyone is still nervous, anxious, and dreading this day, and the next few days to follow.

So it got me to thinking about the origin of this phrase. My research suggests the earliest found uses in the 1830s, and generally means “extremely difficult” or “stubborn”, and referred to the difficulty found in people giving up information or money. An example from 1831 published in the Foreign Missionary Register of The American Baptist Missionary Magazine (Vol. 12, October 1832, No. 10), in the 23rd October 1831 entry of Mr. Judson's Journal: “When any person is known to be considering the new religion, all his relations and acquaintance — rise en masse; so that to get a new convert is like pulling out the eye-tooth of a live tiger.” Or in 1836 Knickerbocker: “And for this service to the sons, what did I get from the sires? The pittance of a few dollars, which came like pulling so many teeth.” 

Image courtesy of intelligentdental.com

For as long as dentistry has been around, pulling teeth has been a painful and distasteful experience.

And so the same is true for many people when it comes to rendering money or information. At least nowadays, there is nitrous oxide and other forms of anesthesia to ease the pain (at least during the teeth-pulling process). Unfortunately, as my son can attest now that the teeth are pulled, there is little that can be done to make the whole teeth-pulling ordeal completely free of discomfort. On the way home from the dentist, while still feeling the effects of the nitrous, he asked if we could come back tomorrow because “it was fun” and “only took 5 minutes” (it was an hour). Well, it has all worn off, and he has absolutely no interest in going back tomorrow for more “fun”. Or ever.

But what in the world does this have to do with insurance? You see, it has long been my theory that insurance companies deliberately want to make the claim process as difficult and distasteful as possible, mainly because it often ends with the insurance company making a payment. Even if they don’t make a payment, they certainly don’t want you to leave with the notion that, “Hey, that was great, I can’t wait to do that again!” This only makes sense, especially when you consider that every dollar they pay out on a claim, is one less dollar for the bottom line. And again, even if no money is paid, simply considering a claim comes at a cost for the insurance company, which also negatively affects the bottom line.

When you think about it, they have to walk a pretty fine line. They want their claim service to be highly regarded, for claim personnel to be friendly, knowledgeable and accurate, and to have (relatively) few complaints. Yet they don’t want people beating a path to their doors (premium paying doors yes, but not the one where claims submitted ).

So what do they do? They have trained people to practice smiling while they answer phones, because they have been told by consultants that “smiles can be heard over the phone”. Their people are trained in customer service to have numerous word-tracks at their fingertips to keep customers calm, patient, and understanding as they are being “handled”. They set up numerous layers (agents, desk examiners, field adjusters, independent adjusters, supervisors) such that each person can say they are doing what they can for the customer, even when the end result is negative. It’s like a bullet-proof vest that is made up of very thin layers of material, each of which on its own could not stop a bullet, but when combined together are able to diffuse the energy of the bullet, and stop it cold.

Receive your FREE copy by filling out the form below.

In this way, extracting money, and sometimes information, from an insurance company is a lot like extracting teeth. It can be an emotionally charged, painful process, which even if successful, leaves a bad taste in your mouth, with no desire to repeat the procedure anytime soon. The process also tends to get people frustrated, particularly if they were not prepared for the ordeal.  This makes them much more likely to exit the process with less money, or no money at all, just as suggested in an 1855 quote from Godey's Lady's Book for October, 1855: "Some people it's like pulling teeth to collect from; they dodge and shuffle, and ask me to call again, until sometimes I am quite out of patience."

In my years of helping people with insurance claims, I have had several who were not just willing, but eager to accept less money, sometimes a lot less money, just to be through with the claim process, or “ordeal” as they would call it. In most cases, I could get the policyholders to stick it out with me, letting them know I would not give up on them, if they would not give up on themselves. A few times, nothing I could say would change their minds – their will was broken.

One such case in particular was a woman who lost not only her home of over 40 years to a fire, but she lost her husband of over 45 years to that same fire. With the home a total loss, the insurance company had no choice but to pay her policy limit on the structure. But when it came to her (and her husband’s) personal belongings, they required she detail each and every item the two of them purchased, collected, and possessed during the past 40+ years. It was a painstaking and emotionally painful process, and they offered no assistance, even considering her state of mind. When all she could do was recall about $50,000 dollars worth, they depreciated it all and paid her about $35,000, or about half of her $75,000 limit for contents.

They were nice enough about it, even telling her that if she could think of more items, all she would have to do is submit that as well, but now they would require proof of ownership of any additional items. I assured her she would not have to prove everything as they were saying, and that I would be willing to sit with her and help her remember and document additional items, even those over her policy limits so she could claim those amounts on her taxes as an uninsured loss, but to no avail. Basically, they presented her with the idea of having more teeth pulled, and my offer of anesthesia was not enough to dull the pain.

Image courtesy of pixshark.com

Sometimes in life you have to go through things that are not pleasant. Whether it is having teeth pulled, or dealing with an insurance claim, try to keep in mind you’ll survive both. And in either case, I recommend the laughing gas.

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.  

Honesty and Your Policy

by Mark Glodwich

In my last blog I talked about the importance of documenting your insurance claim in order to maximize your chances of success in recovering everything you are entitled to.  In that blog, I mentioned how documenting your claim properly could save your claim even if you made other mistakes along the way.

Image courtesy of commentsmeme.com

So today I wanted to talk about just 1 common mistake people make when filing an insurance claim. And just as the documentation tips in the prior blog can be used for situations other than insurance, this mistake should also be avoided in non-insurance situations. As is often the case, really good tips, advice, and suggestions can be used in all kinds of situations, by anyone, and with consistent success.

The one common mistake I’m going to focus on today is not being honest, bending the truth, telling a little white lie, fudging, or just plain committing fraud. Needless to say, don’t do it. I’m not going to say insurance companies aren’t stupid on a global scale, but I have found that individuals who work at insurance companies can be fairly intelligent. And keep in mind; some of their best trained adjusters are those working for their “fraud” units. Sure, everyone knows lots of people rip off insurance companies and get away with it.  Sometimes their right hand doesn’t know what their left hand is doing, and they can be too overworked to notice your minor fudging on a relatively small claim. But when it comes to risk versus reward, it’s just not worth it.

We usually only hear of big fraud cases where the fraudster is greedy and dumb, which is a terrible combination. But the reality is, regular people get caught all the time, even on small claims – it just doesn’t make the evening news. And often, that’s because there is no arrest for the news media to become aware. In my experience, most would-be insurance cheats are not arrested, their claims are simply denied (sometimes just the items being inflated are denied, or sometimes the entire claim is denied), and they “get off with a warning”.

This “policy of honesty” starts from the time you fill out your application for insurance. Did you know, if you make what is called “a material misrepresentation” on an insurance application, years before a valid claim takes place, your insurance company can not only deny your claim, but they can rescind your policy entirely? When your policy is rescinded, it is as if you never had it, meaning you cannot collect on it. And just what is a “material misrepresentation?” In short, to an insurance company, it’s when you answer in such a way that they consider the answer to not only be untruthful, but that if you had told the truth, they would have never insured you to begin with.

Courtesy of rootinc.com

Now think about this…You’re sitting with an agent, and he or she is asking question after question on the insurance application, when out of the blue they ask if you had a DUI in the past 5 years. You’re embarrassed that it happened in the first place, and you can’t remember if it happened 4 years ago, or 6 years ago, but it was right around 5 years ago. So you think to yourself, that it has nothing to do with the homeowners insurance you are applying for. So you answer, “No.”

Years later, your home burns to the ground, with everything in it, and you submit a claim. To your surprise, instead of paying the claim, your adjuster tells you they need you to submit to an Examination Under Oath. “It’s no big deal,” the adjuster says, “it is very common to require this on large losses.” And besides, you know you had nothing to do with starting the fire. As you proceed with the EUO, an attorney for the insurance company introduces you to the court reporter who will be transcribing everything said. You are still not thinking about that day in the agent’s office until the attorney asks, “Have you ever been convicted or plead no contest to a DUI?” Still not putting 2 and 2 together, you answer, “Yes.” The attorney promptly follows up with, “In what year was that?” to which you reply, “I have no idea; that was nearly 10 years ago.” “Actually,” the attorney says, “our records show it was in such and such year, isn’t that correct?” Again you respond that you don’t remember, but that sounds about right. He then asks you if you remember the agent asking you the question about the DUI within the past 5 years, and he asks you to confirm your signature on the application, and the date, which you do. Now you start doing the math in your head, and your stomach starts to churn a bit, but you’re able to keep your lunch down because the attorney quickly goes on the next question, and the next…

Fill out the form to get a free copy of Mark's latest book.

With all the questions over all the hours, it still hasn’t sunk in. That is, until you get a letter about a week later, explaining that your policy has been rescinded, with no payment on your claim, and only your premium is being refunded, because your DUI was only 4 ½ years prior to your insurance application.

This happens a lot more often than you would ever imagine. I call this, “denial by rescission”. If the

Image by leisuremartini.com

insurance company can’t find another reason to deny the claim, they may look to the application for items they consider “material misrepresentations”. Sometimes this happens when the agent didn’t even ask the question, but completed the application for the client, thinking they were helping speed up the process, and maybe also being embarrassed about some of the questions, or thinking they know the answers.

This is why it’s critically important to review the policy application questions and answers before signing it. And don’t assume any answer is not relevant, or that it wouldn’t count if that’s what the agent wrote as the answer. In a situation like that, you should assume that if you sign it, they will hold you to it.

And certainly once a claim is made; stick with the policy of honesty. Even if the answer to a question is embarrassing, or if the fact that you don’t know the answer is embarrassing, be truthful anyway. If “I don’t know” is the answer, state it every bit as proudly as you would if you did know the answer. Offer to find the answer. Or, suggest they speak with the right person to get the answer.  It will be a lot better than trying to make up an answer, just to hide the fact that you didn’t know something. Remember, the penalty for not knowing something is never as harsh as the penalty for giving a bad, untruthful, or dishonest answer.

What we learned in kindergarten is still true today – honesty is the best policy.

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.

Documentation Cubed

by Mark Goldwich

Image courtesy of LinkedIn.com

Everyone knows when it comes to real estate there are only 3 things that matter – location, location, location.  Similarly, when it comes to insurance claims, the key is documentation, documentation, and you guessed it, documentation.

I can do several blog posts on subjects like, “The 5 most common mistakes made by policyholders". But when you boil it all down, many of those mistakes can be avoided if you start with documentation. Now, I can tell you the word “documentation” can mean different things to different people. We all know the person that takes their shoe box overflowing with random receipts and bills to their accountant on April 14^th and proudly says, “There’s my documentation, all organized for you!”

Sure, the accountant can fix it, after filing an extension for that person, and a little cursing, but he or she will probably charge more for all the extra time it takes sorting out that mess. So, when we talk about documentation, we are really talking about documentation that is organized and meaningful, not just random, illegible bits of information.

At the start of every claim, I recommend people get out a legal pad, so they can keep track of every conversation and activity that relates to the claim, and keep it in chronological order. Start by noting the time and date of the loss, what happened, what was damaged, and other relevant details (maybe other parties were involved, where it happened, how, etc.). Make detailed notes of every phone conversation (especially those with the insurance company adjusters), appointments with adjusters, contractors, etc., other activities related to the loss, and of course you want to record what has been damaged or destroyed.

For property claims, this can usually be broken down into 2 main areas: structural damage, and

Courtesy CDC.gov

damage to personal property. Most people have a tough time detailing structural damage. Simply do your best to take photos or video. And when it comes to personal property, especially after a large loss like a fire, tornado or hurricane, this can seem especially overwhelming. My suggestion is that you tackle the task the same way you would eat an elephant – one bite at a time. Start in one room, and move to one corner of the room. If needed, zero in on one piece of furniture, like a dresser, and focus on the top left drawer, and continue methodically from there. I recommend you do this for no more than 60 minutes at a time, taking a 15-30 minute break. You may wish to hire a company to help you with this task.

Depending on the size of the loss and your abilities, hiring someone to help document a large personal property loss could well be worth it. I have personally seen clients so stressed out by the event that damaged the property, that the thought of documenting the loss was more than they could bear. They would rather walk away from tens of thousands of dollars than risk their very sanity.

Needless to say, if you are really up on your documentation, you already have a complete inventory of everything in your home, complete with description, date and place of purchase, photo, receipt, owner’s manual, etc., before the loss ever even happens. Just be warned, your insurance company may believe such attention to detail and foresight suggests the loss was planned. Sometimes you just can’t win!

In addition to the legal pad, you might want to use a folder or binder to keep related bills, estimates,

Courtesy of mentalfloss.com

receipts, letters, and other documents you obtain or produce during the claim aftermath. If these items are not dated when you receive them, place the date you received the document on them* and try to maintain them in chronological order.

*Note: some attorneys might advise against writing directly on a document you did not personally create. I am not an attorney, and I am not giving legal advice here, but in my experience, if you can explain what you wrote, when you wrote it, and why you wrote it, you should be fine. And by all means, when in doubt, ask an attorney.

The point is, in addition to maintaining your documentation, and categorizing your documentation, sometimes you need to document your documentation.  You also need to understand your documentation. This can be difficult, especially if the documentation is handwritten with poor penmanship and grammar, or is of a technical nature.  Whoever is providing the documentation needs to understand what it is they are giving you, and they should be willing to explain it to you. This is where that legal pad comes in handy again. If you don’t understand what the documentation says, how are you going to explain it to someone else?  If no one understands it, what good is it?

Fill out the form below to receive a free copy of Mark's book.

So, there you are, taking notes of every conversation you have with every person related to the claim in any way.  You are keeping every related document in order, and you understand what they mean. You have a list of everything that is missing or damaged. Now, when your adjuster asks you to prove your claim to them, you can make it all but impossible for them to do anything but pay your claim promptly and fully. And if they don’t, you have everything you need to take matters to the next level, whatever that may be.

From boston.barstoolsports.com

It may sound like a good deal of work to document your claim, but just think about what happens if

you don’t – that is the stuff “5 most common mistakes” lists are made of. The stress, heartache and financial repercussions from failing to document your loss can be tremendous, and trying to document and organize everything after the claim starts to go south can be more work than doing it to begin with.

Documenting and organizing from the start, and consistently throughout, will take much of the stress out of the process, leaving you more confident and comfortable with everything that is happening. It can be the difference between feeling like a victim, or feeling like you are in control. 

Mark Goldwich is president of Gold Star Adjusters, a group of public insurance adjusters dedicated to helping citizens get the maximum settlement for any insurance claim.