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Reconstruction Man
124 Posts |
 Posted - 01/12/2004 : 21:51:36
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Hello all,
Having tired of getting together damage reports / estimates, that reflect all damage and business process costs needed to address each case-by-case project, we have decided to simply let the insurers' reconstruction estimator present their estimate to our clients, and then we "grade" them for accuracy.
As a general reconstruction specialist, it has been interesting to watch major insurers, [Allstate, State Farm, Farmers, Safeco, USAA,etc.,etc.], and national adjusting firms consistantly "missing" [glaringly obvious] hail and wind damage. Especially so with the tightening of the economy.
One [new] heavily [golfball+ size] hail damaged project consists of [clearly] dented custom metal roofing, bruised mod.bit roofing, dented golf cart / vehicle garage doors, smashed exterior AC unit cooling foils, windows, broken stucco and damaged paint on the NE side of the home.
The adjuster stated, in his "First/Final Appraisal" that the metal roof had not been "compromised" and was to be "washed and sealed" [same for the garage doors], the [smashed]AC was to be combed out, and the paint was weathering naturally.
This kind of adjusting "professionalism" is rampant here, and homeowners, once they realize the true extent of the damage, and actual repair or replacement processes needed, are disgusted.
We have seen, in the few last years, a determined effort by insurers to bog down the claim settlement process in such materially, and psychologically, clever ways. Low-balling, "missed" construction components [spelled out in their estimating programs], warranted G.C. O&P ignored, no returned phone calls, doublespeak logic, and etc. in the name of "honest" adjusting practice.
The Safeco adjuster mentioned above even went so far as to state [12-30-2003], "Safeco does not pay General Contractor overhead and profit or oversite fees, as you will see in his [contractor] estimate".
If it wasn't so serious of a thing, those antics would be fuel for a new serial segment on Saturday Night Live.
Allstate appears to have no bottom to their bags of claim settlement nonsense. Even insulting their own customers is OK. And their estimating philosophy, explained to TDI, makes it clear that their estimates contractor O&P subtotals, that removes the roofing subtrade investment from the G.C. O&P lines, is OK too.
[Or do those lines now represent the other subtrades O&P...hmmm.]
We are certain that honest adjusters and honest contractors, properly educated, will counter this present state of affairs by listening to their collective conscience and informing the naive policyholder on how to stand up for themselves.
We are collecting data and expert testimony to help that effort along. We would appreciate any support.
Roger Poe 956-969-4454 rogerpoe@acnet.net
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Edited by - Tom Toll on 01/13/2004 15:24:49 |
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gloverb
USA
54 Posts |
Posted - 01/12/2004 : 22:21:02
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I am an approved contractor for several insurance companies as well as being an adjuster. It is typical to not pay o&p on roof claims & even most floor covering. They seem to see these items as stand alone items not needing a general contractor. The standard is that there has to be at least 3 separate trades involved before o&p is included.
I only have 1 insurance company that is now allowing o&p for roofs. But, they only allow this for their approved contractors. |
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Tom Toll
USA
154 Posts |
Posted - 01/12/2004 : 23:08:48
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| There is alway two sides to a coin. You are making statements without presenting photographs to back up the claim. You may be right, but to post here making accusations without facts, is in no ones best interest. The adjuster may have been right, or you may be right. Words don't cut it, present your facts when making a post such as this. |
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Reconstruction Man
124 Posts |
Posted - 01/13/2004 : 01:07:03
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Gloverb,
General Contractors are "allowed" to answer phone calls from any [existing or potential] client that may want them to fulfill a construction need that they have. At least that is how the G.C. business people we know feel about their business "rights".
Should a client have a single trade "reroofing need" to be accomplished, we do not call one of our roofing contractor subs and hand them our business lead. We inspect the situation and invest in the reconstruction risk. Insurers would have ones believe otherwise with mass produced / convoluted fair trade practice ideas.
We have yet to see the mysterious [insurer] documentation that states what business a G.C. must pass up because only a single, double or triple trade scope is indicated by an "incident". We invest in single and multiple trade projects outside the insurance claim arena, and insurer speak does not trump rational business practice simply because they are responsible for the bill.
Also, roofing contractor, or any other subtrade O&P can either be internally accounted for in their costs in an estimate, or it can be line itemed. MS/B and IntegriClaim includes the O&P internally. The G.C. O&P is shown externally, at the bottom of the estimate.
Allstate, Safeco, Cunningham Lindsey or any other insurers damage scope / reconstruction scope assessor would underpay a claim if G.C. O&P [10+10] is mathematically short.
Tom Toll
If facts [pictures, documentation] is needed to show our clients side of the coin, then we will follow up here with our digitals and the adjusters "observations".
The scenarios we mentioned above are facts, and we and our clients are more than ready to prove our side of the coin is not "tarnished". And...We are looking for justice. |
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jlombardo
USA
212 Posts |
Posted - 01/13/2004 : 06:27:45
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Reconstruction Man,
If you and your "clients" feel that yo have been wronged, then I suggest that you seek the proper legal redress......Remember, we as adjusters can only go so far in the adjustment of the claim.....we follow the carrier's instructions, particularly when on CAT....Yes, we should not, and I personally will not, do anything unethical in the adjustment process......but, for most of us on this site, you are singing to the proverbial choir......remember, a proper adjustment that scopes and address ALL the covered damages puts money in our pockets, therefore, it behoves us not to miss any legimate damages...... |
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JimF
USA
1014 Posts |
Posted - 01/13/2004 : 07:50:19
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Alice lives in a nice pleasant little town named Wonderland.
Wonderland is a clean town, with laws which are enforced, and a thriving entreprenurial spirit which drives a competitive local economy providing good jobs and incomes for every citizen wanting to work hard and prosper.
Now in Wonderland, there are 10 retail stores all selling a product called the souper dooper widget. One is a WalMart, one a K-Mart, throw in Circuit City, a few more, and last but not least an outlet appropriately named Roofer Robbers Rip-Offs.
This souper dooper widget is such a wonderful necessary product that every single family in the town of Wonderland has one. Because they are susceptible to accidental damage, most citizens of Wonderland insure theirs with a homeowners indemnity policy.
There are also five insurance agents in Wonderland which sell basically the same homeowners insurance coverage in the form of an HO-3. Alice buys her HO-3 coverage from one of these agents.
Alice has an unexpected loss event which destroys her souper dooper widget and she calls her insurance agent in Wonderland who sends out an adjuster to handle her insurance claim and indemnify Alice of her damages.
Alice and the adjuster determine that her souper dooper widget can be bought down at WalMart for $489.00 and at K-Mart the price is $495.99 while at Circuit City the souper dooper widget is $499.00. In fact, an investigation reveals the pricing on souper dooper widgets is in the range from $489.00 to $520.00 everywhere in Wonderland, except over at Roofer Robbers RipOffs, where the price for the exact same souper dooper widget as sold everywhere else in Wonderland is only $799.00.
Now Roofer Robber Rip-Offs also has a Yellow Flag Warning Sale going on right now wherein for the low low price of only $999.99 they will sell this exact same souper dooper widget to their insurance company friends and customers for only $999.99.
Roofer Robbers Rip-Offs charge a little more to their insurance friends complaining of a little more paperwork and because they say their souper dooper widgets are worth a little more; despite the fact that their product is exactly the same as what is being sold down the street at 9 other stores for a significantly less price.
Now if you lived in Wonderland what would you personally pay if you wanted to buy a souper dooper widget?
And if you experienced an insurance loss in Wonderland, just exactly how much would you expect your carrier to pay for a souper dooper widget?
Ah.....life in Wonderland. It may not be wonderful for rats, rascals and varmints, but it is wonderful for most everyone else.
The concept of indemnity is still alive and well in Wonderland. |
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okclarryd
USA
106 Posts |
Posted - 01/13/2004 : 08:57:12
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Oh Well,
I fixed my own.
I live out in the suburbs where life is just a little different. |
LARRY D HARDIN |
Edited by - AllCatMan on 01/13/2004 22:44:01 |
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KileAnderson
USA
875 Posts |
Posted - 01/13/2004 : 09:18:36
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Reconstruction Man,
Why is it not a proper fix to comb out an ac? I've payed for it thousands of times. Only had two complaints. One guy told me it would void his warranty from Carrier, I called the local Carrier dealer and he said, nope, that's just maintenance, won't void the warranty. The other guy just had an estimate to replace the whole thing, I called the AC guy and he said, sure, we can comb it out, the guy just asked me for an estimate to replace the thing so that's what I gave him.
I see you mentioned TDI, so I'm assuming you are in Texas. My parents have a house in Texas and it has a metal roof. They got a discount on their premiums for signing a cosmetic damage waiver for their metal roof. Unless hail or other covered peril actually punctures the roof or peels it off there is no coverage for it. Is it possible that this particular loss you refer to had that same waiver? Judging by the fact that the adjuster used the language "the roof was not compromised" I would bet that a similar cosmetic damage waiver is in effect for this particular loss. Do you know anything at all about insurance coverages and what policy your customer has?
Just curious. Why don't you do your job and let us do ours. |
Edited by - KileAnderson on 01/13/2004 09:24:04 |
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olderthendirt
USA
370 Posts |
Posted - 01/13/2004 : 09:21:06
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| Has the ending of the practice of paying O&P on roofing claims had a major impact on the Cruise Ship Business? |
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Justin Hustead
USA
3 Posts |
Posted - 01/13/2004 : 09:53:20
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O&P….The bottom line
After reviewing more files than I care to admit and with many different insurance companies, being cussed out and threaten with bodily harm by contractors for not allowing O&P I offer the following;
Insurance companies have allowed O&P to the true General Contractor assuming that the definition of a true General Contractor is one who is licensed, insured and uses subs 100% to perform the work. In return for supervising the job the GC was allowed to mark up the estimate 10% on overhead and 10% on profit to cover the GC’s costs and make a profit without marking up each subs invoice.
After years of abuse by contractors, insurance companies are limiting the O&P to 2 or more trades. Some companies are saying 3 or more trades, while others say 3 or more excluding roofing and require proof of using subs (a copy of the subs invoice).
So there are no surprises, you need to find out up front what position the carrier you are working with is taking on O&P before you submit your estimate.
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ChuckDeaton
USA
373 Posts |
Posted - 01/13/2004 : 11:06:03
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Points that get lost in these posts is that contractors are not a party to the insurance contract and insurance adjusters write estimates, not bids, estimates. Once the scope is agreed, the adjuster writes an estimate and contractors submit bids. I have done this enough times to say that a proper Xactimate/DDS estimate will be very close to a proper contractors bid. Any variance should be handled by an agreed supplement. There won't be any extras and the job will have to be properly managed and completed, but no carrier intends to improperly estimate any job or under pay any claim, much less enough claims to constitute a class action.
As was demonstrated by the recent Texas mold claims, the continuity of our economic system depends on this process being properly and honestly accomplished and the financial health of the insurance industry. |
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Reconstruction Man
124 Posts |
Posted - 01/13/2004 : 12:14:13
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--jlombardo,
...we follow the carrier's instructions, particularly when on CAT....
Carriers have predetermined, thru their actuarial / statistical risk assuming / profit generating process, what a full [or partial] loss on a home should be by charging an appropriate dollar amount[the premium]. The value [predetermined reconstruction dollars bundled in the premium] allows for single trade or multi-trade construction business risk assumers / investors to conduct their daily business also.
Since the premium reflects "low risk" business model [insured and stable business model contractors vs. the other kind of contractor] contruction business professionals business costs to be [openly and honestly] accounted for, it is interesting to see how those costs are avoided...per carrier instructions.
When [certain] adjusters, having access to our reconstruction costs, in their estimating programs, pretend to be estimating as a Roofing Contractor, G.C., Builder, etc., should, by leaving out critical business costs, and then argue their points [bluff] to the policyholder [naive person], then the carrier is not to blame for those "claim severity control" stratigies.
But, those kind of adjusters know they need work also and ignore their conscience to rip off naive "policyholders" [people]. The corporate training necessary to psychologically scar someones conscience must be almost cultlike in its delivery...and acceptance.
By the way, to set the pace for further discussions, we assume all adjusters here are honorable. We have worked with high standard adjusting professionals. None of our [field / business] observations apply to such professionals. We have been encouraged, by the feel of past forum discussions on this site / discussion forum, that [truely open and honest] adjusting professionals still exist.
We have noticed concern by adjusters comments that [many] carriers are not [openly and honestly] adjusting claims per the manner they require, based on predetermined [reconstruction] premium values. Rather,it appears insurers use adjusters to hide from properly assessing and valuing claim setlements they know are owed.
Charging premiums for sound [reconstruction] business practice, then circumventing those costs, is called what...?
--JimF,
Contractors / carriers / adjusters / have historically thorough [low risk business model] G.C., etc. reconstruction data values, based on completed projects, to reference to determine project processes, costs / premium values for their particular trade practice in the region of the country they are in.
Alice, in effect, has prepaid for the [like and kind sound business model[s]] that the premiums have predetermined is fair.
If those fair values are ignored, or ground down, in the claims settlement process, do you think Alice would know?
Is an insurer "saving money" since they already have a pretty good idea what should be objectively scoped / paid? Or is their scope / payment settlement process a backdoor illegal profit maker?
If Alice is in the construction / claims settlement business, she would know the premium allows for a range of truely [apple for apple] business models to be allowed for. "Allowing" less than that, predetermined to be allowed / charged for, would be called what...?
Roofing construction business investors charge more than retail outlets because they do more. Like pay employees to perform life endangering work, pay workmens comp [50%+- of each dollar of labor costs], liability insurance [16%+- of each dollar of labor costs] run an office, pay material costs, pay taxes and finally pay themselves, with the hoped for investment return [10% profit] reward for the whole effort.
Passive retail shelved widget costs vs. widgets installed by sound widget installation professional. Hmmm...Seems like costs are going to vary somewhat...
It appears Alice lives in "Wander Land". Run by insurers / adjusters who wander from construction estimating values she has prepaid for.
--okclarryd
Good deal. Just make sure you are paid properly for your loss. The value of your premium payment is based on hiring quality [low risk] single trade / multi-trade business professional/s.
You do not "profit" being paid accordingly to the value of your loss your premium promise charged, and now "owes" back to, you.
--KileAnderson
AC cooling foils are factory designed to be a certain shape [architecture] for maximum air flow. IF, exposed foils are so badly crushed that combing becomes a meer carrier / policyholder claim settlement psychological pacifier, then what is that restoration approach called?
Would an [objective] potential homebuyer be convinced that the [obviously "repaired" vs. restored] AC unit has the same value as an undamaged one?
As for homes in Texas, especially in hail / wind prone areas, "appearance allowances" appear to play on naive home owners lack of realizing the value built into the appearance of the architecture / cosmetics of their investment, and keeping that appearance in place.
And paying for "appearance" does not pay to have a given damaged item repaired or replaced, continuing its preloss value. Appearance allowances pay for a psycological massage to be applied to [insurer] preyed on policyholders, who do not have proper insurance protection they may suspect they have.
Appearance allowance ["disqualified" ACV / RCV logic] metal roof minus deductible, minus depreciation = ACV of...? A home that looks awful and will have to be solded for less [a financial loss]. Insurer makes money on concept, policyholder loses money concept.
Discounted "appearance allowance" based insurance policies must be really dirt cheap since the carrier risk is practically zero on the payout end.
Finally, yes, we own policies and have talk to clients / neighbors / insurance agents over
the years regarding presently offered policies and the carrier speak they contain. We are constantly exposed to, and research, the indemnity protection business from many angles.
We are always open to further meaningful knowledge sharing. Two many consumers are unaware of real and solid premium [indemnity protection] calculations...and their claim settlement values / rights.
--olderthandirt
No. In fact insurers are enjoying more cruises as a result of those practices.
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Ghostbuster
476 Posts |
Posted - 01/13/2004 : 15:07:42
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I gotta tell ya, with all the slashes, parenthesis, and asides, I can't understand this. About all I get is that Reconstruction Man is irritated.
I can't get a handle on his specifics without going cross-eyed. |
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ChuckDeaton
USA
373 Posts |
Posted - 01/13/2004 : 15:29:57
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| Evidently Reconstruction Man needs more OJT and his business model needs to be tuned. |
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jlombardo
USA
212 Posts |
Posted - 01/13/2004 : 15:38:53
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Reconstruction Man,
Before this goes any further, would you be kind enough to identify yourself and gives us all a little background as to who you are...... |
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JimF
USA
1014 Posts |
Posted - 01/13/2004 : 15:54:45
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How do you stay in business with your non-insurance customers when you obviously (or so it would appear) charge a higher price for the exact same roof that a customer can obtain elsewhere from your competition at a much more affordable price?
And what kind of surcharge do you tack on to normal pricing for insurance carriers over and above your non-insurance related replacements?
I don't think most people driving down a street, yourself included, would be able to spot the difference between a roof your company installed and those roofs replaced by your competitors.
If they can replace roofs more affordably for a lesser price, then why can't you? |
Edited by - JimF on 01/13/2004 15:56:05 |
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Hail Damage and G.C. O&P Sleight of Hand
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