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Whilst I know that there are exceptions to any rule,

adjusters handling flood claims (at least in theory and by mandate) are required to have a minimum of 4 years experience for access to Residential and Manufactured lines of NFIP coverage. There are NFIP Mentor programs through Pilot and Colonial and I am sure some other IA firms, yet those adjusters are working under an experienced NFIP adjuster.

What I think is the problem is NOT with NFIP claims in and of themselves. It is from HO claims that do NOT have NFIP coverage (or private flood coverage) and most damage to the risk is being attributed to flood.

Same dilemma with Katrina,

Seems to me this is more about insured's NOT being accountable and feigning ignorance with, " What do you mean my HO policy doesn't cover flood damage on my BEACH FRONT property????"

In these situations where there is only HO coverage is where an inexperienced adjuster is most likely to become involved.

On a side note, I am fully aware that MANY (not all but many) rookie adjusters have not a clue as to basic construction methods and are in fact relying on XM8. What they need to understand is that, "Because XM8 says so is NOT a viable answer to any inquiries whether from the insured or PA or attorney.

I am not the best adjuster in the world. Yet with not being allowed to handle my own claims until I could create a comprehensive estimate of a risk from foundation to roof and everything in between with nothing more than a pencil, paper, tape measure, ladder and a calculator, between that and let's face it a bit of luck, I have been able to carve out a living in the CAT industry over the last 10 years

Once I could demonstrate that I understood the dynamics of modern building methods, only then was I able to utilize any estimating platform.

Not sure how, but there can come a point where an estimating platform may not be available for adjusters on the ground. I think (again not all but most) rookie adjusters know how to create an XM8 estimate, but do NOT know how to create an estimate

Why yes some adjusters fell short. I worked with a smaller firm at Sandy. Only about 100 were deployed. Every week it seemed the list was cut in half. By week 5 half of what I got was angry insured's. Most of the time the estimates were so far off, all I could do was say I'm sorry here is how we will fix it. Now I worked for another smaller firm in OKC. They brought out their best adjuster's. I did the clean up here, since I live here. The contractors and insured's new the game. Very rarely did I say I will get this fixed. I never have worked for an insurance company that would not listen to me or the insured's after the original offer. I do think at a large catastrophe adjusters are just people, its a wide variety.

This is a very complex issue. At first, it seems easy to identify the cause based my own individual experiences, but no single experience is the same.

This article touches on a bigger portion of the myriad of issues affecting homeowners' anxiety after a big storm: http://www.accuweather.com/en/weath.../19162713.

I think it gives a fairer shake on what's really going on. I don't like the Foxnews article, because it's too one dimensional and the evidence is anecdotal. It's useful for stirring the pot. While the Accuweather article includes anecdotal information, it doesn't rush to pin the tail on just one donkey.

Posted By OkieTex on 10/23/2013 11:57 PM
Why yes some adjusters fell short. I worked with a smaller firm at Sandy. Only about 100 were deployed. Every week it seemed the list was cut in half. By week 5 half of what I got was angry insured's. Most of the time the estimates were so far off, all I could do was say I'm sorry here is how we will fix it. Now I worked for another smaller firm in OKC. They brought out their best adjuster's. I did the clean up here, since I live here. The contractors and insured's new the game. Very rarely did I say I will get this fixed. I never have worked for an insurance company that would not listen to me or the insured's after the original offer. I do think at a large catastrophe adjusters are just people, its a wide variety.

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Agreed in part. Yet the crux of Roy's post was related to "flood" insurance proceeds. Consumer advocates have not the clue as to the difference between flood and wind. Whilst NFIP certified adjusters are not superheroes, in general they are competent.

What these advocates aren't saying is that if a claim award is insufficient to fully indemnify the insured, it is a simple matter of calling for a re-inspection and/or a supplemental payment if labor and material costs increase due to demand.

Just tough to understand because the Standard Flood Insurance Policy and the Adjuster's Manual are very black and white with regard to coverage

More press on the adjusters working on Sandy claims;  The quote below comes from a AOL Money article.  I wonder what kind of press we as adjusters would have received if the estimates had to be hand written?  

"Amy Bach, executive director of United Policyholders, an advocacy group for insurance consumers, said that for adjusters with no background in construction, there is a tendency to rely too much on software like Simsol, Xactimate and Symbility to tell them how much a repair job is going to cost.

"Some of these guys could have been selling oranges last week at a fruit stand, and this week they are an insurance adjuster," Bach said. "Instead of using [the software] as a tool to check the estimates produced by the contractors, they use them as a last word. But computers don't rebuild and repair homes. Contractors do."

Claims software is widely used in the industry after major disasters and represents a break with the old practice of getting estimates directly from contractors. It is designed to take out the guesswork while offering a check against contractors who exaggerate the cost of a job.

The programs supply detailed prices, by ZIP code, for carpets, cabinets, light fixtures and almost every other part of a house, as well as the labor costs for tasks as simple as putting masking tape around electrical outlets before painting a room.

Using those programs properly involves entering an inventory of every piece of damage in the house, and every possible task that might be required to put the building back into its proper state. There are thousands of variables. Miss a few, and that means less money for storm victims.

Simsol's president, John Postava, said that like any computer program, it is only as good as the data people feed into the system: "Garbage in, garbage out."

Simsol also operates an adjusting firm and had 158 adjusters working in the Northeast on Sandy claims. Postava said he is confident the great majority did a good job.

Two of the largest adjustment firms involved in the Sandy effort, Colonial Claims Corp. and Pilot Catastrophe Services, declined to make executives available for an interview."

Read more here:  http://www.dailyfinance.com/2013/10...insurance/

To say there is only one reason for estimates to be low is obviously an oversimplification.

There's never been a case where some of the damage was hidden?

There's never been a case where something was left out of the estimate because it wasn't covered under the policy?

There's never been a case where a contractor was asking for much more money than any other contractor would charge for the same work?

There's never been a case where a contractor wrote an estimate for how he or the homeowner wanted the house to look (granite counters?) , and not what was already there (tile counters)?

Whether or not the adjusters' estimates are being written low due to lack of construction knowledge is a legitimate question. I don't think that happens all that often, but it can happen. Even experienced contractors don't know all the costs that may occur, especially when there is hidden damage or specialty trades involved. It's just not possible to avoid all differences in opinion between contractors and adjusters.

But a more important question is how are the inevitable differences resolved? Do those differences get resolved? Do they get resolved timely? Is the process fair and understandable?

Adjusting the claim includes reviewing any estimates submitted by the insured, determining if the scope of work is covered by the policy, determining if the price is reasonable, recommending payment or denial according to the terms of the policy, and communicating that to the insured.

Certainly it is important for adjusters to be good estimators. But it is more important for them to be good adjusters.

I think that the "hiring adjusters in a hurry" aspect might have a great deal to do with unsatisfied insureds. While I readily acknowledge that adjusters are not perfect, errors happen and that the vast majority of the time that there is a problem with a loss, the insured's lack of understanding of their policy can be a factor (good adjusters, however, have learned over the years to manage the expectations of the insured by increasing the insured's understanding of coverage), the hiring of "warm bodies" always has been and always will be the source of a lot of the bad PR that our industry endures. I personally think that adjusters should be made to go through an apprenticeship program with seasoned adjusters before becoming fully licensed. Appraisers and other skilled trade professionals have to do it, and while I used to see some of that system as the result of clever lobbying by the established players, I have come to see the benefits of it as well. When you have an Appraiser come to your home or business, you know for a fact that a licensed appraiser has to endure a long (a few years depending on the state) apprenticeship program, pass several tests and even then, they are typically on a "level" system, kind of like the NFIP (certain experience levels open up the ability to take on higher and higher value projects). You do not know that with an independent adjuster. An independent adjuster can take a few day class with Vale, AdjusterPro, Mile Hi or any of the other adjuster farms and become instantly nationally recognized as an adjuster. Or they can simply take the test, sans classes, in NC, or they can simply practice in their home state that does not require a license. A licensed adjuster certainly does not come with a guarantee of knowledge, experience or professionalism, and hiring standards are not exactly the theme of the day for the bigger companies that take on tens of thousands of claims at a time.

An example would be one of the larger IA firms out there during Irene. They literally had a radio ad that I personally heard on 3 different stations  in NC saying something to the effect of "No experience required, just bring your license to such and such conference room at such and such hotel and we will put you to work". They went on to offer rapid pre-licensing courses (NC is one of the few states that does not require classes to be taken before testing for your license.. you just have to pass the test). Now, do you think that that firm, and other Cat firms that I know for a fact have similarly low hiring standards (I know because I have made a lucrative business of cleaning up after them, and I see their "work product"..and I use that term lightly.. regularly) are generating consistently accurate adjustments? Do you think it more likely that the guys they send out are apt to be flipping burgers or slinging shingle waiting for the next "warm body" situation, or do you think that they have become professionals overnight and made a business out of it?

Posted By AcceleratedAdjuster on 10/29/2013 6:46 AM

I think that the "hiring adjusters in a hurry" aspect might have a great deal to do with unsatisfied insureds. While I readily acknowledge that adjusters are not perfect, errors happen and that the vast majority of the time that there is a problem with a loss, the insured's lack of understanding of their policy can be a factor (good adjusters, however, have learned over the years to manage the expectations of the insured by increasing the insured's understanding of coverage), the hiring of "warm bodies" always has been and always will be the source of a lot of the bad PR that our industry endures. I personally think that adjusters should be made to go through an apprenticeship program with seasoned adjusters before becoming fully licensed. Appraisers and other skilled trade professionals have to do it, and while I used to see some of that system as the result of clever lobbying by the established players, I have come to see the benefits of it as well. When you have an Appraiser come to your home or business, you know for a fact that a licensed appraiser has to endure a long (a few years depending on the state) apprenticeship program, pass several tests and even then, they are typically on a "level" system, kind of like the NFIP (certain experience levels open up the ability to take on higher and higher value projects). You do not know that with an independent adjuster. An independent adjuster can take a few day class with Vale, AdjusterPro, Mile Hi or any of the other adjuster farms and become instantly nationally recognized as an adjuster. Or they can simply take the test, sans classes, in NC, or they can simply practice in their home state that does not require a license. A licensed adjuster certainly does not come with a guarantee of knowledge, experience or professionalism, and hiring standards are not exactly the theme of the day for the bigger companies that take on tens of thousands of claims at a time.

An example would be one of the larger IA firms out there during Irene. They literally had a radio ad that I personally heard on 3 different stations  in NC saying something to the effect of "No experience required, just bring your license to such and such conference room at such and such hotel and we will put you to work". They went on to offer rapid pre-licensing courses (NC is one of the few states that does not require classes to be taken before testing for your license.. you just have to pass the test). Now, do you think that that firm, and other Cat firms that I know for a fact have similarly low hiring standards (I know because I have made a lucrative business of cleaning up after them, and I see their "work product"..and I use that term lightly.. regularly) are generating consistently accurate adjustments? Do you think it more likely that the guys they send out are apt to be flipping burgers or slinging shingle waiting for the next "warm body" situation, or do you think that they have become professionals overnight and made a business out of it?

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AA whilst I know what you speak of to be true, in this example, this is exclusive to NFIP claims. It appears that vast majority of complaints are coming from  insured's who are ignorant as to what is and isn't covered via the Standard Flood Insurance Policy than it is to the "inexperience" factor of NFIP certified claims adjusters.

Make NO mistake, just because one holds an NFIP certification does NOT mean they are an NFIP automaton free of mistakes, yet the SFIP is very black and white. Most misgivings have to do with ignorant insured's who wonder why their ALE was denied

Posted By CatAdjusterX on 10/31/2013 12:31 AM

AA whilst I know what you speak of to be true, in this example, this is exclusive to NFIP claims. It appears that vast majority of complaints are coming from  insured's who are ignorant as to what is and isn't covered via the Standard Flood Insurance Policy than it is to the "inexperience" factor of NFIP certified claims adjusters.

Make NO mistake, just because one holds an NFIP certification does NOT mean they are an NFIP automaton free of mistakes, yet the SFIP is very black and white. Most misgivings have to do with ignorant insured's who wonder why their ALE was denied

 According to the article posted, homeowners were concerned with the fact that in many cases they were getting 10's of thousands less than it would take to make them whole again, not necessarily ALE issues. While as I said, a great deal of the time, homeowners simply do not understand their policies, be they HO or Flood, and many of them have a hard time grasping ACV or "no coverage", the field adjusters are also every bit as culpable, even if they write perfect estimates. Part of being a good adjuster is taking the time to educate the insured and manage their expectations before you walk away from the inspection. Our adjusters (both wind and flood) have a very low complaint ratio, and one of the reasons that can be credited for our numbers is the fact that we instruct our adjusters to sit down with the insured and explain the "good news and the bad news" before the leave the risk. The FA will go over what is covered and what is not, as well as the difference between ACV & RCV. The insured is most definitely not always happy with the news that their policies are typically not all-inclusive, but after a little explanation, justification and discussion, they also do not call their local media or their local senator. Managing expectations is every bit as an important facet of customer service as getting the inspection done and the numbers right in a timely manner. 

As far as experience levels, the NFIP experience levels and licensing fit the bill for what I described earlier. There sure are a lot of NFIP certified adjusters out there that have maintained their NFIP licensing for years and never seen a flood (much less a flood policy). If an adjusting vendor takes in all those inexperienced flood adjusters and does not give them the proper administrative support, these kind of news articles happen. 

Anyone who thinks "adjusters" actually handle flood claims needs to sit down with the NFIP standard dwelling policy and read it cover to cover. The NFIP provides personnel to assist the insured with filing a proof of loss.

Read the policy!

7. The insurance adjuster whom we hire to investigate your claim may furnish you with a proof of loss form, and she or he may help you complete it. However, this is a matter of courtesy only, and you must still send us a proof of loss within 60 days after the loss even if the adjuster does not furnish the form or help you complete it.

The policy states (p13 of 19, J.8) “We have not authorized the adjuster to approve or disapprove or to tell you whether we will approve your claim.”

One way to source a copy of the NFIP policies is to email me.

...The requirement that independent adjusters be certified

by the NFIP applies to all independent adjusters seeking to

handle flood losses...

...WYO companies are free to choose whatever adjusters they wish, either, staff adjusters or independent adjusters, to adjust their flood losses

The adjuster prepares accurate calculations of the insured building’s replacement cost and actual cash value and properly conclude the claim....

... NFIP requires the adjuster to assist the insured when necessary with the preparation of the contents claim, to verify that all contents included in the adjustment are covered under the SFIP, and to determine or verify accurate local replacement costs...

The adjuster should not close his or her file until all items on the Final Report are completed.

...NFIP requires the adjuster to provide identifying information (manufacturer , model and serial number, and whenever possible, capacity, etc.) on major building equipment such as furnaces, central air conditioning units and major appliances such as refrigerators, washers, dryers,televisions, etc.

The adjuster is required to inspect the property within 48 hours of receiving the loss assignment.

The initial inspection will include preparation of a preliminary scope of damages.

The adjuster assigned to the loss must inspect it personally and should not take a contractor along to inspect or scope the loss.

When the claim has been concluded, the adjuster furnishes the insured with a copy of all building and contents worksheets and proof(s) of loss

The adjuster’s file should contain adequate notes about the progress of the claim and the scope of damages, calculations of replacement cost and actual cash value, and a diagram of the insured building with measurements.

The adjuster should take as many photographs as are necessary to portray the damage. Photographs of non-damaged property can oftentimes be as important as photographs of damaged property.

(excerpts from the NFIP claims manual)

Posted By AcceleratedAdjuster on 10/31/2013 5:48 AM

Posted By CatAdjusterX on 10/31/2013 12:31 AM

AA whilst I know what you speak of to be true, in this example, this is exclusive to NFIP claims. It appears that vast majority of complaints are coming from  insured's who are ignorant as to what is and isn't covered via the Standard Flood Insurance Policy than it is to the "inexperience" factor of NFIP certified claims adjusters.

Make NO mistake, just because one holds an NFIP certification does NOT mean they are an NFIP automaton free of mistakes, yet the SFIP is very black and white. Most misgivings have to do with ignorant insured's who wonder why their ALE was denied

 According to the article posted, homeowners were concerned with the fact that in many cases they were getting 10's of thousands less than it would take to make them whole again, not necessarily ALE issues. While as I said, a great deal of the time, homeowners simply do not understand their policies, be they HO or Flood, and many of them have a hard time grasping ACV or "no coverage", the field adjusters are also every bit as culpable, even if they write perfect estimates. Part of being a good adjuster is taking the time to educate the insured and manage their expectations before you walk away from the inspection. Our adjusters (both wind and flood) have a very low complaint ratio, and one of the reasons that can be credited for our numbers is the fact that we instruct our adjusters to sit down with the insured and explain the "good news and the bad news" before the leave the risk. The FA will go over what is covered and what is not, as well as the difference between ACV & RCV. The insured is most definitely not always happy with the news that their policies are typically not all-inclusive, but after a little explanation, justification and discussion, they also do not call their local media or their local senator. Managing expectations is every bit as an important facet of customer service as getting the inspection done and the numbers right in a timely manner. 

As far as experience levels, the NFIP experience levels and licensing fit the bill for what I described earlier. There sure are a lot of NFIP certified adjusters out there that have maintained their NFIP licensing for years and never seen a flood (much less a flood policy). If an adjusting vendor takes in all those inexperienced flood adjusters and does not give them the proper administrative support, these kind of news articles happen. 

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AA I don't dispute that just because one holds an NFIP certification does not mean they have a good "bedside manner" With that, I do agree that many miscommunications could be handled on the spot if said adjuster spent an appropriate amount of time not only adjusting the risk, but adjusting the insured by explaining the process and letting the insured ask questions.

With regard to what I said about ALE, my point wasn't that any of these issues had to do with not getting ALE out of their NFIP flood policy. My point was some insured's believe they are entitled to ALE from their flood claim, hence the ignorance because there is no ALE in any NFIP policy. 

Often spending an additional 5 minutes with the insured and talking to them, doesnot even have to be on point with the clean, leaves them with a feeling they are being treated as a human, not a number on your busy schedule. This can save you endless emails complaints and phone calls. If all you are worried about is how fast you can get rid of them, they feel like no one cares. There is more to adjsuting then how fast you can scope and write an estimate. I do not see must sign of this skill being taught to the young and money hungry.

I'm old and have always been in this for the money, Stormcrow. The deal is that those that do the best work make the most money. The trick is use technology to everyone's advantage. Everyone has an email address and all adjusters should have a smart phone and use a cloud service, I use Dropbox, equipment makes providing a policy a snap.

By the way, I have free flood information, I share with anyone who emails me. This is not AdjusterPro or Mike Popejoy, all the information I provide is free.

Posted By ChuckDeaton on 11/01/2013 7:55 PM
I'm old and have always been in this for the money, Stormcrow. The deal is that those that do the best work make the most money. The trick is use technology to everyone's advantage. Everyone has an email address and all adjusters should have a smart phone and use a cloud service, I use Dropbox, equipment makes providing a policy a snap.

By the way, I have free flood information, I share with anyone who emails me. This is not AdjusterPro or Mike Popejoy, all the information I provide is free.

..................................................................

I feel obligated to add a disclaimer, Mike Popejoy of (MHA) is a close friend and colleague. He is an honest, hard working man. Anyone who knows me is well aware I have little tolerance for PREDATORY training vendors. Whilst I can be a long winded (Jeez will Robby EVER shut the @#$% up???) blow hard (LOL), I am a fiercely loyal friend. 

If Popejoy is a "close friend and colleague" of yours, that pretty much seals the deal as far as I'm concerned.

Purporting to sell information, information, that desperate individuals think may help them make a living is a sorry way to make a living.

Posted By ChuckDeaton on 11/03/2013 3:35 PM
If Popejoy is a "close friend and colleague" of yours, that pretty much seals the deal as far as I'm concerned.

Purporting to sell information, information, that desperate individuals think may help them make a living is a sorry way to make a living.
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Thank you for sharing your opinion Chuck.............
  
 

Sandy was a flood event much more than it was a wind event. People didn't bother to buy adequate flood coverage and were looking at their wind limits instead of their flood limits.  I had a dozen griping to me that their limits were too small.  That's what this boils down to.

Chuck's post below:

Anyone who thinks "adjusters" actually handle flood claims needs to sit down with the NFIP standard dwelling policy and read it cover to cover. The NFIP provides personnel to assist the insured with filing a proof of loss.

Read the policy!

7. The insurance adjuster whom we hire to investigate your claim may furnish you with a proof of loss form, and she or he may help you complete it. However, this is a matter of courtesy only, and you must still send us a proof of loss within 60 days after the loss even if the adjuster does not furnish the form or help you complete it.

The policy states (p13 of 19, J.8) “We have not authorized the adjuster to approve or disapprove or to tell you whether we will approve your claim.”

One way to source a copy of the NFIP policies is to email me.

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 For complete NFIP information, click on the following link:

http://catadjuster.org/Channels/NFI...pport.aspx

Chuck, with all due respect, you are cherry picking and using the above two excerpts entirely out of context. Why you are doing so is not clear. I applaud your efforts with providing important information to our newly licensed brethren interested in becoming NFIP certified claims adjusters. Yet inaccurate information is worse than NO information

Your two quote(s) (highlighted in yellow) were taken from the quite lengthy Adjustment Standards and Requirements below:

ADJUSTMENT STANDARD AND REQUIREMENTS

FEMA’s adjustment standards and requirements have been revised and expanded to clarify NFIP expectations of flood adjusters. What follows supersedes the "NFIP Minimum Standards and Reporting Procedures," which have been distributed in the past and should be carefully reviewed by adjusters. 1. General Standards and Requirements a. Authority of the Adjuster. The NFIP expects every adjuster handling NFIP flood losses to understand and to communicate to the policyholders that the adjuster does not have the authority to deny a claim or to commit the NFIP or the WYO Company to pay a claim and that all adjustments are recommendations only, subject to review by the NFIP Servicing Agent or the WYO Company. b. Knowledge of the Program. The NFIP expects every adjuster handling flood losses to be thoroughly familiar with the provisions of the Standard Flood Insurance Policy (SFIP). The adjusters should also know coverage interpretations issued by FEMA, and explained during the NFIP Claims Presentations. All claims are adjusted in compliance with these provisions. c. Professionalism. Because the adjuster represents the NFIP to the policyholder and public, the NFIP expects that every adjuster will conduct themselves in accordance with the highest standards of integrity and ethics and be courteous and professional in all dealings with policyholders.

2. Specific Standards and Requirements a. Adjuster Preliminary Damage Assessment. The adjuster completes the Adjuster Preliminary Damage Assessment form (PDA) on building claims that meet the c riteria for substantial damage. After the adjuster conducts the inspection of the risk, the form must be completed and submitted to the NFIP Bureau and Statistical Agent by fax at (301) 577-2421, e-mail iservice_claims@ostglobal.com, or by mail to P.O. Box 310, Lanham, MD 20706 (refer to FEMA Bulletin W-09077, issued November 20, 2009). b. Building Replacement Cost (RC) Special Loss Settlement, and Actual Cash Value (ACV). The adjuster prepares accurate calculations of the insured building’s replacement cost and actual cash value and properly conclude the claim on an RC or ACV basis as applicable. c. Contents Claim Adjustment. The NFIP requires the adjuster to assist the insured when necessary with the preparation of the contents claim, to verify that all contents included in the adjustment are covered under the SFIP, and to determine or verify accurate local replacement costs and reasonable physical deprecation. Applicable depreciation should be shown separately for each item. d. Special Limits. The special limitations on some contents (jewelry, furs, contents used in business, etc.) should be properly applied. Appropriate documentation supporting the claim value should accompany the worksheets. e. Loss Avoidance Measures. Claims for removal of insured property due to the imminent danger of flooding must be documented and verified in order to be covered under the SFIP. Only the value of work performed by the insured and a member of the household is covered. f. Final Report. The NFIP Final Report is required on all NFIP Direct and WYO losses. The adjuster should not close his or her file until all items on the Final Report are completed. g. Identification of Building Equipment and Major Appliances. The NFIP requires the adjuster to provide identifying information (manufacturer, model and serial number, and whenever possible, capacity, etc.) on major building equipment such as furnaces, central air conditioning units and major appliances such as refrigerators, washers, dryers, televisions, etc. h. Identification of Minor Appliances. The adjuster should provide identifying information on certain items for claims control and validation purposes. i. Inspection. The adjuster is required to inspect the property within 48 hours of receiving the loss assignment. This is also time to complete the Adjuster Preliminary Damage Assessment Form. The Adjuster Preliminary Damage Assessment form must be completed and submitted to the NFIP Bureau and Statistical Agent by fax at (301) 577-3421, e-mail iservice_claims@ostglobal.com, or by mail to P.O. Box 310, Lanham, MD 20706 (refer to FEMA Bulletin W-09077, issued November 20, 2009). The initial inspection will include preparation of a preliminary scope of damages. The adjuster assigned to the loss must inspect it personally and should not take a contractor along to inspect or scope the loss. If it is not possible for the adjuster to inspect the loss within the required time frame, the adjuster must explain why in the NFIP Preliminary Report and

advise when the loss will be inspected. Visits to the insured risk without an appointment should be avoided. j. Insured’s copy. When the claim has been concluded, the adjuster furnishes the insured with a copy of all building and contents worksheets and proof(s) of loss. k. Manufactured (Mobile) Home/Travel Trailer Worksheet. The adjuster s hould complete a Manufactured (Mobile) Home/Travel Trailer Worksheet for every manufactured (mobile) home/travel trailer loss. l. Narrative Report. One or more NIFP Narrative Reports may be submitted for any flood claim in which the circumstances are unusual, suspect, or especially complicated, and additional explanation is appropriate. Only facts should be included in reports. Opinions or accusations have no place in reports. m. Origin of Loss Verified. The adjuster verifies that the reported claim was caused by direct physical loss by or from flood as defined in the SFIP. n. Partial (Advance) Payments. FEMA encourages advance payments to the insured and the adjuster should advise the insured of the availability of a partial (advance) payment. If the insured requests a partial payment, the adjuster must prepare documentation necessary to support the recommendation to the insurer of the amount of payment requested, including an NFIP Proof of Loss form or advance payment receipt. The range of partial payment amounts will be approved by the WYO Companies or the NFIP Servicing Agent. The partial payment should not be for more than 50 percent of the anticipated total claim payment and preferably should be made against the contents claim. If paid under the building coverage, the mortgagee(s) must be included on the claim check. o. Preliminary Report Complete. The NFIP Preliminary Report is required on all flood losses; however, adjusters who handle losses for WYO Companies may use the company’s preliminary form or comparable form provided by the company. The Preliminary Report is due to the company within 15 days after the claim has been assigned to the adjuster and the adjuster should complete all items in the Preliminary Report. Information unknown at the time the Preliminary Report is submitted must be supplied in a later report. An estimated reserve amount (the dollar value of future payments) should be provided to the insurer. If there are changes in the value of future payments during t he adjustment of the claim the adjuster should notify the insurer. The depth of flood water and its duration in the insured building are important and the duration should be verified by a local official when possible or when in the adjuster’s judgment it seems necessary. p. Prior Losses Checked. The adjuster should verify that damages from any prior loss have been repaired before the subject loss occurred, and must exclude from the adjustment any unrepaired prior damages. The adjuster is expected to review to the extent necessary, using j udgment, experience, and investigative skills to determine if prior damage(s) have been repaired. In those instances, were prior loss history is warranted the WYO Company representative should contact the NFIP Bureau and Statistical Agent to determine the prior losses history on claims if the previous losses were insured through a different carrier.

 

Progress Notes in the File. The adjuster’s file should contain adequate notes about the progress of the claim and the scope of damages, calculations of replacement cost and actual cash value, and a diagram of the insured building with measurements. The adjuster will make his or her notes available to the NFIP General Adjuster(s) during t he reinspection process. r. Prompt Contact. The adjuster initiates contact with the insured or agent by the end of the business day after receiving the loss assignment. This initial contact preferably will be by telephone; but, if contact by telephone is not possible, the adjuster should send the insured or agent a postcard or letter acknowledging t he assignment. The postcard or letter should include the adjuster’s telephone number where the adjuster can be reached. Also, when the insured, agent, or company staff person leaves a telephone message for the adjuster, the adjuster is expected to return the call by the end of the business day after the message was left. In the majority of flood events, these standards are easily met. However, there have been instances where the insured property was severely damaged, hindering the adjuster’s ability to contact the insured within the required time. The adj uster should contact the carrier and seek guidance on how to proceed with the loss. s. Proof of Loss. The adjuster may assist the insured in completing the Proof of Loss; however, this assistance is only a courtesy. Insureds must use their own judgment concerning t he amount of the loss and they must justify that amount. A fully completed NFIP Proof of Loss form, signed and sworn to, with the required documentation is required on every claim on which any payment is recommended. Unless in very large events the Federal Insurance Administrator extends the time in writing (Bulletin) the insured must send the signed and sworn to Proof of Loss with all required supporting documentation to the insurer within 60 days after the date of loss. Only the Federal Insurance Administrator can waive this or any SFIP provision. All waiver requests are made through the insurer. Proofs of Loss and/or NFIP Final Reports are issued as follows: • On claims up to $7,500, the signed NFIP Final Report form will suffice for this purpose. The WYO Company may request the policyholder’s signature on the Final Report to be s worn to. If the claim payment is more than $7,500, a separate Proof of Loss form is submitted. • If the insured qualifies for replacement cost coverage, the adjuster submits the Statement as to Full Cost of Repair or Replacement for the additional amount recoverable under the replacement cost provisions. • If the i nsured qualifies for Increased Cost of Compliance (ICC) coverage, a signed and sworn to Increased Cost of Compliance Proof of Loss form is submitted. t. Proper Building Depreciation. Depreciation is applied reasonably and accurately. This refers both to the determination of the building’s actual cash value (replacement cost less the value of physical depreciation) and the repair estimate. Depreciation is shown separately, as applicable, for each line item in the adjustment, including overhead and profit. "Lump sum" depreciation is not acceptable. Replacement cost, depreciation, and actual cash value for each item are shown in this manner on all claims, regardless of whether the claim is concluded on an RCV or ACV basis. u. WYO Errors (Proper Building Scope and Estimate). The NFIP expects the adjuster to accurately identify the covered damages caused by flood and to allow only the cost of:

 

repairs and/or replacements reasonably caused by direct physical loss by or from flood. The WYO Companies and the NFIP Servicing Agent rely upon the judgment of adjusters in the preparation of the scope of loss and the estimate of damage. It is natural and expected that the judgment or opinion of the adjuster at the scene immediately after the disaster may differ from those reviewing estimates either on the scene at a later date or by a reviewer in a remote location after the claim has been resolved. Claim payments arising out of policies issued by the insurer are binding upon the Federal government. However, non-judgmental errors, at its discretion, are not binding on the Federal Government. • Non-judgmental matters involving inadvertent error (e.g., payment of a loss under a policy issued on an ineligible risk, payment of a loss, twice, for the same item of damage, payment for nonexistent items of damage, payment of a loss in respect to which the damages are unverified, such as where an adjuster might scope the damage as to one building, then settle multiple, similar buildings on the same basis without actually verifying t he damage, etc.) are governed by Article IX of the Arrangement, dealing with errors and omissions, in which it is provided that the responsible party (Federal Emergency Management Agency (FEMA) or the WYO Company) will rectify the error as soon as possible after discovery. FEMA management, in such cases, will resolve the manner in which the error is to be rectified with the WYO Company management. In such cases, redress may be sought, for example, from the policyholder or adjusting firm responsible for the error, either by the company, in a claim for reimbursement, or FEMA in a federal claims collect effort, as is appropriate. NFIP and WYO Company joint reinspection representatives are encouraged to highlight the above situations in their reports, thereby calling such instances to the attention of WYO Company and FEMA management. • Judgmental matters where there may be a difference of opinion between WYO claims Management and the Federal Emergency Management Agency (FEMA) as to whether a claim payment involved on excessive, or inadequate, loss payment (e.g., differing views on the amount of depreciation taken, whether a general condition of flooding existed, whether sufficient verification of damages was obtained, etc.) are governed by Article II (F) of the Arrangement, which provides that "The Company shall investigate, adjust, settle and defend all claims or losses arising f rom policies issued under this Arrangement. Payment of flood insurance claims by the Company shall be binding upon the FEMA." Such matters will be subjected of claims operational reviews and special meetings between WYO management and FEMA management. The above wording was designed primarily for reinspections of buildings and may not express the documentation requirements of large commercial contents claims. What is expressed is the long-held principal that FEMA will not recoup from the WYO Companies or the NFIP Direct Servicing Agent when an error is judgmental. v. Proper Photographs. The adjuster should take as many photographs as are necessary to portray the damage. Photographs of non-damaged property can oftentimes be as important as photographs of damaged property. w. Salvage. The salvage value of all total-loss items must be considered. Where the size of the salvageable loss makes it appropriate, a salvor should be engaged, with the authorization of the NFIP Servicing Agent or WYO Company. Otherwise, the reasonable salvage value of property left with the insured is deducted from the covered loss.  

Subrogation. When the adjuster identifies subrogation potential, he or she must determine the grounds for a possible subrogation recovery. The investigation is considered a routine part of a loss adjustment. The adjuster completes the Cause of Loss and Subrogation Report form and any details of the investigation should be provided to the insurer. y. Timely Reporting. The adjuster’s NFIP Preliminary Report is submitted within 15 days after receipt of the loss assignment. The NFIP Final Report is due 30 days later. If the claim has not been concluded within 45 days, subsequent reports are due every 30 days after the Preliminary Report, or otherwise as specifically directed by the claims examiner, until the claim is concluded.