Public adjusters can boost insurance claims after a disaster
By JEFF LAZERSON / CONTRIBUTING COLUMNIST
My wife and I were indescribably relieved that our graduate student daughter weathered the Baton Rouge flooding without injury or damage to her living quarters near the LSU campus.
Thinking about the 40,000 homeowners who suffered damage or complete loss due to the recent flooding in and around Baton Rouge, do any of us have enough insurance and the correct kind of coverage to rebuild or restore our homes to the condition they were in prior to the event?
In California, consider whether you have enough coverage. Are you in a flood zone needing that coverage? Or what about adding earthquake insurance?
If something happens to your property, first and foremost, do not assume your insurance company is going to make you completely whole.
“Insurance companies are in the business to make money,” said Denise Sze, of Los Angeles-based Merlin Law Group and general counsel for the California Association of Public Insurance Adjusters.
Public adjusters represent the insured, not the insurance company, in negotiating better settlements for a homeowner who lost his home to a fire, for example. Public adjusters receive anywhere from 2 to 35 percent of your settlement with an average of 15 percent according to Sze.
“It’s a felony for a public adjuster to approach any homeowner within seven days in any declared disaster area,” said Nancy Kincaid, press secretary to California Insurance Commissioner Dave Jones. Kincaid pointed out public insurance adjusters must be licensed. And, the state insurance commissioner’s office accepts complaints and investigates on behalf of the insured.
Wendy Holt of Rancho Cucamonga-based Holt Insurance adamantly believes that public adjusters are not necessary.
“If the client has a decent agent and you get your estimates (to compare to the insurance company’s repair and replace estimates), that will cover you.”
Holt stated that public adjusters will monitor fire department radio frequencies. She had one client who signed up with an adjuster within two hours of her house burning down.
“That homeowner (unnecessarily) lost thousands and thousands of dollars,” said Holt.
In California, think hard before you make an insurance claim or even an inquiry about damage, particularly for smaller matters.
“People that file claims are more likely to file more claims,” said Kincaid. The insurance industry tracks you individually and tracks each property separately through CLUE or Comprehensive Loss Underwriting Exchange records, according to Kincaid. She pointed out that even an inquiry could get posted to CLUE by your insurance company.
If you do make a claim, be it water-damage, fire or anything else, find out what your insurance company will offer you with their detailed bids attached.
Go get your own comparative bids to be sure the insurance company bids are fair.
Then, contact a public adjuster.
Ask if he or she can get you a better settlement by negotiating for you. If so, sign a contract that specifies that they must do better by X, including their commission. Have your attorney review the contract before engaging a public adjuster.
If you sign-up with a public adjuster, under California law you have three days to rescind the contract, Kincaid said.
Jeff Lazerson - Mortgage Columnist since 2011