ON THE LEVEL: VIEWS OF A STOREFRONT BROKER.

• Author: Carbajal, Michael
• Position: LOOKING BACK INSURANCE ADVOCATE - 25 YEARS AGO

Handling Homeowners' Claims

There is little doubt, as far as I am concerned, that insurance as a guarantor of almost endless aspects of life situations, works reasonably well.

While in many ways the business has internal checks and balances, the governmental regulatory system is much in evidence to the business, but much less to the rank and file public. Even though there are large numbers of individuals who contact insurance departments to make complaints or to ask for advice, by and large they constitute a very small percentage of those who buy some form of insurance protection. The regulators, aside from their direct input in rate supervision and solvency surveillance, appear only to intervene when there is some gross unfairness or illegal activity in the business.

One aspect that troubles me, however, is connected with public adjusting. It seems to me that something must be wrong with the system if it becomes necessary for a homeowner, who suffers a fire or windstorm loss, to employ a public adjuster just to get what he or she is entitled to under a contract of insurance.

Insureds and insurance companies, perhaps more than in previous times, have become adversaries. Of course, there is no mandate that anyone who suffers a loss must hire an adjuster but there is little doubt that in too many cases, the recovery will be less if the insured decides to handle the loss on his or her own.

My purpose is not to minimize the importance of public adjusters. They perform a vital function to the insuring public in the adjustment of larger losses including complex residential losses. Their services are invaluable in preparing a large loss for inspection by a carrier. There are books and records that must be made available and inventories to contend with as well as measures to safeguard undamaged properly. Insureds do not have the expertise to perform these tasks to the satisfaction of the companies or for their own protection. There are a myriad of other problems that must be resolved before a large loss can be adjusted. Public adjusters earn their keep in this area.

There are an increasing number of personal lines losses that are proving difficult to settle because the system is poorly structured. Some companies are using appraisers who have little or no credentials, and to gain favor with the companies they consistently give low estimates for repairs. Licensing of these individuals is not mandated; therefore the expertise of these individuals is...