Do I Need A Public Adjuster ?
In February, I heard this question many times as I was meeting with property owners along the hurricane damaged New Jersey shoreline from Wildwood in South Jersey through Brigantine, Little Egg Harbor, Tuckerton, Manahawkin, Long Beach Island, then through Seaside Heights and neighboring towns until I was stopped by the National Guard going into Mantoloking. I learned a very important fact. Most property owners either didn’t know what a Public Insurance Adjuster was OR didn't know why they would need the assistance of a Public Adjuster.
Let’s start out with the definition.
“A public adjuster is an insurance claims adjuster (negotiator) who advocates for the policyholder in appraising and negotiating a claimant's insurance claim. Aside from attorneys and the broker of record, public adjusters licensed by state departments of insurance are the only type of claims adjuster that can legally represent the rights of an insured during an insurance claim process. A public adjuster will be most beneficial when it is clear that the insurer will pay the claim and the only issue is the proper identification [of the damage] and valuation of the loss. Primarily they appraise the damage, prepare an estimate and other claim documentation, read the policy of insurance to determine coverages, and negotiate with the insurance company's adjuster.”
The Public Adjuster's main responsibilities are:
- · If business owner - Evaluate interruption losses and other extra expense claims
- · With Owners input - Determine values for settling ALL covered damages
- · Prepare, document and support the claim on behalf of the insured
- · Negotiate a settlement with the insurance company on behalf of an insured
- · Re-open a claim (supplemental) - Negotiate for more money if a discrepancy is found after the claim has been settled
While it is not always clear when a policyholder may benefit from using a Public Adjuster, the most benefit is likely to be realized if they are engaged immediately after a substantial damaging event, such as Hurricane Sandy’s horrific pounding on the New Jersey shore areas, both the high levels of flooding and 60+ mph gusting winds.
It is extremely important to note that the insurance policy itself is written in a language what we call Technical English, written by the Insurance Companies....for the Insurance Companies. There is much "wiggle room" for interpretation, both on the insurance company’s standpoint and the property owner's. This wiggle room translates to monetary negotiations between the Public Adjuster and the Insurance Adjuster.
By way of one example, let’s talk about “Wave Velocity”. Remember when the kids were in the bathtub splashing about, then when they got out, the water level lowered and settled. That became the “scum line” (which you had to scrub off), but the water had been much higher. “Wave Velocity” is the phenomenon of ocean salt water and the bay saltwater coming inland from all directions (seeking its own level) causing waves from 6” to 12” and many times higher. Salt water has a scouring affect and does not show how high the water splashed until the water settled and formed your “scum line” or water line. This water line now becomes the entire “foundation” for your flood claim settlement according to the insurance company's adjuster. The Public Adjuster knows the damage line is much higher. Many times this damage is not readily apparent but 3-6 months from the hurricane, the evidence will begin to manifest.
The Wave Velocity concept is important to owners where their water line was just below their floor joists, or flooring, insulation, windows, air conditioning equipment, etc. and because of “capillary suction” or “wicking”, salt water that splashed up to these areas, insulation will be wet, flooring may start to warp or cup, the air conditioning equipment will start to rust badly. The insulation just above the water line is soaked and would need to be replaced; floor joists and subfloor would need to be mold mitigated. Usually the insurance company's adjuster WILL NOT volunteer this information, either because he/she has not been trained OR they have been trained NOT to volunteer this information. This does open a can of worms for negotiating.
Public Adjusters, along with their professional advisors, i.e. structural engineers, general contractors, etc. can, many times, find damages that are overlooked by the insurance adjuster, (no, not because they are EVIL) but because they may be newly trained, or extremely overbooked or just plain overworked. They are usually rushing to finish, get the job done and move on to the next of their many scheduled appointments. Also, the insurance adjuster may not get around to submitting their report on your property for many weeks or months later, which leads to more damaged items missing, overlooked or underpriced. Public Adjusters work for the policyholder and “COMMIT” themselves and their years of experience to the policyholder’s claim to “MAXIMIZE” every single legitimate item. Consider this perspective: Pay the Public Adjuster X amount or lose 3X-4X-5X MORE to the Insurance Company!
However, any time during negotiations with the insurance company and even after a settlement has been received by the insured, a Public Adjuster may be able to negotiate for a higher amount if additional damages have manifested or have been discovered.
There are other avenues open to the Public Adjuster if the two parties cannot agree on the total value of the claim. The Public Adjuster would then appeal to the Supervisor or upper management. If that did not resolve the dispute(s), the Public Adjuster would then call for an “Appraisal”. Each party would hire an independent appraiser to determine the value of their respective claim. Usually this solves most disputes and each party feels they have won. If the Appraisal Process fails to resolve their differences, then there is arbitration and/or lawsuit, which would be the absolute last resort and is very time consuming and expensive.
In summary, the whole idea of insurance is to make the Insured’s property “whole” again to its original state…not more, not less but EQUAL. This is called "Pre-Loss Condition". It's New Jersey Law !
Joe Fallon
LARJ Public Adjusters, LLC
www.MaxOurClaim.com
Gibbsboro, NJ 08026
(855)-SOS-LARJ 855-767-5275
Cell (609) 685-0507
