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SeizeOWisdom
25 Posts |
 Posted - 11/14/2003 : 06:57:02
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After contemplating Roy's suggestion that a new thread be started for this topic, it seems to me that newer adjusters might well benefit from a greater understanding of the process of file reviews, files reopening, how reopens are handled and why, and what effect reopened or unclosed files has on an adjuster's holdback or pay.
It further seems to me, that this thread can be of benefit if the many adjusters who have worked clean up can share some of the mistakes and faults which they commonly see (generally over and over) in problem files here for discussion and the education of our newer adjusters.
It would appear that perhaps this topic could be examined from at least four perspectives:
(1) The file review process by the vendor prior to submitting a file to the carrier.
(2) The file review process by the carrier
(3) Mistakes commonly seen in reopened problem files
(4) How to avoid the simple mistakes that cost adjusters their holdbacks
As I am still handling clean up for Hurricane Isabel, I will post later my observations in greater detail as they relate to items (3) and (4) above, and invite others to share their thoughts and experiences as well. |
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TomWeems
USA
24 Posts |
Posted - 12/14/2003 : 09:02:31
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| I would like to address items 3 & 4 as I am currently working cleanup behind a group of about 40 adjusters in NC. I would say that 90% of my reinspections could have been eleminated if the adjusters had taken pictures of all of the roof, not just the area that was damaged. What typically occurs is I get a message from the CSR saying that the adjuster did not measure the roof correctly as the roofer had 25 squares and the adjuster only paid for 12. Well I look at the file photos, and no pictures of the undamaged area, so I have to drive back out there and take the pictures and make my report. Now I'm not complaining mind you, because work is scarce and even working cleanup is better than going home and watching the car rust. But it would seem if you don't want my feasting off your holdback, take pictures and accurate measurements of the entire roof! Also, if the insured has an HO2, take a minute and explain why you are not paying the interior damage if they don't have damage to the roof. Otherwise, I will just have to go back out, reinspect the roof, and write letters to the insured. Reinspections in NC are mostly far apart, which causes a lot of windshield time. That extra expense is taken out of the holdbacks to feed me. Clean up adjusters try and handle this stuff on the phone if possible, as the expense of driving can easily exceed the amount paid on a particular file. Slow down a little, and take the few extra minutes it takes to do the job right. Then I won't be feasting at your expense. |
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Tom Toll
USA
154 Posts |
Posted - 12/14/2003 : 19:27:18
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Tom Weems is absolutely correct in his summation of clean up. I have also seen the problem, in that estimates were incomplete, photos were not there to back up what had been written. Of course you cannot photograph every little damaged nook and cranny, but you should provide enough photos for the examiner to make an educated analysis of your estimate. I am getting the notion that adjuster's are not taking sufficient time scoping and photographing. It is to any adjuster's advantage to take the time to scope correctly so that the file is unquestionable and thorough. When another adjuster has to go behind you on a re-inspection, and you have not scoped it right, you deserve to lose your money on the file.[8]
If it is damage that was not visible at the time of inspection, that is a supplement and should not be chargable to the adjuster. Of course, thats where an honest vendor comes into play. If you feel that an item may be damaged and is invisible to the eye, make a note of it on your estimating system.
Everyone has their own methodology for scoping, so fine tune it and stick with that methodology. Be thorough and careful then your files, in all likelyhood, will not re-open.[:D] |
Edited by - Tom Toll on 12/14/2003 19:30:35 |
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pilot48
USA
78 Posts |
Posted - 12/14/2003 : 20:15:33
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If the adjuster first assigned the loss did their best based on what was submitted, then they should be paid for the work they did. If the "clean up" adjuster, which we all know what this is, found other damage, then the the company should pay that additonal damage, and the vendor should bill a supplemental accordingly, but to punish the original adjuster for what is a negotiated sum or whatever should not effect the good faith efforts of the first adjuster who was working in good faith based on the initial information he/she had.
We all miss stuff, that goes with the nature of the beast, but to be finacially punished when the vendor has the right to bill for extra damages discovered, is fraud and unfair.
For any adjuster who didn't make it as the real adjuster, and was asked to remain on to do clean up as a favor to an old and doddering claims person to speak out as if they had all the answers, when they themselves were short of being fired due to being not responsible for their initial duties is a shame to this site.
Let the real people who worked hard and did a job in good faith speak here, and no one else!
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Russ
USA
75 Posts |
Posted - 12/15/2003 : 09:20:22
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I worked cleanup in the Outer banks, and while most of my re-opens were price oriented, I agree with both Toms that when you do a roof claim, a risk photo front and rear and a roof overview photo are necessary if for any reason the file reopens. It helps in dealing with the insured over the phone which would save a reinspection.
I also had a few strange flood files that were rated wrong. Some of the Original Adjusters did not read the loss notice. We had Grand Fathered "C" zones (on the beach at Kitty Hawk), AO zones which are not considered special flood hazard zones, and Elevation Certificates that covered many Owners Closets, that should not have been covered. |
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danmeler
25 Posts |
Posted - 12/17/2003 : 11:41:07
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| Wow! This thread really hit a nerve with at least one poster. I agree with both views...that a vendor should be VERY slow to charge back every little reinspection to the original adjuster. Most of us are not perfect and something could be found wrong with most files if examined closely enough on site. On the other hand, I was asked to re-work some Isabel claims behind a couple of supposedly experienced adjusters and the files were as poorly done as you could ever imagine....so it goes both ways. Many years ago I found that Crawford routinely kept adjuster holdbacks, offering no accounting explainations. I lost a lot of money that way and so did many others I knew at the time. I eventually quit accepting assignments from them. I've heard that has mostly stopped now. Most vendors are good about holdbacks. I worked 4 storms for E.A. Renfroe this year and received 100% of my hold back on every claim. I can't beleive some of my files didn't reopen for one reason or another and I'm grateful Renfroe is a company with strong integrity. |
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MRichardson1952
USA
24 Posts |
Posted - 12/17/2003 : 18:14:51
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| What would the general thought be should a file being re-inspected, nothing done to modify the original adjustment, but the initial adjuster charged back with the expense of the re-inspection? |
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C Bond
32 Posts |
Posted - 12/17/2003 : 19:50:58
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| If the claim is paid based on the original adjustment, and the reinspect was no fault on the part of the initial adjuster, his holdback should be released. Adjusters should not be penalized simply because the insured does not understand their coverage or disagrees with the settlement and wants a second oppinion. |
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jlombardo
USA
212 Posts |
Posted - 12/17/2003 : 20:27:37
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| I'm with you C Bond........ |
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Wes
USA
62 Posts |
Posted - 12/17/2003 : 21:27:22
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| What does the second adjuster get paid in the above situation for his time if he shouldn't collect the hold back as pay? |
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JimF
USA
1014 Posts |
Posted - 12/17/2003 : 21:34:47
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Mileage, photos, phone calls/fax charges and T&E for the additional time for the reinspection and a 'second' report is 'generally' the practice under the scenario you depicted.
I do disagree however, with the scenario wherein the insured does not understand coverage because the initial adjuster did not take the time to explain it to the insured, and in such instance, all or a portion of the fee billed for the file should be forfeited for a reinspection, for failure to properly complete the claims process. |
Edited by - JimF on 12/17/2003 21:41:31 |
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KileAnderson
USA
875 Posts |
Posted - 12/17/2003 : 21:41:51
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| Jim, you know as well as I do that some people, no matter how you explain something to them, will not be happy with the explanation if the outcome is not to their expectations. Also, how many times have you explained the same thing to an insured 5 different ways and they keep asking you the same question. I'm glad I've never had to work for a company that uses the holdback practice and I don't believe I ever will. It sounds like a big scam to me. |
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JimF
USA
1014 Posts |
Posted - 12/17/2003 : 21:51:51
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Kile, first of all, you are indeed lucky I suppose in not having to be involved with holdbacks.
I would argue however that the intent certainly is not to scam an adjuster, but to protect all parties to insure a complete proper work product.
While you may not have had the experience, given the standards under which both your carrier and vendor expect you to handle claims your position is understandable. However, other vendor's differing requirements or lack thereof, may lead to situations which you might be hard pressed to believe do in fact happen, albeit hopefully rarely.
Many times I have witnessed adjusters who inspected losses without turning in closed files until they did so in one bundle on the very day they were packed and ready to leave.
On one particular storm, in a scenario which is likely fairly well known to some here, an adjuster on the last day turned in approximately 75 closed files. Believe it or not, upon inspection of the adjuster's closed files, every single risk photo was exactly one and the same. Based on that evidence alone, a phone call to a sampling of insureds quickly indicated that not one had ever been contacted by this adjuster. That adjuster came to be reknown as "Drive-By !$#@$#$" by some in the claims community.
You simply would not believe some of the things you see (or don't see) in files on clean-up, and while the holdback method does penalize and cause in delay of full payment to the majority of adjusters who are professional at what they do, it is the few bad apples out there who give us all a black eye and exposure to the holdback system.
I do agree with you that there are some cranially challenged insureds we encounter who just can't seem to ever understand coverages and lack of coverage for a loss, and my suggestion is when you recognize one of those, advise them to call their agent for an explanation, then call their agent yourself to advise them of a problem in their customer not understanding coverage, and then DOCUMENT the insured's confusion and your actions in notifying the agent in your diary, and you have probably staved off the problem before and if the file reopens.
Still, there are many times when the clean-up adjuster discovers that the adjuster NEVER contacted the insured (to either inspect or advise of an estimate or lack of coverage), and when the file reopens only to have to explain coverage or the claims process, then I still hold that the adjuster deserves to be penalized for their failure to properly handle the claims process, resulting in an unneccesary file reopen.
Ask any of the cleanup adjusters around here, and I think you'll discover that this problem is more prevalent than you might expect, at least with carriers other than your own. |
Edited by - JimF on 12/17/2003 22:06:22 |
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C Bond
32 Posts |
Posted - 12/17/2003 : 22:45:12
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The retention of holdback and initial adjustment fees in general is completely understandable in cases where the original file was without value in settling the claim. Unprofessional work should not be rewarded. This practice should invariably provide more work for the professional adjuster at a fair rate. That being said, I find it odd that the responsibility of making the insured understand their policies, at the absolute worst time (claim process), falls on the adjuster. Many times I have explained coverage only to have the carrier exercise their right of approval for a particular item or event. The ultimate decision of coverage lies with the carrier, does it not?
My most recent cat experience has been that, "you do NOT discuss coverage with the insured. PERIOD" This was part of the inspection Guildlines. "Agreement on scope ONLY."
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MRichardson1952
USA
24 Posts |
Posted - 12/17/2003 : 22:56:21
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JimF,
I agree that the second adjuster should be paid his/her expenses for that re-inspection. However, you mention also, T&E, many of us are paid a flat fee or a schedule based on the size of the loss. How do you pay the second adjuster T&E? It seems that in some cases, the T&E could be more than the original flat fee paid to the first adjuster. Is there some regulated formula in the industry that guides one on this?
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JimF
USA
1014 Posts |
Posted - 12/17/2003 : 23:18:34
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Mark, I am sorry if I was unclear, but what I was suggesting was that T&E was the general practice of how a cleanup adjuster is paid under the limited scenario which Wes suggested, when the reopen adjuster finds no additional damage and the claim has been handled properly.
Under most other scenarios, I agree that the second adjuster is paid based on the fee schedule differential for what is now a much larger claim. I was chatting earlier this evening with Mark (OlderThenDirt) who is handling cleanup in Norfolk, and he was describing a clean-up file which was initially reported to the carrier with an attached estimate of approximately $3,000.00 and based on Mark's reinspection, the estimate for loss damages was upped to approximately $25,000.00. Under that scenario, most clean-up adjusters would receive the difference between what was paid the initial adjuster based on the lower estimate per fee schedule and the new estimate per the fee schedule. An adjustment could and perhaps would also be made depending on other aspects of the initial report and claims handling.
And you are right as well Mark, that at times, reopened files are paid to the clean-up adjuster based on some preset flat rate per file or on a per diem rate (which is what I think Kile is receiving as a clean-up adjuster in Paducah).
While I have some grave concerns personally with an adjuster not being allowed to discuss at least minimal aspects of coverage with an insured (we are insurance professionals after all right?), I do agree with CBond's comments regarding not suffering holdbacks when the carrier wants only an agreed scope with an insured.
CBond is correct as well that ultimately coverage or denial for a loss and damages rest with the carrier, but I still feel that an adjuster has a responsibility to both understand coverages and the insurance policy, and to generally be able at the slightest, to explain policy provisions relative to any given loss.
Perhaps the scenario suggested by CBond wherein a carrier says an adjuster should not discuss coverage is worthy of discussion under another thread.
As an afterthought, I would suggest to Mark, that there are indeed times when the second billing/fee charged to the carrier and the pay to the clean-up adjuster are (well) in excess of the original initial service billing and fee paid to the initial adjuster. It happens all the time.
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Edited by - JimF on 12/18/2003 00:02:28 |
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File Reviews, Reopens & Holdbacks ~ A Process
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