Drones Help Insurance Companies Check Damage in Cedar Rapids

Erin Jordan | Claims Journal

Insurance adjusters who descended on Cedar Rapids after the Aug. 10 derecho storm are using drones to check roofs and asking homeowners with less severe damage to take their own photos.

Some of this is due to the COVID-19 pandemic, which has reduced the number of experienced adjusters willing to travel. But the changes also help speed up claims and get repairs done sooner, company representatives said.

“Drones or aerial imaging helps them estimate the claims,” said Scott Hauptman, vice president for claims for Grange Insurance, of Columbus, Ohio, which is working with Integrity Insurance, of Appleton, Wis., to handle at least 500 storm-related claims in Cedar Rapids. “It’s as efficient as possible and helps them (adjusters) safeguard their health.”

Cedar Rapids officials told The Gazette on Wednesday that 140 buildings are too damaged to be occupied. Several hundred more have non-structural or cosmetic damage.

Before buildings can be fixed and people can return to their homes, insurance companies must document the damage and determine how the loss will be covered.

Many insurance companies have sent catastrophic teams to Eastern Iowa. Nationwide Insurance, for example, stationed some at the Home Depot on First Avenue SE in Cedar Rapids.

“Really the biggest thing we’ve found in Cedar Rapids, due to lack of internet and power, is they (homeowners) weren’t sure if they had a claim filed or not,” said Courtney Kannas, property field claims manager for a Nationwide team that covers Iowa, Nebraska and parts of Kansas and Missouri. “If they didn’t have a claim filed, we could do that for them. We also could give them a high-level understanding of their policies.”

Integrity adjusters sent a drone Wednesday afternoon over the Wired Production Group’s building on N Towne Lane in Cedar Rapids to get a better look at a roof that was peeled off and a crumbled back wall.

“This 12,000-square-foot building is a total loss,” said Ron Rausch, Wired Production president and owner. “They (Integrity) brought a structural engineer in here to document that was the case.”

An adjuster also looked at millions of dollars in cameras and other equipment Wired Production uses to stage events for many Eastern Iowa companies, including The Gazette. When the roof was ripped off, rain and water from broken water mains flooded the offices and ruined much of the gear, Rausch said. The firm is setting up operations temporarily in Dubuque until the Cedar Rapids site is rebuilt.

“They were very amenable to letting us start the cleanup process and work with people we want to,” Rausch said of the insurance company.

State Farm, the first insurer to get Federal Aviation Administration approval to operate drones over people, has been using drones to gather information on Cedar Rapids claims, spokeswoman Tammi Estes said.

Nationwide hasn’t been using drones in Cedar Rapids because of the challenges of photographing around fallen trees, Kannas said, but the company is encouraging policy holders with minor damage to photograph the property and submit claims online.

“It gives us a better picture right away as to the extent of the damage they have to their home so we can get them emergency reimbursement or set them up with temporarily housing a little quicker,” she said.

A Washington, D.C., law firm said in a news release that homeowners and businesses hit by the derecho will face challenges in getting adequate reimbursement.

Weisbrod Matteis & Copley, which represents homeowners in lawsuits against insurers, pointed to an Aug. 4 webinar with insurance executives who said many older adjusters were reluctant to go out in the field because of risk of contracting coronavirus.

Some insurance companies also have struggled to get adjusters into states that require quarantines for visitors.

“After battling the insurance industry after Katrina, I fear that Iowans will be left at the mercy of a B team of insurance adjusters,” Jim Hood, a former Mississippi Attorney General who now works for the law firm, said in a statement. “Storm victims will need to quickly document their damages with drones, pictures and lists of damaged items.”

One insurance executive on the webinar said he thought fewer adjusters in the field would increase fraud.

“I do have some concerns we are going to have to do more virtual adjusting,” said Jed Rhoads, president and chief underwriting officer for Markel Global Reinsurance, based in Virginia. “If we’re adjusting claims through satellite imagery or drones or handheld devices, it could lead to new additional types of fraud.”

People could doctor drone or cellphone images or charge a company additional costs to procure the photos.

Integrity Insurance has been allowing virtual adjusting for several years, Hauptman said, and has developed strategies for detecting fraud.

“We have means on the back end to authenticate the pictures to make sure the time and location are appropriate,” he said. “The vast majority of our customers are great people. If there is fraud in an industry, that affects everyone’s rates.”

About the photo: Cleanup continues around the area in Cedar Rapids on Friday, Aug. 21, 2020 following the Aug. 10 derecho, which left hundreds of thousands of Iowans without power and displaced many whose homes were damaged or destroyed in the heavy winds. (Rebecca F. Miller/The Gazette via AP)

Policyholders—-What Are the Four Questions Every Insurance Adjuster Should Be Asked and Then Required To Answer?

Chip Merlin | Property Insurance Coverage Law Blog | October 2, 2019

Speaking at the IAUA Conference in San Antonio yesterday, I suggested that every insurance company should be demanding from their field adjusters and claims managers that they deal with their customers who ask these four questions:

  1. How much am I fully entitled to?
  2. When am I going to get those benefits?
  3. Are you certain that I am not entitled to more, and what are those benefits?
  4. Is there anything you can do to speed up getting what I am owed?

Claims managers, insurance regulators, public adjusters, attorneys for policyholders, and the media should be asking these four questions. These are questions I am demanding our Merlin Law Group attorneys and staff answer to our clients. It is the same question insurance companies should be asking from their own employees serving their own customers.

Does this happen? I would suggest that often it does not. It is almost as if the insurance customer after making a claim is the enemy and the amount demanded is fraudulent.

Claims managers should be asked whether they agree these four questions are the basis for good faith claims handling and that they should be penalized for failing to adhere to them.

I bet a big waffle answers will happen.

Thought For The Day

Criticism in good faith is good. When it’s targeted solely to destruction, I’m not interested.
—Andrea Bocelli

California’s Insurance Adjuster Act of 2019 Is Coming

Derek Chalken | Property Insurance Coverage Law Blog | August 5, 2019

California’s Senate Bill 2401 is making its way through the legislature and will hopefully bring some important changes to the way insurance companies train their out of state adjusters who handle California based policyholder’s claims. The bill, also known as the Insurance Adjuster Act of 2019, was created by Senator Bill Dodd to eliminate confusion and delays caused by out-of-state or unaware adjusters.

Of significance, the bill will require the California Department of Insurance (DOI) to produce an annual notice describing the most significant California laws pertaining to property insurance policies (including those regarding declared states of emergency) and require the out-of-state adjusters to submit a signed certification, under penalty of perjury, that they have read the most recent notices issued by the DOI, as well as a handbook for adjusting claims prepared by the DOI.

Another part of the act requires that carriers assign a primary point of contact for insureds during a state of emergency. This law was drafted with the hope that it would limit confusion created when carriers assign multiple adjusters to a single claim. For example, insurers often have a desk adjuster, independent field adjusters, contents adjusters and even ALE adjusters working on a single claim. The new bill will require the DOI to provide training standards for these adjusters and require the carrier provide a single point of contact. Insureds simply do not know which person to contact. The new law aims to streamline these communications with the insurer through one person.

These guidelines will hopefully increase the accountability insurers have when they assigned out-of-state adjusters to deal with increased claims activities following catastrophic disasters. If you feel your carrier is not abiding by their obligations to you, contact a Merlin Law Group attorney for a consultation.
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1 https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200SB240

3 Rules for the Claims Adjuster’s Tools

John O’Brien | AdjusterPro | April 16, 2019

In my earlier article for AdjusterPro, I discussed some of the biggest mistakes I see new adjusters make when they enter the claims industry. The formula for a successful career as an insurance claims adjuster is quite simple: more claims closed = more money. So it should come as no surprise that to close the maximum number of claims, you have to work quickly, efficiently, and accurately. Time spent figuring out Xactimate, or having to go back and fix mistakes or take photos you missed is time you aren’t closing claims and making money. And that’s where your adjusting tools come in.

Compared to other property-related careers, being an insurance claims adjuster doesn’t really require that many tools. But the tools you do need, including your technology and clothing, need to be good quality, accessible, and well maintained.

I’ve found that if you follow these three rules, you’ll avoid a lot of wasted time and needless stress. They may sound simple or seem obvious but I see adjusters struggling in the field all the time because they didn’t make a little extra effort to treat their equipment like a vital part of their job success.

Rule #1: The Single Point of Failure

If the loss of any single tool would make it impossible to do your job, perform an inspection, or complete a claim, have a backup or alternative method at the ready.

If you use a digital camera, you should have a spare SD card. But you also need a backup device to take photos, like a smartphone, in case your camera picks a mid-inspection time to die its final death. You should also have a vehicle charger as well as a juice pack or mobile way of charging the camera or phone. You never want to ask a policyholder if you can charge your phone or camera while on inspection. Have 2 tape measures, 2 laser measures, and 2 shingle gauges. Carry spare pads for you cougar paws.

To put it simply, never put yourself in a position to have to stop doing your job in order to replace any tool or device.

Rule #2: Have Dedicated Tools

Your adjusting tools will make you hundreds of thousands of dollars. So get good tools and take care of them. Most importantly, only use your claims adjusting tools FOR claims adjusting.

As soon as you start using your tools for other things, like personal projects around the house, you exponentially increase the likelihood that you’ll forget to put the thing back. You’ll find yourself on inspection, rifling through your truck and cursing the new picture you used the tape measure to hang because said tape measure is still on your kitchen table. This extends to family and friends as well. Don’t let others borrow your tools because the Law of Neighbors says you only get things back 50% of the time and when you do, there’s a 50% chance it’s broken. (Warning: that may not be an actual law but it’s been my experience.)

Of course, if you are following the single point of failure rule you will have a spare tool, but what if that one breaks or gets lost? Having dedicated tools that are always where they are supposed to be will make your life much less complicated, plain and simple.

If you’re interested in learning more about what specific tools an adjuster can’t live without, I’d love to see you at my Adjuster Success Method webinar. We cover tools, how to find employment, perform inspections, close claims, and so much more. It’s a great course for adjusters looking for a systematic way to set their careers up for immediate and long-term success.

Rule #3: Keep your Vehicle Clean & Organized

This may seem like the most obvious of my ‘rules’ but I can’t count the number of times I’ve seen an adjuster open his door and have Gatorade bottles fall out and napkins fly away. I’ve seen guys knee deep in stuff in their truck beds hunting for a shingle gauge. I’ve been asked to borrow batteries because the adjuster bought extras but couldn’t find them.

And it makes sense. We live our lives on the road, sometimes driving over a hundred miles a day. We eat, and sometimes even sleep in the car, rarely stopping except for necessary breaks. But it’s all the more reason to take proper care of your environment – in this case, your car.

Keep your tools organized and in a dedicated location within your vehicle. Everything needs a consistent place. This will reduce the possibility of losing a tool or wasting time trying to find something. Remember: time is money! Make the effort to organize your tools in your vehicle in a way that makes sense to you. And then always return things back to “their place.” Throwing your equipment in your truck bed because you’re in a hurry not only beats it up, you’ll just have to spend more time hunting for it later.

organized tools
Take a hint from the best – keep your tools organized and secure in your vehicle

Clean your car or throw away trash every time you have the chance: getting gas, using the facilities, grabbing a snack. Don’t let your vehicle become a trash can. In addition to making your job harder, claimants notice and it creates a poor impression about your abilities and professionalism.

Following these simple “rules for your tools” not only makes it easier to get the job done, it also subconsciously reduces your stress levels. Every day and every claim is different. Adjusters never really know what situation you are walking into so it’s important to control what you can. Time is money and as an adjuster, yours is precious.

Are There Ethical Conduct Standards Between Public Adjusters and Independent or Company Adjusters?

Chip Merlin | Property Insurance Coverage Law Blog | April 18, 2019

An excellent and successful insurance company defense attorney, Bill Berk and I were on a panel presentation at the 2019 Windstorm Insurance Conference earlier this year. Berk reminded the audience of adjusters that under Florida law, they should not be saying or implying bad things about each other. He noted this Florida regulation:

A public adjuster shall not represent or imply to any client or potential client that insurers, company adjusters, or independent adjusters routinely attempt to, or do in fact, deprive claimants of their full rights under an insurance policy. No insurer, independent adjuster, or company adjuster shall represent or imply to any claimant that public adjusters are unscrupulous, or that engaging a public adjuster will delay or have other adverse effect upon the settlement of a claim.

I can imagine how many public adjusters and company or independent adjusters reading this post are thinking about times they may have forgotten this ethical regulation.

I raise this regulation because a public adjuster wrote me about a regional independent adjustment firm, Residential Property Adjusting, Inc. from Connecticut, Rhode Island, and Massachusetts that expressly tells the public on its website:

Like most insurance specialists, we strongly recommend AGAINST hiring a public adjuster. However, should you choose to make that decision there are a few things you should know. First, understand that your insurance carrier is legally and ethically bound to handle your claim under the terms of your insurance policy and it is interested in resolving your claim as quickly and fairly as possible. In other words, give them a chance to do the right thing as they usually will.

Second, understand how a public adjuster is compensated. Public Adjusters charge a percentage of your final settlement, usually around 10%. So if your insurance company offers to pay you $100,000 then your hired public adjuster WILL TAKE $10,000 of that amount. Public adjusters will always tell you that this fee is offset by their skills in securing a larger settlement in excess of what the average insured can obtain for himself. In other words, if the damages can be repaired for $100,000 they will try and get the insurance company to settle at a much higher figure like $140,000. What they usually fail to tell you is that your insurance company is only obligated to pay you for either what costs you actually incur or what costs you will incur to have repairs done. It does not owe you any “excess,” and certainly will not agree to pay the bill you incur to hire the public adjuster.

Your insurance company will never object to your hiring of a public adjuster as legally they can’t. But most good insurance companies will assign experienced adjusters to handle the files where a public adjuster is involved. A good insurance adjuster can spot where the public adjuster is falsely inflating a claim or estimate and quickly put a stop to it. Just because a public adjuster creates a massive estimate, does not mean that the insurance company will honor it. In fact 99.9% of the time they will make payments based solely on the ‘insurance company’ estimate created by either their staff employee or an outside Independent Adjuster such as our firm. They will review the public adjusters estimate to see if additional line items are warranted, but that’s usually where it stops.

Also, remember that these outside contractual arrangements with a public adjuster will always be at your expense…..

…..

It is also important to note that a public adjuster (PA) has no legal authority. They are not an attorney, nor can they act as one. Some public adjusters make the mistake of advising their client to sue an insurance carrier if they don’t get their way. Other than being poor advice, it’s also illegal advice, and the public adjuster (PA) is at risk of losing their license if it is reported to the State Department of Insurance of their violation.

If you ultimately decide to hire a public adjuster (PA) we recommend the following some simple strategies to narrow the selection. If they can’t meet these criteria then we really really really discourage you from hiring them. Here is the advice:

…….

2. Ask for a timeline provision in your contract. Specifically, request that they settle your claim within 45 days from being hired or the contract is void and no payment is owed. Unfortunately, many public adjusters will drag out files for up to 6 months or a year (even more at times).

I have certainly stated incorrect opinions in the past and am not close to being perfect. Perhaps after reading this blog post, the managers of this independent adjusting company will have a change of heart and remove this position on the topic.

Until then, any attorney, public adjuster or policyholder dealing with this independent adjusting firm should keep this as evidence. It reads like a similar script which some insurers wrongfully teach adjusters how to dissuade policyholders from hiring public adjusters and shows a bias against the policyholder getting professional and licensed help in the adjustment of their property insurance claim.

Before cheering too loudly, I want to suggest that any public adjuster holding a Florida license should immediately audit their websites to make certain that they are not in violation of the regulation above. Some clever and unfriendly insurance attorneys and adjusters may be checking your public adjuster websites as soon as they finish reading this post.

I suggest those interested in this topic read, And Goodwill to All–Unless You Are a Public Adjuster, where it stated:

Dogs and cats. Oil and water. I predict the civility Dan Odess suggests in his article will not be acknowledged by many on the insurer side simply because it came from a public adjuster. For adjusters with a pre-determined attitude, no matter what the truth may be, their mind is already made up.

And remember, such acts in many states can result in fines and possibly cost one’s license or livelihood in the property adjustment business. So, let’s be nice to one another out there in the adjustment world. It is tough enough.