The Pope, An Immigrant, and Donald Trump walk into a bar…

by Mark Goldwich

Just kidding – the point is, no matter what your job is, it is important to be current when
broadcasting to the “masses”. (pun intended)

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Each of us has a wealth of information, based on personal and professional experiences, formal and informal education, books read, seminars attended, and so on. So while we can speak about any number of subjects, I am often reminded that the best topics to talk about are those that are most current, or in today’s lingo, what is “trending”.

For me, being in the insurance industry, I could look to local items, like:

Just this week there was a news story and article on www.FloridaWaterDaily.com titled, “Jacksonville Budget Amendment Transfers Money from Drainage Project to Firefighters”. In the article, it talked about people with localized flooding issues caused by recent heavy rainstorms, who are upset because “A last-minute amendment passed on Monday that took money away from storm drainage to help restore the salaries of Jacksonville firefighters. The amendment passed on Monday takes about $300,000 from the drainage fund and puts it towards restoring the salaries of Jacksonville firefighters.” These residents are not against firefighters, but they pay taxes that include storm water fees, and they are tired of having to wear rubber boots every day just to walk outside their home.

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Earlier this month I saw a story on www.news4jax.com about a fire that broke out in the kitchen of a local McDonalds restaurant at 3 a.m. Similar fires damage homes and businesses daily, and each one details the need not only for insurance, but prevention, maintenance, and fire suppression.

You can also find countless stories about local insurance agencies, insurance companies, jobs in the insurance field, or stories about insurance benefits for local city government employees and officials.

You could then easily expand your search for recent events on a statewide level, and for example, find a story about famed coach Lou Holtz, whose Orlando area home was heavily damaged by fire, along with personal items like photographs with presidents and popes, the torch he carried in the 1996 Olympic games in Atlanta, and so much more.

There has also been plenty of severe weather all across the state recently, damaging homes, businesses and cars. A www.weather.com article earlier this year posted the following events which all occurred on the same day in Florida:

-          Storms brought down trees and knocked out a few traffic signals in St. Petersburg, Florida.

-          Throughout Tallahassee, Florida, reports popped up of trees blocking roadways and damaging homes after a storm struck around 10:30 a.m.

-          A National Weather Service employee spotted a funnel cloud in Miami early this afternoon.      Another funnel cloud was reported by a trained spotter in Boynton Beach, Florida, at 4:20 p.m.

Widening the search to regional or national levels, and again for international news on industry or related topics would only yield more current events to investigate, discuss, and opine upon.

Once I find a current topic I want to discuss, I always try to find a way to add my own personality to the subject, whether by comparing it to an actual situation that has occurred in my business, or by giving my own position on the topic. I also want to give the reader something else to think about, in addition to what is being reported on. After all, every story would be different depending on the background or point of view of the reporter.

Most news stories aren’t going to go into all facets of the event. Take a simple story about a home fire, for instance. I could talk about the importance of getting the right insurance policy, or documenting your valuables so you can prove your claim later, or presenting your claim to the insurance company, or even fighting to maximize your claim, and much more. Someone else could talk about restoration methods, new construction materials, fire suppression equipment, smart-home wiring, using LEED-certified products in the reconstruction – the potential list of alternative topics using just this one scenario is absolutely endless.

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In this article I talked about writing articles that are current. Even though I am relatively new to writing my own articles, I have learned enough to use timely material, based on relevant topics, and inject my personality, to create a product people can not only learn from, but enjoy (hopefully). After all, I’m not a writer; I’m just an insurance adjuster, who owns a small business, and writes about it.

 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.   

The Shortest Distance

by Mark Goldwich

Image courtesy of en.wikipedia.org

There’s an old saying that is also a scientific fact – “The shortest distance between two points is a

straight line.” I was thinking about this because I wanted to present another real case scenario, where the insurance company quickly denied a valid claim based on an incomplete or otherwise flawed investigation. And I was then struck with the obvious question of “why do they do this time and again?”

First I’ll present the scenario, and then I’ll make a case for why it happens.

In this case, a couple was moving from Jacksonville to Gainesville. They found a home in Gainesville, and got it under contract before selling the home in Jacksonville. And besides, the home in Gainesville still needed some work, so the husband was going to go back and forth, doing the needed work, until the Gainesville home was ready, and the wife would remain in Jacksonville until that time, or until the Jacksonville home was sold.

So they took out insurance on the Gainesville home, and then something happened to delay the closing, and the insurance policy was canceled. The policy was then reinstated prior to the second scheduled closing, which went off without a hitch. After the closing, the husband spent a week in the Gainesville home they just closed on, doing repairs and getting it ready. At the end of the week, he drove the 2 hours back to Jacksonville, and about 2 weeks later they got a notice in the mail from the utility company in Gainesville, saying there was a spike in the water usage, indicating a water leak somewhere.

Mold image courtesy of en.wikipedia.org

Luckily (that doesn’t seem like an appropriate word here, but it fits), they knew a neighbor in Gainesville that they quickly called to check things out. The neighbor could not see any problems, there was no water leaking out the doors, so he shut off all water going to the house just to be sure. When the husband returned to the Gainesville home a few days after that, and went inside, there was water everywhere, and mold was already starting to grow.

So they called their insurance company, and told them about the loss. The insurance company sent someone out to the property a few days later, and took a recorded statement of the homeowners. And within just a few more days after that, they received a letter from the insurance company…drum roll…denying the claim in its entirety. The letter explained in detail that the policy had an exclusionary clause which prohibited payment in the event of a water leak, but only if the home was vacant or unoccupied for 30 days, unless the property owner shut off the water and drained all plumbing lines of water (this is typical in the North where plumbing lines left unattended in the winter tend to freeze and rupture). In this case, the water was not turned off, as no sudden freezes were expected in the middle of summer in Florida.

When I spoke with the property owners, they explained the facts to me, just as they did to the ^st, which was just a few days prior to when the insured called the claim in, after going to the property and seeing all the damage. And since August 1^st is more than 30 days after the property was purchased on June 13^th, they quickly concluded that the property was vacant or unoccupied for more than 30 days. Case closed.

insurance company and their representatives. So, why the denial? The main reason is the insurance company set the date of loss as August 1

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But why August 1^st, and if that is not the correct date of loss, what is? The insured told me they called the insurance company on or about August 4^th to report the claim. I have no doubt they were asked at that time “when did the loss occur?”, as is standard practice. Naturally, the insured did not know when the loss occurred, since they were not living in the property at that time, so they would have answered with, “I don’t know when it happened.” Everyone could agree it did not happen on August 4^th, and that it must have been prior, so I can only imagine the insurance representative input August 1^st as the date of the loss, simply for convenience. (If they did it because they knew the policy well enough to know this date would likely result in a denial, that would make them evil). This practice of approximating the date of loss is not at all uncommon, but it often makes for confusion down the road. As it did here.

The fact is, the property owners received the letter from the utility company on about July 23, meaning it was mailed a few days earlier, and the letter stated the meter was read on July 19. This proves the loss must have occurred prior to July 19. And since the homeowner left the property on June 24, and there was no problem with the water at that time, the date of loss must be between June 24 and July 19. No matter how you slice it, the property could not be empty for more than 25 days. And even in Common Core math, 25 is less than 30. Will the carrier agree with my position? We’ll find out soon enough, but for now, the insurance company and their hired adjusting firm are both playing dumb.

Now to answer the original question, “why does this happen?” Initially, I believe it happens by a combination of coincidence and convenience. They are not sure of the date, so they simply guess. Or, they are not sure of the cause of the loss, so they simply guess. Sometimes they base it on the opinion of the insured, or a witness. The problem is, the date might be wrong, or the insured or witness might not understand the difference between “flood”, “back-up”, or “fill-up” – heck, some seasoned adjusters don’t know the difference. But once they are shown the difference, you would think they would make the correction in their record, and re-adjust the claim accordingly. Alas, I don’t find that happens in most cases, and if it does, it only happens much later. Instead, the carrier insists their initial decision (or “instinct”) was correct, and they will fight any other position fiercely.

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When I was in my early days of training as a company adjuster, I was showed a diagram that looked like a baseball field. I was told that for every single claim, regardless of type or size, you had to go around the 4 bases of the “claim diamond”. First base was Policy – there had to be a valid policy in force. Second base was Coverage – there had to be coverage for this type of claim. Third base was Exclusions – if there was an exclusion for this event, you could not proceed to Home Plate, which of course was Payment – paying the claim (paying the appropriate amount is a whole other story).

It just seems now adjusters are not taught this same diagram, where you run from point to point, 

around what looks like a square, never running in the same straight line. Instead, they appear to go straight to third base, looking for that exclusion, so they can stop all that running around. Maybe it’s laziness on the part of the carrier in conducting their training, or maybe it’s laziness in the newer adjusters, or maybe they all just want to save a few million dollars each year. Whatever it is, it is working pretty well for them, and all insurance consumers need to be aware.

In this article I presented a real-life case scenario, where a valid claim was erroneously – if not intentionally – declined despite facts which refute the denial. I also offered reasons why this happened in this particular case, as well as why it happens regularly throughout the industry. And the moral of the story is…Having a professional guide you through the claim minefield will help you make it to home!

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.   

Too Much of a Good thing?

by Mark Goldwich

Image courtesy of piff.net

If you have not heard about the “Assignment of Benefits” crisis currently going on in Florida and elsewhere, you are not alone. But just because you haven’t heard about it, or experienced it, doesn’t mean it’s not out there. Assignment of Benefits has been around a long time. Historically, these forms were used by doctors and other medical professionals so they could provide treatment and then seek reimbursement directly from the health insurance companies. Only recently have emergency restoration companies and other contractors begun to use these forms in a similar fashion. Most people have not heard about it, and will not hear about it, until “it” happens to them. Unfortunately, then it may be too late (for them). Fortunately, you are about to take a short course in “it”.

What is “it”? Well, that depends on which “it” you are talking about. The first “it” is the damage that happens when your property suffers a loss from fire, water, storm, or other insured event. When that happens, you usually have a restoration contractor come out to help clean up, dry out, or otherwise assist in getting your property back to normal.

The next “it” is the “standard” Assignment of Benefits form that the restoration contractor asks you to sign “before work can begin”. Now think about it, you just came home to find 3 inches of water throughout your home, all kinds of property was ruined, you scrambled to find an emergency restoration contractor who could come out right away, and they are handing you a form to sign before they begin to suck gallon after gallon of stinky water out of your carpet, walls, cabinets, and so on. Of course you are going to sign it, right? And yes, most people do. Especially when the contractor quickly explains how it is in your best interest, it is done all the time, it is nothing to worry about, and it allows them to go directly to the insurance company for payment instead of you, Darn right it sounds good!

Courtesy of flickr.com

So people sign it. And just to be clear, in many cases, that is last they will ever hear about it. I am not writing this for all those situations that happen to other people. I am writing this for you, so you know enough about the form, the process, and the pros and cons, so if you are ever faced with this situation, at least you will know enough to make an informed decision.

The fact is, for the most part (as far as I can tell), the Assignment of Benefits form is a good thing. It allows your contractor to deal with your insurance company for you, and to bill them directly, and to even sue the insurance company if they don’t pay the whole claim. Otherwise, they would have to bill you, or even take out a lien your property if you couldn’t pay, and then you would have to sue your own insurance company to get the money to pay your contractor. That’s a good thing, right?

Well, you know the old saying, “If something seems too good to be true, it probably is.” This old adage still applies today for a reason. As with many things in life, once word gets out about a “good thing”, it tends to attract a lot of attention, including the attention of profiteers .

So what could be bad about the Assignment of Benefits form? Naturally, that usually depends on the nature and character of the contractor asking you to sign it. The potential downside is if the contractor does a whole bunch of work that is not covered by your insurance (every insurance policy has more exclusions than you can shake a stick at), guess who will not be paying that bill? Hint: The insurance company. Guess who will wind up paying that bill? You (unless the contractor eats it, and the odds of that are slim). And while the Assignment of Benefits form allows the contractor to negotiate the claim (since the claim now belongs to the contractor, not the homeowner), not all contractors have the experience and expertise to effectively settle all these insurance claims. And insurance companies will suggest that contractors are getting the Assignment of Benefits, greatly inflating the claims, and if the insurance company balks at paying right away, the contractor simply hands the file over to an attorney who promptly sues the insurance company.  This creates legal fees that are eventually passed on to consumers in the form of higher premiums.

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How do insurance companies feel about Assignment of Benefits forms? Here is a quote directly from
www.securityfirstflorida.com): “If your home is damaged, your first thought may be to call a contractor before contacting your insurance company. This can be a costly mistake. There have been an increasing number of homeowners who have unknowingly signed contracts or forms that include Assignment of Benefits agreements. These forms are sometimes provided by contractors, often from damages that are caused during a storm, and must be read carefully. By signing documents with an Assignment of Benefits agreement, you may be allowing the contractor to collect your claim settlement funds directly from your insurance company. This has resulted in homeowners losing control of the claim process and it could mean having to pay amounts beyond what is covered in their policy. The contractor could place a lien on the home, and contractor liens in Florida can be enforced by foreclosure.”

the website of Security First Insurance (

Was that scary enough? Clearly, insurance companies do not like Assignment of Benefits at all. This alone might lead one to think these forms benefit the homeowner (despite the insurance company warning), but it may not be that simple, for the reasons stated above. Combine this with the fact that there are law firms traveling the state (possibly the country), presenting seminars to crowds of contractors, specifically on the use of Assignment of Benefits forms. Naturally, these are the same law firms that would sue the insurance companies on behalf of the contractors who use the Assignment of Benefits forms but fail to settle the insurance claims (whether inflated or not). These attorneys guide the contractors on the use of the forms, caution them on how to act within the law, and ultimately create a stream of lawsuits for the firm.

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What’s the answer? Know what the form is really about, so when you read it, you can have a basic understanding of what you are being asked to sign. Also try to get a feel for the contractor who is asking you to sign the form. They should be able to explain it to you. If they can’t, that is a bad sign. If they try to suggest it says something other than what is says (we have heard some say the form simply allows the contractor on the property, or allows them to communicate with the insurance company), that could be a worse sign. If they stress they know how claims work, and they will cover your deductible for you, or even get you some extra money…while it might sound good, it suggests they are willing to cut corners, or operate outside the law, and I would suggest you find someone else. But if they are open and honest, and you find them to be credible and ethical, and the form does not say anything that makes the hair on the back of your neck stand up, I would sign the form. But still watch what they do and make sure they are not overdoing things. 

One thing is for sure. The insurance companies are very hard at work figuring out ways to beat the Assignment of Benefits dilemma. Stay tuned for further developments, as this is not going away anytime soon. There is simply too much money at stake for all parties involved.

In this article I explained the basics of the Assignment of Benefits form as it is used in property insurance claims, gave some pros and cons, discussed the reasons it has gained attention and usage, as well as explored the potential for abuse. 

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.

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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.

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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.