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Posted on Wednesday, September 20, 2000 - 9:27 am:   

In the past, working on numerous cat storms, a carrier will pull 25% of your initial files turned in, to review. A very good process. Measuring to the inch, accounting for only the items covered and damaged by the storm, and an accurate listing of said damage, line by line assists any reviewer and insured looking at that file. From those 20 files, which should look the same, the adjuster should be told from the 5 files, what areas needed further consideration, further explaination, giving the adjuster the needed care to handle future files, be it the next 80, 200 or 550 files that might be handled over the next 30 days or 9 months. Starting off on the right foot, puts the adjuster, the carrier and all insureds that this adjuster will be talking to and settling their claims a pleasant process. We learn of any potential problems that could occur on any given storm, by having our immediate supervisor assist, in letting us know from those first 20 files what lies ahead. Being away from the family is never easy. Any time I can learn how to do my job better for all parties, and their are professional people who I have always worked with and for, ready to steer me in the right direction. The insured in the 1 story, 2 bedroom has the the same concern, as the insured in the 30,000 SF home on the same storm. Inspect my claim, show me the damage, turn in the claim, and the carrier will show them the money. Sorry, I couldn't help myself with that last line. Remember, to not forget the extra labor to remove items to replace items. David, thanks for the post.
John Mcmennamy
Posted on Wednesday, September 20, 2000 - 7:57 am:   

To An Insured, You the insured are the heart of our industry. When you purchase an insurance policy you enter into a contract with the insurance company. This contract insures you against certain Perils ( Wind, Hail Lightning, Fire, Ect. ). As independent Insurance Adjusters, as Jim stated, we are called in by Adjusting Companies hired by Insurance Companies when a catastrophe occurs so your claim is handled in the fastest possible time frame. As adjusters we work for both you and your Insurance Company. If the damage is caused by an insured peril you should be paid a fair amount to had your property repaired minus your deductible. In order for an adjuster or roofer to correctly tell how much damage is has occurred to the property they must inspect your property. You can not do this by phone. In the case of a roof an adjuster or roofer must inspect and measure the roof. In order to inspect the roof someone must get on it. In the case of a steep or unsafe roof it may be a perimeter inspection from a ladder. I know several very capable adjusters and roofers. I do not care how much experience you have you can not inspect something you can not see. When we inspect your property and find damage the insurance company owes for covered damage, no more and certainly no less. You the insured are important to our industry. Without you there would not be an insurance industry. On the other hand if there were no insurance companies you and I would be in trouble trying to cope with a catastrophe and the expense of repairing our property. I am an adjuster and I like most others try to put ourselves in your position ( I.E. What would I do if this was my property ? ). I am also an insured like you and want to be treated fairly. This is only my opinion. Thank you for your post and welcome to CADO. You are not just an insured. As Jim stated you are a valued insured. Please visit CADO again. Yours Truly, John ( Johnny Mc ) Mcmennamy
Jimlakes (Jimlakes)
Posted on Tuesday, September 19, 2000 - 10:45 pm:   

Dear Valued Insured, We are glad that you found the site for "Catastrophe Adjusters." If I may, I will attempt to answer your question, "What is the differences between Pilot and RAC and some of the other adjusting companies?" There are hundreds of independent adjusting companines throughout the U.S. All the way from a one person company to the largest, which is Pilot. Some work daily claims and some specialize in "catastrophe" claims. Some work all claims. We all work for the insurance industry. On the catastrophe side, most insurance companies do not have the staff adjusters to handle large catastrophic events, because of the pure numbers of claims in a concentrated area. When this happens they call in independent adjusting firms. We all make our living by handling claims for the carriers. For the most part, all adjusting firms try very hard to do a good job and pay the insured's what they have coming. Most all insurance companies want us to pay the insured everything they have coming. I know of no insurance company that asks us to underpay an insured for their damages. Most independent adjusting firms operate the same by using independent adjusters. There are good ones and there are bad ones, like in any business. Most all independent adjusters try very hard to do a good job because their use by the adjusting firms is based on their performance. If they do a good job, the adjusting firm will continue to call them. We all try to get the best adjusters available at the time. Like with any business, if we provide a quality product to the insurance industry, by servicing their insured's in timely manner and a fair settlement, they will continue to call the Pilot's and the RAC's. Again, thank you for your question and I hope that I have answered it properly. Best Regards Jim Lakes National Catastrophe Director RAC Adjustments, Inc. 630.375.9640
An insured
Posted on Tuesday, September 19, 2000 - 7:19 pm:   

I am just an insured and I stumbled onto your web page. After reading your site I can see there are some good, honest adjusters. I never knew there were different adjusting companies, I thought they worked for the specific carrier. I notice you talked about going on roofs. After going through a major catastrophe in my area , and it took years, none of the adjusters did the things you ladies and gentlemen talk about. I knew alot of people who went through the same thing I did and none of their adjusters went on the roofs. I had one good adjuster, the second one and I felt he was very good, but the carrier got rid of him and he sounds more like you ladies and gentlemen. You speak as if you just want is right. My question is what are the differences between the different adjuster groups such as PILOT and RAC. Thanks, an insured
Tomj (Tomj)
Posted on Thursday, September 14, 2000 - 8:44 pm:   

Jim L, TomT, RJ, Others,
Most of the problems I have seen over the years have come down to three areas. The first, the adjuster not receiving adequate instructions as to what was agreed on with the vendor and the carrier. Second, not enough experience, and not enough support staff. Third, the individual just should not be there if not able to organize and handle the work and have the experience to deal with the insureds and compamies.
One other note, if the vendor and company is working on a very small schedule with a 60/40, at 40 where is the support staff.
A note to several of my customers, thanks for the support of the staff which enables me to preform my duties, espically the clerical dept.
Posted on Thursday, September 14, 2000 - 5:57 pm:   

Does it make sense that since most vendors hold back 10% of the adjuster's commission income, that the vendors anticipate a reopen rate of 10% of the files?
Tom (Tom)
Posted on Thursday, September 14, 2000 - 12:23 pm:   

Jim Lakes has hit the nail squarely on the head. Read his post several times, take his advice, and you will find your adjusting life to be much more peaceful and calmer. I have been in this business for almost 40 years now. My wife and I are both licensed adjusters and pride ourselves on the fact that we have very few if any re-opens. We do not overpay claims to attain this. We do not close a file until agreements have been made with the named insured and/or their contractors. It does not require that much more time to get an agreement on repairs, after all, that is what you are being paid for. The turn and burn philosophy sucks. It does not work and never will work. Give a quality product and eventually you will work for quality vendors who are representing quality companies.

RAC seems to be becoming a leader in the effort to attain and use only quality adjusters. I commend them for that and hope that other vendors are reading these posts and letting it soak in. We will destroy this line of work if we do not apply due dilligance. Educate yourselves, take pride in what you do, and the income will increase. Learn to plant, learn to sow, and you will learn to reap.

Tom & Janice Toll
Jimlakes (Jimlakes)
Posted on Wednesday, September 13, 2000 - 10:37 pm:   

I agree with you about most of what you have stated, especially the "qualified" adjuster.

The only thing that I might add is that the "qualified adjuster," will in almost all cases, obtain an agreed price with a contractor that is preffered by the carrier or the contractor of the insured's choice. This is something that we ask for from our adjusters. If the agreed price is obtained by the adjuster it will cut the re-open rate to near nothing. Otherwords, "why do a lot of files re-open?" Because the adjuster did not obtain the agreed price with the contractor or the insured. If he/she did, the only thing that most contractors would call back for an additional is something that was hidden or unforseen.

As for the fee schedules, there are some vendors, that will not provide the quality product for the fee schedules that others will accept. The ones that do accept them have a hard time finding the "quality" adjusters because of the low fees. Many of you may not believe it, but there are carriers that truly belive that you "GET WHAT YOU PAY FOR." We are working a storm, as I write this, for such a carrier and they have stated this fact and we are providing a "quality" product to them and we know that we will have less than a 5% re-open rate.
I might also add that the vendors that accept the "too low" fee schedules are also the ones that do not properly supervise or review the files before they are submitted to the carriers. Is this the adjusters fault? I think not. These are also the vendors that care more about the "numbers" instead of the "quality" of the product that they produce.
I feel that there is blame that can be placed on everyone, some carriers, for expecting to much for to little, some vendors, for accepting the low schedules and not providing a quality product after they do, and some adjusters, for not doing a quality job.
If we all would do our job, things would be better for all.

Jim Lakes
National Catastrophe Director
RAC Adjustments, Inc.
Gale (Gale)
Posted on Wednesday, September 13, 2000 - 9:45 pm:   

Rj what percent of reopens would you consider normal?
Rj (Rj)
Posted on Wednesday, September 13, 2000 - 12:24 pm:   

David, you make an excellent case for carriers expectation of a percent of files that should or will reopen, however, I do disagree with your statement that no reopens automatically means that the claims have been over paid. There are exceptions to your assumptions and that of carriers that are only looking for fast inaccurate adjusting.

My disagreement lies with your assumption that all adjusters will close files in the same manner. That is just not the case in the world or reality. You see there are catastrophe adjusters that will not improperly handle files for the sake of fast closings. These are the adjusters that know proper adjusting practices and have a personal code of ethics. Almost without exception the only time a file of a qualified adjuster will reopen is for hidden damage & replacement cost benefits of which is not normally the responsibility of nor is expected to be handled by the original adjuster.

This now brings us to the underlying question as to why you & many carriers have developed this mental attitude with respect to an expectation of a certain percentage of file reopens. Included in some of my prior posts I have outlined theories of CAUSE and EFFECT.

In this discussion we are looking at Two outcomes (EFFECT) of handling files and conditions (CAUSE) which brought about the condition of stating a percentage of file reopens vs. no file reopens.

First let us start with your expectation of a percentage of file reopens. As you have stated there are many reasons for file reopens that are outside the range of hidden damage & replacement cost benefits. The many reasons you have stated for file reopens are the EFFECT of poor adjusting skills & improper claims handling which are the secondary CAUSES for reopening a high percentage of files. The primary CAUSES for a high reopening of files go back to the hiring practices of the carriers and vendors and the contacts between them.

David, whenever a vendors' and or carriers' primary objective is to close claims faster than is humanly possible while paying substandard service fees the bottom line result is going to be a nightmare for anyone doing cleanup. First of all the areas you have explained as the CAUSE for many of the files being reopened are totally manageable by the initial adjuster. Provided that the vendor and/or carrier hire qualified adjusters in the first place. The problem is and will continue to be the manner in which the claim is handled by the first adjusters' handling of the insured's claim and given the current fee schedules about the only people many of the vendors and/or carriers find are young, inexperience and/or have no ethics. The money is just not there to attract good qualified adjusters into the profession and unfortunately is chasing many qualified adjusters out of the business, hopefully that will change.

Secondly, lets us look at those that claim to have a near or perfect record for closing files and keeping them closed. Since my wife & I both are licensed & qualified adjusters in all lines including flood, I will briefly explain some of the differences between qualified & unqualified adjusters.


1. A qualified adjuster establishes quick initial contact with the insured and maintains communication with the insured throughout the handling of insured's claim.

2. A qualified adjuster inspects insured's damages as quick as possible with the insured present.

3. A qualified adjuster determines cause & origin of insured's loss before evaluating insured's loss.

4. A qualified adjuster fully explains his settlement recommendations to the insured prior to submitting said recommendations to the carrier for payment.

5. A qualified adjuster prepares his loss report such that anyone reviewing the file can follow and understand the adjusters recommendations.


1. May or may not contact insured for initial contact or during the handling of insured's claim.

2. Often just drive by the risk for exterior photos and may or may not actually conduct a partial of complete inspection of insured's damage claim with or without the insured being present.

3. Rarely if ever be concerned about cause & origin and just write of all damages occasionally including items either undamaged or non-existent.

4. At the most will phone insured and tell insured a dollar amount & will not answer any other questions by insured.

5. Files are difficult to read, understand and follow making payment recommendations with no sound basis for doing so.

David, I am sure that if the truth be known about the file reopens that are being discussed on this web site you would find the files, in all probability, were handled by unqualified adjusters. Therefore, that being the case don't blame the unqualified adjuster (he shouldn't have been hired in the first place) blame the vendors and carriers that encourage these practices in the first place by negotiating the qualified adjusters out of the business through the practice of extremely low fee schedules and demands for instant settlements under threat of pulling files.

David, on a positive note, we have found a few good vendors to work for that have contracts with carriers that understand the value using only good qualified adjusters. While the fee schedules still need a little work, the file requirements are such that they have realized that indeed it is better to allow the adjuster a little more time to do the job right. In the end the insured is better informed & satisfied with their settlements which result in fewer long term complaints and all but eliminating file reopens by the insured. After all the most important thing is to indemnify the insured after a loss within the terms & conditions of the insurance contract (policy). Unfortunately, speed only creates more confusion & less positive end results when speed is the most important factor.
Rj (Rj)
Posted on Wednesday, September 13, 2000 - 9:07 am:   

I have created this new discussion based on the questions and opinions surrounding file reopens that have gone off into a tangent in the discussion titled "New revenue streams for cat adjusters, STORM OR NO STORM? " because file reopen discussions are unrelated to the topic of new revenue streams.

To begin this topic I have copied over the last response in the topic "New revenue streams for cat adjusters, STORM OR NO STORM? " by David Bennett.

Maybe this subject should be put in a proper perspective. That is, what percentage of claims are we generally talking about. 5%, 10% 20% of the total claims in the storm. I am not saying that some of the mistakes, outright BS etc is not a problem. Mistakes happen, missed damages happen, math errors happen. These types of errors can be corrected. The outright writing of items not damaged, not there or having someone else write the estimate in my book is fraud and that person has no business in this business. If a company or vendor has 30% or more reopens that might be an indication of a problem. On the other hand, the company or vendor that has no reopens definitely has a problem, as you can virtually be assured that every claim has been overpaid. You see, there is an old school of thought, which applies if you are writing a solid accurate estimate, Not everyone is going to be satisfied and will want more so there should be a relative %, say 10% or so that should reopen or need additional inspections.

There are those who would disagree and say that they accurately write and close with no reopens every claim they handle. My thoughts, having been on the carrier's side is that this is not possible in this day and age. Why? neighboridis, greed, trying to get more, covering deductibles and of course the contractor who waits for 30 days to request a reopen, hoping to get another adjuster who he can buffalo or may not be as experienced or who doesn't take the full time because it is a reinspection and unless there is add'l payments he doesn't get as much pay(unless your working per diem )and will write additional damages (questionable) to get the claim closed.

One point which hasn't been discussed, is that if you write a tight sheet without being lenient, the claim will reopen. Most carriers are lenient in a storm situation, because this is the time when they must respond. So a 100.00 for some questionable guttering or whatever, which closes the claim for good and prevents add'l time being spent, is generally considered ok by the carrier in the storm situation. Is it an overpayment? yes, but the cost saved is worth it. Now a carrier probably won't put this in writing, but talk to those who have been around, this is the principle.

David Bennett
Jimlakes (Jimlakes)
Posted on Tuesday, September 19, 2000 - 11:03 pm:   

SWK, Speaking from the standpoint of a vendor, we believe that the 10% holdback is not based on our adjusters having a 10% re-open rate. It is to cover the cost of having to rework files by some adjusters that do not properly close their files. I must add that this is a rare occasion, however, if we have to use, say you, to go out and re-adjust a file that someone mishandled, you are going to want to be paid for your services. Who is supposed to pay your fee? The vendor or the adjuster that mishandled it to begin with. We do have a policy that if an adjuster has worked for us on three or more storms and has had no re-opens as a result of his/her mishandling, we do not holdback money on that adjuster. We as a vendor are not happy if we have more than a 5% re-open rate on our closed files. That of course is because we try very hard to provide a "quality" product by the most qualified adjusters. Jim Lakes National Catastrophe Director RAC Adjustments, Inc 630.375.9640

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