The Calm After the Storm

by Mark Goldwich

Image courtesy of commons.wikimedia.org

Everyone talks about the calm before the storm when what they really should be forcused on is the calm AFTER the storm.  In the wake of Hurricane Hermine last week, I wanted to talk about some storm insurance basics. First, a little about myself, just so you know I’m qualified to speak on the subject. I’m a Florida native, and have seen my share of tropical storms and hurricanes over the past 50 (or so) years. I have a Bachelor of Science degree in Insurance from the University of Florida, and my diploma is hanging on the wall behind me. I’ve been a licensed insurance adjuster in Florida since 1987. I spent 17 years with one of the country’s largest insurance companies, and personally handled or managed the handling of hundreds of thousands of claims, in many states across the country. In 2004, I decided to leave my job at the insurance company, start Gold Star Adjusters, and adjust claims for policyholders, not insurance companies. A few years later, after seeing too many terrible things happening to so many insurance claim victims, I wrote and self-published my first book, “UNCOVERED: What Really Happens After The Storm, Flood, Earthquake or Fire”.

So with that out of the way, here are some little-known facts about property insurance:

First, how do you think about your relationship to your insurance company?  How many of you think of yourselves as a “customer”? Do you want to know what you really are? – You are a financial and legal adversary. That’s right. Now, if you have an insurance agent, especially an independent insurance agent, you may feel like a customer to them, and to be honest, they probably feel the same way about you. But to the claims department of the insurance company, as soon as you file that insurance claim, you are asking the insurance company to share their profits with you. To get an idea of how well that goes over with them, think about asking Microsoft to share profits with you the next time you buy a computer. Good luck.

Image courtesy of flickr.com

Did you know that although insurance is generally marketed as a “product”, your insurance policy is actually a legal contract? The insurance company writes the contract, and when you buy the insurance, you are accepting the contract. Did you also know that while you can’t negotiate how the contract is written, you can negotiate the settlement of a claim? The catch is, even if you knew you could negotiate the settlement, who do you suppose knows more about insurance? - the insurance company, or you, the policyholder?

Not only can you negotiate an insurance claim, but did you know you can re-negotiate a claim after it has been paid (or denied), or that you can re-open a claim years after it has been closed, or even after it has been denied? You can. In Florida, you have 5 years to pursue your claim...except after a windstorm or hurricane like Hermine. You see, while you weren’t looking, your insurance company, their lobbyists, and your state representatives quietly changed that a few years back. Now you only have 3 years to pursue your hurricane claim. Two years, gone, just like that. But again, even if you know this, how well are you going to do against the insurance company’s experts?  

Did you know that just because your insurance company sends an official letter, complete with policy language or other legalese, stating your claim has been closed or denied, that doesn’t make it so?  We get many of these denied claims paid every year.

Get a free copy of my book.

OK, now that you’ve learned a little more about the insurance industry than you probably wanted to know, let’s talk a little about how you can make the best of it, should you ever need to file an insurance claim (a lot of this comes from a section in my book, UNCOVERED, detailing my “10 commandments of claims”):

Know your insurance policy. Meet with your agent and have them explain it to you, and make sure you have the proper coverages, endorsements, limits, and deductibles, based on your individual needs.

Fill out the form below for your free copy.

Flood is not covered by homeowner’s insurance, so consider buying a flood policy.  

Just because you’re not in a designated flood zone, doesn’t mean you won’t get flooded. Flood zone maps are created and updated by the federal government. If you trust their accuracy now, you may be one of 1000s filing for government assistance later. Think about it, we (especially in Florida) are surrounded by water. I don’t care what the flood map says, if you live in Florida, you stand a real chance of flooding.

Take photos or video of your property and valuable possessions, and store important documents where they can’t be damaged (the cloud, family, safe deposit box, etc.). These photos and videos could prove to be invaluable when it comes time to documenting your loss.

Don’t try to pull one over on your insurance company – be thorough, but honest. Many of their best adjusters work in their “fraud” units. It would be nice if their best and brightest adjusters were the ones paying claims, instead of being the ones denying claims, but that’s another story, and a testament to the priorities of the insurance companies. Inflating a claim is just not worth risking a felony conviction.

Take notes of everything that’s damaged and keep a detailed log of all conversations with your insurance company, your contractor, and everyone else.  Show the adjuster all the damage and be as thorough as possible.  If the adjuster doesn’t want to spend to time to review it all, make a note in your log, and have them (or someone else) come back when they have more time.  Review the adjuster’s estimate in detail, until you understand it completely. Request a licensed contractor or other professional review the insurance company estimate and provide an independent quote.

If the insurance company refuses to pay for anything at all, demand they explain why – in writing. Even if they explain why in writing, get a second opinion. I can’t tell you the number of times we have gotten claims fully paid after the insurance company initially denied the claims, in writing, including the exact policy language they relied upon to deny the claim to begin with. My motto is, “the claim is covered until I say it is not”.

Be persistent and don’t give up. Appeal up the chain of command. Too many policyholders give up too easily, and as a result, I am convinced they leave many tens (if not hundreds) of millions of dollars in the insurance companies’ bank accounts every year.

And, lastly, seek professional assistance when needed. Whether from a public adjuster, attorney, contractor, engineer, politician, consumer reporter, or anyone else you think can help.          

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 Calm After the Storm

by Mark Goldwich

Image courtesy of commons.wikimedia.org

Everyone talks about the calm before the storm when what they really should be forcused on is the calm AFTER the storm.  In the wake of Hurricane Hermine last week, I wanted to talk about some storm insurance basics. First, a little about myself, just so you know I’m qualified to speak on the subject. I’m a Florida native, and have seen my share of tropical storms and hurricanes over the past 50 (or so) years. I have a Bachelor of Science degree in Insurance from the University of Florida, and my diploma is hanging on the wall behind me. I’ve been a licensed insurance adjuster in Florida since 1987. I spent 17 years with one of the country’s largest insurance companies, and personally handled or managed the handling of hundreds of thousands of claims, in many states across the country. In 2004, I decided to leave my job at the insurance company, start Gold Star Adjusters, and adjust claims for policyholders, not insurance companies. A few years later, after seeing too many terrible things happening to so many insurance claim victims, I wrote and self-published my first book, “UNCOVERED: What Really Happens After The Storm, Flood, Earthquake or Fire”.

So with that out of the way, here are some little-known facts about property insurance:

First, how do you think about your relationship to your insurance company?  How many of you think of yourselves as a “customer”? Do you want to know what you really are? – You are a financial and legal adversary. That’s right. Now, if you have an insurance agent, especially and independent insurance agent, you may feel like a customer to them, and to be honest, they probably feel the same way about you. But to the claims department of the insurance company, as soon as you file that insurance claim, you are asking the insurance company to share their profits with you. To get an idea of how well that goes over with them, think about asking Microsoft to share profits with you the next time you buy a computer. Good luck.

Image courtesy of flickr.com

Did you know that although insurance is generally marketed as a “product”, your insurance policy is actually a legal contract? The insurance company writes the contract, and when you buy the insurance, you are accepting the contract. Did you also know that while you can’t negotiate how the contract is written, you can negotiate the settlement of a claim? The catch is, even if you knew you could negotiate the settlement, who do you suppose knows more about insurance? - the insurance company, or you, the policyholder?

Not only can you negotiate an insurance claim, but did you know you can re-negotiate a claim after it has been paid (or denied), or that you can re-open a claim years after it has been closed, or even after it has been denied?  You can. In Florida, you have 5 years to pursue your claim (except after a windstorm or hurricane like Hermine). But again, even if you know this, how well are you going to do against the insurance company’s experts?   You see, while you weren’t looking, your insurance company, their lobbyists, and your state representatives changed that a few years back. Now you only have 3 years to pursue your hurricane claim. Two years, gone, just like that.

Did you know that just because your insurance company sends an official letter, complete with policy language or other legalese, stating your claim has been closed or denied, that doesn’t make it so?  We get many of these denied claims paid every year.

Get a free copy of my book.

OK, now that you’ve learned a little more about the insurance industry than you probably wanted to know, let’s talk a little about how you can make the best of it, should you ever need to file an insurance claim (a lot of this comes from a section in my book, UNCOVERED, detailing my “10 commandments of claims”):

Know your insurance policy. Meet with your agent and have them explain it to you, and make sure you have the proper coverages, endorsements, limits, and deductibles, based on your individual needs.

Fill out the form below for your free copy.

Flood is not covered by homeowner’s insurance, so consider buying a flood policy.  

Just because you’re not in a designated flood zone, doesn’t mean you won’t get flooded. Flood zone maps are created and updated by the federal government. If you trust their accuracy now, you may be one of 1000s filing for government assistance later. Think about it, we (especially in Florida) are surrounded by water. I don’t care what the flood map says, if you live in Florida, you stand a real chance of flooding.

Take photos or video of your property and valuable possessions, and store important documents where they can’t be damaged (the cloud, family, safe deposit box, etc.). These photos and videos could prove to be invaluable when it comes time to documenting your loss.

Don’t try to pull one over on your insurance company – be thorough, but honest. Many of their best adjusters work in their “fraud” units. It would be nice if their best and brightest adjusters were the ones paying claims, instead of being the ones denying claims, but that’s another story, and a testament to the priorities of the insurance companies. Inflating a claim is just not worth risking a felony conviction.

Take notes of everything that’s damaged and keep a detailed log of all conversations with your insurance company, your contractor, and everyone else.  Show the adjuster all the damage and be as thorough as possible.  If the adjuster doesn’t want to spend to time to review it all, make a note in your log, and have them (or someone else) come back when they have more time.  Review the adjuster’s estimate in detail, until you understand it completely. Request a licensed contractor or other professional review the insurance company estimate and provide an independent quote.

If the insurance company refuses to pay for anything at all, demand they explain why – in writing. Even if they explain why in writing, get a second opinion. I can’t tell you the number of times we have gotten claims fully paid after the insurance company initially denied the claims, in writing, including the exact policy language they relied upon to deny the claim to begin with. My motto is, “the claim is covered until I say it is not”.

Be persistent and don’t give up. Appeal up the chain of command. Too many policyholders give up too easily, and as a result, I am convinced they leave many tens (if not hundreds) of millions of dollars in the insurance companies’ bank accounts every year.

And, lastly, seek professional assistance when needed. Whether from a public adjuster, attorney, contractor, engineer, politician, consumer reporter, or anyone else you think can help.          

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.                

When the World Comes Tumbling Down

by Mark Goldwich

Image courtesy of en.wikipedia.org

By now most everyone has seen the terrible images from central Italy, where a magnitude-6.2 earthquake struck in the middle of the night earlier this week. Small towns substantially damaged, hundreds of casualties, and many more wounded. While there have been some dramatic rescues, including a girl about 8 years old that was pulled out of rubble the day after the quake, at least 250 lives were lost. Compounding matters were the fact that the earthquake struck at night when most people were inside and sleeping, in buildings that were not specifically built to withstand this type of stress. Add to this the fact that at least one of the areas was busy with tourists, and this makes it difficult to accurately know how many people are still missing.

Image courtesy of commons.wilimedia.org

It is scenes like these that should cause people to take account, not only of all that they have, but of all that could be lost, from loved ones, to property, belongings, pets, if a sudden disaster were to strike without warning. It seems so distant when it comes to us via cable news from half way arount tha world, but events like this happen all too often. Right now there are wildfires burning out of control in California, incinerating homes and leaving virtually nothing behind.  There are floods devastating entire neighborhoods, and storms brewing in the Atlantic. All of these have, can, or will bring heartbreak and loss to hundreds or even thousands of people.  Yet there is only so much that can be done about it (and even less to prevent it).

In Italy, it is still very early on in the aftermath of the earthquake. I am sure there will be much discussion (and finger pointing) revolving around the construction methods, design, and engineering of the buildings that were destroyed. Hopefully, they can move past that point and quickly develop consensus on how these buildings will be repaired or replaced. Improved construction materials, methods, design, permitting and inspections can greatly impact the ability of structures to withstand whatever nature has in store.

Image courtesy of en.wikipedia.org

No matter the type of disaster, there are things that can be done to increase your chances for survival. For example, you can carefully research and choose where you live. In insurance terms, this is called risk avoidance. Terrified of tremors? Don’t live on or near a fault. Have a fear of fires? Avoid wildfire-prone areas. Scared of cyclones? Don’t reside in areas known as “tornado alley”. Frightened of floods? Pick a home on elevated grounds and far from large bodies of water. Harried by hurricanes? Move far inland, but hopefully not near a fault line, tinder-dry canyon, low-lying riverbank, or tornado area.

Let’s face it, no matter we live, we face some risk of widespread damage by a catastrophic event. The next consideration is to accept the possibility of loss, but to take steps to reduce the potential impact on your way of life. The applicable insurance term for this is risk transfer. Typically, this involves buying the appropriate insurance, and thereby transferring the financial risk from you, to the insurance company.

Impace windows courtesy of HomeRute

Along the way, you can do other things, like being sure your home is built to withstand various calamities as best as you are able. If you live in areas prone to storms, spend a few extra dollars to have wind resistant windows installed.  If in a low-lying area, homes on raised pilings are a plus. And of course, homes built to withstand earthquakes would be preferred if you live in areas that periodically experience earth tremors.

And finally, you need to take steps to minimize loss of life. Besides the steps mentioned above, this would include anything from living in areas known for early warning systems, well planned escape routes, and responsible civil authorities, to developing your own plans for escape (which should certainly include heeding evacuation calls), communication, regrouping, and subsistence, as well as having a well built and well stocked basement or storm shelter. Plans for all types of disasters abound freely on the internet, so it would be senseless not to take advantage.

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Nobody can guarantee a life free of natural catastrophes, but there are plenty of things you can do to reduce the likelihood, degree of impact, and overall consequences, no matter what Mother Nature has in store for you. Please keep our friends in Italy, and in Louisiana, and Colorado, in your thoughts and prayers and be proactive before the world comes tumbling down around you. 

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. 

Your Vacation Checklist

by Mark Goldwich

Image courtesy of pixabay.com

Summer break is nearly over, but vacations happen year round, so it is never too late (or too early) to learn a thing or two that could really come in handy should disaster strike while you are away, from the perspective of an insurance claims professional.

First, be sure you have insurance to begin with, and that it is the right insurance for you and your property, with the right coverages, endorsements, and deductible. Whether you are going on vacation or not, you should meet with your insurance agent yearly, or you should review your policy carefully if you don’t have an agent. Why? As you might imagine, insurance policies differ from company to company, and each insurance company may also have policies that differ. Some policies are actual cash value only, meaning they will deduct for depreciation in the event of a loss, while other policies are replacement cost value, meaning they will not deduct for depreciation, but fully pay whatever it costs to replace what you had that was damaged, lost,  or destroyed. Even this is not consistent, in that some policies say they are replacement cost, but will only pay the full replacement value if you replace the item, and they will not pay actual cash value until or unless you actually replace the property first.

Image courtesy of pexels.com

Another consideration that needs to be made when researching insurance options is what I call “internal limits”. Most people understand their policies have overall policy limits for which their property is covered, like a limit for all items related to the structure, and another limit for all of their personal belongings.  However, some don’t realize there are usually internal or sub-limits for items, usually for personal property. For example, all your personal property may be insured for $50,000, but your policy may have multiple sub-limits for items like jewelry, cash, antiques, camera equipment, business property, stamps, firearms, silverware and goldware, watercraft, trailers, expensive rugs or tapestries, and even computers. Sometimes these limits apply only if the property is damaged under certain circumstances (like theft), and sometimes these limits apply regardless of what caused the damage.

In short, it’s important to have an idea of what these limits and circumstances are, and whether or not you can buy additional insurance to cover your property. Oftentimes you can, but unless you know what the limits are, how can you know whether you need to buy more insurance or a better policy? Early in my career as an insurance company adjuster, an associate and I inspected a claim for a theft loss that highlights this well. As we interviewed the homeowner, he explained that while he was out of town, thieves broke into his home and stole a number of items, including jewelry, cash, and designer clothing from his wife’s boutique. Other items were stolen and damaged as well, but the items listed above were all subject to relatively low internal limits.

The cash limit was $200, the jewelry limit was $2,500, and the limit for clothing used in his wife’s

Image courtesy of pixabay.com

business was $1,000. Normally, this wouldn’t be so dramatic, but in this case, the amounts he was claiming were extraordinarily high. You see, he was claiming the amount of cash stolen exceeded $200,000, the amount of jewelry exceeded $100,000, and the clothing exceeded $50,000 in value. We were shocked, he could probably sense in our questions that we doubted his story, but he assured us he could document and prove all the items and quantities being claimed. He even noted the money was still in the U.S. Marshall’s bags from when the money was recently returned to him. A strange claim, indeed! And to say he was upset about the shortcomings of his policy sub-limits would be an understatement – I was glad to make it back to the office alive! No doubt most people will never experience a loss of this magnitude, but it well illustrates the point of internal policy sub-limits, and the importance of being familiar with those in your policies.

And for similar reasons, it is crucial to have at least a basic understanding of all other aspects of the policy. Without this basic knowledge, it is impossible to know whether or not you have the right policy and endorsements for your needs. Once you are confident of your policy, you can be a bit more at ease when you leave for vacation.

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But just having the right policy is not enough. You need to have a plan as well. This can include how to prepare your home to make it less attractive to thieves, to be less susceptible to electrical and plumbing losses, and general life and home protection ideas, including a contact list to use in the event of some disaster, and a step by step strategy for beginning to deal with the claim remotely. I actually found some very good ideas and tips on insurance websites for www.Nationwide.com and www.Travelers.com (hey, just because I don’t trust those guys to help you after a loss doesn’t mean I won’t recognize any of their good works).

With a comfortable knowledge of your policy, a plan in place, and your home prepared, it’s time to pack your bags and enjoy your trip!

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. 

Public Adjusting Takes a Vacation

by Mark Goldwich

Image courtesy of flickr.com

Like many other Americans, this week the family and I are on our last vacation of the summer.  Vacation is a bit different for me as a business owner versus my decades as an employee for a large national insurance company. Back when I worked as an employee of the insurance company, I could just go. My job and the office would be there when I returned, but I didn’t have to worry about work while I was away on vacation. Now when I go on vacation, I have to be sure to take my phone and laptop (and chargers) with me, both of which allow me to communicate in various ways with coworkers, insureds, and others. With the systems we use, I can work virtually from anywhere, as long as I can connect to a network, or get Wi-Fi, without missing a beat.

In fact, just yesterday, as I was completing the last driving leg of our trip to Williamsburg, Virginia, I got a call from an adjuster I was expecting to hear from the day before, and in just less than 10 minutes at highway speeds, we were able to settle the claim. My insured, Ms. “P”, will be very happy. Ms. “P” suffered a water leak in April when the shower valve in her daughter’s bathroom sprang a leak in the wall cavity between the bathroom and the laundry room. They immediately shut off the water and called a plumber, who located and repaired the source of the leak. She then called a contractor who extracted the water and dried the structure. In the meantime, Ms. “P” got a closet-full of shoes out of her daughter’s room, and began drying and cleaning them. A few days later, the insurance adjuster showed up, and Ms. “P” said she could tell it was not going to go well from the start. The adjuster began by saying he needed photos of odd things, like the mailbox, and the exterior of the home (none of which had any damage or were related to the claim in any way). The adjuster suggested the water was leaking for “quite some time” and questioned the insured’s truthfulness regarding certain aspects of the claim.

Image courtesy of flickr.com

Sure enough, about a week later, the insured was officially told her claim would be denied because the insurance company felt the water leak was an ongoing maintenance issue that occurred for weeks or months, and not just hours or days as the insured had claimed. Fortunately for Ms. “P”, her water restoration contractor told her about me, and one month after the leak was discovered, she hired me to help recover on the claim. As soon as I saw the damages, exactly as the insurance company adjuster saw them, I knew with certainty the loss should have been covered. I took my photos, made some notes, and had an estimate prepared. The estimate was sent in to the insurance company with a request to meet with an adjuster (either the same one, or a new one). They sent a new one, about a month later. When we met back at the house, the adjuster acknowledged he was not familiar with the claim, or why it was not covered, but assured us he would consider it with “fresh eyes”. I remained sure the claim would be paid. Ms. “P” was encouraged, but not yet convinced. Until today, when I communicated (via email from 3 states away), the general terms of the agreement the adjuster and I came to in the car yesterday. He confirmed they agreed to fully cover the claim, and even agreed to the vast majority of my estimate, plus something to compensate the insured for saving and cleaning her daughter’s shoes.

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While on vacation, the TVs where we are staying are programmed to have the weather channel appear when the TVs are turned on. For most guests, I imagine this is so the visiting tourists can check the weather and plan their days. Of course, for me, I get to see where the storms are, and remain in “work-mode”. Today, for example, I see Tropical Storm Earl is heading for Mexico’s Yucatan Peninsula, and that Maryland is recovering from recent heavy flooding. So, while my family is at a local theme park, I am taking the day off from vacationing to catch up on some emails and write this blog. Tomorrow, though, it is back to family vacation fun, I promise – but I may need to take a work call or two, and check email and text every few hours. And I wouldn’t have it any other way. I love that I can help people any day of the week, no matter where I am!

 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. 

What Are They Up to Now?

by Mark Goldwich

With a title like, “What are they up to now?”, you might think I’m writing about my kids, the presidential candidates, politicians in general, or some other high-profile group. What I’m talking about in today's blog are Insurance Companies. You see, earlier this week I attended a two-day conference presented by the Florida Association of Public Insurance Adjusters. The conference is billed as an educational and networking event designed to improve our skill sets, become better at what we do, and network with other industry professionals.

Image courtesy of Pixabay.com

One of the main takeaways from the conference was learning about significant trends in insurance industry tactics and strategies. These strategies are usually marketed as “consumer protections”, which also just happen to help insurance companies stuff billions more into their collective coffers. A happy coincidence, I’m sure (that’s sarcasm, for those of you who are unfamiliar with my writing style). Those of us whose job it is to protect the insured from their own insurance companies, see these tactics and strategies for what they really are, profit boosters.

Rather than bore everyone with all of the topics discussed, I’m going to focus on one key strategy, “Repair Cost Control”, which I will separate into two popular methods, “Managed Repair” and “Our Option”.

The idea behind “Repair Cost Control” is fairly straightforward – if the insurance companies can exert greater control over the repair process, repair costs will decrease, and profits will increase. They will naturally argue that reduced costs and increased profits translate into lower premiums, but just ask yourself when was the last time your insurance premiums were significantly reduced, despite the fact that your coverages were significantly reduced? Answer: You’re kidding me, right?

To gain even greater control over repair costs, as if having professional adjusters, estimating programs created with insurance industry input, and a host of repair professionals and attorneys at their disposal was not enough, the insurance companies have come up with “Managed Repair” (sometimes referred to as “Managed Care” to make it sound more benevolent), and “Our Option” (which could more accurately be renamed as, “Butt out, this claim is none of your business!”).

Under the “Managed Repair” process, the insurance company “guides” insurance victims to hire contractors who are “preferred vendors” that have special relationships with the insurance company,

Image courtesy of commons.wikimedia.org

rather than contractors of the property owner’s choosing. You can imagine how lucrative it could be for a contractor to enjoy such favored status. A large insurance company could provide so much work that the contractor could all but eliminate their marketing budget, which previously could have been tens of thousands of dollars each and every month. Gone! That doesn’t sound so bad, especially for the contractor and the insurance company. But think about it – the contractor gets the claim job “gifted” to them from the insurance company, and gets direction from the insurance company's adjuster.  This includes coverages, limits, and exclusions, which are all outside the scope of the contractor’s job, both realistically and legally, and the contractor gets included on claim payments, rather than getting paid by the insured property owner. Is it any wonder these contractors tend to forget they are working for the property owner, and tend to feel they are really working for the insurance company?

And what happens when the work done by a “Managed Repair” contractor is good enough for the insurance company, but not satisfactory to the property owner? “No problem,” the insurance company says, “you signed a contract with the contractor, so it is your responsibility to deal with them.” Nice!

And what of this “Our Option” mentioned as an alternative to “Managed Repair”. In my opinion, it’s even worse. Most property insurance policies have an “Our Option” clause that basically says, “we may elect to repair or replace the damaged property with a contractor of our choice.” Most insurance companies interpret that to mean that they can buy contractors, or enter agreements with contractors, so that if the insurance company agrees a loss is covered, they pay the contractor directly for the repairs, and the insured has no voice in the repair of their own property (usually, their home).

Think about that. The insurance company can literally own the construction company, or employ the contractors, and if the insurance company agrees to pay the claim, they pay themselves, instead of paying you. Talk about keeping it in the family! If someone can explain how that is not a clear conflict of interest, well, you’d be the first person to explain that. But, so far as we can tell, no state agency has even thought to ask that question, let alone demand an answer to it.

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So, what’s a property owner to do in light of these trending strategies that remove you from the process while growing insurance company profits? First, you need to know that these strategies exist, and how they work. Done! Next, you need to decide whether you want to believe the insurance company is doing this in your best interests and go along with the plan, or if you want to maintain control over who repairs your property, how they repair it, and with what workers and materials. If the latter, you need to know your rights, and be willing to fight for your rights (otherwise, you will probably lose those rights).

I hope I was able to bring to light, in an easily understandable way, a couple strategies trending with insurance companies that we as insurance consumer advocates recognize are detrimental to property owners, and primarily serve to benefit insurance companies. Feel free to research the topics on your own, and learn how to protect yourself.

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.

All is Right With the World of Claims

by Mark Goldwich

Recently I wrote posts about two claims I was handling. They were similar in that both cases

Image courtesy of commons.wkimedia.org

involved strict denials, meaning that the insurance companies were saying the claims were not covered at all, in any way, for any amount, and they had very specific reasons, using verbiage selected from the insurance policies, detailing why the claims weren’t covered. They were also similar in that from my very first consultation with the insured, I could understand exactly why the insurance company would reach the conclusion they did, yet I did not agree with the insurance company in either case. Additionally, they were different in that the two claims were the result of completely different causes of loss, and the two claims were denied for completely different reasons.

In one case, the insureds suffered damage from a pipe breaking inside a home they recently purchased, but before they actually moved into the home. The insurance company could not see a way to otherwise deny the claim, until the insured mentioned they had not moved into the home, and it had been over a month between the date the home was insured, and the date the claim was reported. You see, there was some obscure (to most people, but not to the insurance company) language in the policy that said there would be no coverage for water damage if the home was vacant or unoccupied for over 30 days (heads up for anyone that has any home, rental property, business, or other property).

image courtesy of en.wikipedia.org

To most people, hearing the bit about there being a month between buying the home and reporting the claim would have been meaningless. After all, what is a month in the scheme of home ownership? And besides, it’s not really that uncommon to purchase a home, but not move in right away because you haven’t sold your prior home yet, and sometimes the new home is not “move-in ready”. That’s how most people think, anyway. But to most insurance adjusters, the mere mention of that month is like waving a red cape in front of a bull. It triggers some pleasure receptor in their brain, instantly bringing them back to a day in claim training when an instructor said something about a policy exclusion for losses to properties vacant or unoccupied for at least 30 days. They are suddenly curious, but only inasmuch as the answers continue to trigger those pleasure receptors.

So once the adjuster’s “investigation” confirmed the sale date of the new property, the fact that they did not move into the new property right away, and the approximate date of loss being beyond 30 days from the sale date, they had all they needed to keep those receptors firing in their brain, and their sense of curiosity quickly fades away. Their work is done. They can close that file with a form denial letter, and move to the next claim in a tall stack of claims.

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Until, that is, until they get my letter, explaining that they overlooked a key piece of information in

their “investigation.” What they missed was the fact that the insureds did not just purchase the home and not move in, the husband stayed in the home after the purchase for a few weeks to work on it and prepare to move in, while the wife returned to the prior home to prepare it to move out. With just those few weeks taken into account, the time the home was unoccupied was reduced to about 3 weeks. Initially, the carrier simply replied that they were standing by their decision to deny the claim.

After another letter explaining their error, they re-opened their investigation, and requested proof of when the loss actually occurred. Fortunately, this loss was discovered by the local utility company at the new home when they went out to read the meter, so we knew the leak occurred on or before the date the meter was read. Once we got that information in writing from the utility company to the carrier, they agreed to pay the claim, which totaled over $35,000.

In the other case, extremely heavy rains caused water to enter the insureds’ home as they slept, by filling up a unique atrium room within the home. The water could not escape the holes built into the exterior wall of the atrium fast enough, and the water rose until it was able to pass under the French doors leading from the family room to the atrium.

In this case, multiple triggers starting firing on those receptors. Words and phrases like, “flood”, “surface water”, “subsurface water”, “rising water”, “design defect” and “no opening created” overwhelmed their pleasure receptors and once again, true curiosity failed to take root. This one was easy, they no doubt thought, it’s simply not covered. The form letter went out, and the claim was closed.

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Again, that is, until the insurance company got my letter explaining they had misinterpreted their own insurance policy, whether as an innocent mistake, or something more nefarious. As the coverage question in this case was more complicated, it took more letters, and phone calls, and a demand the matter be mediated via a State mediation program, and frank discussions about attorneys getting involved and how other similar cases were ultimately ruled on by various courts – but we eventually settled this case as well. While the dollar amount on this claim was less than the other, I was happier about this resolution because the coverage issue was more contested. It took more research, and more negotiation efforts, but I felt strongly that we were right, and they were wrong. Now, the settlement agreement will say the insurance company does not admit they were wrong… but I know.

Being passionate about what I do for a living makes it worthwhile, even when things don’t always go my way. Fortunately, that doesn’t happen often. But when the stars align and multiple cases go our way, as they usually do, it feels even better! For now, all is right with the world (of claims).

 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.