What to Look for When Hiring a Public Adjuster During a Catastrophic Event

This article first appeared on Jansen/AI’s newsroom at: https://www.jansenai.com/newsroom/the-three-dimensional-approach-to-handling-insurance-claims

What is the biggest challenge in dealing with a catastrophe insurance claim? 

Coordinating and managing all aspects of the claim while the event is still happening. 

For the best property insurance claim outcome for the client, all decisions must point towards a complete recovery from the property loss.  

Public adjusters are often called to lead the charge in emergency situations because of their commitment to their clients to obtain the best possible overall recovery, allowing the insured to return to normal sooner. 

Public adjusters should be very knowledgeable about the processes that restoration companies, engineering firms, and accounting firms follow when called on to mitigate and document the extent of losses. This is especially true during a natural disaster or catastrophic event.

There are three critical things that a public adjuster must do to provide the insured with maximal recovery during emergency property damage and loss situations:

1. Look out for the best outcome for the client’s long-term interests, by asking:

• Is it better to spend funds on mitigation? Or is the loss so extensive that a complete rebuild is in order?
• Does the insured’s policy provide enough coverage to allow for both mitigation and a complete rebuild?
• How do the policy sub-limits affect the availability of funds to make both scenarios happen?  

At times, contractors may recommend short-term solutions that are not in the best long-term interests of the client. Many times, financial commitments must be made early in the process that can later lead to disagreements about the scope of the loss and what the insurer is willing to pay for.

2. Decide a proper scope on a coordinated plan of action while also getting all parties in line with the recovery strategy

In a “perfect claim world,” all experts would meet to plan out the whole scope-of-loss process and valuation of the claim. Ideally, those normally participating would include:

• Engineers/Architects 
• Mitigation and Restoration companies
• Municipal Building Codes officers
• Public adjusters
• Carrier’s adjusters

Unfortunately, we do not live in a perfect world. Orchestrating that scenario is something quite hard to achieve. 

[Familiarity in dealing with this complex process, one that involves a diverse group of experts, is a huge advantage for Jansen/Adjusters International’s public adjusters when handling large property loss claims. We work to come close to achieving the “perfect world” scenario early in the claim settlement process.]

Public adjusters should strive to coordinate the team and to build trust, so that each expert involved, including the remediation and/or restoration company, is willing to work toward the common goal of doing what’s needed to benefit the policyholder. 

When decisions need to be made for mitigation and restoration efforts, the opinions of the engineers and the remediation and restoration companies who are involved can have a significant impact on the policyholder’s claim.

The public adjuster and the insurance carrier’s adjuster must also agree to these early decisions because they act as the foundation for finding common ground as the claim moves ahead toward settlement.

As public adjusters advocating for clients, the goal is to provide professional direction to the claim assessment and settlement process to expedite the best possible long-term recovery.

3. Negotiate payment and keep the restoration moving toward completion.  

Most property losses are followed by the typical claim process, including agreeing on the scope of the damage, preparing the cost estimates and/or bids, and then reaching an agreement on costs.

Following the settlement of the claim are the usual permitting and rebuilding stages to complete the actual restoration.

These are processes that policyholders will be familiar with and expect.

But there are many other parts to the claim process that the policyholder does not see. These are the parts that are very necessary for the public adjuster to prepare, document, and settle the claim accurately and efficiently. These include: 

• Multiple interim negotiations with the multiple layers of adjusters and their experts on specific items of damage to reach a comprehensive scope of loss.
• Consideration of alternative mitigation and restoration scenarios that can significantly impact the estimates of loss.
• Providing logic for specific recovery alternatives that will be in the best interest of the client, and that the insurer will accept.
• Dealing with reinsurance or multiple layers of coverage issues.
• Engaging municipalities for building code interpretations.
• Determining if a mortgagee is expected to control the settlement funds following the settlement work to establish clear communication early in the process. 
• Requesting advance payment to ease the financial strain on the policyholder.

If your public adjuster approaches your situation with these three critical concepts in mind, positive outcomes will result when settling your claim. This is a system that I personally have been able to benefit from through well-honed adjusting experience and the relationships built over the years. 

When all parties involved in the policyholder’s property damage claim work together, it is the insured who benefits the most. 

After all — isn’t that what customer service is supposed to be about?

Luis R. Esteves is a Principal at Jansen/Adjusters International. He handles around $1 billion dollars in losses annually and has more than 20 years of experience with adjusting complex claims. You can find out more about him on the Jansenai.com website.