Handling Insurance Claims
Hi, I have a client who had ice dam problems in December, water in the walls. The insurance adjuster has been out, twice (second time I was there too) and I thought we had things figured out. Now the claims rep from the insurance company wants me to itemize my bid the same way the adjuster has, like 52.26 ln ft of base, 182.34 ln ft casing, etc……. I don’t think so. How do you guys handle insurance companies? If I didn’t need the work and this wasn’t a good customer, I would walk.
When I was putting a roof on my house last summer I messed up and during the roof installation it rained and it damaged the sheetrock ceiling in my living room.
I casually mentioned this to the insurance adjuster and he said "the damage is covered under your insurance and we'll pay for the repairs"
I said "what" uh, OK and he had to have precise details:
The size of the sheetrock patch
The dimensions of the ceiling in the living room (since I had to repaint the entire ceiling)
Anyway, he used his calculator to give me the exact amount of what they would pay based upon the dimensions and their figures in their computer.
It's based upon what they pay per actual dimension, or length, or sq foot.
My experience with State Farm was the same when I had a water leak in the attic - exensive water damage in my kitchen, carpet destroyed throughout much of the house. They claimed the carpet could be dried out (the mildew stench was so sickening I tore most of it out and threw it away). Sq. ft. prices to do the repairs - they told me they don't recommend I hire a licensed contractor, they're too expensive. I was ready to fight them on it, but DW didn't want to, and I didn't want to fight her on it!View Image â€œGood work costs much more than poor imitation or factory productâ€ â€“ Charles GreeneCaliforniaRemodelingContractor.com
a large percentage of my work in 2008 and 2009--will be coming from a hailstorm on june8 2007
i am currently scheduling for september 2008.
what i would recommend to you is to NOT itemize the bill for the insurance company.
very briefley- the adjuster is trying to get YOU to do his job for him. In theory- he can only pay so much per square foot, so much per lineal foot etc. he wants you to provide all that detailed info so that he can simply look up in his charts what he can pay
that means NOTHING to you- what he pays has ZERO bearing on what it will cost YOU to do the work.
make out your proposal-lump sum price--sell the HOMEOWNER on how great it is going to be to have YOU do the job and let the homeowner and the insurance company argue it out. Remember- the homeowner is your customer--not the insurance company.
you are either going to get the job--or you are not going to get the job. investing your time in itemizing your bill for the insurance company will have ZERO impact on wether you get the job
the ONLY thing that determines if you get the job--is the homeowner. Itemizing the bill for the adjuster only adds to your overhead costs- it has zero impact on wether you get the job or not.
OK, this gets even better. Got a second "estimate" from the adjuster, at about 60% of my bid. Replace exterior walls (drywall lath, insulation, baseboard, window trim) on two bathrooms, two bedrooms and a closet. $7,605.57, I am at $13,154.75.He has no costs for moving or protecting furniture and floors, dust control, removing and rehanging window coverings, pulling and resetting toilets (10" from the walls to be repaired), working around/behind tub surround which is on exterior wall, working on second floor, adding missing drywall nailers (of course they're not there!), taping to adjacent plaster walls and ceilings, matching various existing plaster and orange peel textures, painting entire room because new paint won't match, milling custom trim to match trim in 50 year old house, emptying closet, removing and reassembling shelving. Oh, and I get a whole 204.11 for a "single axle dump truck - per load - including dump fees"I have called and left the adjuster messages three times in a week and a half, no returned phone calls. Today I will call the 'claims specialist' from Liberty Mutual and bend her ear. Should be fun, the first time I called her response was a snippy "so, what are you not happy about?" Ditch.
You are approaching it from the wrong perspective. Stephen is correct. I've done insurance deals where the agent thinks we are double what they want to pay. I ended up getting the jobs anyways and the homeowner got the contractor of their choice: us. Our proposal to the client is private business and the agent does not have any right to see it. They do get to know the bottom line number though. They have their charts, and we have our business. We don't base our business model on their charts. The relationship between the client and the owner is also private business. It's none of my business, but I usually offer to help if I can. I'll send a letter and field a call but I won't listen to some agent tell me what it costs him to paint a room. I immediately counter with "we use professionals that are licensed, insured and skilled with plenty of experience. We have our professional reputation to protect and we don't intend to use some guy operating out of a rusty pickup truck just to meet your numbers. Your numbers don't work for our business model and quite frankly, that discussion is something you can discuss with the owner. I understand that you have your numbers to meet but they aren't real world when quality installations are being done." That is the gist of the conversation. Remember, I'm not negotiating with the insurance company...I'm offfering a private proposal to a private person and they are attempting to get a check for some or all of the repairs from their agent. It really has nothing to do with our business. I have written, upon request, all of the steps needed to be taken by us to satisfy this contract. I will do that, but I don't include any times or prices. The laundry list includes everything including setting up daily and breaking down and cleaning up daily. That alone takes a ton of time that the agents can't refute. They tell me that they have drywallers that do the repair in one day and I tell them it takes us three and we don't care if his guy does it in one day: we aren't using him. In the end, the agent has to make a decision to cut a check. That's his ONLY decision, other than the amount. If he wants to pay his client only half of what the repair bid is, then the client makes up the difference and the insurance company loses a client. Bob's next test date: 12/10/07
your customer is the homeowner--not the insurance agent. you should not have the slightest care what the insurance agent pays the homeowner-- it is NONE of your concern-- it has zero bearing on your price.-
to be crude- you don't care WHERE the homeowner gets the money--maybe they get it from the insurance co.-maybe they get it from their savings acount-maybe it comes from a home equity line of credit-maybe it comes from a cofee can buried in the back yard-maybe it comes from their grand daughter pole dancing, LOL--- none of it is your concern.
last year i did several roofs here- 2 layers of shingles over a layer of slate-------3 layers of shingles over a wood shingle roof-----all tear-offs.
the customers call me--" steve- we want you to do our roof--when ever you can fit us in-just come up and give us a price."- so i go write out-the proposal- in one of the cases i leave with a deposit check.--weeks later the insurance company calls wants me to itemize my proposal and break out all the costs----" sorry- not interested in doing that" i tell them. they want to know why not-- i tell them those costs are my concern, not theirs-- doesn't matter to me what,IF ANYTHING, they pay the homeowner- what the insurance company wants to pay is none of my concern. the agent says" good luck in business with an attitude like that.- i just chuckled--- he had know idea i already had a signed contract and a deposit
in another case-- i had completed the job and already been payed by the homeowner--when the agent calls-- he wants me to itemize it all for them---"sorry not gonna do it' it tell him.-- he absolutely can't believe i won't do it--just can't grasp it.-- I told him---- you have my proposal right?-- look at the date on it. notice i gave these folks the proposal almost 3 months ago???????? ya should have called then--but NOW???? the job is already done.
you need to remember--YOU almost certainly make more than the claims adjuster, BY FAR. you have already forgotten more about business than he knows--- don't let him push you around.- Serve the customer, cultivate the customer-- not the insurance agent.
remember-- you are either gonna get the job-or not, based on your relationship with the customer---the agent has nothing to do with it.
Very best wishes,
The problem I find on smaller insurance jobs is the numbers, adjusters use, just don't work. Every item is calculated base on a different subcontractors rate. Trash removal and demo might get 20 bucks an hour... drywall $30.00, painter $45.00, cabinet maker $125.00. I had one once where they were willing to pay $27.50 to pull out 432 cubic feet of wet blown in insulation from an attic space less then 2' tall. I called the adjuster and offered him the job at 40 bucks( a loss for me) and disposal would be on him... He declined.... go figure.
Another issue with insurance is the work is based on bringing you back to where you were before the incident. This isn't an opportunity to make eveything bright and shiney and new, which is what I have real trouble with. This ain't remodeling... it's repair and patch work.
The one time I got sucked into itemizing a job. They promply told me what I was charging too much for but failed to tell me what was to cheap. I needed the work and ended up working for dirt wages!!
I should have stuck to my price and I would have been OK, not rich but OK!
Your costs should be based on what it will cost to do the job. DO NOT sell the job for whatever the adjuster decides they will pay. If the HO is underinsured it is not your burden. Dealing with the adjuster should be your client's headache, not yours. Just because the adjuster say so, doesn't mean it is. The adjuster's job is to minimize the insurance companies costs, period.
If the HO's budget is defined by the insurance award, then so be it, but spending your time trying to convince an adjuster how much something will cost on behalf of your client is your time down the drain.