Forums

Ray

In regards to the Texas windlift argument, would you depreciate the labor cost to physically re-sealing each lifted shingle ?

In regards to the "SLAB" claims, how would you write the claim as with nothing left, it is obvious that the monies received by the insured will NOT go towards actually repairing their property.

Great topic by the way

Robby

To reseal a comp roof that is wind lifted is a perfect example of how to apply depreciation on a loss. NO depreciation in this case. WHY no betterment.

The Texas wind seal lift is not about depreciation or betterment is is about blackmail. This is how it works. the first driver is the TV lawyers who advertize they will get you thousands more. This is a true fact a windlift shingle claim that  get in the hands of these attorneys follows this path. The insurance carrier is notified and has 6 days to settle the demand letter amount or suit will be filed. If the carrier does not demand appraisal inside the 6 day window suit is filed. Now after suit is filed its too late to work out a settlement, because you had you chance to be fair in 2008 when you sent your adjuster out to my clients house.

The judge now ask the defense attorney to attend the first mediation set for a date. The demand is about $250,000 for severalo insults you have done to my client. Its not settled on the first mediation as the black mail amount is too high. Several weeks or months it comes up on the court docket for the 2nd mediation. The carrier is now sweating out all the ongoing leagal expense of $250.00 per hour plus experts on depositions etc. The 2nd mediation is more in line with the carriers and his high priced legal teams thinking and is dropped to $125,000 and that case is settled in mediation and  off the insurance carriers list of law suits and the courts docket of several thousand is reduced by one. The firm for the insured gets its 40% plus expense anf the insured gets about 50% and sure enough its thousands more as the roof was replaced by the first insurance check, but in 2008.

But, its not all bad for the IA,s who work these reopen IKE losses like myself. We meet the roofer and pay for wind lift and the roofer gets the insured a new roof and does not steer the insured to appraisal or a law firm to work this claim in the "lawyer mode". As you can see the lawyers are the roofers best bud and vice versa.

I have a flat rate for my reinspections and recommendation.... business has been good in 2010, but will slow down after 9/13/2010.

The citizens of the USA will have to rise up and demand the appraisal clause be changed in all property policy's to give the carrier more rights to make the clause more like an arbitration clause; before SUIT can be filed. Licensed arbitrators must be used, but not always lawyers or members of the American Arbitration Board. Most American policy holders would like protection at a reasonable cost.... not rate increases ever year.

Richjans   Believe it or not this approach works very well. Very few roofers balk at producing paid expense or showing their cost.  The carrier is just forcing the insured to do what the policy wants, replace the roof  and if not, prohibits an insured from profiting off his loss.

This wind lift issue will eventually get stopped by carriers who are tired of getting soaked.  Laws are made by politicians, who are mostly plaintiff lawyers. The current push for 6 days or sue is confirmation.  You have to get ahead of a problem.  Carriers should automatically replace the roof as soon as the wind claims are reported. Pay the insured and tell them to replace the roof. If not, then defending their failure to protect the property from futher damages, is more winable since they were paid to replace the roof.  Eventually,  the Texas wind policies will restrict or somehow eliminate wind from the coverage, simply due to all these ridiculous claims,  similar to removing water damage,  thus removing mold issues or restricting their exposure to a stated value.  The Texas wind policy is a joke even now with only a few covered perils. Remove wind and see how Texas residents like it.  Carriers will also force insured's to pay higher wind deductibles say 5% or 10% of Covg A to slow down frivolous claims. 

Carriers are not going to continue to get soaked when they can reivse the policy to remove a costly problem.  They did it with asbestos, then mold,  flooding, and will do the same with wind.

Carriers could all but eliminate an IA with the current technology. One inside IA could order a GPS roof measurement, that are all more accurate than any IA diagram I have ever seen,  then replace the roof  to eliminate claims due to leaks. If there are leaks most insured's can measure a room and photo interior damage, and if not there are building records that will.  Most carriers already handle Contents and ALE inside.  

I am surpised some IA firm doesn't embrace this approach to a carrier. We will handle every one of your claims inside the office saving you time and considerable expense and problems.

Well I have used that word from the witness box and the jury seemed to understand that not taking depreciation when applicable, WAS BETTERMENT.

Chuck please explain if rebuilding a jet turbine several thousand hours before the normal time; because it was damaged by an insured peril, is not betterment. This will be my last post on this topic, if you can convince yourself you are still correct. I will ask Barry Zelma, adjuster turned lawyer 35 years ago to give an answer on the net.

I find it ironic that I came across this situation on Friday as we have been discussing this topic

    Please see photo below

Yes folks , that is 6 layers of shingles

There must be some kind of veil over these cases out of the 10th Circuit. Branch vs. Farmers and Davis vs. Mid-Century both are very clear. The decisions on both cases state that labor on the roof replacement can be depreciated. They both also state that the tear off should not be depreciated. The tear off is labor, but that is not why these cases decide depreciation is not in order.

In Davis vs. Mid-Century the roof in question was debris from the storm onward. In Branch vs. Farmers the roof continued to function as a roof for a full year with no pieces of shingle or debris falling off. Still, the court decided it was debris that needed removal before a replacement roof could be installed.

Both Davis and Branch decisions mentioned that the insurer could have included language to depreciate "debris removal" but did not. For these cases, the decision was that the policy called for "debris removal" with no mention of depreciation.

Yes, debris removal is labor. What besides labor and a few tools is needed to remove a roof?

What about those companies that depreciate roof removal when they replace an old roof with a new one? I don't know what their reason is, but Alan says the adjuster that does this better have a good reason. Well, reason #1could be that it is the insurance company rule, not the adjusters. Reason #2 might be that the old roof is still a roof until it is removed. Once it is removed, it becomes debris! Could it be that payment for debris removal be "deferred" until incurrence?

Before you can answer this next question I have, you've got to accept that these two cases allow depreciation of labor on a roof replacement. Find this in the decision before you consider my next question. This is not about right or wrong....just trying to figure out what the law is in this jurisdiction.

If we can "defer" the difference between ACV and RC until it has incurred, why should we not defer the "debris removal" until it has actually happened? If the insured takes the ACV settlement and doesn't replace the roof for ten more years......then I suggest that the old roof was not debris at all...until the end of that roof's life. If it wasn't debris, then why would it be owed?

Please do not apply Florida or California reason to this. Those states...and probably others have totally different laws and a totally different mindset.

Posted By RandyC on 17 Sep 2010 04:24 PM

There must be some kind of veil over these cases out of the 10th Circuit. Branch vs. Farmers and Davis vs. Mid-Century both are very clear. The decisions on both cases state that labor on the roof replacement can be depreciated. They both also state that the tear off should not be depreciated. The tear off is labor, but that is not why these cases decide depreciation is not in order.

In Davis vs. Mid-Century the roof in question was debris from the storm onward. In Branch vs. Farmers the roof continued to function as a roof for a full year with no pieces of shingle or debris falling off. Still, the court decided it was debris that needed removal before a replacement roof could be installed.

Both Davis and Branch decisions mentioned that the insurer could have included language to depreciate "debris removal" but did not. For these cases, the decision was that the policy called for "debris removal" with no mention of depreciation.

Yes, debris removal is labor. What besides labor and a few tools is needed to remove a roof?

What about those companies that depreciate roof removal when they replace an old roof with a new one? I don't know what their reason is, but Alan says the adjuster that does this better have a good reason. Well, reason #1could be that it is the insurance company rule, not the adjusters. Reason #2 might be that the old roof is still a roof until it is removed. Once it is removed, it becomes debris! Could it be that payment for debris removal be "deferred" until incurrence?

Before you can answer this next question I have, you've got to accept that these two cases allow depreciation of labor on a roof replacement. Find this in the decision before you consider my next question. This is not about right or wrong....just trying to figure out what the law is in this jurisdiction.

If we can "defer" the difference between ACV and RC until it has incurred, why should we not defer the "debris removal" until it has actually happened? If the insured takes the ACV settlement and doesn't replace the roof for ten more years......then I suggest that the old roof was not debris at all...until the end of that roof's life. If it wasn't debris, then why would it be owed?

Please do not apply Florida or California reason to this. Those states...and probably others have totally different laws and a totally different mindset.

Hey Randy,

Awesome post,

you bring up a very strong and valid argument, I look forward to the debate on this topic

Once again, nice job

* Just a quick note to the masses, I gotta say, it seems awful qiuet since Olegred has been banished from the boards and dare I say maybe we all actually enjoyed and possibly liked him a bit ?
 

Yes I am aware that a few fellow colleagues had to resist the desire to choke Olegred from time to time,

but he does kinda grow on you.............like a WART !! 

* Just a quick note to the masses, I gotta say, it seems awful qiuet since Olegred has been banished from the boards and dare I say maybe we all actually enjoyed and possibly liked him a bit ?

LOL!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!