Don't Let the Grinch Spoil Your Christmas!

by Mark Goldwich

People know this time of year for buying gifts, gifts, and more gifts. No matter the economy, or the weather, or the state of the Nation, gifts are purchased this time of year by the hundreds of millions. That’s a lot of gifts. And a lot of money. And a lot of LOOT!

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Yes, sorry to burst your gifts-galore daydream, but many a gift will be stolen again this year, some

right out from under the Christmas tree, just like in our favorite Dr. Seuss show. And more will be stolen from trunks, and backseats, from vans and from planes, from stores and from…well, you get the idea. This time of year is not only prime-time for retailers, it is prime-time for thieves as well.

Think about it. Brand new items, still in boxes. No wear, no tear, no scratches or scuffs, no personalization of any kind. Ready to sell, or pawn, or re-gift to a friend. It’s not difficult to see the allure of stealing Christmas presents – if you’re in the stealing state of mind.

Now that we have painted a rather nasty picture, let’s put an insurance claim bow on it, and see what we can DO about it. The way I see it, we have two main choices. We can try to avoid the theft, or we can transfer the risk (or the cost) of the theft, should it occur despite our best efforts to avoid it.

To avoid being a victim of holiday theft, there are countless websites that will give you endless tips, from email and credit card security, ATM safety, keeping gifts hidden, staying with your gifts, using alarms, carrying concealed weapons, etc.

Simply Google “Holiday Crime Prevention Tips” and you will quickly find a wealth of information that will greatly reduce your chances of falling victim to modern day Grinches.

But, should a holiday mishap happen to happen despite all your best laid plans to avoid it, there is always the transfer concept noted earlier. And by transfer, of course, I mean insurance. After all, that is what insurance is – transferring the risk of something bad (and expensive) happening, from someone (part of a large group of people) who can’t afford to have that something happen, to a group or company that can afford to pay for the loss, thanks to all the people in the group that did not have anything happen, but paid a premium just in case. Insurance companies call it “peace of mind”. Then, at the end of the year, they call it “profit” – with compounding interest.

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So, whether you use credit card insurance, or some type of property insurance, make sure you understand how your purchases will be covered until you give them, and how your gifts will be covered once you get them. Talk to your insurance agent, or review your homeowners or renters insurance policy. Typically, gifts you buy are covered under your policy until you give them to someone else, while they are “anywhere in the world” (even on Santa’s sleigh), but always subject to the “limitations and exclusions” of your particular policy.

Some policies say if you have an alarm, but don’t turn it on, and your property is stolen, you are not covered. And many policies place a maximum limit on certain types of property that is stolen, like money, jewelry, furs, business property, photography equipment, artwork, and other more “unique” items. Know your policy, and consider purchasing extra insurance for such property, typically called an “inland marine” or “floater” or “personal articles” policy, and which is often relatively inexpensive.

With over 27 years of experience as an insurance adjuster, I understand a simple truth: “People know enough to carry insurance, but don't know enough about the insurance they carry.” That’s why I always recommend people get to know their agents, or get reacquainted. They can be a great help in understanding the insurance you have, or getting a different policy that suits you better. If you don’t have an agent, then it is your responsibility to understand your insurance policy thoroughly – not an easy task.

Whether or not they have an agent, people all too often leave the claim handling to the insurance company, in hopes they will be treated fairly and be paid what they are entitled to under the policy. Many times, though, policyholders are paid only a fraction of what they are owed.
As I remind people over and over, the insurance company adjuster (or the independent adjuster they hire) represents the insurance company. They do not represent you. Only a public adjuster works exclusively for you, the policyholder, to ensure your best interests are served. If you are leaving the insurance claim handling up to the insurance company, you are basically allowing them to decide their own profits. This is rarely a good idea.        

What most people don’t know is that insurance is not an exact science and settlements are subject to interpretation and negotiation. How your claim is interpreted and negotiated can greatly affect the amount of money you receive, or how your property will be restored or replaced. Another little-known fact is that insurance claims can be submitted, or reopened, years after the event, or even after the claim was closed or denied.

To prevent delays, denials and deflections by insurance companies in handling your claim, my first and best advice is simple: consult a professional. But, if you decide to handle a claim yourself or reopen one you think deserves a second look, please consider the following ten “commandments”:

1)            Don’t try to pull one over on your insurance company – be thorough, but honest.

2)            Take note of everything that’s stolen or damaged, and keep a detailed log of all conversations with your insurance company.

3)            Take pictures – photograph and/or video it all, and be sure to keep copies separate from the item itself (credit card statements or cancelled checks can help).

4)            Show the adjuster all the receipts and damage, and be as thorough as possible.

5)            If your home was damaged in the process, remind the adjuster that not all homes are built with the same materials.

6)            Review the adjuster’s estimate in detail, until you understand it completely.

7)            Request a licensed contractor review the insurance company estimate and provide an independent quote.

8)            If the insurance company refuses to pay for anything, demand they explain why – in writing.

9)            Be persistent and don’t give up. Appeal up the chain of command.

10)        Seek professional assistance when needed.                        

When thinking about holiday Grinches, and how you can protect yourself, don’t restrict your material concerns. Be sure you are also mentally prepared. As I always say, the best time to prepare is…now! For everyone at Gold Star Adjusters, Happy Holidays!

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.

Don’t Keep The Home Fires Burning

By Mark Goldwich

Image courtesy of www.fire.ca.gov

Although we’re thankfully past hurricane season, those of us in Florida and other hurricane prone

regions of the U.S. have again fared better than predicted, we can not afford to let our guard down. As temperatures drop, a new disaster season begins – that of home fires.  Whether from space heaters, fireplaces, candles, Christmas tree lights, cooking accidents, or a variety of other sources, the end of hurricane season on November 30^th seems to mark the beginning of home fire season.

Just as with hurricane season, you need to have an action plan for fire season.  This involves detecting fires, putting out fires, escape routes, alternative meeting locations, calling assignments, disaster kits (for people and animals), temporary living arrangements, disaster cash, and of course, plans for documenting your claim to your insurance company.

Did you know that it’s your responsibility to prove to the insurance company what you own if your home should burn to the ground?  You may pay for $100,000 (or much more) in personal property coverage, but you may only receive payment for what you can both remember and prove that you owned. 

I once had a client that lost well over $100,000 worth of belongings when her 2-story home of over 40 years burned to the ground. Tragically, her husband perished in the fire. Would you believe her “top-notch” (but not so “neighborly”) insurance company would only pay her for about $40,000 in property because that is all she could remember in her traumatized state of mind?

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This is why I highly recommend you consider photographing, filming and listing all your https://www.facebook.com/ProofOfAssets .  Or contact United Policyholders at: http://www.uphelp.org/ .

possessions, or at least your most valuable ones, and keep copies (with receipts, owners manuals, and appraisals) in more than one location.  A safe deposit box or a fire and waterproof safe works well for this task.  Another way to accomplish this is to retain a company that will do this for you. This service is quite affordable, especially when you consider how much time, money, effort and heartache it can save you to be able to document your claim.  If you are local to the Jacksonville, Florida area, contact Renee English at:

The same holds true for your home itself.  Building materials come in a wide range of styles and levels of quality, and the size or age of the home can have little to do with the cost or quality of the building materials used.  Maybe you have high end cabinets, or wallpaper, or tile.  Or maybe you upgraded when you remodeled recently.  After a fire, many of these things look the same (black).  The tendancy of the insurance company is to “guess” at what you had by considering the age, size, neighborhood, etc.  But if you keep good records, and photos or video, you’ll stand a much better chance of recovering everything you are entitled to.

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While I tend to focus on the insurance side of things, always keep in mind the very best way to avoid being victimized by your insurance company is to not have the claim in the first place.  There are numerous websites that can give you tips galore for minimizing the risk of a home fire (and for safely escaping), especially around the holidays, when it is not only cold outside, but people have extra lights, candles, cooking, and so on.  Use good judgement and care. 

Even worse judgment is to try to capitalize on a home fire by overinflating the damages caused.  Some people think that just because their home is a mess and everything is burned beyond recognition (or seems to be), that this is a good time to try and pull a fast one on the insurance company.  By all means, don’t do it.  Insurance companies relish the thought of catching would-be cheats, and their fraud investigators tend to be their best trained assets.  Don’t give them this gift.

Remember, that when it comes to disasters not all come with names and media hype - or warning.  The best time to prepare for a home fire that will probably never happen is always…now!  To avoid getting burned twice, once by the fire and once by your insurance carrier, remember that you don’t have to go it alone.  Hire a licensed public adjuster who can help you through the process and in so doing get you everything all you deserve.

Please enjoy a happy, safe and healthy holiday season!

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.

Diving Into Deflection - Part 2

by Mark Goldwich

Last time we ended by talking about the fact that despite all the frustrating tactics used by insurance companies, including unnecessary delays, confusing denials, and mysterious deflections, most claims – even those with both high values and merit – never seem to make it into court.

It’s not really that surprising that most of these situations don’t land in a courtroom. By the time most people start thinking about lawsuits, they’ve already been battling the insurance company for a year or more. Then they are told the lawsuit will probably take another two to three years! Be honest. What would you do? Sometimes, when people find themselves caught in the “deflection game,” they’ll give just about anything to be done with the process.

Are these “deflection” situations isolated cases? If you ask representatives of the insurance industry, the answer will be an immediate “Yes.” If you ask Elliot Spitzer, former New York Attorney General, and former Governor of the State of New York, he’d offer a somewhat different assessment of the situation.

What did Spitzer have to say about this? In a lawsuit, Mr. Spitzer accused major insurance companies of "fraud, bid-rigging, and antitrust violations," and charged some of the biggest players in the game with fleecing their customers. Spitzer warned that the American insurance industry “needs to take a long, hard look at itself," and suggested that "if the practices identified in our suit are as widespread as they appear to be, then the industry's fundamental business model needs major corrective action and reform."

He went on to note that "there is simply no responsible argument for a system that rigs bids, stifles competition and cheats customers." Mr. Spitzer’s investigation and lawsuit

focused first on corporate customers, but specifically included individual consumers as being among those victimized by industry practices. His press release was entitled,

"Investigation Reveals Widespread Corruption In Insurance Industry."

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Isn’t the legal system supposed to correct problems like this? In theory, yes. And there are some encouraging signs. A 2007 DecisionQuest poll of practicing attorneys found 75% of respondents would now expect jurors to agree with the sentiment that insurance companies “would do anything to avoid paying even legitimate claims.” That’s refreshing evidence of reality-based thinking within the halls of justice.

But most of these cases, as we have seen, never reach a jury. For your own protection and economic well-being, it may be wisest to stop thinking of insurance companies in terms of your friendly neighborhood insurance agent, and start thinking of insurance companies as resembling the people who ran their firms into the ground by setting up a nearly incomprehensible maze of wholly-owned, partially-owned, and “affiliated” companies … companies whose relationship with one another seemed to require an advanced degree. I realize that sounds like a harsh assessment. But the irresponsible use of deflection warrants it, in my opinion. Let me give you a brief example that may help you understand why I feel as I do about this.

Think of a big insurance company. Let’s call it Baseball, Mom, and Apple Pie Insurance – BMAPI for short. BMAPI’s motto is, “Faithful and friendly, during good times and bad.” It has an expensive ad campaign that features gorgeous sunsets, adorable puppy dogs, and happy policyholders who dearly love and respect their local BMAPI agent.

Now, if BMAPI handles, say, 1.5 million claims in a year, and then deflects – sorry, “saves” – just $300 on each claim, that adds up to nearly five hundred million dollars more for BMAPI to keep for itself and invest as it sees fit (1.5 million times $300 = $450,000). That’s right, nearly half a billion dollars.

Follow me on this next part, because it’s extremely important. The number I just used to get to roughly half a billion dollars of extra income for BMAPI was, you will recall, three hundred dollars of, shall we say, “savings.” Now, you might well ask: How realistic is that figure I just used? Is three hundred dollars a valid number -- or a dubious number?

Hear me, please, when I tell you that my typical additional recoveries – that is, the money I get the insurance company to agree to pay in valid claims over and above what it had already agreed to pay out – is not in the hundreds of dollars. It’s in the thousands of dollars. That’s in my average case. 

Image courtesy of the lostogle.com

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Ponder that, if you will. Not three hundred dollars per case. Thousands of dollars per case. And that’s not the exception to the rule. That’s what usually happens.  Deflection is real! Taking this fact into consideration, let's do that math in our heads … 1.5 million times $3,000 = $4.5 BILLION! That’s per year, for just one company. Not too shabby! Are you starting to see why a cynical person might start to think all the coincidences that seem to favor insurance companies might not be so coincidental after all?

But now I really must be exaggerating about the $3,000 figure, right? I would say that is conservative, and base that on thousands of claims we have helped our clients settle for $5,000, $20,000, $100,000 and more (we even helped a client recover over $396,000 on a claim the insurance company insisted for 4 months was not covered at all). And keep in mind, we are just 1 firm, in 1 city, in 1 state, in a great big country.

For more information on bad faith insurance issues, please take the time to visit this web site: www.badfaithinsurance.org -- or just do a Google search with the words “bad faith” along with the name of your own “friendly and faithful” insurance company, and see what kind of ugliness pops up. You may be surprised.

In the next blog, we’ll get some more clarity on exactly how the “deflection game” is likely to be played in your world.

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.

Diving Into Deflection - Part 1

By Mark Goldwich

If you are current on my blogs, you know we have been talking about the various ways insurance companies are able to create and take advantage of delays – to their financial gain, and your financial loss. It’s not easy, but these delaying efforts can be overcome.

Even if you endure all the delays, and even if you somehow work your way through the labyrinth of denials, the insurance industry may well have one more coincidence up its sleeve. This coincidence catches a lot of insurance consumers by surprise. It often contributes to the exasperated, exhausted homeowner’s conclusion that it’s better to give up, settle for what they can get, and perhaps accept dimes, nickels, or even pennies on the dollars they are actually owed.

The coincidence is known as deflection, and it’s what happens when the insurance company finds reasons to avoid paying you money that you actually have coming on your claim. Although listed last in this blog series (after delays and denials), deflections can be encountered at any time during the claim.

In this blog, I’ll give you a broad overview of the “deflection game”; in the chapters that follow, we’ll look at how the game is actually played to the detriment of you, the policyholder.

Like the coincidences mentioned in previous chapters, this one requires the help of a professional if you want to stand the barest chance of getting all you are owed. All too often, though, this is a game that non-professionals lose … simply because they don’t realize they’re playing in the first place.

Q&A: What you should know

What, exactly, does the “deflection game” involve? It involves the insurance company finding ways to avoid giving a direct, truthful answer to what would seem to be a fairly basic question: “Who has the moral and legal responsibility to make sure that my legitimate claim is paid in full, promptly and to my complete satisfaction?”

Isn’t that obvious? Doesn’t the insurance company itself have the obligation to pay the claim? That answer may perhaps seem obvious to the policyholder, but sometimes it’s not all that obvious to an insurance company with a multitude of adjusters, engineers, restoration companies, attorneys, insurers, re-insurers, and third-party administrators at its disposal. There are so many cases of insurance companies dodging this issue that I can’t really do justice to the topic in a blog of this size. I can say, though, that it seems the legal system has finally begun to catch up with a few of the worst offenders.

What kinds of cases are we talking about? In Ohio, a jury held that a life insurance and disability management services company was guilty of breach of insurance contract; the jury awarded the plaintiffs $429,400 in compensatory damages for nonpayment of claims. But that wasn’t all. The jury also found the insurance company guilty of bad faith insurance practices, and mandated an award of $1,130,000 to the plaintiffs.

They coupled this with a whopping punitive damages award of $3 million. Documents from the case give some sense of the elaborate lengths to which some companies will go to avoid paying people the money they are owed. This particular insurance company used a third party administrator, and an affiliate re-insurer (which was also a 40% owner of the third party administrator) to combine their efforts in an illegal scheme to avoid paying completely legitimate claims.

 

The scheme involved a whole host of complex accounting maneuvers, as well as false information that was submitted to an insurance commission. Now, I realize that, at this point, you may be having some difficulty getting your head around all this. That’s because a) such cases are pretty complicated and b) you’re probably still thinking of insurance companies as responsible businesses with an obligation to take care of their customers over the long term. All too often, it seems they’re simply not very responsible, and not thinking about the interests of their customers in any time frame, short or long.

Are there other cases like that Ohio case mentioned? Plenty. Many have a disturbing, and all-too-common, theme – the insurance company says that paying you is actually someone else’s responsibility.

But the “someone else” either never follows through or only partially follows through on its obligation to you. Or they say that the other party’s report or advice “prevents” them from paying you (as if they can’t override the opinion of an outside party). I’ve personally seen this happen many, many times.

Do all of these cases wind up in court? No. In my opinion, very few of the cases that could go to court ever get there, and most policyholders in these situations do not get the impartial hearing they deserve.

Why not? Because many individual policyholders simply can’t tolerate the idea of wandering into another bureaucratic maze with no clear outcome that they can see benefiting them in the near future. (As we all know, going to court can be a long, expensive process.) After all the delays, and after all the denials, many people are simply sick of the process of trying to get the insurance company to pay up. They either take whatever crumbs they’ve already been tossed, settle prior to trial, give up altogether, or even die (yes, we’ve seen claim victims pass away before seeing the claim check arrive).

As I’ve suggested elsewhere in my blogs, I suspect a fair number of people suffer one of these outcomes. We’ll dive deeper into deflection next time.

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.