What is a Public Insurance Adjuster & Why Do You Need to Hire One?
To learn about what a public adjuster can do for you, we caught up with Jeffrey O’Connor, who has been a licensed public adjuster since 1985 and has been with Alex N. Sill Company since 1992. Sill, along with its sister firm, National Fire Adjustment Co, Inc. (NFA) forms North America’s largest national public adjusting and loss consultants firm servicing insureds on their property claims (and never the insurance company) throughout the United States, Canada, and the Caribbean. Headquartered in Cleveland, Ohio, the company has 30 offices throughout the US and Canada and is accredited by the National Association of Public Insurance Adjusters (NAPIA).
What are the most common property insurance claims you help your clients with?
We assist our clients with any insured sudden event, termed a peril, that results in a significant insurance claim. This includes fire, water, wind (storm, hurricane, tornado), explosion, hail, theft, flood, collapse, and mudslides. Cyber claims are also becoming a significant loss event that we can help our clients recover from.
Tell us a little bit more about what a public adjuster is exactly.
A public adjuster is an insurance claim expert that works as an advocate exclusively for the policyholder, never the insurance company, to assist in preparing, adjusting, and negotiating property insurance claims. We are licensed by the departments of insurance in 46 states, the District of Columbia, US Virgin Islands, Puerto Rico, and several provinces in Canada. We assist the insured to:
- Analyze the insurance policy for recovery options, policy limitations, and exclusions.
- Measure the loss amount.
- Document the claim detail.
- Present the documentation to the insurance company representatives.
- Negotiate settlement amounts for maximum recoveries.
We do so by executing the following functions:
- Perform all on-site inspections.
- Prepare damage assessments to buildings.
- Prepare a detailed inventory of all personal or business personal property [contents] and determine the extent of loss and damage to the contents and equipment including pricing.
- Appropriately calculate the depreciation, if applicable, to the damaged structure and contents.
- Prepare a financial statement of the loss of income calculation and the extra expenses a commercial insured incurs as a result of the peril.
Immediately after the loss event, our team, led by our adjusters (all formerly employed by insurance carriers and/or as independent insurance adjusters), along with our in-house attorneys, review the policy for all available entitlements. We then meet with the insurance company and their representatives at the loss location, strategize with the insured for the best course of action for the insured to achieve its goals in response to the peril, which often involves recovering the maximum benefit of the policy conditions. We also assist in helping the insured make sound insurance decisions that ensure their goals for the future of their home or business.
We represent the insured in all negotiations and discussions with the insurance company’s adjuster until the final settlements are received by our clients.
What are the first things people should do if their property is damaged?
The policyholder has many obligations in the adjustment of a claim but the most urgent responsibility is to protect the property from further damage by acting with reasonable care. Examples are calling the fire department, stopping water flows, covering holes in roofs, boarding up windows, etc.
The policyholder should report the loss to the agent or directly to the insurance company claim department within a reasonable amount of time.
Next, the insured must immediately decide who will professionally represent their interests in connection with managing the insurance claim, understanding that once a claim is made, an insured should not expect that its agent, broker or insurance company and adjuster will be acting in the insured’s best interest. The insurance company will enlist professionals such as contractors, cleaning companies, accountants, etc. to represent its interests on the claim. Consider speaking to a licensed, experienced public adjuster as soon as possible. You may ultimately decide not to hire them, but their advice early on can make the difference between your success and full recovery - or not.
We will relieve the insured of most of the daily, time-consuming details of the claim process, allowing the insured to concentrate on the details of getting their lives and businesses back in order.
What are the benefits of using a public adjuster?
We will relieve the insured of most of the daily, time-consuming details of the claim process, allowing the insured to concentrate on the details of getting their lives and businesses back in order. Preparing an insurance claim under the best of conditions is extremely stressful to a homeowner or business owner, let alone at a time of physical and emotional duress of trying to recover from a disaster. The insured must also understand that the burden of proof of damages is on them, not the insurance company. Hiring a professional public adjuster which can help an insured meet that burden of proof of damages is essential to a successful claim resolution.
In addition to relieving an insured of preparing the estimates required in the claim process, the added benefit of our involvement is that it results in a net recovery far in excess of what the insured would obtain on their own.
What are the key things that insurance adjusters often overlook?
There are many things, but I will list three important ones:
Coverages
In addition to the basic coverages of building and personal property, there are many other recoveries available in the policy that the insured may not know about or know to maximize. Examples are extra amounts for debris removal, code upgrades, landscaping, property of others, etc. We often say that no one in the history of the world has ever read their property insurance policies. And if they did, the policies are intentionally written both ambiguously and using industry terminology that make understanding the policy extremely difficult. We also often comment that the first page(s) called Insurance Declarations (AKA Dec Pages) of a policy giveth coverage and the next hundreds of pages taketh away coverage, thus mandating that an insured hire a professional public adjuster who deals with and understands these policies in the regular course of business.
Repair Scope
Most claims are underpaid as a result of being under-scoped by the insurance adjuster. This means only a portion of the correct repairs is identified. An example is hidden smoke in wall cavities, water behind cabinets, etc.
Like-kind and quality
The policyholder is entitled to have a replacement of the same materials that were damaged. Often, the repair estimates the insured receives substitute cheaper materials and convenience for original high-quality materials and skilled labor. For example, replacing plaster walls with drywall or replacing ornate moldings with more common standard “big box store” products.
In what ways has the pandemic affected Sill’s work?
Unfortunately, all are aware of the devastating effect this pandemic has had on all of us, both physically and emotionally. As caring, considerate human beings, the effects of this pandemic are well beyond the measurable economic impact. However, the economics cannot be ignored and like any disaster, people protect themselves from economic disaster with insurance. It is extremely disappointing to see what the response has been from the insurance industry. Individuals and business are struggling for their existence and the insurance carriers have responded to this struggle with denials and policy exclusions on why they should be absolved from sharing in the recovery.
We are documenting many claims for recovery and continue to press the insurance companies for proper responses to our clients’ needs.
Tell us about some of Sill’s most recent successes?
We handle hundreds of claims per year from medium-sized homeowner claims to large, complex manufacturing claims. Each one has its own success story. Here are a few examples of very typical claim experiences:
The Diversity Center of Northeast Ohio
A charitable human relations organisation dedicated to eliminating bias, bigotry, and racism, which experienced a significant flood that resulted in the destruction of some of its business personal property and the interruption of business operations. After unsuccessfully attempting to resolve the loss claim with its insurance company, The Diversity Center turned to Sill to help settle the claim. Sill’s team was able to dramatically increase, by 261%, the property and business income settlement over the offer by the insurance company, prior to Sill’s involvement.
Leonard’s Big Valley Farm, Goldthwaite, Texas
A major pecan processing plant in Texas was ravaged by fire along with 100,000 pounds of pecans. Although initially estimated as a $1MM loss by third parties, Sill’s adjuster, building expert, contents estimator, and business income loss accountant inventoried the damage, prepared comprehensive damage estimates and presented the detailed and overwhelming documentation to the insurance company. The result was a final loss settlement of nearly $3MM.
Alberta Central, Portland, Oregon
A flare from a July 4th fireworks celebration landed on the roof of the retail centre at Alberta Central causing a major roof fire. We sent our staff of adjusters, building appraisers and forensic accountants to the site to put loss estimates together on the building and business loss. Initially, the insurance company’s estimate for damages was a fraction of what the Sill Company had documented. Ultimately, after several go-arounds with the insurance adjuster and their building consultant, they agreed to Sill’s numbers, resulting in a recovery for the insured 144% above the insurance company offer.
What is the company’s ultimate goal?
Our goal is to represent the policyholder to arrive at a fair and timely settlement that allows the insured to continue to return to life as normal as possible.
For business owners, more businesses will fail after a disaster than fully recover. We want to change that narrative for our clients. We are a vital part of their recovery and the continuation of their businesses.
For homeowners, we help them by taking the heavy burden of the claims process off their shoulders. With our support, they can recover quickly and completely with far less interruption to their normal way of life.
We feel strongly that anyone representing you should do so professionally and ethically, in a manner that you would be proud of. For that reason, we employ the most technically trained professionals in our industry, dedicated to complete customer satisfaction.
We are expanding our practice throughout North America, and we can mobilize our staff at a moment’s notice to respond to your needs.