Are There Any Public Adjusters I Should Use?
This question was repeated many times in February as I met with property owners along the storm-damaged New Jersey shoreline. I met with them from Wildwood, South Jersey to Seaside Heights, and then was stopped by the National Guard entering Mantoloking. This was a crucial fact that I discovered. Many property owners didn’t even know what a Public Insurance Adjuster was or why they needed it.
Let’s begin with the definition.
A public adjuster is an insurance claims negotiator who represents the policyholder when assessing and negotiating an insurance claim. Public adjusters are licensed by the state department of insurance and can legally represent an insured’s rights during an insurance claim process. The public adjuster is most helpful when the insurer has made clear that they will pay the claim. The only thing that is left is to properly identify the damage and value the loss. They assess the damage and prepare an estimate.
The main responsibilities of the Public Adjuster are:
*If business owner – Evaluate interruption claims and other extra expense claims* Owners input – Determine the value of all covered damages
* Support the insured by preparing, documenting and supporting the claim
* For an insured, negotiate a settlement with the insurer
* Reopen a claim (supplemental). – Negotiate for additional money if there is a discrepancy after the claim has been settled.
Although it’s not always obvious when a policyholder might benefit from using the Public Adjuster, they will be most effective if they are engaged right after a significant damaging event such as Hurricane Sandy’s devastating pounding of the New Jersey shores, with both the high levels and gusting winds at 60+ mph.
It is important to remember that insurance policies are written in what we call Technical English. This language is used by Insurance Companies… for Insurance Companies. There is a lot of “wiggle room” to be interpreted, from both the perspective of the insurance company and that of the property owner. This allows for monetary negotiations between Insurance Adjuster and Public Adjuster.
Let’s take “Wave Velocity” as an example. You can remember when the children were playing in the tub, and then the water level dropped. This was the “scum line”, which you had to clean off, but the water level had been much higher. Wave Velocity is the phenomenon where ocean salt water and bay saltwater come inland from all directions, seeking their own level. This causes waves from 6 to 12 inches and sometimes even higher. Salt water is a scouring agent and doesn’t show how high water splashed before it settled, forming your “scum” or water line. According to the adjuster at the insurance company, this water line is now the foundation for your flood claim settlement. The damage line is higher than the Public Adjuster. This damage can often not be immediately apparent, but it will start to show 3-6 months after the hurricane.
Wave Velocity is for owners whose water line was below their flooring, insulation, windows or air conditioning equipment. Capillary suction or “wicking” can cause salt water to splash up into these areas. Insulation will become wet and flooring will warp or cup. Air conditioning equipment may also rust. The insulation above the water line has been soaked and will need to be replaced. Floor joists and subfloors would also need to be mold-milded. This information is usually not shared by insurance adjusters because they aren’t trained to do so or they have been told NOT to share it. This opens up a lot of possibilities for negotiation.
Public adjusters are also referred to as their professional advisors. Structural engineers, general contractors, technical advisors, etc. Many times they can find damages that the insurance adjuster overlooks. This is not because they are evil, but because they might be new to the job, overbooked, or simply overworked. Insurance adjusters often rush to get the job done, then move on to the next scheduled appointment. The insurance adjuster might not submit their report on the owner’s property until weeks or months later. This can lead to additional damaged items being overlooked, underpriced, or missing. Public Adjusters are there to help the policyholder. They “COMMIT” their experience and years of knowledge to helping the policyholder “MAXIMIZE” all legitimate items. Think about this: Pay the Public Adjuster $X or LOSE $3X-4X-5X to the Insurance Company
A Public Adjuster can negotiate for a higher amount in the event of additional damage or other damages.
If the parties are unable to agree on the value of the claim, there are other options available to the Public Adjuster. The Public Adjuster then appeals to the Supervisor or higher management. If this fails to resolve the dispute(s), then the Public Adjuster will call for an “Appraisal”. To determine the claim’s value, each party would hire an appraiser. This usually resolves most disputes, and both parties feel they have won. If the Appraisal Process fails, the parties can then go to arbitration or a lawsuit. This is a very expensive and time-consuming option.