In today’s addition of “Hitting the nail on the head”, I want to talk about the Insurance industry and how the handling of claims has changed over the years This will pertain more to home and business property damage claims. In the good ole days, you had a storm that caused damage, you called the Insurance agent, and they would have you get 3 estimates from local contractors. The home/business owner would then call 3 contractors and get an estimate from each one. The amount of the repairs would be determined solely by the contractor who would be completing the repairs, any additional amount needed the insurance company would pay to cover the remaining amount of the loss. But today there is a program the Insurance companies use called “Xactimate” and there are independent adjusters, company employed adjusters and independent inspection companies such as “ladder assist”. Xactimate is supposed to be the referee of the Roofing/Contracting industry. It prices each market based off the zip code the property is located in. It is designed to keep the insurance companies from paying too little and keep the contractors from charging too much. However, Xactimate is being used by the Insurance -companies to drive down what they pay and set the base line for how much they pay. The main issue with this, is that contractor labor, shortages and pricing is going up and down with the market and Xactimate is only updated monthly. Most of these issues coming from Covid with lack of materials production and the labor shortage. The contractor is then forced to do jobs for less, use cheaper products/ materials, and argue back and forth with the insurance just to get paid what it takes to complete the job correctly. With this the Insurance wins and the property owner loses. Another issue is the Insurance companies intentionally leave required items off estimate hoping the Contractor will do the work and not supplement for the cost of the missed items (which many do) because they simply don’t have the energy or time to fight over these items. Now these issues have birthed, public adjusters, Insurance lawyers and 3rd party supplement companies who work for homeowner/business owners and contractors, to get what they are owed for damages per their insurance policy. At the end of the day the insured loses, and the insurance company wins. These companies are figuring out how they can save money, from raising the deductibles, denying claims and underpaying claims all to drive large profits. Even a few of these companies spend close to as much on advertising as they do paying out claims. If you are home/business owner what should you do about it? First, I would review your insurance coverage, make sure you have an RCV (replacement cost policy), code upgrade coverage, marring coverage and no greater than a 1% deductible. If you do have a claim, find a good professional contractor, who is experienced in dealing with Insurance claims. I would also recommend getting your roof inspected yearly to make sure there is no new damage and handle any maintenance issues that arise. In closing I want to make it clear that not all Insurance companies are bad, in most part they all have good intentions and want to do the right thing. But there is a quote I read once before that said, “When money is involved, people cheat”. If I can help, please reach out to many at one of the sources located below!
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