| Author |
Message |
john postava
| | Posted on Friday, June 16, 2000 - 8:40 am: | |
Eric:
You "hit the nail on the head" regarding the manipulation of labor rates to effect global changes in a construction database (pardon the pun). Most adjusters don't require this feature in their software (and many carriers don't want it in their field systems). The ability to do this is in our system but we only have had a handful requests from adjusters to use it (mostly commercial estimators). We have found that more restoration contractor users like the ability to enter their tradespersons rates into their systems so they can get a better handle on their own job costs. |
Eric Carlson
| | Posted on Thursday, June 15, 2000 - 3:39 pm: | |
I concur with John about the Craftsman data and the Craftsman company. Our relationship with them has not been as long as SIMSOL's but it has been completely positive. We tried several other data vendors but none were anywhere near as responsive when it came to our needs.
John, I looked at a current version of your program and looked at the unit cost breakdown. You do have the ability to view the material, labor, crew, productivity, etc. but the feature that I was proposing was to give the adjusters the ability to modify the rate for a particular type of labor or a particular material and have that rate apply to all items in the database that are based on the same rate. (You may already have this feature also but I couldn't find it right away.) Anyway, with that level of control over the cost it seems it would be much easier to update databases to match the spikes and dips that are found in certain areas for certain materials.
This might be more than most adjusters would want to get into but I was just throwing out a suggestion to see if there would be interest. |
john postava
| | Posted on Wednesday, June 14, 2000 - 9:14 am: | |
SIMSOL has been working with third-party national databases for over 10 years. Up to last year I personally managed our products published database pricing before turning over to a full-time estimator who knows alot more than I do about constructing unit costs.
At the present time we begin with Craftsman's National Construction Estimator as the basis of our prices because we have found it to be the most accurate pricing guide of all their books. It is the only estimating guide they publish which is maintained by Craftsman itself (their other publications are compiled by other estimators) and it has been in development for over 48 years! Craftsman's other books are relatively new compared to the NCE publication.
Due to the complexity of building accurate national (factored by ZIP code) databases, we have found that additional research must be done to the base data supplied by Craftsman. Because our company handles thousands of local and catastrophe claims each year, we have the unique ability to know EXACTLY what labor rates and material costs to use and at what costs estimates are being agreed upon. Our adjusters obtain this data from the contractors they work with or by researching pricing at local supply houses. By making modifications to the base costs and rates supplied by Craftsman, we are able to (hopefully) get closer to the reality of the local marketplace in terms of the real unit cost.
We have had a long running, positive relationship with Craftsman and we inform Craftsman of our findings and the estimators there further research our data and make any adjustments they feel necessary to their database and they update their cost book as needed.
No Nationally factored database is perfect. Market pressures and short-term labor and/or material shortages will spike prices temporarily from time-to-time. Professional adjusters and estimators are aware of these realities and know their local markets and make adjustments accordingly (that's why they call it "estimating").
Our company's approach to our software's core cost databases (i.e. using a national publication and combing that data with our knowledge of the current markets), we feel, is the best approach to zeroing-in on the most accurate and fair unit costs. If the user disagrees with a cost, they can click on a button and see exactly how we arrive at that unit cost. In addition, they can click on another button and enter their own labor, material and equipment charges and tradesperson productivities and our system will calculate their own unit costs if they need to.
I hope this explains how SIMSOL develops it's unit pricing for our estimating systems. Any comments from CADO readers are always welcomed and highly encouraged. Private emails will all get a response. |
Eric Carlson
| | Posted on Wednesday, June 14, 2000 - 12:43 am: | |
Thanks for the input, information, opinions, etc. This kind of input will certainly help us as estimating program vendors as we continue to look closely at the data we are using to be sure we are giving you guys the best information we can. We will definitely work some kind of quick access button into our estimator to give a more in depth look at the data. I think one of our concerns before was trying to show all of the data all of the time which would create lots of confusion for everyday estimates. But what I seem to be getting from the conversation here is that for the run of the mill stuff you need to get as close as reasonably possible but you also need the ability to dig into the data when there is a question or a special case.
David, I've been reviewing your initial post and it has my wheels turning. I look at the way our data (and everyone else's data that I know of) is structured and it really doesn't reflect the real world process that you described for coming up with a unit cost. All you typically get in a computer database is a material cost and a labor cost, sometimes an equipment cost. However, it looks like in order to be able to really "adjust" those stored prices to their real world equivalents you would need a way of tweaking the individual components of that cost. If we could store our data in a way that you could for example, simply change the labor cost for drywall installers and have that apply to all drywall items in the database, would that be a useful feature? |
ksmith
| | Posted on Sunday, June 11, 2000 - 12:59 am: | |
here's my two-cents worth. first, i'd like to thank eric carlson for his restraint- gale hawkins should be so graceful. secondly, to answer one of eric's comments- one way you might make the extra data available is to add an on-screen button to the estimate section. fix it so that we could hit that button while writing the estimate & have a small window open up to show exactly what your unit price includes.
thirdly, i got a few comments on unit costs and the commonly used data bases.
first off is the carrier- know thy customer, & give him what he wants. some carriers may prefer to pay a little on the tight side throughout a storm. others may pay a little on the tight side going in, and get loose as the storm goes on. still other carriers may want to be a little loose all the way through. and still others may not care either way, as long as the claim gets settled. the different attitudes can result in quite different claims handling not only from carrier to carrier but also from storm to storm with the same carrier. three things are sure about those attitudes: there are reasons for following each one; we adjusters (especially independants) are generally not privy to those reasons; and the decision as to which to follow is generally not ours to make. however, unless it's illegal or unethical (as opposed to mere differences of opinion or judgement), we should try to do it the way they want.
as for as the unit prices themselves go- i don't put an extremely high value on either craftsman or nce. i use them on routine stuff because they're commonly accepted and easy to use. however, if it gets right down to the nut-cuttin', especially on very large or one-of-a-kind losses, i'll go back to manually doing labor and materials. the labor allowances come out of the walker or thomas books, and the labor rates come fron the local union hall (if it's a union state) or from local inquires in a right-to-work state, and the materials prices come from local dealers. if there's a big general contractor involved, there will also be another source of info. most larger contractors keep their own records/data bases as to their historical productivity and costs on past projects. if you can get with the g.c.'s lead estimator, chances are he can provide helpful info along those lines. and, i promise you, his records will usually be lower than what you might otherwise figure off these computer databases.
finally, as somebody else has already noted, two hours of time is one too many on comp shingles. we commony estimate one hour, but any nail-bender worth his salt can beat that. and, with 4 nails per shingle, it runs about 1 lb of nails per square. also, even though our unit roofing prices commonly allow for nicities such as ohd/pft and payroll burdens, a lot of the actual roofing labor, especially with smaller contractors,is actually a "sub" item, with the laborer being paid by the square, not by the hour. or, sometimes, he's paid by the day.
p.s.- since the advent of computerized estimating, have the adjuster trainers stopped teaching folks how to develop unit costs? |
David P Bennett (Whitey)
| | Posted on Saturday, June 10, 2000 - 11:57 pm: | |
Eric, thank you, I finally got someone to address the pricing. I am familiar with the renovation book as published by craftsman. I understand that craftsman is not the editor of this book and in checking I found that the modification factors for this particular book do not match the modification factors in the rest of craftsman's publications. (I believe the rest of the publication's use the same modifier's ) As for the craftsman construction manualitself, If I'm not mistaken, the unit cost are for the individual item themselves. e.g. roofing is strictly the shingles and labor to install per square. If you want felt you have to add for it as well as boots, drip edge and so on.
To be honest, when you compare the pricing between craftsman's construction and the renovation manual published by craftsman, the renovation manual is way to high. It actually found its way to file 13 in my office. The other manuals available, Marshall Swift, R S Means and a few others are all within 5 to 10% of one another which is an acceptible variance.
If all of the programs you listed are using Craftsman then the only explanation for price difference's must be the inclusion of some items in the unit pricing and or the use of the renovation manual. I sympathize with those using pricing from the renovation manual as every public adjuster and contractor in the country would love to settle losses on these numbers. Why? because in reality, they are overinflated.
As for passing along the information, I would think that the unit pricing should be just that. Unit pricing for shingles, for felt, for painting and not be inclusive of other items which may find their way into the particular operation.
You see what happens is the adjuster uses the unit pricing for shingles, then adds for the felt, drip edge, plumbing boots etc and if the unit price for shingles allready includes some of the items, the end result is an overpayment of the claim, which we all know simply infuriates the carriers.
As for the adjuster who says he can remember all the pricing for most every item when in actuality you have a potential for in excess of 10,000 items you can run into, well their memory must be far superior to mine. I've been at this for 20 + years and you know what, prices change, materials change, quality changes, labor rates go up and all those prices I thought I remembered, just aren't practical anymore.
I agree, a database cannot have every item in it, but the more the better. As long as the more is practical and reflects items found in the construction arena for the most part.
Again thanks for your input. |
Eric Carlson
| | Posted on Saturday, June 10, 2000 - 9:09 pm: | |
David and others,
I am with one of the estimating vendors that you hopefully want input from. We use the same database that several other software vendors use (the National Renovation and Insurance Repair database from Craftsman Book Co. Some also use the National Construction Estimator which we are almost through converting for inclusion in our program.) The Craftsman data seems to be generally well liked but there are always situations where the pricing is "not in the ball park" according to some adjusters. The Craftsman data relies on a regional adjustment of labor, materials, and equipment costs in order to approximate the costs in different area of the country. This works well in a lot of cases but not in others. However, we have even heard complaints about unit costs from users of other vendor's software who publish specific databases for individual regions.
One problem we encounter had to do with the roofing costs as they were published in the NRI database. Many adjusters complained about the cost being too high but the problem was that the cost of the shingles also included felt paper, flashing, etc. If you were reading a craftsman book and manually taking the costs from the book and putting them into an estimate you would see this kind of information printed in the margins along side the pricing. The trouble with converting that data for use in a software program is that the screen real estate is so limited, and also if we try to present the users with too much data at one time they usually tell us, "That's too much data." So I guess the question is, how can we present all this data to you guys and gals without creating a program that's not going to look so complex that you throw it out the window the first time you look at it?
There are some of the seasoned adjusters who tell us they want a database with only 600-800 line items because they know the costs so well that they can pull stuff out of their head when they need it or they're not afraid to look it up in a book or make a call if necessary. But on the other end of the spectrum there are the new adjusters who fully expect the software to feed them every bit of information that could conceivably be needed for a wide variety of claims. So again, this is an area where we are trying to do two seemingly contradictory things to fit different styles of adjusting.
Getting back to the thread topic which is how these costs are being establish. Craftsman data is used by PowerClaim, DDS, and SIMSOL and the manuals go into a great amount of detail about how they are established. The problem seems to be that some of the information about how those costs are being established is not easily accessible from inside the programs. So, any creative ideas about how we can present this data without overwhelming you, the end user, would be helpful for all vendors I would think. |
Tom Toll (Tom)
| | Posted on Saturday, June 10, 2000 - 11:57 am: | |
I don't know who Ghostbuster is, but from what I read on his posts on CADO, he is obviously a common sense, well educated adjuster. Tom Weems is in the same category. The posts from them on this thread are valuable and informative. Do the carriers really care. Do the vendors really care. Some do, some don't. CADO can help weed out those that do not care about us as insurance adjusting technicians. Posting schedules is wrong, posting true, authenticated information about vendor misbehavior is necessary and welcomed by me and hopefully all concerned. I sometimes reap criticism for some of my posts, which is what I want. Only when there is a challenge is there change. Yes, lets elaborate on those vendors and companies that make prostitutes of us. This is a rewarding and decent occupation. Do we as an adjusting community have some rats and moles in the barrel. Sure we do. We always will, as that is what the new society is producing. Some criticize the old timers, (and I am one), but that is okay. Most of us can read between the lines. My wife and I work as a team and have never turned an apprentice adjuster down if he or she asked for help, and we never will. We need more young minds in this field as the old minds are fading out fast. I never intend to retire, unless a disability causes it. If I can figure out how to get a wheelchair to climb a roof, I may try that. Cado is a wonderful mechanism to change our industry. The industry of adjusting. It will not change the companies attitude, nor the vendors, but we do not have to work for the bad ones, right. |
David P Bennett (Whitey)
| | Posted on Friday, June 09, 2000 - 10:08 pm: | |
You know, its really amazing how a simple question poised to those of us who are capable of breaking down unit costs and arriving at the right dollar amount for repairs and poised to the estimating vendors who are sending out unit pricing, turns into a discussion about unions, organizations, costs paid for adjustments etc. I really want the estimating program vendors to provide some input. Specifically on painting, drywall, roofing and siding prices. There really seems to be a wide range on the pricing. One program has a unit cost of .60 for two coats of interior paint on walls and ceilings or a 1.40+ for drywall taped and floated (which actually is taped, floated and a full skim coat applied).
Lets start providing some input to the estimating vendors on what we see as accurate costs or at least let them know where they are out of line and why. |
Russ Doe
| | Posted on Wednesday, June 07, 2000 - 1:38 pm: | |
In response to Goitalone. I think we have the beginnings of an Organization of Adjusters who arent afraid to ask the hard questions and are willing to share their knowledge with all Adjusters.We will through this organization raise the level of competence throughout the industry. Information is the key to success for any endeavor!From what I've seen on these pages in the last year,we have only scratched the surface.My Thanks again to Roy Cupps for the vision and the tireless effort.Also thanks to all who take the time to voice their opinion on all matters relating to our business.Have a great day and BE SAFE,THINK BEFORE YOU CLIMB. |
Ghostbuster
| | Posted on Wednesday, June 07, 2000 - 10:03 am: | |
Or, let's try this on for size... In Texas a car maker cannot sell its products directly to the public. It must sell thru independent dealerships. Why? Because back when Christ was a PFC and the auto makers could not afford to build a company store network, the dealership boys got together and with the salestool called the '4B's', (Booze, Bucks, Broads, & Buicks), rammed thru the legislature a convienient little ol' law saying that only they, (the independent dealers) could sell cars. The moral of this fairy tale is that perhaps we should be thinking along the same lines. We do need some legislative help out here if our survival as true PROFESSIONALS means anything. |
Tom Weems
| | Posted on Wednesday, June 07, 2000 - 9:06 am: | |
Jim, I am sure you remember that during the south Florida part of Hurricane Andrew, Mr. Tom Gallagher the Florida Insurance Commissioner set the unit pricing. I am also sure you remember what happened as a result of politics interfering in the adjustment process. Yet carriers are a lot more interested in the costs involved with adjustment expenses than they are in the actual pay out on the claim. This is caused by the failure of the various states to allow IA expenses to be passed on to ratepayers, and of course the reinsurance issue. . As long as these expenses are charged against the profit margin, instead of being a part of the regulated administration expenses, which are passed along to the ratepayer, the carriers will continue to seek the cheapest way to settle claims. In a perfect world they would be attempting to employ the better adjuster who will potentially earn his keep in the proper handling of claims.
I congratulate you on your proper adjustment of your Andrew condo association claims, but I wonder if the carrier involved whined about the service bill afterwards. Too many carriers out there are happy to “pay em and make em go away”, instead of concentrating on proper adjustment of claims. I grieve about the way the industry is heading. |
Jim Flynt (Jim)
| | Posted on Wednesday, June 07, 2000 - 9:00 am: | |
Well Mr.Goitalone, even if we are a lot like those in the oldest profession, we should at least learn from them. Even they realize and recognize that the more talented in their midst can and do charge higher rates. Or as they say on the "street", the nicer the nice the higher the price.
I and most other professional adjusters are not afraid of "competition." We are more afraid of those so called "adjusters" who are giving our industry a bad image: the part-timers, roofing salesmen, 7-11 clerks, etc., ad nauseum.
Yes, I do think we can have higher rates while bringing better educated and more well trained "Newbee" adjusters into our folds. And YES, I do understand that means we are going to push some other "adjusters" out of this business: the ignorant, the untrained, the unprofessional, and those who refuse to adapt to the changing world we live and work in. And, I say, Good Bye and Good Riddance.
And I also say, Welcome aboard to any and all Newbees who want to learn, train, develop, and educate themselves to their highest potential. We have plenty of room under the tent for MORE not less professional well trained adjusters. Ask any vendor or carrier and they will tell you, there really are too few good well trained and educated professional adjusters.
Welcome Aboard Newbees! |
goitalone
| | Posted on Wednesday, June 07, 2000 - 8:01 am: | |
NO, NO, NO, NO!
Lets train more for the carriers and vendors so they will have more to work for cheaper fee schedules. Where do we want to go people. More competition or higher rates. You can not have both. THINK ABOUT IT! Besides, anyone that thinks they can organize the bunch in this profession needs to have his head checked. It will never happen! As a wise old timer once told me, we are a lot like the oldest profession out there on the streets. |
Ghostbuster
| | Posted on Wednesday, June 07, 2000 - 2:34 am: | |
OK, which begs the question, what kind of organization do we want? That poor old stuffed and toothless teddy bear called NACA is an association. Do we want a Guild? One that has a strong leader or spokesman to tell the carriers how the cabbage will be distributed and eaten? What about keeping the troops disciplined to hold the line and not fire till we see the whites of their eyes sort of thing? While strength is in numbers, and he who gets there firstest with the mostest wins, in fact, does our superior CADO expertise really mean anything to the carriers? At every storm my 1/4 century of pure property adjusting acumen is deemed worthless by the carrier and vendor RT's and they have to retrain me to their brand new way of expertise. (Yeah, I'm more than a little bitter right now after this last storm.) And one last thing, let's just say that one day several hundred organized CADO-ites go to a storm and make loud noises. Whose to stop the carriers and/or vendors from bringing in the usual motley crew of bagboys, wrecker drivers, and ex-strippers to wear the carriers shirts? (Say, didn't we have this same conversation about seven months ago with our pal Union Cat Adjuster?) |
Jim Flynt (Jim)
| | Posted on Tuesday, June 06, 2000 - 10:43 pm: | |
LAW OF LARGE NUMBERS 101
GHOSTBUSTER, You and I are saying exactly the same thing!
The only hope on the horizon as far as I see it is CADO, when it comes to "organization" and yes, we do need to be organized.
Finally, there is one other concept which insurance companies understand, and that is the "Law of Large Numbers."
When a large number of adjusters refuse to work or fail to show up for work for a large vendor or carrier because of lower fee schedules, then things will change.
In other words, what do you think will happen the first time State Farm (Allstate, Farmers, American Family, etc. ad infinitum) have a hurricane or other major event, and no one shows up?
I have an opinion as to the answer. What is yours?
Gentlemen (And Ladies) as they say in Spain, where are our brass cojones? |
Ghostbuster
| | Posted on Tuesday, June 06, 2000 - 9:06 pm: | |
WHY, Jim?? Simple, because we are too independent to ORGANIZE into a organization with teeth and the courage to use them. Here is where we could take some lessons from the legal industry and the various State Bar Associations. Aren't law fees pretty well set by the Bar Associations? Why are we not compensated at a rate near what lawyers charge? Last time I looked, we were doing a lot more and knowing a lot more than they do.
Why are we not restricting the size of our ranks like the legal industry does with things like law schools and Bar Exams? Do we really want part time school teachers, bankrupt contractors, and your cousins 22 year old, ex-wife out here? I recall from history that the European black plague killed off enough of the population that the wages increased significantly. I.E. The Law of Supply and Demand.
But NOOOOO. We're independent. We're hungry and will go clear across the country for a vendor and be happy little children for 33 files from American Family Ins. Co. What we really are, are suckers. And stupid ones at that. And do the carriers care? And do the vendors care? You tell me. And will it all happen again tomorrow, and the next day, and the day after that? |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 8:30 pm: | |
David, We use to use a material `& wage labor factor years ago, then everyone wanted unit costs so that it could be reviewed easier. We live with that now. Besides, if a roofer takes an hour to lay one square of shingles, better start flippin burgers |
Jim Flynt (Jim)
| | Posted on Tuesday, June 06, 2000 - 8:27 pm: | |
LAW OF SUPPLY AND DEMAND 101
A basic law of economics is "supply and demand."
That law, stated quite simply, says that as the supply of a commodity or service diminishes, and demand for such increases, the price or value of the commodity or service increases proportional to the supply/demand differential.
We all see the price of roofing, drywall, paint, and other items go up, and go up severely, when there is a major catastrophe, in response to the natural forces created by "supply and demand."
In fact, we also see the price of housing, ice, generators, gasoline, batteries, flashlights, tarps, plywood, food, and almost any other commodity item skyrocket in a storm hit area.
Yet, why is it that the only idiots that do not understand this, and respond accordingly, are the adjusting service vendors (who by the way, have bid the fee schedules DOWN) and we, their support personnel?
WHY?
Why is it that vendors, carriers, and yes, even we catastrophe adjusters all expect the cat adjusters to work for LESS, instead of MORE, during those times of lower supply, higher demand, known as hurricanes, earthquakes, and other catastrophic events?
WHY?
Why is it that we see special lower catastrophe fee schedules that vendors use during major cat events, rather than a SPECIAL higher fee schedule which should be used due to the increased demand and the lower supply of qualified insurance adjusters?
WHY?
Why aren't cat adjusters getting tired of hearing the vendors say: "well, we have a special fee schedule" for this hurricane or other storm event?
WHY? |
David P Bennett (Whitey)
| | Posted on Tuesday, June 06, 2000 - 8:04 pm: | |
Well guys, seems I really wasn't clear on my question. I am fully cognizant of the price guides set out in storm or cat situations. This was not my question or point. Yes every situation requires a review of the circumstances and prize guides are just that price guides. Of course my example was based on one person. The reality of the roof pricing is that any roofer will tell you, if their employee takes two hours to lay a square of shingles on a simple gable roof, he's gone. A decent roofer should be able to lay 1 square per hour. As you noticed in my example, the base rate for the employee was approx. 18.00 an hour with the burden and benefits added in, it came out to 25.00 an hour.
You see, there is one program which started out as a contractors program that has set pricing for the contractors and they believe its gospel. Yet when you sit them down and break down their costs, using their rates, burden, oh&p it's nowhere near the factors set out by the program they're using.
I am fully aware of RS MEANS, NCE, MARSHALL SWIFT, HOME TECH AND OTHERS. There is one put out by NCE, INSURANCE RESTORATION, The prices in this one makes no sense whatsoever. The others, generally use models and government data to arrive at their crews, times and pricing.
Generally when you put a crew together, your wage factor goes down as the productivity increases. So your average wage instead of being the 25.00 an hour in the example I used, becomes 18 or 19.00 an hour just for the crew time, calculated for the job.
Maybe I'm just complaining, though its not my money being spent. Seems the roofers and drywallers and some other trades, want to be able to make 200% profit on jobs.
Now I'm not just talking storm situations or losses but every day, fires, water losses, wind damage etc.
Would like to hear from some of the vendors who prepare the estimating software on what goes into their unit pricing.
I still believe 1.40 a square foot for drywall and 125.00 a square for shingles is out of line. All though I have found that a lot of the roofers in the Northeast are including the felt in the pricing.
Also isn't it amazing that if you were to solicit a roofing bid, seperate from an insurance claim, that boot jacks, drip edge, chimney and counter flashing and in some cases the ridge vent are all included in the unit cost. |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 4:34 pm: | |
Jim, Agreed and agreed
But with the mentality in place, the numerous certifications, etc etc, team leaders, adjust by the numbers mode who is going to let an adjuster off the leash so to speak. I am not saying that it is not necessary for the tight reviews but it does come ot a point where you no longer adjust. |
Jim Flynt (Jim)
| | Posted on Tuesday, June 06, 2000 - 3:37 pm: | |
Tom Joyce, you are right I guess. What I was trying to say is that I have a mind and I like to use it. I also like to work for carriers and vendors who appreciate my mind, knowledge and experience.
I don't particularly care to work, although Yes, I have done it (GAG) with carriers and vendors who could otherwise just employ pre-programmed "robots" or "monkeys" to do the same thing, although without having a mind of their own.
I honestly think we could teach the average 10th Grader in America how to go through the "mechanics" of adjusting. Yet realizing that without imparting to them the wisdom, knowledge, and judgment necessary for professional, competent, and rational claims adjusting, which can only come from age and experience.
I am sure that Gale Hawkins would agree that even 10th Graders could easily learn PowerClaim and with the pictures which DDS offers, any idiot would almost have to be blind not to be able to utilize it as well. But, would that make them "adjusters?" Certainly not, at least to my way of thinking.
Yet, every day out here on a storm, we do the very same thing in a sense. We have so called "adjusters" in their 20's, 30's, 40's and 50's who cannot even spell High School Diploma! (They don't EVEN HAVE one because they are generally NOT REQUIRED remember?). Is there really any difference in those "adjusters" out here in the field than those same 10th Graders I mentioned earlier? Not to my way of thinking!
In fact, some of those 10th Graders might actually enjoy an "edge" in knowledge, education and wisdom. Now there is a scary thought.
Sure, they can "point and click" at all the pretty pcitures on DDS. But do you honestly think they know policy? Do you believe for one minute they know construction technique or repair process? Do you think they have the education, erudition, and social and cultural skills that most carriers would want servicing their insureds?
Do they have even the slightest idea what an item is worth?
Is that what we now call adjusting?
Well, to me it is not adjusting, and I apologize to no one for holding that view.
The real value to a vendor or carrier for an adjuster, at least as I see it, is being able to recognize when the values are different from the price lists. And those values can easily be just as much too high as too low.
I handled a claim once on an extremely large condominium complex in Miami during Hurricane Andrew where just 5 cents per square foot differential in wall and ceiling paint pricing made a $50,000 difference in the bottom line costs. You better believe that we did not use Xactimate or any other software pricing to establish the real costs to paint. There were many other instances in this one claims alone, and in negotiating the actual costs of repairs, we were able to lower the initial repair costs by almost $5 Million dollars. And that is not chicken feed, even for an insurance company.
When we needed several thousand of the exact same light fixtures for this same claim, we did not again use pricing from Xactimate (although we were using Xactimate to write the estimates). Instead, we went to a electrical wholeseller and priced several thousand fixtures deleivered to the job site. Then we had the insured's contractor put the installation out to bid for replacement (which we helped in initiating and implementing). Again, the costs saved were in the tens of thousands of dollars.
The point I am trying to make is that Price Lists and estimating software pricing ARE and SHOULD BE used as guidelines and nothing more.
As I have said elsewhere, you can hire knowledge or you can hire a warm body. BUT, you get what you pay for; you can pay now or pay later if you are a carrier! |
Tom Weems
| | Posted on Tuesday, June 06, 2000 - 3:33 pm: | |
What do you expect for $30k and a car? |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 3:28 pm: | |
Agreed Tom, and how often have you discussed this matter with the company examiners, or whatever, and explained that the local staff will be over their heads with reopens when the dust clears, to no avail? |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 3:23 pm: | |
Sure you do Jim, one way or another, its not the first rodeo. |
Tom Weems
| | Posted on Tuesday, June 06, 2000 - 3:18 pm: | |
That's what makes this job fun. The unit prices change weekly and the insured gets paid whatever is the price in effect at the time his file closes. And they wonder why files reopen.... |
Jim Flynt (Jim)
| | Posted on Tuesday, June 06, 2000 - 3:01 pm: | |
I don't work (long at least) with insurance companies like that! |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 2:10 pm: | |
And when the company and the re-inspectors say...here is the price list and this is what is accepted? |
Jim Flynt (Jim)
| | Posted on Tuesday, June 06, 2000 - 11:25 am: | |
I think what David was trying to say, or perhaps was asking, is why some of the price lists used on cats are actually TOO HIGH and not too low. I have seen price lists go both ways, and that is the real attribute where wisdom and experience in value by an adjuster as opposed to price or estimating software pricing comes into play. |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 11:09 am: | |
Try RS Means, National Const. Est., etc,
Means is available on cd-rom |
Jim Jones
| | Posted on Tuesday, June 06, 2000 - 10:59 am: | |
David,
When a repair uses only one person to complete the task you can use the type of calculations in your example. However, most repairs require a crew and that's where it gets complicated for unit cost pricing. Now you must take into consideration the wage and burdens of each crew member. Typically most unit costs with multiple crew members are calculate by adding the wages of each member and then dividing the result by the number of members in the crew. That's the easy part. The magic number to the whole thing is the productivity of the crew (how much can they do in a given period of time). This number (usually expressed in hours i.e. 1.035 hours) must be multiplied times the crew wage to determine the total labor cost. Productivities come mostly from government surveys but differ depending on the source and crew makeup. In short, just because you see an hourly wage listed for a particular repair, remember that there are probably multiple workers in the crew and the wage you see is an average of all crew members. An as always just because you saw it in a price list or estimating program doesn't make it right. These tools are not a replacement of your good judgement. |
Tom Joyce (Tomj)
| | Posted on Tuesday, June 06, 2000 - 10:13 am: | |
Keep in mind that with companies that utilize a preferred contractor program, you'll probably be given their price list. Sometimes there is no rhyme or reason to it, other than the file will reopen once the job starts. Such the nature of the "preferred contractor program" |
Paul Bagato
| | Posted on Tuesday, June 06, 2000 - 9:29 am: | |
David,
Many of the IA fims will supply the adjuster with the carriers unit cost guide lines for the storm in the immediate area. This being so the field adjuster should stick by these numbers, yet please remember they are guide lines and not written into fact. When you believe the guide lines are not acceptable to an indivudual house, well then note it all over the place to justify your cost increase. Increase the unit cost for what you believe to be fair and reasonable, just back up your costs with fact. i.e. 20ft. high ceiling, 5" tall base molding, required scaffolding, etc.
Remember, there is never enough time to do it right the first time, but always enough time to do it over. |
David P Bennett (Whitey)
| | Posted on Tuesday, June 06, 2000 - 9:20 am: | |
In reviewing the different unit costs being set by the various vendors as well as what is actually being charged by the contractors-roofers-drywallers. I wanted to get some input on the following.
Seems roofing is ranging anywhere from 55.00 a square for installation of 240 3 tab 25 year shingles to 125.00 a suare. In my simple way of approaching the pricing:
Shingles $25.00
Labor 2 hours @ $25.00 50.00
nails 2 lbs 2.50
Total $77.50
Overhead & Profit 16.27
Total 93.77 A Square
This of course is based on a Wage Rate of 18.00 for the roofer and then add the burden (Taxes Ins. and the benefits) Now in talking with roofers, they all would like to be paid 18.00 an hour but most aren't anywhere near that amount
On Drywall
Lets say $8.00 a sheet or .25 a square foot. Labor lets say 25.00 an hour (which is 18.00 plus the burden and benefits) Installation should be 100 sq' an hour. (Thats 3.33 sheets) That equals .25 a sq' to install only. Now lets figure taping and finishing the joints Material .03 a square foot, .37 a square foot = .40 a square foot for taping and finishing or a total for installed taped and finished at .90 a sq foot.
Now this of course is base on a labor rate that most drywallers and finishers would like to get but almost all are in the 13 to 16.00 an hour range and some less.
In some of the programs the base pricing is as much as 115.00 for roofing and 1.40 for drywall. Of course the contractors using some of the programs, on drywall for example choose the category for tape and finish, which the specs shows is a full skim coat finish at 1.40 to 1.60 a square foot. I myself have only run into a small percentage of homes, where skim coats are fully applied to all the drywall.
Just seems to me that the pricing is not in line with actual labor amounts being paid. Of course my above calculations are based on what has been said is the national average and does not take into consideration any discounts obtained by the contractor in buying the material.
It would be nice if those that set there prices could comment and any of the experienced adjusters, who have developed unit costs, please comment. I just believe we have fallen pray to using provided pricing, without questioning what is in the pricing. |
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