The Insurance Company’s Adjuster Here Today, Gone Tomorrow, Never to be Seen Again
Your insurance company’s main goal is to earn money on your premiums. Too often this means skimping on how they provide claim services to their policyholders.
When something unforeseen happens to your home, business, or building and you are facing major property damages, you want to communicate directly to the people that take your monthly premium and naturally expect them to provide you with the service you feel you are entitled too. Unfortunately, many insurance companies view providing high quality claim service as a costly nuisance, especially since many insurance companies have decided to turn their claim departments into profit centers.
Many insurance companies no longer have their own claim personnel in order to avoid the large expense that comes with employing internal resources. What most policyholders don’t realize is that the insurance adjuster that shows up at your door does not actually work for your insurance company. The chances are high that a third party administration (TPA) company is working as the claims department for your insurance company. These TPAs then outsource your claims to independent claim adjusting companies.
Independent adjusting firms may range in size from as small as two people to as large as 4,000 people who then outsource your claim to an independent adjuster. The independent adjuster is usually hired on a commission fee basis per claim. The independent adjuster is mostly rewarded based on the volume of claims he or she can handle much like a sales incentive program, rather than by quality of their work handling claims to the satisfaction of the policyholder. Therefore, the more claims an independent adjuster completes in a day, the more he or she makes, regardless of your claim satisfaction.
The claim handling instructions on how an insurance claim is to be handled is provided by your insurance company. Do we pay for only part of the roof or the whole roof? Do we only pay to repair part of the damaged kitchen cabinets or replace them all? Do we only provide one coat of paint on the estimate? The insurance company advises the independent adjuster on every detail from how much to pay on a per item basis, to the software the claims adjuster has to use, to how the independent adjuster is to view the scope of repairs. As you can now see these independent adjusters are not independent at all.
Some independent adjusters will contact you and tell you they are from your insurance company. Which you now know is obviously not true, but it is true that they have been assigned to inspect your damages. They may schedule an appointment with you, come out to your damaged property acting very nice and sincere as they take photographs of your damages and measure your property to write an estimate. This personable person usually has zero authority to make any settlements of your claim. They are only the eyes and ears for the insurance company. They give you a hearty handshake while saying goodbye, telling you everything will be fine, then leave your property and tell you someone will contact you soon. Most likely, you will never see or hear from this adjuster again as their work is now complete.
The independent adjuster will now turn in his claim report to be reviewed by the claim auditor from the independent adjusting company that gave him your assignment. The auditor’s job is to make sure there was no overpayment on any single item and meet the insurance company’s given claim criteria. After the claim report successfully passes this stage, it then goes back to the third party administration company where your claim is reviewed again by a desk claim examiner.
The desk claim examiner who works for this third party administration company may disagree with the initial adjuster’s finding or decide to send out another person to look at your damages such as a general contractor, flooring expert, roofing expert, or engineering firm to help support the independent adjuster’s initial findings.
More than likely you are going to get a phone call from the inside desk examiner who will politely ask you many questions about your insurance claim.
What you will find is that no one person in this chain wants to take responsibility for the handling of your claim. The desk adjuster tells you everything is up to the field adjuster and the field adjuster tells you it is up to the desk adjuster. It is just one of the many inherent claim delay techniques that are being deployed by your insurance company.
As a consumer you might want to find out, before you purchase insurance, if your insurance company actually has their own claim adjusters, if they outsource the claim handling to a third party administration company, or if you will be working with an independent adjuster in the event of a loss occurrence. In the above scenario that is more common than you may think, the hard truth is that not one person from the independent adjuster’s company is paid to provide you with exceptional service and claim resolution. The property damage insurance claim handling model is such that independent adjusters really feel no loyalty to you.