Reply by Catsvstrained May 31st, 2007.
Hello and welcome to the party, I believe that you have come to the right place for gaining perspective on this career field. The CADO Forum is a parallel world of sorts to the actual practice of claims adjusting in the sense that challenge lies in finding fact amongst the sea of opinion. “It is what it is”, that is what I tell Policyholders, Contractors, Claims Managers, Reinspectors, etc. , because you cannot argue with good scope. and good scope is fact. Claim settlement is only as accurate as it is translated from actual damage through the insuring agreement and into dollar amounts that represent real construction practice. All settlement contains opinion however accuracy will always be directly proportional to the amount of opinion that is substituted for fact. This said, I will try to limit my opinion in answering your questions to assist you in reaching an accurate perspective of the industry.
With the respect of establishing some order, I think that I would like to respond to your last question first, the “Million Dollar Question”: The problem with any response to this question is that no one can predict how much work will be available in the foreseeable future (next two years) because the amount of work that will soon be available will be determined by (almost completely) future, not past events. This in itself is practically the entire foundation that the Independent industry was built on. Today’s Insurance companies rely on an Independent work force as an effective tool for handling the unforcastable overflow / glut of claim work that exceeds their ability to settle w/ in-house staff. Hiring and maintaining a large staff force in anticipation of large / unforeseeable events is not a cost effective solution and to date, I have yet to hear of any better means of handling large claim activity (within the mandates put in place by the DOI) than w/ an Independent force.
There is no such thing as a good time to start a claims industry career, there is only good timing. If you obtain your adjuster’s license, carrier certification, complete estimatics and policy training now and a hurricane of any significance makes landfall on a populated area this year, chances are very good that you will receive an assignment w/not just one IA company but every IA Co. that you take the time to complete an application process / sign on with.
$45K / year ?... Yearly earnings will depend on many things but I don’t want to skirt what I perceive to be the fundamental spirit of your question so I think the best way to provide you with some perspective on the subject, I will need to create an fictitious (yet very possible) chain of claim generating events that would level the work opportunity playing field for all catastrophe adjusters (newbies – old salts) for accurate comparison:
Walk with me if you will to the year 200?, the year that began in mid January with a large earthquake in LA, followed by a record spring hail season, the landfall of a strong category 3 on the upper east coast in August followed by another hurricane of similar proportions in Miami come mid October. In this calendar year, all licensed property adjusters would have the opportunity to work as many days as they could stand up to a total of 350 days.
In this scenario, the individual yearly salaries would range (conservatively) from $0.00
To $500,000.00 pre taxes and post deduction amt for carrier percentage split. Mixed amongst these incomes figures you would find:
- Numerous new – moderately experienced adjusters who became overwhelmed w/their assignments and quit before their first paycheck.
- Numerous hard core, tenacious new adjusters who slugged their way through all 350 days, billing on a component basis for the first 30 – 90 days and succumbing to a $476/day (daily rate) for the balance of days remaining in that year.
- Some well seasoned / trained adjusters w/ average levels of motivation who quit the year in July after banking $250,000.00. (because that was more money than they had ever made in a given year)
- Some highly motivated 2-3yr experience level adjusters who earned $200,000.00 - $350,000.00 by working the whole year strictly on a component basis.
- Some 5 – 15+ year highly motivated crackerjack adjusters that earned $500,000.00+ ( very desirable to the industry because of their accuracy and efficiency) This group of adjusters were continuously pushed into large new claim inventories from event to event by the Independent firms that they worked for. (The industry tends to lead with their best foot forward because adjusters who make a lot of $ will also make a great deal of $ for the IA Co.s that employ them.)
My conclusion: There is no average income.
That would be my most accurate assessment of yearly potential income based on what I have witnessed in past years. Note: some opinion was unavoidably included to cement the integrity of scope into some semblance of meaning. If you would like my most politically correct answer than disregard what I just said, forget about potential salary and pay attention to the details and priorities of becoming well established in a new career.
- Get licensed, IDL’d, certified and trained because your opportunity to work storm will come. Most every year will include what I would call a jumping on event. The time just following a large catastrophic occurrence when the IA train (if you will) slows down just enough for new adjusters to jump on board. In other words, all licensed adjusters (with very few exceptions) wanting a storm assignment will get the opportunity to work a large occurrence.
- Don’t forget to bring your education, know how, insight, knowledge, understanding etc. of how the claims industry operates! New Independent Adjusters could earn 2-3 times the salaries of new doctors and attorneys if they were simply willing to invested 1/10th of the time and financial resources of medical and law students. The opportunities (training schools, information and events) to learn are everywhere. Every major cat site I witness a sea of new IAs that are forced to spend 12 out of every 14hr day in the office working on returned files and asking questions when they could be out in the field earning money. Remember: It’s Ready, Aim, Fire - NOT – Ready, Fire, Aim.
- Be prepared to demonstrate the appropriate attitude and capabilities for working both current and future claims.Getting invited back to work the smaller and more frequent (career sustaining) storm events will depend largely on a strong first assignment performance. It is very difficult to portray any redeemable qualities to a new employer when you are overwhelmed and frustrated. Your first storm deployment is nothing short of an interview for the chance to work future storm events.IA companies (much like any company that wants to prosper) don’t like to take a risk on the great unknown therefore they tend to carefully choose who to deploy from their list of employees whenever possible. IA companies don’t care how much or how little education or experience that you have because they have learned that the best way to evaluate an adjusters capabilities is by first hand knowledge of work product and behavior. (Example: I am currently deployed on a storm clean up assignment with a very capable and talented Independent Adjuster who never finished high school. With less than 3yrs of full time experience, he unquestionably has earned the respect of the IA firm that we work for because he is consistently offered storm work even during periods of slow storm activity.)
How many companies to hire on with? – Sign up w/as many companies as you like or have time for but don’t let all that time and effort detract from the time and effort you should spend on getting prepared. Remember that even green adjusters are in high demand during a “jumping on” event.
Flood training , wind training or both? Forget about flood for now, that will come. Taking a flood certification class now would serve little purpose as the Feds require 3yrs exp before they will give you a NFIP #. Focus on wind & estimatics certification as it does not require experience, besides most wind adjusters will get free flood certifications during a future large flood event by the carrier they work for.
Hope this helps.
Kevin (Owner/Operator K-Squared Cat Training Svs)