Altier vs Worley Catastrophe Class Action on Overtime issues by BP Adjusters settles under Confidential Terms

February 3, 2012

Thanks to www.law360.com  for posting an update on the Altier vs Worley Catastrophe Claims which confirms rumors that the two Altier cases (Lousiana and Federal Court) have settled which are the class action cases that adjusters working for Worley that worked BP claims filed regarding overtime issues / pay versus contract disputes.

The terms are confidential so don’t be bothering your claims associates for the details. Here is the link found when using their share button to Linkedin post for the full article:

http://www.law360.com/southeast/articles/296901

For further followup or questions- you can contact Worley for comment at www.worleyco.com or contact the law firm who handled the settlement and class action as all contact information can be found in the left hand corner of their website on this class action at www.worleyovertime.com where you will also see a link to the court documents in the left column which show the plaintiff adjusters who opted in as of June 2011. I don’t see the settlement information up on that site most likely due to the confidential terms of settlement.


Update on Worley overtime class action case Altier vs Worley and BP- BP granted dismissal May 2011

May 11, 2011

Doing some research today, I was able to locate a May 9, 2011 court decision granting BP’s motion to be dismissed from this class action lawsuit filed by independent adjusters working BP claims through Worley adjusting firm.  Here is the link.

It is interesting to see several more independent adjuster names on the court document now as plaintiff’s…several of which I recognize from online interactions from several sites.

In another online document from a February 25, 2011 Status Conference held  involving all BP cases, they do list both Alteir vs Worley and Alteir vs Worley and BP as item number 17 on the Agenda. Here’s the link to that pdf document found online.

The website listing the status of the 368 litigation cases against Deep Water Horizen does show these two cases still open here (search alpha order for Alteir vs Worley.

While doing some online research I also came across another case in AL that includes BP and Worley as well as ESIS who BP originally assigned cases to filed with the State of AL as one of two plaintiffshere which also lists it as a RICO case as shown in this document. I will make some contacts to see if I can get more documents if they available to the public. There is a short explanation about the type of case it is in the top right corner of the pdf document. The 2nd plaintiff listed on this AL case is CMCO, LLC and here is the trademark info I found on them but no clue if this is actually the plaintiff listed on this case.

Amazingly (not) is a website which is basically an advertisement from the firm filing the class action speaking to adjusters who may have worked for Worley found here. The website for the law firm is listed on the bottom of that link along with contact information.

As far as what independent adjusters are saying,  here is a lin to a CADO forum topic where a few were discussing this case when it first hit the news.

For links to our prior posts with the original Complaint documents which explains the details of the case if you missed it, here is the link.

As we locate more documents and information we will update the information here on the blog.


Filed Court Documents on Class Action filed against Worley and BP by Adjusters on Overtime Issues/Daily Rate- Part II

February 11, 2011

We previously posted about the information learned about a Class Action lawsuit filed on behalf of BP adjusters working oil spill claims.

Here is a link to the original post if you missed it:

http://dimechimes.wordpress.com/2011/02/09/adjusters-handling-bp-claims-file-a-class-action-lawsuit-on-two-issues-overtime-pay-and-failure-to-receive-65-of-daily-fee-per-contract/

This post now contains the two Complaints filed by the adjuster seeking to represent the Class of adjusters who worked the claims:

Altier v Worley BP et al gov.uscourts.laed.145020.1.0 This is the Complaint filed seeking Class Action on Overtime Pay Issues although they were independent adjusters working on a daily rate

Alteir v Worley only  This is the Complaint filed seeking Class Action on alleged failure to pay BP Adjusters 65% of the daily rate they received per Adjuster

Thank you to the source who provided the copies of the court documents. We will continue to follow this case and post updates as we learn them as we feel this is a significant case that all carriers and adjusting firms as well as adjusters will follow due to the daily rate/ employee vs independent contractor/ and overtime issues involved.


” Adjusters ” handling BP Claims file a Class Action lawsuit on two issues- Overtime pay and failure to receive 65% of daily fee per contract

February 9, 2011

Roy Cupps over at CADO posted this link in the forums there regarding a Class Action lawsuit filed by MS Attorney JP Hughes  (I could not locate a website for him but I’m working on it through network connections )on behalf of the adjusters handling the BP claims regarding two issues:

1) Overtime pay- working more than 40 hours per week and not receiving over time pay (they were on daily rate)

2) Alleged failure of adjusting firm to pay adjusters their 65% of the daily rate they were paid by the BP Fund

For complete details, here is the link:

http://www.courthousenews.com/2011/02/09/34026.htm

This is definitely a case to watch as it is standard for independent adjusters to receive a daily rate of pay for each day worked on a catastrophe or daily assignment where they agree to work for a stipulated daily rate for a given split of the daily rate. The rate these adjusters were paid is on the high end of the daily rate independents normally receive. I have no idea why this alleged adjuster would feel entitled to time and a half for hours worked over 40 hours unless the contract indicated the daily rate was for a given 40 hours which is unheard of in the claims industry for independents working on assignment.

I am very curious if this person was actually one of the actually non claim folks working on BP claims. I have actually been told by several were working in field offices that BP Csar Ken Feinburg changed adjuster job titles to “evaluators” when he took over. If that is true, do you think that the prior findings of the Fair Labor Standards commission would differ on findings on this class action?

If you missed our prior several blogs on overtime issues and adjusters, here are links to prior blogs on the topics and prior decisions on some of these cases:

http://dimechimes.wordpress.com/?s=Overtime

http://dimechimes.wordpress.com/2010/02/27/supplemental-info-on-geico-auto-adjuster-overtime-issues/

http://dimechimes.wordpress.com/2010/02/02/fenton-et-al-v-farmers-insurance-exchange-no-07-4864-dc-mn-2009-mn-staff-claims-adjuster-overtime-decision/

http://dimechimes.wordpress.com/2010/01/06/geico-wins-case-on-overtime-issues-for-auto-adjusters-view-washington-post-article/

http://dimechimes.wordpress.com/2009/02/27/adjuster-overtime-issues-supplemental-info-from-none-other-than-attorney-gloria-allreds-current-news-letter/

http://dimechimes.wordpress.com/2007/09/24/insurance-adjuster-overtime-pay-issues-and-complaints-in-the-news/

Regarding the second issue of alleged failure of  Worley Adjusting firm to pay the agreed 65% split of the daily rate, I find that very hard to believe as they have such an excellent reputation for paying adjusters fairly in the claim industry which is remarkable considering the number of adjusters who have gone unpaid by unprofessional firms since Katrina. I assume we’ll be able to view the contract when documents are filed during discovery on the case to show first of all the daily fee Worley was receiving per “adjuster” as well as the independent contract terms they were using on this assignment. I’ll keep an eye out for those to make the records in the coming months.

There were many experienced adjusters who would gladly have deployed for the given rate of pay. In addition, adjusters working out of town at BP assignments were given daily per diem while working which is unheard of for independent adjusters working for insurance carriers so those who were lucky enough to be deployed were most thankful for the assignment.

I think this case will be closely watched by all insurance carriers who use independent adjusters on daily rates. I know I will be closely following it. You can as well by subscribing to this blog to watch for updates as we post them.

If you also want to follow this discussion going on over at CADO where Roy Cupps posted this information, here is the link to that topic forum discussion there:

http://www.catadjuster.org/Forums/tabid/60/aft/11695/Default.aspx#22348


Supplemental Info on Geico Auto Adjuster Overtime Issues

February 27, 2010

It is just amazing the great information found while experimenting with Twitter this month for use in the claims industry.

One of the great finds today is a detailed article explaining the overtime issues in the case that Geico recently won by Weil Gotshal  law firm.  Their newsletter with a pdf  link to their article can be found on page 4 using this link.

We recently blogged with a link to the Washington Post articleon Geico’s win on these auto adjuster overtime issues  in this prior blog.


Fenton, et al., v. Farmers Insurance Exchange, No. 07-4864, DC MN, 2009, MN Staff Claims Adjuster Overtime Decision

February 2, 2010

Here’s some information on an over time case involving a Farmer’s case, Fenton, et al., v. Farmers Insurance Exchange, No. 07-4864, DC MN, 2009 .

It sounds like an SIU (Special Investigation Unit arson fraud adjuster) Investigator won a decision in MN on adjuster overtime pay. According to this article, it was based on the fact their supervisor made the final decision if a case was fraud or not. It seems the states are across the board based on alot of other decisions I’ve posted on this blog. This is surprising since a claim supervisor making the decision on a claim file would be applicable on all claim files that exceed an adjuster’s authority, files to be denied,  and normally any coverage issue files as well.

For information on Fenton, et al., v. Farmers Insurance Exchange, No. 07-4864, DC MN, 2009, here is a link I found on today’s email update from a great site for HR that I subscribe to at http://www.thehrspecialist.com  

Here’s the link:

http://www.thehrspecialist.com/article.aspx?articleid=30351&cigx=d.n,stid.7491,sid.374530

This link will take you to all other blogs I’ve posted that included other claims adjuster overtime cases. This does apply to staff adjusters not independent adjusters. I’m curious if the independent adjuster classifications will be questioned as well with the 2010 concentration on employee versus independent classification we’ve been reading about.

http://dimechimes.wordpress.com/?s=overtime

Doing some additional web search for a link to the court documents on the Fenton vs Farmers case, I came across this link to an entirely different court finding in Farmers favor in 07. It sure is interesting comparing this to the Fenton case:

http://www.hreonline.com/HRE/story.jsp?storyId=9595529


Geico wins case on overtime issues for auto adjusters view Washington Post article

January 6, 2010

Geico has won a case on overtime issues for staff auto adjusters according to the following article posting on the Washington post here.

We have written several other blogs here on staff adjuster overtime issues if you want to view them here.


Adjuster Overtime Issues Supplemental Info from none other than Attorney Gloria Allred’s current news letter!

February 27, 2009

Speaking of reading interesting information found on the internet! I found this information on Gloria Allred’s law firm website. If you are a Greta Vansustern  fan on Fox News (9 pm CST week nights) you will definitely recognize her. This is a post she has on her current newsletter about overtime and wage and hour issues you will find interesting:

http://www.amglaw.com/CM/News/eNewsletter.asp

Here is a link to our prior blogs on Adjuster overtime issues. One of these days we’ll get a great employment attorney to answer adjuster questions on overtime issues. (Gloria…..hint we are a big fan of Foxnews but this is a  volunteer free non income producing volunteer effort blog trying to educate trainee independent adjusters with no ads so we need pro bono-smile! ):

http://dimechimes.wordpress.com/2007/09/24/insurance-adjuster-overtime-pay-issues-and-complaints-in-the-news/

**Update 2/27 4 pm CST:

Had I read Gloria Allred’s Bio before making this entry I might have been less likely to have teased her on an open blog. She has a most impressive background. Here is a link:

http://www.gloriaallred.com/CM/Custom/TOCAbout.asp


Insurance Adjuster Overtime Pay Issues and Complaints in the news

September 24, 2007

I’ve been trying to find time to write about the big ongoing question about adjuster overtime pay and a related issue on the commonly asked question ” am I an independent or am I an employee”.  The new suit brought by two AIG adjusters   in September 2007 again brings this topic to the forefront and we’ll watch this case to see if anything new develops to help us understand these issues. We would appreciate any comments by employment attorneys to help us clarify these issues. Today we will provide information on the overtime issue and tomorrow we’ll blog about the Independent adjuster vs employee questions which we are frequently asked about by adjusters when signing independent adjusting firm contracts.

Here is a link to the news article about the AIG adjusters new suit. Here is also a link to the Bloomberg article on this new suit.It’s not just carrier staff adjusters and employees filing these suits as this article shows adjusting firms are the subject of such suits also in this article saying Pilot Catastrophe  Services  also received a Complaint in 2004. I’d like to know how the adjusting firm case was resolved but could find no information on the web about the outcome of the case.

The AAICP -American Association of Independent Claims Professionals wrote an excellent article on this overtime issue in June 2004 found here. This article in part says:

“Insurance claims adjusters are still exempt from federal overtime requirements under the United States’ Department of Labor, Wage and Hour Division’s final version of the controversial changes to the white collar exemption regulations. As requested by the American Association of Independent Claims Professionals (AAICP), an association of independent claims adjusting companies, the Labor Department specifically noted in the new regulations that claims adjusters are generally exempt from overtime pay requirements regardless of what kind of company they may work for – an insurance company or an independent. The new regulations also make some adjustments to exempt salary requirements that may affect claims adjusters, including raising the minimum exempt salary and creating a new pseudo-presumption of exempt status for higher wage-earners.”

Here is more important information in this article:

“As requested by the AAICP, the new regulations specifically use insurance claims adjusters as an example of an exempt administrative employee:

Insurance claims adjusters generally meet the duties requirements for the administrative exemption, whether they work for an insurance company or other type of company , if their duties include activities such as interviewing insureds, witnesses and physicians; inspecting property damage; reviewing factual information to prepare damage estimates; evaluating and making recommendations regarding coverage of claims; determining liability and total value of a claim; negotiating settlements; and making recommendations regarding litigation.  “

Please read the full article for other important details.

Here is another article from the AFL CIO which specifically addresses insurance adjusters and overtime issues which concurs with the article from AAICP stating in part:

“Insurance claims adjusters—Again, court cases on whether insurance claims employees receive overtime pay have gone both ways—some courts have said they are exempt and other have said they should receive overtime pay. This is a very heavily-litigated field, and corporations have not been able to win a blanket victory. The Bush Administration has handed them that victory by changing the nationwide regulation to specify that these employees are generally disqualified from receiving overtime pay. (New Section 541.203(a)) A quarter of insurance claims adjusters make less than $35,000 a year. “

**** 

 

 

 

 

 

In a more recent case involving Farmers, White and Case provides this analysis of an overtime case in multiple states in this February 2007 article on Farmers prevailing in a case on the claim adjuster overtime issues. Here is the link to their article.

*****

 

One of the most excellent articles I could find (here)is  from Holland and Knight in December 2006 which addresses the duties of adjusters who alleged use of computer estimating systems and claim manual among other things took away their individual judgment thus they were entitled to overtime pay. Some important comments in this article include:

 

 

“The Farmers claims adjusters asserted that they were not exempt from the overtime pay requirements because the work that they performed was part of the “production” side of the business, not the “administrative” side. They also argued that because they had to follow claims manuals and guidelines, and use computer programs to determine loss values, they did not exercise sufficient “discretion” and “independent judgment” to fall within the exemption.The trial court found that all of the claims adjusters were doing “administrative” work; that is, that their role was on the administrative side of the business, not the “production” side. In addition, the trial court found that most of the claims adjusters used a sufficient amount of discretion and independent judgment in their work to qualify for the exemption. However, the trial court found that some claims adjusters, such as automobile adjusters and adjusters who mostly handled claims less than $3,000, had to follow so many guidelines and rules that they did not exercise an adequate amount of discretion and independent judgment to meet the exemption”. 

I found this article addressing the size of the claim particularly interesting in light of all of the claim central operations handling smaller losses.

Here is another good article by the Jackson Lewis firm from November 2006 outlining more duties of adjusters and providing more information on the Ninth Circuit ruling that claims adjusters are exempt from overtime pay while noting that CA courts reached opposite conclusions. This brings us to this September 19, 2007 article  here by National Underwriters discussing some recent CALIFORNIA cases where Allstate, State Farm, and Farmers agreed to pay millions on other cases out there. Is this because they are cases in CA subject to other laws or is it because of overtime regulation interpretations prior to the new overtime rules of the Federal Labor Standards Act?

This MSNBC article here from August 2004 explains what changed with the new overtime regulations when they went into force. I’m not an employment attorney so I am not sure of the answer to this question as to why some carriers were settling these cases but it may be due to the regulations in CA differing as an article  addessing several CA cases settled by carriers in Los Angeles Business Journal explains here. 

 Here is an interesting article from October 2006 by CFO.com indicating the 2004 update to the FLSA has increased the confusion on overtime pay and the number of suits filed. Particularly interesting on page 3 of this article is the list of FLSA auditor “red flags” indicating things they look for to see if a firm is in violation of overtime issues such as having all employees on salary versus some time card employees. Adjusting firms should read this article.

The bottom line in all of these articles seems to verify that adjusters are not entitled to overtime pay with the exception of CA (see this 2nd article here from Holland Knight on CA regs opposed to Federal regs) . I’d make sure your adjusting firm is compliant on these issues especially during catastrophe operations when many firms are working employees at the required carrier hours of 7am-7pm 6 or 7 days per week. Check with your employment attorney to verify you have your firm properly classifying your employees and adjusters. There are many new in office programs adjusting firms are participating in such as running call centers, using an increased number of adjusters in claim central operations at carrier catastrophe centers, running additional living expense and contents claim units from their adjusting firm home offices or field catastrophe centers.

Due to the increased number of suits as a result of the new 2004 FLSA decisions as indicated in these articles, it appears wise to get a legal opinion on your overtime decisions BEFORE your firm is subject to such a complaint. Review of this Department of Labor article found here says it best:

 “The status of an insurance claims adjuster, however, does not rely on the “claims adjuster” job title alone.  There must be a case-by-case assessment to determine whether the employee’s duties meet the requirements for exemption. “

In my earlier years as a staff adjuster, we were never paid overtime pay except when moved to “time card” status while attending claim schools as they advised us training status required overtime pay while normal work did not. We were never paid overtime as claim managers in line field units, claim central operations, or while serving as catastrophe claim managers working 7 days per week 12 hours per day. In more recent years when performing temporary catastrophe management duties with independent adjusting firms, they also paid us on salary with no overtime. I can assure you in both staff and independent positions that adjusters normally work far beyond a 40 hour work week to keep up with carrier performance guidelines and Department of Insurance mandated deadlines during catastrophes. This 28 year carrier career was all prior to 2002 with the independent experiences from 2003 to the  present.

 I am curious what adjusters today (after the 2004 changes) are experiencing on these salary, time card, and overtime issues and hope to hear from many of you in reply to this blog. Please list your position, your state of employment, your carrier or adjusting firm, and your method of pay both for regular 40 hours and overtime. Should you not wish to comment in the blog, you can send emails to us and I can post your input anonymously in reply to this blog. We’ll also post this in our  forums at ClaimSmentor for continuing ongoing discussions with our members.


Organization Chart for the Claims Handling Blame Game- A Humorous Graph -A Serious Look at Claim Bad Faith Issues

March 6, 2009

Insurance Company – Adjusting Firms- Claim Staff -Reinspectors -Independents  – Public Adjusters
Claim Litigation  Attorneys
 
→   →   (Everyone to R)       ←     ↓        ↑  →                           ←   ↓   →                                 ← (all 3)  →                                                 ← (all 4)
************************************************************************************************************************
What a mess  that makes no sense and it isn’t humorous at all. This is a huge insurance consumer issue. Just check out the Bad Faith organization or NAIC (National Association of Insurance Commissioners) for all kinds of information and surveys on claims handling. The link I put to NAIC is their 2009 Report on the Top Complaints by insurance consumers. You can sort by carrier, by type of complaint, by state I think, and much more!
 
When are we also going to get Insurance Departments on board to help improve this by doing the following things I’ve discussed in this blog before:
 
1) Require Insurance companies to report to all state insurance departments consumer links where they provide complaint information for carriers to provide information on adjusting firms that have been dismissed by a carrier for trends of bad faith claim handling issues. Presently, I know of no place when independent adjusters can validly find this information until it is too late. Dismiised firms are not required to be reported (if they are I am not aware of it) so they just move on to solicit new carriers so even more insurance consumers continue to be harmed by firms with bad consumer servicing problems.
 
2) I believe insurance companies require liability and errors and omissions information from adjusting firms before they use them. Are there any reporting requirements by state insurance regulators on claims ratios on E and O policies for adjusting firms or independent or public adjusters so 1) policyholders don’t hire a PA who has a large complaint ratio 2) so adjusting firms have a source to know (other than just checking regulator sites to be sure an adjusters license is still active), and so adjusters can have a valid source to see the complaint ratio of an adjusting firm so they can make a good decision about which adjusting firm they wish to deploy with so they don’t get hooked up with a firm that might be unprofessional?
 
3) Insurance Regulators should require that adjusting firms be required to disclose the name of the owner and the name of any key executives they may have on the payroll and post them on their website.  Often if an adjusting firm develops a bad reputation with adjusters or carriers, they just either a) move to another state so carriers and adjusters cannot find bad information about them at insurance department licensing sites that allow you to research licenses or b) the adjusting firm owners or key executives just change the name of the adjusting firm so adjusters don’t know who they are.
 
4) Another thing that concerns me when trying to find good adjusting firms for newly licensed adjuster recommendations , when asked by ClaimSmentor members , is that so many of the adjusting firms do not list one thing on their ABOUT pages about who the key owners are. I tell them just to go to http://www.whois.net/ but this only tells you when a website domain was open and the contact name and information for the person who opened the site. Sometimes the only results you get there are to the website company they opened the site with but it is one source of information you might try.
 
5) Adjusting firms should be required to post links on all of their websites such as Department of Insurance Consumer Complaint contact information AND information for independent  adjusters as to where they can report violations of adjusting firm contracts with independents and adjuster non- payment of fee bill complaints. If you don’t think there is a need, just check out this site that opened post Katrina and when overloaded by complaints of non payment to adjusters, their system crashed many many times : www.professionalfeecollection.com (site was opened post Katrina and we have no idea what happened to this agency and it’s alliance of attorneys working proactively to collect unpaid independent adjusting firm fees. We know they were overwhelmed by the claim files faxed in to them and the thousands of adjusters attempting to utilize their services. It was run by a Terry Bagsby out of TX. The interesting thing was that these adjusters were all complaining about the same continuous group of adjusting firms based on discussions I had with him in 05/06.
 
6) Adjusting firms should be required by State Insurance Regulators to not only have a contract for independent insurance adjusters but they should be required to have two signed originals so one can be given to the independent adjusting firm and one can be given to the adjuster. I cannot even begin to tell you how many new adjusters have been frankly taken advantage of either not being given a copy of the contract or no contract at all.
 
We wrote in our blog done a few years back called “Splish Splash don’t go taking a bath” on this topic.(See link at bottom of this blog) I always teach new adjusters in our Fundamentals class not to deploy without seeing the contract and making sure they agree to the terms, not to sign blank forms, to watch out for Non-Compete terms, to make sure they know what the fee split is with the adjusting firm (how much they keep of the fee schedule and how much you get based on a percentage fee split) or what your daily rate is if you are getting paid a daily rate how much it is and what your fee split.
 
There is much more information in the blog I wrote linked to above. The very best advice that I would give you is to see your personal attorney about E & O insurance coverage information in the contract to be sure YOU are protected and to be sure that you are not signing something you shouldn’t be signing.
 
7) Insurance regulators need to regulate a) the length of time a carrier has to pay independent adjusting firms and TPA’s who process their claims, the time an adjusting firm has to pay the independents, holdback percentage provisions in contracts and hefty fines for those adjusting firms not paying them within a regulated time).
 
8   ) Insurance Regulators must begin setting regulations for insurance carriers as to what claim handling fines a carrier can pass on and require of  independent adjusting firms and adjusters.
 
They have gotten totally out of control on the RFP requirements I have seen such as Citizens of FL 2007 RFP 08-0016 or 07-0003 with fines as much as 1,000 per vioation. Is what developed after these fines starting being imposed in RFP’s is that independent contracts started transferring these fines on to adjusters in contracts without even specifying what these fines were.
 
9 ) Insurance regulators have got to put a stop to the erroneous information being advertised about the TEXAS adjuster’s license for independent adjusters. Just take a look at the many classifieds telling those interested in a claims career that the TX license with give them licensing in any where from 25-32 states.
 
This is inaccurate as the adjuster still has to fill out applications, finger prints and pay licensing fees for those non resident licenses. Dr Birzon at the University of Central Florida’s Insurance licensing online program has been forced to post a warning such as this on their website link (see News flash column on left of that link) because so many residents of FL had taken TX licensing classes thinking that they were waived from taking the FL Resident adjusters license.
 
I regularly receive resumes from adjusters who are permanent residents of FL that is all that I see in the licensing information of their resume is their TX license info. Dr Birzon has been so helpful answering questions on ClaimSmentor on licensing issues and even helped out a few of our adjusters who were in non compliance on CE’s and had to retake Fl license requirements again so we referred them to his online FL licensing program which the state regulators approved as a means of getting your FL license and bypassing the FL adjusters exam. These adjusters who were working out of a state on a catastrophe assignment could meet the FL Department of Insurance requirement they sit for the exam again by taking Dr Birzon’s online class at night and still service claims assigned to them out of state.
 
10 ) Insurance regulators need to require that any training firm producing adjuster 
training classes be approved by the state department of insurance to meet minimum claims experience requirements ,which I would insist included experience in claims management, as well as professional insurance education requirements that are recognized in the insurance industy such as AIC (Associates in Claims) and/or CPCU course through AICPCU. I have completed IIA, AIC, and 9 sections of CPCU with only one left to go (the much dreaded Accounting session). I cannot tell you strongly enough how much I recommend these courses  for independents as well.
 
11 ) While the insurance regulators do not control which independent firms a carrier uses, they should at minimum require that adjusting firms and TPA’s require some kind of screening. The one I prefer the most is the membership requirements at the National Association of Insurance Adjusters which is an association of independent adjusting firms who have had to go through substantial financial screening and other membership criteria you can view here.
 
12 ) There are good procedures established by the insurance regulators, emergency management, and state governors for adjusters coming in from out of state. They are called emergency adjuster regulations.
 
In a new trend the large adjusting firms are now requiring of independent adjusters, they are requiring that adjusters obtain non-resident licenses in all coastal states and those like Oklahoma  and Minnesota that have regular windstorms. There are valid reasons because carriers and independent firms cannot activate non resident adjusters who do not hold a non resident license in the state of a storm until the governor announces that by his order at the time of an emergency that independent adjusters are allowed in the state to work claims on an emergency license. 
 
If an adjuster secures a non-resident license in all the states a carrier MIGHT deploy them, they can stay longer because emergency licenses are temporary in nature and only allow adjusters to work a storm designated a catastrophe by the governor. Carriers also do not use their national catastrophe teams if there isn’t enough volume in a given state although I’ve read about alot of improvements on this. This is usually do to the fact that they have to bill the region where they deploy the adjusters for their services. Can we do something about this? It appears to me to be the only way carriers and adjusters can deploy adjusters and get around the governors emergency disaster authority. It has created a huge financial burden on independents and on CE reporting requirements when they should be concentrating on servicing insurance consumers. It is also creating a “dumbing down” of independent adjusters that can be used as we often see less experienced independent adjusters deployed because the experienced adjusters tend to leary of jumping through the huge volume of hoops and know that when the big one hits they will be deployed when carriers through out all pre-storm requirements.
 
I regularly refer new independent adjusters to these firms meeting the NAIIA criteria as hopefully a safety net for them when finding reputable firms. See their membership directory here. While I cannot guarantee it will, I would think that it would atleast provide a place to start when considering who is your “A” list of adjusting firms you will work for. How about for carrier independent staffing needs when their core adjusting firms “run out “of  core adjusters (their A team of who they will first deploy based on experience and certifications and licensing”.
 
I do know some excellent firms that might not yet meet all of the NAIIA membership criteria who are trying to do the right thing. Several that come to mind as I have gotten to know their owners through years of membership at ClaimSmentor or through the staffing side of my operation are CSP claims (owners are retired carrier management), Legacy Claims (the one owned by the Ellis’s), and Action Catastrophe Claims. I do not post those here lightly as I have spent almost four years now getting to know them and I listen intently to what experienced adjusters working for them have shared with me, I’ve watched their adjuster training programs, and I’ve heard great reports on their CMS Claim Management systems and payment records with adjusters who complied with file requirements.
 
I know of very very few independent adjusting firms run by owners or managers who have these course certfications. One of my clients who feels as strongly about this is Dennis Martin, CPCU  who runs the FL Division and catastrophe division  of William Kramer and Associates. He is a joy to work with since he understands the issues facing our claim industry , the Florida insurance crisis , and knows what happens when an adjusting firm doesn’t properly manage claims and claims adjusters and CONTROL compliance with file requirements. This is especially important with their primary concentration on commercial claims such as very large Condominum Claim Associations.
 
We co -authored an article for Claims Magazine as the featured story titled “ A Box of Chocolates” in 2008 about condo claims handling. We both can’t thank Eric Gilkey, Editor of Claims Magazine for his skills and patience working with us as neither of us had significant experience in writing an article)!
 
                                                                                                    Some Things to Ponder
This is also another thing that inquiring minds want to know!  If a file is approved first by an independent adjusting firm manager and sent on to the carrier management for approval and they approve the file and pay the claim based on their review how can they possibly go back and fine an adjusting firm a year later when their auditors catch the mistake. I know of a few firms this has happened to. Where are the insurance regulations on this?
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Why do carriers always tell our members and my staffing firm that they don’t want to consider very good experienced catastrophe adjusters for staff positions when they meet all other qualifications such as a four year degree, insurance continuing education requirements,etc? I was astonished over the past four years to receive staffing requests from 3 major carriers that said the following ” we need adjusters but we can’t get approval in our budgets to use a staffing firm. Will you send them out free to your rosters? ” You’ve got to be joking! Take the resources I have developed over 4 years of staffing and building contacts and mass emailing for them free? I did post their notices in our Career Forum where we do post jobs such as these that we come across but I sure wasn’t servicing them free. Also, while I can understand that they think cat adjusters will jump as soon as a major storm hits, don’t tell us that your staff adjusters do not do so as well. What is your turn over rate? The only thing that keeps staff adjusters on your employment lists is the fact you often offer benefits such as health but adjusting firms are
getting just as savvy in some cases and they often get employment applications from your staff adjusters just like my firm does.
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Last but not list in the things to ponder list is the failure of carriers to put a stop to “hand me down” claims. Almost every issue of non-payment to new independent adjusters has come through a 2nd or more tier adjusting firm subcontracting claims out to another adjusting firm when they run out of adjusters. Often , I doubt the carriers even know about it. When the unpaid adjusters contact the carrier, they are often told “sorry….we don’t have a contract with that adjusting firm”…well dang….I guess the first tier firm made a sidetrack agreement with the 2nd tier firm leaving the independent adjusters to hang out to dry. I’m referring to adjusters who have a contract with firm 2 or on down the line but they have no contract with the adjusting firm who had the contract with the carrier. During the 04/05 season when the FL Dept of Insurance set deadlines with HUGE fines, I saw many a carriers hurt when the primary adjusting firms couldn’t account for claim file status. I never even knew this went on until I transferred to the independent claims industry. I had one firm call me and say “and we have the 1st tier contract with the carrier” on this one. Maybe I am wrong and this is a regular practice, but I can tell you the majority of calls my staffing firm received on non-payment issues when they were looking for a new assignment because they weren’t getting paid was from 2nd or more  hand me down claim adjusting firms. I simply think the practice should be forbidden.
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There are four ways I can think of to add these regulations which are long overdue. Not being an insurance regulator, but someone with a huge interest in protecting independent adjusting firms and independent adjusters to preserve our important service to the claims industry:
 
1) Click on the link here to all insurance departments and print out a copy of this blog (just click on the blog title and it will open up just this blog versus reviewing a string of our blogs) and send a copy to either your state insurance department or to any insurance departments where you have worked assignments and/or are licensed. If you fear for your career in claims, just print it out and mail it in and don’t sign your name. If they get flooded with enough copies of this blog, maybe they will listen.
 
2) Print and send a copy to the NAIC who is responsible for cancelling the recommendations for National Licensing. Again, don’t sign it if you don’t want to. Volumes of copies of this might help. The link to the blog on this act is included at the bottom of this blog entry.
 
3) Insurance regulators who are responsible for claim handling regulations can add requirements such as these to their Good Faith claim handling regulations and licensing requirements for independent adjusters and adjusting firm licensing requirements.
 
4) How about Insurance Regulators developing a Code of Conduct form for independent adjusting firms (similar to what carriers require independent adjusting firms and adjusters are required to sign). Look at the NAIC Code of Conduct they require their member adjusting firms comply with
 
There are so many possibilities that can be done to improve the industry, reduce insurance consumer complaints, to reduce the number of consumers who have to resort to use of public adjusters thus reducing their insurance indemnification dollars, and to reduce the ever growing field of claim litigation. It is worse now than I have ever seen in over 30 years in the insurance industry.
 
Which claim career field is really responsible for the problems in our industry? Here’s a complex self assessment test. Is all it takes is four questions:
 
1) Who issues an insurance policy with insurance consumers with obligations required of both insurers and insureds? (Key to answer you will find the answer in column 1)
2) Who has to take instructions from who? (Key to answer- see column 2, 3, 4  as they answer to #1)
 
3) Who contributes to the training issues for the claim industry? See columns 5,4,3,2, and 1
 
4) Are public adjusters and consumer advocate attorneys the only driving force behind the increase in claim litigation? Yes in some instances they are but could they be successful in winning claim litigation cases by the hundreds if they weren’t finding examples of bad faith across the board- see 1, 2, 3, and 4 in the graph).  I don’t think  they are the only contributors of these huge costs which are being passed on to insurance consumers when carriers have to consider defense litigation costs when rates are determined by insurance companies.
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So why are we all mixed up and playing the blame game? This is such a goofy game not befitting of an industry that has such an important place in the lives of  every person in America that has been going on as long as I’ve had a career in claims. Here’s how the game works:
 
Step 1 ) Insurance Companies (common to all major insurers) use independent adjusters when a major storm such as Hurricane Katrina and Ike
 
Step 2) Insurance Companies provide training before the storm only to independent adjusters with atleast 2 years experience and to their staff claim departments UNTIL the big one hits
 
Step 3) Carrier Auditing Departments, Claim Examiners and Managers.  and Reinspectors start rejecting files because they don’t provide training or enough information to adjusters. It is provided during a carrier certification class which is usually a one day training session put on by CARRIERS through ADJUSTING FIRMS THEY SELECT or at a one day catastrophe induction center where they do present a good outline of file handling guidelines if you are experienced enough to just make exception to general claim handling instructions you already know
 
Step 4) Newly licensed adjusters are activated to handle claims when carriers lower their 2 and 3 year experience requirements when they THINK they have run out of adjusters based on information from the pre-selected adjusting firms who may service there claims. ***Let me point out here it is like a “where is Waldo” game for independent adjusters entering the industry to find out who is servicing the claims because the majority of CARRIERS provide no information on their website about which firms are handling their claims (God forbid someone might consider them “employees versus independents). See our prior blogs on the cycle
 
Step 5) Don’t overlook the fact that the file requirements and claims guidelines are changed by CARRIERS almost daily when on storm. Even if an adjuster’s file meets file requirements one day, by the time it make’s it through the claims management cycle (Independent or staff adjuster →Claim Examiner or Claim Manager→Insurance Company who approves claim settlement payment and settles claim with insured (often with in office claim trainees who have never handled a field inspection or an inoffice claim operation TEAM so the insured can get bounced around and never talk to the adjuster who actually inspected their claim?
 
Step 6) Who pulls the authority from most independents which takes away great customer service of explaining their itemized estimate to the insured in person while they are out there …see column one. This also applies to carriers who have pulled field adjusters from handling contents claims and additional living expenses so the insured once again has to deal with multiple adjusters (field and in office) rather than having the personal claim service they desire from one adjuster?
 
Step 7) Carriers then blame everyone in column 2, 3, 4, and 5 for causing poor claim survey results and swears to never use much needed independents so experienced independents leave the claim industry as they have no way to support their families.
 
Step 8. ) A major catastrophe such as Ike and Katrina hit and independent adjusting firms are asked to deploy again to assist storm insurance consumers who have no idea what changes have taken place at the carrier’s regarding claim handling standards as the Carriers in Column 1 do not communicate with individual adjusters or hold yearly claim conferences updating them on the hot topics they have been dealing with while independents were at home trying to support their families. Why don’t they have newsletters for independents (refer to comment above on employee/independent issues). No instead they insist they will stop using independents again.
 
Step 9 ) Return to Step 1 and the cycle we regularly experience starts once again.
For two examples of the blame game see the final report of the Citizens  FL Task Force on Claim handling where they submitted their findings to the Citizens Board of Directors blaming both independents and public adjusters for reopen claim issues. I don’t recall seeing where any responsibility was accepted by this now largest insurer in FL except possibly understaffing with field adjusters but they are moving in the right direction training staff and Independents deployed pre-storm and with face to face meeting requirements that they are visiting unannounced to be sure the adjusters are being taught their claim handling expectations and not just glossed over.
 
See also this news article I posted recently where General Manager, Jim Oliver, of the Texas Windpool partially puts the blame on inexperienced adjusters. This is very exasperating to me when I am going on my fourth year of searching for all carrier claim certification classes for members of ClaimSmentor. I can rarely find them except by the few adjusting firms posting in classifieds which are cost prohibitive to most firms when they haven’t gotten many carrier assignments such as in 2006 and 2007. Carriers have staffed up with employed staff adjusters due to their erroneous decisions in the steps above instead of looking SQUARELY in the eyes of their claim training operations, their current trend to leave the responsibility of deployment of independent adjustering firms instead of the carrier maintaining control (again employee vs independent issues).
 
Should anyone question my dedication to keeping independent adjusters informed for the right reasons…it took me 8 hours of volunteer time to produce this one blog entry to provide resources and information for you.  I had no clue as all of our resources were internally generated as claim staff employees.
 
It has been a very long four years studying the independent insurance adjuster industry and learning that while  I had managed them for years that I knew nothing about what went on before they deployed with us. It has been a major eye opener which I openly share with those in our field who need to get caught up to speed immediately in their decisions on entering the independent field and once they confirm that decision learning the professional way to perform their duties. **Update 3/7/09: You can follow this blog through RSS feeds as long as you are not placing it on a site that has banner ad sales or revenue generated through google ads (exception CADO who also spends untold hours volunteering his time for his site). I am getting referrals to this site from Blog Colony which I still have to research which are new this week and have another site copying my links on right column on their website. I am taking proactive action through ICAN  and this wordpress administration who controls websites so be forewarned if you want to remove them if you are using a link to this site to generate revenue for yours. All independent adjusting firms or claim groups are free to put up a blog roll on this such as the one CADO (www.catadjuster.org) has on their blog page in bottom left corner. WordPress does NOT allow banners or search engine ads at this location so I will be proactive with them to shut your feed to this blog if you are using it for such purposes which we can see on our administation dashboard.
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I welcome any volunteers who want to edit my blog entries to correct mistakes made. I was always taught by my mentor , my dad, not to present a problem without a solution….smile. If you have the solution for my lack of social networking editorial skills I welcome your help in this additional e-mentoring project.
 
For other great resource links, articles, and claims news I highly recommend Roy Cupps CADO  site at www.Catadjuster.org which has operated atleast 10 years. His article section, news section, employer rating section, adjuster resume data base, and so much more . The archived forums provide a wealth of information about the independent opinions. We formed ClaimSmentor with Roy Cupps blessing initially in those forums but took quite a bit of harassment from a few bad apples who felt we were taking away their job opportunites so we moved the site to a private site at www.ClaimSmentor.com. I have nothing but the very highest regard for Roy Cupps and the resource links he keeps updating on his site.
 
Here are links to all prior blogs we have written in our archives since we began this service in July 2007 that discuss these issues on emergency licensing, carrier’s deploying adjusters, claim training, insurance regulations, and all other topics we’ve discussed in today’s current blog for a more thorough understanding of the changes needed :
 
http://dimechimes.wordpress.com/2009/03/06/just-one-claimsmentor-moment-2-twia-adjusters-blog-on-ike-claim-handling-issues/
 
http://dimechimes.wordpress.com/2009/02/27/adjuster-overtime-issues-supplemental-info-from-none-other-than-attorney-gloria-allreds-current-news-letter/
 
http://dimechimes.wordpress.com/2009/02/26/compare-twia-manager-jim-olivers-comments-about-a-major-galveston-storm-608-to-209-statement-on-ike-claims-part-i-of-ii/
 
http://dimechimes.wordpress.com/2009/02/23/branch-consultants-whistleblower-case-reinstated-appeal-court-decision-february-2009also-links-to-info-on-the-rigsby-whistleblower-cases/
 
http://dimechimes.wordpress.com/2009/02/19/citizens-of-fl-board-approves-selection-of-30-selected-adjusting-firms-see-list-here-with-websites/
 
http://dimechimes.wordpress.com/2009/02/19/citizens-of-fl-board-approves-selection-of-30-selected-adjusting-firms-see-list-here-with-websites/
 
http://dimechimes.wordpress.com/2009/02/14/twia-texas-windpool-offers-two-adjuster-certification-workshops-in-march-and-april-2009/
 
http://dimechimes.wordpress.com/2009/02/13/independent-adjusters-participant-in-our-poll-on-carrier-certification-exams/
 
http://dimechimes.wordpress.com/2009/02/13/have-license-ready-to-go-not-so-quick-take-this-self-assessment-test/
 
http://dimechimes.wordpress.com/2009/02/05/have-you-registered-for-your-2009-nfip-adjuster-certification-class/
 
http://dimechimes.wordpress.com/2009/02/05/2509-updates-on-the-state-farm-announcement-in-fl/
 
http://dimechimes.wordpress.com/2009/02/03/we-are-back-next-50-hour-online-fundamentals-of-claims-class-begins-march-2-2009/
 
http://dimechimes.wordpress.com/2008/10/08/2008-claims-magazine-claims-salary-survey-is-up-in-the-october-2008-issue/
 
http://dimechimes.wordpress.com/2008/09/20/new-source-for-temporary-housing-in-houston-tx-area-for-adjusters-and-insured-additional-living-expense-temporary-housing-part-ii/
 
http://dimechimes.wordpress.com/2008/09/17/independent-agents-rank-claim-service-as-top-measurement-of-carrier-performance-part-ii-of-claim-and-agency-relationships-can-make-or-break-an-adjuster/
 
http://dimechimes.wordpress.com/2008/09/03/preliminary-damage-statistics-from-hurricane-gustav-updates-on-temporary-housing-in-gustav-damage-territories/
 
http://dimechimes.wordpress.com/2008/08/26/hurricane-gustav-expected-to-be-major-emergency-tx-and-la-license-links-claim-statistics-for-ts-fay-eduardo-dolly/
 
http://dimechimes.wordpress.com/2008/08/21/fl-emergency-adjuster-regulations-for-tropical-storm-fay/
 
http://dimechimes.wordpress.com/2008/08/26/hurricane-gustav-expected-to-be-major-emergency-tx-and-la-license-links-claim-statistics-for-ts-fay-eduardo-dolly/
 
http://dimechimes.wordpress.com/2008/08/07/ms-ag-hood-and-state-farm-reach-agreement-on-katrina-disputes-wednesday-86/
 
http://dimechimes.wordpress.com/2008/08/05/citizens-of-fl-cancels-rfp-for-independent-adjusters-yet-another-time-in-2008-rebid-now-times-4/
 
http://dimechimes.wordpress.com/2008/07/23/hurricane-dolly-makes-landfall-in-texas-checking-availability-for-rosters/
 
http://dimechimes.wordpress.com/2008/06/26/nationwide-insurance-proposes-one-policy-covering-wind-and-flood-coverage/
 
http://dimechimes.wordpress.com/2008/06/02/auto-adjuster-claim-training-updates/
 
http://dimechimes.wordpress.com/2008/05/29/what-role-are-rising-gas-prices-going-to-play-in-your-deployment-decisions-for-hurricane-season-2008-carriers-and-adjusting-firms-should-meet-the-need/
 
http://dimechimes.wordpress.com/2008/05/23/colorado-hail-tornado-of-may-22-2008-updated-damage-reports/
 
http://dimechimes.wordpress.com/2008/05/19/concerned-regarding-adjuster-fee-schedules-for-citizens-of-fl/
 
http://dimechimes.wordpress.com/2008/05/14/citizens-of-fl-changes-independent-training-requirements-for-2008/
 
http://dimechimes.wordpress.com/2008/05/01/insurance-carrier-claim-certifications-where-do-you-test-for-them-much-improvement-needed-in-the-process-of-certifying-independent-adjusters/
 
http://dimechimes.wordpress.com/2008/04/30/va-tornado-damage-the-carrier-claim-numbers-are-coming-in/
 
http://dimechimes.wordpress.com/2008/04/28/top-blogs-of-interest-to-new-adjusters-july-2007-april-2008/
 
http://dimechimes.wordpress.com/2008/04/18/supplemental-request-41808-for-tx-licensednationwide-certified-adjusters/
 
http://dimechimes.wordpress.com/2008/04/11/immediate-need-for-experienced-adjusters-tx-license-for-storm-claims/
 
http://dimechimes.wordpress.com/2008/04/10/overhead-and-profit-claim-settlement-issues-under-attack-in-3-ongoing-cases/
 
http://dimechimes.wordpress.com/2008/04/09/state-farm-seeks-dismissal-on-rigsby-false-claim-actklg-update-levee-break-sher-decision-including-overhead-and-profit-issues/
 
http://dimechimes.wordpress.com/2008/04/08/fifth-circuit-appeal-opinion-overturns-punitive-damages-in-broussard-vs-state-farm/
 
http://dimechimes.wordpress.com/2008/04/07/allstate-releases-mckinsey-documents/
 
http://dimechimes.wordpress.com/2008/04/02/adjusters-read-about-class-action-lawsuit-in-ok-on-overhead-and-profit-issues/
 
http://dimechimes.wordpress.com/2008/03/29/cori-rigsby-january-2008-deposition-hoped-to-remain-anonymous-lets-compare/
 
http://dimechimes.wordpress.com/2008/03/28/branch-consultants-whistleblower-case-appeal-filed-on-the-dismissed-case/
 
http://dimechimes.wordpress.com/2008/03/06/rigsby-whistleblower-rico-case-motion-to-dismiss-3-of-insurance-carriers-to-focus-on-state-farm/
 
http://dimechimes.wordpress.com/2008/03/06/national-association-of-catastrophe-adjusters-membership-drive-to-31508/
 
http://dimechimes.wordpress.com/2008/02/23/state-farm-vs-hood-part-iii-an-interesting-news-alert-today/
 
http://dimechimes.wordpress.com/2008/02/21/60-earthquake-rocks-nv-ut-parts-of-ca-22108-adjuster-information/
 
http://dimechimes.wordpress.com/2008/02/08/errors-and-omissions-coverage-guest-bloggers-dale-moore-client-relations-director-for-cplic/
 
http://dimechimes.wordpress.com/2008/02/06/storms-in-tn-ky-ak-al-in-mo-ms-of-2508-adjuster-information-on-emergency-licensing-and-damage/
 
http://dimechimes.wordpress.com/2008/02/05/luckwhere-preparation-meets-opportunity-published-208-in-claims-education-magazine/
 
http://dimechimes.wordpress.com/2008/01/11/update-on-the-rigsby-ea-renfroe-whistleblower-case-will-the-klg-get-dismissed-on-cases/
 
http://dimechimes.wordpress.com/2008/01/10/do-you-really-know-what-your-errors-and-omissions-coverage-covers/
 
http://dimechimes.wordpress.com/2008/01/09/should-your-adjusting-firm-or-carrier-be-blogging/
 
http://dimechimes.wordpress.com/2007/12/18/renfroes-deposition-in-the-rigsby-whistleblower-case-interesting-look-into-their-thoughts-on-the-case/
 
http://dimechimes.wordpress.com/2007/12/13/ok-declares-state-of-emergency-allowing-emergency-adjuster-licenses-link-for-application/
 
http://dimechimes.wordpress.com/2007/11/20/major-changes-in-the-way-carriers-recruit-and-train-adjustersis-there-really-a-lack-of-available-adjusters/
 
http://dimechimes.wordpress.com/2007/11/14/tomorrow-is-postmark-deadline-to-get-applications-in-to-join-naca-national-assn-of-catastrophe-adjusters/
 
http://dimechimes.wordpress.com/2007/10/25/what-can-adjusters-learn-from-the-2003-cedar-fire-regarding-litigation-and-complaints-on-claims-from-ca-wildfires-blog-4-ca-wildfires/
 
http://dimechimes.wordpress.com/2007/09/29/claim-career-coachingconsultant-services-for-new-adjusters/
 
http://dimechimes.wordpress.com/2007/09/27/independent-adjuster-vs-employee/
 
http://dimechimes.wordpress.com/2007/09/24/insurance-adjuster-overtime-pay-issues-and-complaints-in-the-news/
 
http://dimechimes.wordpress.com/2007/09/21/valued-policy-law-in-florida-thrown-out-update-on-mierwza-safety-concerns-part-2fl-insurance-crisis-update-go-jeb/
 
http://dimechimes.wordpress.com/2007/09/14/field-adjuster-safety-concerns-be-careful-remembering-katie-froeschle-of-tampa-fl/
 
http://dimechimes.wordpress.com/2007/09/13/humberto-makes-landfall-as-category-1-hurricane-damage-links-and-stats-and-adjuster-licenses/
 
http://dimechimes.wordpress.com/2007/09/12/commitment-part-2-standby-calls-what-should-i-do-how-are-cat-codes-determined/
 
http://dimechimes.wordpress.com/2007/09/12/tropical-depressions-8-and-9-humberto-and-ingrid-standby-discussion-commitment-discussion-continued/
 
http://dimechimes.wordpress.com/2007/09/10/the-big-c-commitment-problems-with-independent-adjuster-relationships-advice-by-guest-blogger-rocke-baker/
 
http://dimechimes.wordpress.com/2007/09/08/ts-gabrielle-east-coast-windpool-and-emergency-licensing-information/
 
http://dimechimes.wordpress.com/2007/08/30/adjustin-to-adjusting-guest-blogger-linda-goodson-first-storm-duty-was-katrina/
 
http://dimechimes.wordpress.com/2007/08/23/whistleblower-cases-and-your-e-and-o-coverage-part-2/
 
http://dimechimes.wordpress.com/2007/08/12/splish-splash-dont-go-takin-a-bath-understanding-independent-firm-contracts/
 
http://dimechimes.wordpress.com/2007/07/31/naic-model-independent-adjusters-licensing-act-cancelledand-changes-in-nm-nc-and-tx-licensing/
 
http://dimechimes.wordpress.com/2007/07/30/who-moved-my-claims-cheesedealing-with-change-in-the-insurance-adjusting-community/
 
http://dimechimes.wordpress.com/2007/07/27/claim-career-information-the-pros-and-cons-of-going-staff-adjuster-versus-independent-adjuster/
 
http://dimechimes.wordpress.com/2007/07/26/catastrophe-adjuster-resumes-the-requirements-to-get-noticed-do-differ/
 
http://dimechimes.wordpress.com/2007/07/26/most-commonly-asked-question-is-how-much-income-can-i-make-as-an-adjuster/
 
 

What role are rising gas prices going to play in your deployment decisions for Hurricane season 2008? Carriers and Adjusting Firms should meet the need!

May 29, 2008

Here is an interesting article by Dow Jones on how rising gasoline prices are going to increase the cost of claim settlements should a big one hit this coming hurricane season:

http://www.lloyds.com/CmsPhoenix/DowJonesArticle.aspx?id=393043

Basically, the cost of material goods from building material suppliers will rise due to transportation costs of materials,etc thus increasing the cost to settle not only building but contents claims.

What I wish they would have included in the article is the effect rising gasoline prices will have on independent adjusters decisions regarding deployment this hurricane season. For those not familiar with independent adjusters, they must pay their own expenses unlike staff adjusters who are employees for an insurance carrier who have their expenses covered by their employer- the insurance company.

Independent adjusters basically have four options:

1)Deploy and absorb the extra expense greatly cutting into their profits (which are now often greatly reduced to begin with due to partial assignments while the carrier staff works part of the coverage on contents and ale losses). Current hot topics on this subject include adjusters discussing different vehicle options moving from the SUV’s and trucks to smaller vehicles with better gas mileage. This presents a real issue for independent adjusters who live on the road following storms needing larger vehicles for one and two story ladders, estimatic and computer equipment, and living supplies needed for survival in often very unpleasant living circumstances at the beginning of any severe storm. Here’s a link to just two of many ongoing discussions on this topic: click here and here. The first link you may have to login to CADO to read as it’s in the adjuster den forums which require login. There is also a 3rd ongoing discussion about adjusters changing vehicles but I couldnt get my hands on the topic and will update this when I do so.

2) Deploy but only accept in office assignments in insurance companies claim central operations as many carriers have catastrophe claim central operations and use independents in this capacity for the great demand when necessary. I’ve seen many experienced independents accepting these assignments who in the past would never want to be tied to an in office cubicle environment on a daily rate instead of working off fee schedules on field inspections because of several issues to include the unfortunate increase in non paying adjusting firms on fee schedule handled files (they’ll know within 2 weeks  or so if the firm is paying or not working in office) and because of the guarantee of atleast biweekly if not weekly pay versus the unreasonable delay in some carriers offices in settling field catastrophe files so adjusters get paid (as well as insureds of course).

3) Many independent adjusters who prefer the independent adjuster lifestyle are moving to carrier staff adjuster positions. If you missed our blog on the pros and cons of each position- here is a link.

4) The last option is to leave the field altogether which many are doing due to the lack of work the past two seasons. They need a dependable stable income which the independent adjusting business has not been able to provide the last two years.

Here’s a link to an interesting AP article out this week indicating we are getting ready to break US records this tornado season on claims so hopefully independents are finding much more work these past few weeks. We’ve gotten some great news from long term ClaimSmentor trainees who picked up storm assignments in the past few weeks as assistants on rope and harness teams with some of the major independent adjusting firms which I feel sure is due to their committment to continuing adjuster education knowing these individuals who have definitely prepared for this career with licensing, estimatic courses, carrier certification exams successfully passed,  and field mentor training they’ve gone through. This is an outstanding opportunity for them to work with an experienced adjuster on the rope and harness teams to learn the practical application of all of their training in a real claims environment while being coached by this other half of their team. Hats off to the adjusting firms using this approach to develop new adjusters!

So what are some of the things adjusting firms and insurance companies can do to ensure more independents do not leave the field due to rising fuel costs?

1) Carriers and/or adjusting firms (depending on who is making the assignments to the independents)should ensure that their catastrophe claim automation folks on large cats or local field operations on smaller cats are using automated zoning systems utilizing the 9 digit zip codes to ensure that claims are assigned in tighter zones for independent assignments getting their group of claim assignments as close together as possible to  lower their gas expenses.

2) Hopefully, carriers and adjusting firms are all using current technology using CMS (Claim Management Systems) so adjusters can download assignments and upload inspection/claim documents without the need to waste precious fuel to come into pick up  and drop off assignments. CMS systems not only reduce fuel expenses but provide much more prompt settlement of claims for policyholders as carriers have immediate access to claim file documents. My top recommendation on CMS systems if you do not have one is Click Claims which won the AM Best’s Efusion Award for CMS systems- here’s a link if you want to take a free demo. I personally managed adjusters throughout FL during the 4 in 04 hurricanes in FL and cannot image accepting an assignment working without this particular program again. By the way, vendors using email only processes for catastrophe claim documents should be history as it leads to nothing but confusion and loss of claim file documents and unnecessary delays in processing file closures for prompt payments to insureds when no one can find the emailed documents. I am also aware of numerous new adjusters who were burned on adjuster fees when files were not uploaded in their name after emailing them in and a supervisor uploaded them into a different adjuster’s name. I was totally surprised but heard it enough to believe it was true for some inexperienced adjusters.

3) Keep unit meetings during a storm to a limited number reserved for critical information sharing otherwise minor details can be shared by email and teleconferences where managers conference call unit members versus requiring travel to cat offices. This would apply to meetings required by adjusting firms and for insurance carriers.

4) Many adjusting firms share in any gas allowance fees which may be incorporated into a carrier’s fee schedule. For instance, if the fee split in the independent contract with the adjuster is 60% to the adjuster and 40% to the adjusting firm, the firm will take their 40% of the mileage allowance as well as the gross billing on the amount of loss fee. One of the forum links above had adjusters discussing this issue. I’d like some light shed on this practice by SOME adjusting firms as I do not see any reason whatsoever that an adjusting firm should be taking a percentage of the travel fees when they incurred ZERO percent of the cost. If there are reasons they do so, please reply and let us know!

For those that aren’t famililar with insurance company  independent fee schedules, many require the adjuster go a given number of miles with no allowance such as 50 miles before they then consider an allowance for mileage traveled. Typical schedules say the first 50 miles is included in the regular fee on the claim.

Adjusting firms that are doing this should consider offering 100% of the travel allowance to the independent adjuster incurring the cost. Adjusting firms should also consider negotiating a gas allowance per claim particularly if the independent adjuster is assigned a rural territory incurring unreasonable mileage. During the 4 in 04, I had no trouble negotiating a gas allowance for our independent adjusters with many regional carriers at all. I know some carriers such as the recent Citizens RFP says there will be no negotiating on their fee schedule. This could work to their detriment if other insurance carriers are allowing this gas mileage allowance.

5) Carriers can host carrier certification classes online through podcasts and webinars versus requirements adjusters travel to their pre-qualified independent firms offices for testing. Today many offer IDL (Interactive Distance Learning) webinars the adjusters can take in field locations throughout the nation at agents or carrier regional offices yet they then require the independent adjuster actually travel to the independent adjusting firms assigned their claims to take the actual certification test which follows the IDL. For example, an adjuster residing in FL may be able to watch the preliminary IDL in FL at a regional office for the carrier yet the closest adjusting firm office to take the test is in LA. This makes no sense when the carriers can provide monitored testing at the same locations at their offices where the IDL sessions are held or use an examination center like the AICPCU program does for the CPCU or AIC exams where they are proctored at local colleges.

6) Carriers should seriously consider helping with this problem by assigning rural territories to their staff adjusters as their gas expenses are covered if they wish to keep independents working claims. This may not be possible during the clean up phase where territory assignments are more difficult but this should be no problem whatsoever at the onset of a large storm.

Carriers need to consider that independent adjusters when not deployed on cat are working other positions at home and also do not have unlimited time to take off of daily work they are doing at home to travel during the week to take all of the various carrier certification exams required for them to work claims and should also consider offering these exams and IDL programs on Saturdays.

7) Adjusters- have you considered two story rope and harness team assignments where you split the fuel costs? Most of these assignments are paid on daily rates so you will also be paid regularly and on a stable schedule.

8 ) Carriers need to consider claim managers dedicated to reviewing and approving independent claim files as they are often set aside by cat managers to review later due to the extra work involved reviewing and approving the fee bill. During the storms in 04, it wasn’t uncommon to have delays of 60-90 days AND MORE on adjusting firms being paid due to back logs in carrier claim operations reviewing and approving files. Thankfully, that year the FL Dept of Insurance imposed many deadlines on claim closures which helped atleast get them processed a bit more timely. The intent was to get the settlement money in the hands of insureds which is most important but it didn’t hurt getting the payments to independent adjusting firms either.

9) Adjusting firms definitely need to increase their office personnel during a major storm. I’ve had the unfortunate experience of managing independent adjusters and trying to keep them happy and funded when the adjusting firm had far below the number of office personnel to timely invoice the carrier on claims and just as important to timely follow up on unpaid invoices. Adjusters will not be able to sustain themselves this year for 60-90 day time frames with fuel expenses this high and ever going higher should a hurricane hit. Office staff also needs to be mentored on the importance of processing these payments when payments do come into the adjusting firm for timely payment to the adjusters. I have witnessed too often some pretty rude comments coming from office staff such as “if they want a regular paycheck go get a staff job” which does nothing for adjuster/adjusting firm relationships. In another case, at 4pm sharp each day the office staff walked out the door at 4pm as the adjusting firm wouldn’t authorize overtime at a time it was sorely needed to set up new catastrophe assignments and process invoices. Listen folks, if you don’t keep adjusters funded for work they have professionally completed, we will all see the fall of the independent industry. Due to partial assignments from the carrier and poor payment practices on the carrier thus the adjusting firm part, many independent adjusters are finding it most difficult to continue on this career path. This is not to say all adjusting firm office staff are negative, there are many adjusting firms who are proactive on invoicing and their staff runs an excellent operation. Adjusters just need to determine quickly what type of operation they are dealing with and depart the assignment at the first sign of payment issues.

A recent example is the Citizens policy posted in recent RFP documents where they indicate they have 30 days to pay the adjusting firm from the time a claim is submitted yet they require the adjusting firm pay the adjuster within 14 days of assignment.  So………..should all go like clock work an independent adjuster would be looking at a minimum of six weeks before they get paid on a claim from the day it is submitted for closure. How many Americans would work for six weeks without pay …not many I’d venture to guess and they are in a stable home environment not incurring hotel and these excessive fuel charges to service claims.

Here are some other ideas not just adjusting firm and carrier specific but some great ideas:

Offering incentives and rewards in the form of gas gift cards to employees is mentioned in this article which says in part:

A small but growing number of employers are offering gas and commuting incentives to help workers get to work. A May 6, 2008, survey of 553 human resource managers found the percentage of companies offering gas cards as employee rewards more than doubled between 2007 and 2008 — from 6 percent to 14 percent. The study, conducted by the Society for Human Resource Management, also noted that companies are organizing car pools, offering telecommuting options and public transportation discounts and giving cash incentives for employees to buy hybrid cars.

http://www.creditcards.com/credit-card-news/gas-card-price-poll-1277.php

How about gas card incentives offered by various hotel chains- you’ll be amazed at the results if you just enter “gas card incentives” in a google search to find results like the following article with numerous offers by hotel chains:

http://www.travelpost.com/articles/save-on-gas.aspx

Here’s another cool tool adjuster’s would find useful to calculate your fuel costs to deploy to another city for catastrophe duty based on your vehicle and your route from AAA:

http://www.fuelcostcalculator.com

Here is another great site for determining gas prices nationwide, mapping your trip and finding the best deals on gas along the way:

http://gasbuddy.com/

This is just another  challenging opportunity for us to work together with carriers, adjusting firms, and adjusters to find ways to solve this problem to properly service claims for our policyholders. We need to meet this challenge BEFORE the first hurricane hits by establishing plans for dealing with these gas price issues facing independent adjusters. June 1, 2008 is just days away….what a GREAT time to establish and announce your independent adjuster friendly policy for meeting the needs to cover this fuel cost crisis for independents this season!

If you know of other fuel cost savings for adjusters or some innovative way firms and carriers are dealing with this issue…feel free to reply and share your ideas with our readers.


Top Blogs of Interest to New Adjusters July 2007- April 2008

April 28, 2008

 

You can search the Archives for all blogs we’ve entered since we began this blog in July 2007 but it’s very time consuming we know! In an effort to assist new adjusters entering the claims field, we are providing the links to the top read blogs on careers, fee schedules, claim salaries, adjuster safety issues, errors and omissions coverage and other blogs that would be of interest to new claims folks such as those seeking careers also as auto adjusters. Here’s a link to everything in our archives applicable to new adjusters (and experienced alike who may want some up to date information):

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http://dimechimes.wordpress.com/2007/07/27/claim-career-information-the-pros-and-cons-of-going-staff-adjuster-versus-independent-adjuster/

http://dimechimes.wordpress.com/2007/10/13/auto-adjuster-claim-careers-an-interview-with-adjusting-firm-owner-carey-oconnor-with-csp-claims/

http://dimechimes.wordpress.com/2007/07/26/most-commonly-asked-question-is-how-much-income-can-i-make-as-an-adjuster/

http://dimechimes.wordpress.com/2007/07/26/catastrophe-adjuster-resumes-the-requirements-to-get-noticed-do-differ/

http://dimechimes.wordpress.com/2007/08/30/adjustin-to-adjusting-guest-blogger-linda-goodson-first-storm-duty-was-katrina/

http://dimechimes.wordpress.com/2007/08/24/claims-magazine-claims-salary-survey-is-upplease-participate/

http://dimechimes.wordpress.com/2007/10/19/claim-salary-survey-is-up-at-claims-magazine/

http://dimechimes.wordpress.com/2007/08/17/billingual-adjusters-in-big-demand-please-update-your-resume-if-applicable/

http://dimechimes.wordpress.com/2007/08/14/adjuster-fees-in-the-news-the-time-is-now-to-educate-the-insurance-media-and-press/

http://dimechimes.wordpress.com/2007/08/12/splish-splash-dont-go-takin-a-bath-understanding-independent-firm-contracts/

http://dimechimes.wordpress.com/2007/09/27/independent-adjuster-vs-employee/

http://dimechimes.wordpress.com/2007/09/24/insurance-adjuster-overtime-pay-issues-and-complaints-in-the-news/

http://dimechimes.wordpress.com/2007/09/14/field-adjuster-safety-concerns-be-careful-remembering-katie-froeschle-of-tampa-fl/

http://dimechimes.wordpress.com/2008/04/10/adjuster-safety-another-warning-march-08-nationwide-adjuster-shot-in-vehicle-in-tn-while-on-storm-duty/

http://dimechimes.wordpress.com/2007/09/12/commitment-part-2-standby-calls-what-should-i-do-how-are-cat-codes-determined/

http://dimechimes.wordpress.com/2007/10/24/california-insurance-commissioner-clears-the-way-for-non-cdi-emergency-adjusters-to-handle-wildfire-losses/

http://dimechimes.wordpress.com/2007/10/20/cat-tales-by-guest-bloggers-kim-and-nelson-stegall-their-first-storm-experience/

http://dimechimes.wordpress.com/2007/10/11/auto-claim-training-what-options-do-i-have/

http://dimechimes.wordpress.com/2007/11/20/major-changes-in-the-way-carriers-recruit-and-train-adjustersis-there-really-a-lack-of-available-adjusters/

http://dimechimes.wordpress.com/2007/11/14/tomorrow-is-postmark-deadline-to-get-applications-in-to-join-naca-national-assn-of-catastrophe-adjusters/

http://dimechimes.wordpress.com/2007/12/12/nfip-national-flood-2008-adjuster-certification-classes-are-now-posted/

http://dimechimes.wordpress.com/2008/01/10/do-you-really-know-what-your-errors-and-omissions-coverage-covers/

http://dimechimes.wordpress.com/2008/02/08/errors-and-omissions-coverage-guest-bloggers-dale-moore-client-relations-director-for-cplic/

http://dimechimes.wordpress.com/2008/02/05/luckwhere-preparation-meets-opportunity-published-208-in-claims-education-magazine/

http://dimechimes.wordpress.com/2008/04/23/registration-deadline-42508-for-next-40-hour-fundamentals-of-claims-online-live-class/
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CA wildfires – The claims news on damage comes in- CA licensing/ Carrier Info/ Adjusting Firm Info

October 23, 2007

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I’ve spent quite a bit of time researching available preliminary information on the devastating fires in southern California looking at it from our prospective in claims. The latest articles from late tonight indicate approximately 600 homes burned. Reports indicate upwards of 265, 000 evacuees from Malibu to Mexico as one article puts it. Other reports list less damage and the photos coming in the from stadium bring back horrible memories of Katrina. God be with the families and the brave firemen battling these blazes.

Below you will find links to many things you will need to know working catastrophe duty in California as well as links to licensing information not only for adjusters but adjusting firms, a list of carriers with the data supplied on direct written premium for adjusting firms wishing to market your services to the carriers involved, and a list of many adjusting firms listed on the California Assn of Independent Insurance Adjusters. We hope you find the details both interesting and informative for those of you researching potential assignments in California.

Information for Insurance Adjusters and Insurance Adjusting firms about working out in California on storm duty:

CA licensing link for resident and non resident adjuster licenses – click here (See Adjuster organizations and Branch office’s too on same link with forms)

CA Assn of Independent Insurance Adjusters-Membership list of adjusting firms- click here

CA Insurance Companies- Alphabetic listing with amount of direct written premium listed for adjusting firm marketing efforts if you are trying to get assignments for your teams out there (don’t forget Dimechimes Corporation can assist with filling your staffing rosters if you need more folks www.dimechimes.com for contact info): Click here and here

Prior blogs on overtime issues with employees in CA :Click here

Prior blog on CA classification of employee vs independent-new law-15-25K fines: Click here

**You can also click on the archives in right column for Temporary Housing and for Billingual Translation Services info

The Current reports of damage from the California Wildfires:

Slide show-over 250 slides of the damage: click here  Notice all of the damaged autos as well as homes and businesses

News stories accounting for the damage statistics thus far:

Malibu – 5 homes, 2 commercial buildings:  Click here

Evacuees over 250,000:  Click here

Comments on evacuation from Malibu to Mexico: Click here

Article says San Diego County-500 homes/ 100 Commercial buildings: Click here

Damage Statistics seperated by each wildfire: Click here

Miscellaneous articles and emergency declarations for CA:

LA Times Road Closure listings: Click here

Southern California photos sent in by the public: Click here

Fire Agency updated reports for all 11 fires: Click here

CA Governor’s speech 10/22/07 on the fires: Click here

CA Governor asks for 1,500 National Guard and Navy and Air Force support: Click here

Website for firemen with current stories from their perspective: click here (check their forums as well as news stories)

Adjusters and Insurance Companies in  the news in CA for the wildfires:

Auto Owners-property and auto claims/ Adjuster in evacuation centers-will call insureds within 30 minutes of loss notice-imagine those standards! Click here

I’ll be adding to this all day tomorrow. I also saw a story about Farmers sending 260 adjusters and I’ll provide that link and others on the damage statistics tomorrow as the news is updated.

Music always expresses deep emotions which I am feeling after viewing the slides and reading these stories. I was brought up the daughter of a Navy Commander attending military churches in our childhood. One of my favorite hymns from those days comes to mind all day today as I watched the fire flights distributing water over the devastated communities which was  the naval hymn “Eternal Father Strong to Save”. “Lord guard and guide the men who fly through the great spaces in the skies, be with them always in the air, in darkening storms and sunlight fair” (here’s a link to the entire Naval hymn) so I’ll close this saying God Bless you to the firemen  who are doing the very best they can to protect families and homes under such dire circumstances.

Our thoughts and prayers go out to the adjusters who will be dealing in the field with the aftermath of this storm. Let’s all hope that the great state of California treats you much better than the treatment insurers thus adjusters have received during Katrina storm assignments in LA and MS by the politicians and attorneys there. Storms such as this try the best of adjusters due to the emotional and stressful conditions they are dealing with. Let’s support those going. God Bless the USA.

Lord, guard and guide the men who fly
Through the great spaces in the sky,
Be with them always in the air,
In dark’ning storms or sunlight fair.                                                                          
O, Hear us when we lift our prayer,
For those in peril in the air.

Here’s a link to the music that accompanies these lyrics if you’d like to hear it: Click here

                                                                                                                    

Photos courtesy readers at LA Times:  http://yourscene.latimes.com/mycapture/photos/Album.aspx?EventID=357460&CategoryID=20832

**Update 10/23/07: Article quoting 16 firemen injured/25 others, up to 300K evacuees, and 655 structures: Click here

**Update 10/23/07 3:40 Pm CST- 2 now dead, 1600 structures destroyed (this is not a valid insurance claim number as there would be partial losses, civil authority evacuation coverage for the almost 500,000 evacuations Fox news is now reporting, fire damage is covered to trees, shrubs, food spoilage and other power interruption coverage, business interruption losses for commercial businesses and other coverages too numerous to list. Many of these Additional Living Expense (ALE) claims can be handled by the carrier claim central in office departments.

 Click here for info on 10K at stadium, 2 deaths, 1600 structure fires and more damage assessment. Excellent photos included.

AIG Insurance Company sprays Phos-Check Fire Retardant on homes to save them: Click  here   for Fox Business news story on this and other insurance measures in CA on wildfire insurance coverage

Army Times news article about where the Army troops will be used at the stadium, fairgrounds,etc to help: Click here

ABC News Excellent article-today’s Governor’s speech, 1239 Federal Firefighters, and tonight’s ABC 20/20 broadcast at 10pm EST as well as comments from FEMA and more damage assessments: Click here

Video and Audio footage of fires at ABC New’s I-Caught: Click here  (The sound of the wind is horrific)

***Updates 5pm CST:

Insurance Network ( IINC)  of CA- list of wildfires with insurance dollar data through 2007:  Click here

Telephone Numbers for Insurance Companies in CA to report a claim (or adjusting firm marketing!): Click here

Insurance Information Institute (III.org) information on US Wildfire Catastrophe 1970-2006: Click here

Insurance Journal information on Carriers Assessing the Damage: Click here

Red Cross Shelters for CA Wildfires and Details on structures damaged and structures threatened per wildfire: Click here

**Update 8:20pm CST 10/23/07  One million now evacuated: Click here

    Carriers report in as of 2pm today to Insurance Information Network of California with 1,760 claims thus far reported and projected insured losses now $500 million: Click here


Claim Salary Survey Results are up at Claims Magazine!

October 19, 2007

We had previously asked our readers on the Dimechimes Corporation Adjuster Information Blog and on ClaimSmentor to participate in this year’s National Underwriters Claim Salary Survey for Claims Professionals from adjusters up to executive level managers. Here is a link to the initial blog requesting readers participate.

Claims Magazine by National Underwriter has now published the results of the survey with some very interesting findings on salaries for both staff and independent adjusters.

Here is a link to the article and  survey results in Claims Magazines Feature story in the October issue. Due to other things going on, I hadn’t had time to check to see if they were up. Here is the link to the actual salary statistics with several surprises ….I didn’t see one entry at the mythical 200K income level many new adjusters hear about from their friends in the survey reports but hey…maybe those independents earning those big bucks were out on a cruise spending it and missed the survey!

Managing Editor, Eric Gilkey’s done such a good job on the article, I won’t add much by way of comments and let you read it for yourself. The only HUGE thing that stuck out to me was that while the average independent adjuster income from those surveyed was at $60,436 compared to a staff adjuster average income at a bit less at $56,747 there is no true comparison as the independent had huge expenses against their income for hotel, vehicles, and equipment versus the staff adjuster with everything provided by the insurance carrier. I was amazed to see the average Independent adjusting firm owner at only $94,000 against information I often receive indicating with their bonus added in it’s more like 250K…maybe that information was a myth too! Independent firm managers/supervisors came in at 75K versus Staff at the same level earning 83K. Now that is really pretty bad when the IA firm manager had big expenses against their lower income.

Other results in the survey outside of salary correspond to what is going on in the industry….less staff with company cars and cell phones would be right considering the many claim central operations and lower field staff which is one of the very reasons for centralizing or outsourcing claims to cut huge carrier expenses. I don’t understand the part about independents with the company cars unless they are considered employees to the IA firm since independents normally supply all of their own equipment and transportation at their own expense.

If you missed our other blogs on adjuster income for staff, independents, and auto adjusters here are links to other blogs on adjuster income:

Adjuster overtime issues click here.

Pros and Cons of Staff versus Independent Adjusters click here.

Auto Adjuster incomes click here.

Adjuster fee bills in the news click here.

How much income adjusters make click here.

Adjuster- Employee or Independent status- properly classified? Click here.

We hope everyone enjoys the survey and we thank Claims Magazine for this 17th annual poll so we all have a source for determining average incomes of our claim peers!

Watch tomorrow for a new survey up by Claims-Portal.com owner Thomas Brown- there’s a surprise in store for those participating! I’ll have it posted as soon as I have the go ahead to announce the details!


Citizens of FL adds 46th Adjusting Firm / Tornado damage in Pensacola, FL

October 18, 2007

We’ve received word this week a 46th vendor has been added to the roster of Citizens of FL vendors. Apparently, there had been a scoring error for this firm which has now been documented and recommendations have been made to add them to the list of approved vendors.

Here’s the information and a recent advertisement from this adjusting firm for those of you interested in applying. I’m not sure why their ad reads as if they will be handling all of the claims as I’ve verified with another Citizens selected vendor what the situation was.  I just found the wording “all of their staffing needs” a bit curious since there are 45 other selected vendors.

Here is the ad that Bradley Stinson and Associates  had up here. Their website is here.

Here is the Citizens Board of Govenors 9/20/07  information  here with the announcement.

Possibly someone alerted Citizens to my prior blogs (yeah right!) stating how disturbing that they were relying on 45 adjusting firms with 6,000 adjusters yet they had not even bothered to post on their job opportunities page the list of the vendors so independents would even know where to apply. Well they now have the list of the 45 vendors up on their adjuster resource tab(still nothing on the job opportunities page directing an independent to this information )and it’s still the original unprofessional list with adjusting firms names incorrect on the list and no contact information or website information for the adjusting firms. It frustrated me so much that I  spent atleast a week researching firms and processes and wrote a research paper on all 45 adjusting firms selected to provide information about each firm and even linked to each of their ads,websites, and emails adjusters were sharing with us as to what each firm was advertising for training conferences.The research paper also included lots of news articles in the papers around Florida and much task force information. If you’d like a copy so you don’t have to do all of the research yourself, just order a copy from our staffing firm where you can purchase a copy. ( Website info up on About page on this blog) 

 If you weren’t involved, you would be thoroughly disgusted as a Floridian or claim professional at the ever changing training they put all of the adjusters through as the training requirements and procedures changed regularly. They selected the vendors with no clear training path initially leading to a ridiculous amount of confusion for the selected vendors and for the independent adjusters. I think that is finally squared away as we’ve documented all the new reporting in the  forums  at ClaimSmentor for our participants. Here is also a link to the adjuster training link directly on the Citizens website you’ll find below. The Bradley Stinson ad mentions you can change your vendor selection on the training registration but I’d check with each vendor as information seems to differ from adjusting firm to adjusting firm if it’s anything like the initial training information and rounds of training conferences initially held BEFORE Citizens changed the procedure and presented the information to the vendors that they wanted given to the adjusters (they gave them I believe it was less than 2 weeks notice to do it with a deadline of 7/31 for the first 50% of their rosters…they have no clue apparently how independents work when it’s awful hard to commit to someone who has given you no work assignments!)

Also, here is a link they have up on their website for contract and they are showing adjusters as employees W2 status on this schedule. Without interviewing them yet, I don’t know if this applies to all adjusters or just daily. Interesting wording also on the fees for payment. Would you get the full 65% only if your out on cat assignments working overtime and only 40% on daily claims? I don’t know but you’ll want to check this out if you apply. Their site does read very professionally and they may be worth exploring for consideration for assignments. We had a blog a few weeks ago on this very question about whether you are an employee or an independent you might want to view here if you missed it.

Here’s a copy of the small window of information they atleast now have up under Adjuster Resources for independents:

******** 

Adjuster Resources

Looking to become an Independent Adjuster for Citizens? Citizens does not hire Independent Adjusters directly. You must be signed up with one of our approved firms. Please go to Awarded Competitive Solicitations for a list of firms we will use during the 2007 storm season.

********

And here is a link to the award announcement- if you compare the real names on my research paper with the way the names are listed on the announcement you’ll find it interesting the number of adjusting firm names with errors. Had I not been following each help wanted ad, I might never have found a few of the firms. Why they can’t list the website and phone numbers for each adjusting firm is beyond me. It doesn’t give me much faith in the professionalism of their claim handling abilities if they can’t even get a list of their selected vendors completed with accurate details an independent would need to locate them. I’m surprised the Bradley Stinson group hasn’t insisted that they get their name added to this list per the earlier link above that they’ve been added as independent adjusters aren’t going to know about the pdf document of the September Board of Govenors adding them. Come on Citizens…let’s get it together…please for the sake of all of your policyholders living in this great state!

Here are links to my prior blogs that included information about Citizens of FL and these events:

This link here is the blog on the update on Citizens training presented to the task force.

This link here is the blog about opportunities to work for the initial 45 vendors.

Here is a link to the blog here on Citizens claim reserve problem to the tune of 300 million!

Here is also a link to our former blog on Temporary Housing if anyone needs it that may be heading out to the panhandle to work storm losses. There were also many losses in the midwest yesterday so plenty of you may be needing temporary housing:

http://dimechimes.wordpress.com/2007/08/15/temporary-housing-links-for-adjusters-temporary-housing-optionsadditional-living-expense-training/ 

Possibly they’ll be put to their first test this week due to today’s tornado damage in Pensacola, FL. Apparently according to friends and family, there was some significant damage to boats in marinas and the Cordova Mall area. Please note if your an adjusting firm viewing this blog that we have over 40 permanent experienced resident adjusters in the Pensacola-Panama City,FL area who would be more than glad to assist with claims on our Dimechimes Corporation rosters.

Here are links to a few of the Florida panhandle storm reports:

http://www.pensacolanewsjournal.com/apps/pbcs.dll/article?AID=/20071018/NEWS01/71018003/1006/js04

Here’s a Youtube video one of our moderator’s friends took of it:
http://youtube.com/watch?v=aqj7iEXHo

And here’s the link to yesterday’s storm reports on NOAA (these will change after midnight to todays reports):

http://www.spc.noaa.gov/climo/reports/yesterday.html

We’re hearing from local panhandle daily adjusters that the loss reports are coming in so hopefully many of you waiting on work will get the deployment calls.

For those of you who may be deploying on your first assignment whether cat or staff, here’s a great quote to take with you:
“I’m not afraid of storms
for I’m learning how to sail my ship.”

Louisa May Alcott, Author (1832-1888)


Independent Adjuster vs Employee?

September 27, 2007

Storm season always brings up the topic “are you an independent adjuster or are you an employee” as independents start receiving new contracts from adjusting firms for the season.

We wrote a blog about the caution new adjusters need to use when signing independent contracts in our blog called Splish Splash don’t go takin’ a bath. Here is a link to it.

While we are still hoping for a great employment attorney to provide an opinion on some of the issues Independent adjusters commonly face, (am I dreaming someone will come forward and volunteer to interpret these things for us as a guest blogger employment attorney or volunteer employment attorney participant)? I’ll post some links to some interesting things we found while researching this topic.

While I’m not sure we entirely understand the issue as it relates to court decisions, we think we’ve come up with a consensus that the issue relates to “independent judgment”  and “control” issues vs whether or not you or your adjusting firm considers you as an independent.

The majority of independent contracts the adjusters have shared with us state the adjuster understands they are a 1099 reporting independent but there are several such as ASU which states on their website here that their adjusting firm is 100% employee owned. I had the opportunity to meet several of their members at the 2007 NACA convention and find this approach most appealing for adjusters to have benefits, educational assistance, 401K plans and many other benefits independents normally don’t have access to with the majority of firms. Do you know of other firms providing employee status vs independent? It would be great to hear about these opportunities via reply to this blog if so!

I found an interesting site called The Society for Human Resource Management (SHRM). Here is a link to their website. They say they are the largest professional organization devoted to Human Resource management.

Their website points out that there are many agencies that have statutory jurisdiction over the “independent vs employee” issue. Here’s an excerpt from their site about this:

“The many statutory jurisdictions that cover classification of independent contractors include the Family and Medical Leave Act, the Americans with Disabilities Act, the Internal Revenue Code, the Fair Labor Standards Act, the National Labor Relations Act, and individual state-by-state unemployment insurance codes” thus the comment above about not being sure we understand all of the issues because there are just too many federal and state laws involved in the classification determination.

An employment law attorney and member of their site addressed the House Labor and Education committee on July 24, 2007 stressing the need for guidance for employers to properly classify employees due to the confusion with all of the programs listed above. Here is a great article about her testimony. I think the following statement in her testimony best addresses the problem independent adjusting firms, carriers, and adjusters face as they create and sign contracts:

“Every new working relationship brings with it the challenge of asking the right questions to ensure the employment situation is being properly classified as an employee or non-employee worker,” said Walters. “In my experience, employers do on occasion unwittingly, misclassify employees as independent contractors,” she said.

Here is a link to the House Committee July 24, 2007 hearing that includes links to the webcast of the testimony at this meeting and to the presentations of several other speakers to include Paul DeCamp, Wage and Hour Administrator from the Department of Labor. Note that the question in the title of the hearing was “What Policies and Practices Best Protect Workers“. 

Chairman Andrew’s  opening statement is found here  and Chairman Woolsey’s opening statement is found on this link. These are worth the read as they outline the reasons employers may misclassify employees…basically to avoid health insurance and workers comp and other benefits such as social security payments they would have to pay or an employee would be due. From information gleaned in Woolsey’s opening statement, CA considers the problem so significant ( see yesterday’s blog too on CA and adjuster overtime issues) that they have State Assembly Bill S.B. 622 that if passed would assess penalties of up to 15K per violation or 25K  per violation if employers have engaged in a pattern of misclassification. This document here says that this bill passed the Assembly 9/10/07 and the Senate on 9/12/07. Those are pretty hefty fines and I hope that adjusting firm owners have been advised of these new provisions by their employment attorneys and have reviewed these issues as they pertain to using independents for each various operation such as carrier daily branch assist on daily claims, inside adjusters in carrier claim central operations, as well as their classifications for catastrophe independent adjusters especially for the types of contracts I’ve seen that require exclusive work with the independent firm or carrier. Would the use of independents as inside adjusters be cause for concern about classifying them as other than 1099 employees? How about daily assist or daily adjusters working under an exclusive contract? I don’t know but I bet a good employment attorney would know the proper classification. I would also want to know about how a bill such as this one passed in CA would apply to an adjusting firm going out to CA to work earthquake claims. There are many firms holding California Earthquake Certification classes in preparation for an inevitable earthquake out there but have they done equally thorough research into classification of adjusters and if those rules would apply to out of state adjusting firms coming in to work catastrophe assignments? I’m not sure how those laws apply when your working out of state as a vendor vs it being the permanent state of your adjusting firm office.

Paul DeCamp’s testimony found here is longer but if I were an adjusting firm owner, I’d certainly take the time to read this and look at the list of 7 items he calls relevant factors to determine if a worker is properly classified. The one I found interesting the most from the independent adjuster standpoint is the relevant question of “Permanency of the relationship”. Page 2 of his testimony also goes into interesting details about “the process” of reviewing these factors and payroll records and how they conduct their inspections. I had no idea that the Wage and Hour Divisions primary responsibility was dealing with complaints as the testimony says 70-78% of their work is addressing workers complaints on these issues. It is  also very important to read the comments further down on page 5 that says that temporary help is often in the most commonly misclassified category. I’d also read the comments  since this is a national program and the testimony states that they are recommending misclassifications  found by the Wage and Hour Division (WHD) for many other violations for some of the other agencies(listed at the beginning of this blog) that they find value in sharing that information nationally with other state and federal programs(page 6). Pg 7 indicates that GAO feels that employers should be notified when they make these reports to other agencies to investigate while WHD did not think it was appropriate for them to report them due to the fact they do not know the rules nor administer the programs for the other agencies looking at independent classifications. 

Another point interesting to property and catastrophe adjusters would be the comments on page 4 indicating that construction companies are in the group receiving the largest findings of misclassifications. The findings in Decamps report about this are echoed by Sara Stafford with a construction firm who testified that firms such as hers are often penalized by losing contract bids as they include the cost of employee benefits in their estimating costs (overhead and such) when other construction firms improperly classify employees as independents which costs the complying firms work by abiding by the classifications. I imagine this would be the same for independent adjusting firms who would have to increase fee schedules to cover their overhead for employee benefits if they were required to provide workers comp and benefits. Here is the link to Sara’s testimony. I didn’t have time to get to the testimony of two other speakers you can find on the links above.

Other research we found in the past few months includes:

This informational article from the state of Texas on form C-8(0406) found here which contains 20 relevant topics to test your classifications.

Here are some interesting comments on independents here with several more good factors to consider.

I really liked this 20 factor check list for small businesses to determine employee vs independent contractor check list to determine under common law what factors apply found here.

This article here from another law firm discusses NY’s “right to control” factor. It’s an older article from 98 but a good article. This website is full of employment articles at www.ebglaw.com.

Here is a good weblink for IRS information on independent contractors which refers also to links for several publications  you would want to refer to found here on their website.

I found this case from Vermont that the Insurance Journal posted quite interesting from May 2007 where at home workers for a knitting company were determined to be employees versus independent contractors. Here is a link to the article.

It took several days to have time to finish up this blog entry due to weeding out alot of repetitive information and narrow it down to some of the most concise current information you might find useful. The research has been well worth the while as I’ve learned that these issues are not set in stone but very active current topics of discussion, court cases, and federal and state agency hearings and discussions right here and now in 2007. The National Law Journal  at www.NLJ.com on their 9/27/07 article update says this will be a banner year for Supreme court labor and employment cases as they have granted review of many cases in this overview of the article:

September 27, 2007

TODAY’S NEWS

FROM THE UPCOMING ISSUE  |  Supreme Court loads up on employment cases
Besides adding such high-profile issues as the constitutionality of lethal injection executions and voter ID laws to its docket, the Supreme Court ensured, through its latest grants of review, what is likely to be a “banner” year for labor and employment law.

********

This appears to be the time for independent adjusting firms to update the opinions from their employment lawyers if they haven’t already done so to verifiy if their current practices meet all of the 2007 regulations with all of these current discussions going on. All Independents are waiting on weather (wow as independents call it) for assignments so while everyone is waiting you might want to take the time to double check the classifications to make sure everyone is compliant with their state and federal 2007 regulations. I am most curious about how the state laws apply when an adjusting firm from one state ventures into other states to handle losses. Are they subject to those other state laws too? This feels like going to college! The more you learn the more questions you have!


Pros and Cons of working staff adjuster versus independent adjuster positions

July 27, 2007

I find it fascinating that so many new adjusters are entering the catastrophe claim profession based on stories of six digit incomes they hear other independents make during peak storm seasons such as 04/05 with little understanding of the employment options as either a staff adjuster or an independent daily(non catastrophe) or catastrophe adjuster.

I ask new adjusters to give me 5 pros and 5 cons of being a staff adjuster and 5 of each as an independent adjuster. Having taught a Fundamentals of Claims class now to over 100 adjusters in the past year, I have found very few that can answer this question. I have also learned that there are many common misconceptions about the freedom an independent adjuster actually has.

If your considering a career in claims and do not know which way to go, here are some things you may want to consider:

Staff adjuster Pros

Regular reliable salary

Paid training

Health benefits

Possible company car for field adjusters

Computer equipment and estimating software provided free

Travel expenses paid for or reimburseable on expense account sheets

Temporary housing on catastrophe assignments is located and paid for you

Cellphones provided and charges covered by carrier

Carrier keeps you up to date on claim news

Carrier holds your CE classes for you and makes sure you are up to date

Carrier handles your licensing issues and differences in emergency adjuster licensing rules

Carriers often pay continuing education such as AIC designation, CPCU courses, college courses

Retirement benefits

401K plans

Errors and Omissions coverage

Defense costs of counsel paid by carrier should you be sued for claim file handling

Great seminars for training by attorneys, experts and hot topics provided

Field training mentors provided to you for ride-a-long field training 

Independent Adjuster Pros

Freedom to purchase type of equipment and software you like to use

You have the right of refusal of an assignment to a location you don’t want to go(city,etc)

Possibility of earning more GROSS income than a staff adjuster based on fee schedules on cat

Assignments are temporary so you don’t have to stay long term with boss you don’t enjoy

Freedom to decide which adjusting firm you are better suited to work for

Freedom to choose where you house during a catastrophe assignment

Freedom to choose if and when you have room mates at seminars and conferences

Freedom to decide which carrier you like to work files for

Freedom to decide which firm you will work for based on carrier fee schedules

Freedom to use estimatic software you prefer by aligning yourself with an adjusting firm who uses the one you prefer

More employment options since adjusting firms do not require college degrees but hire you based on adjusting experience and adjuster training levels

Adjusting firms pay on fee splits so you can quickly earn the same fee split as experienced adjusters

Many of the more complicated files are moved to staff to complete such as coverage issues so you can be more productive

Independents generally have more down time for vacations between assignments

So then..what are some of the Cons for these positions?

Staff Adjuster Cons

Often don’t have freedom to reject a catastrophe assignment

Constant reorganizations and possible required relocations to maintain employment

Often assigned room mates at seminars, schools, conferences (non management)

Druggery of yearly performance reviews even good employees dread each year

Politics of corporate environment

Long tail on promotional opportunities- some carriers as long as 3-5 years to progress to claim specialist level

Carriers often require a 4 year degree which many independents may not have

May be deployed to catastrophe assignments if you are on a cat team longer than you prefer

Sometimes hard to transition off a catastrophe team to regular claim positions as departments at home are downsizing and scaling back or moving to claim central environments

May be “on call” for 24/7 customer service claims for field adjusters

Dealing with an unpleasant boss long term

Often required to train new adjusters slowing down your work

Often salary and much overtime required to handle files timely (lots of case law on this issue)

You can’t walk away from the bad files with long tails- they are yours to completion

Short vacation allotted -usually 2 weeks for first few years

Guess who handles the problem files when the cat teams depart?

Independent Adjuster Cons

Costly training for seminars, conferences, seminars

Required carrier certification tests for multiple carriers to work their files

Expensive equipment costs for computers, ladders, miscellaneous equipment and cat logo clothing

Estimatic software expenses since you must provide. Especially difficult if adjusting firm working for multiple  carriers using different software programs

Expensive temporary housing for catastrophe assignments you must pay

Difficulty finding reliable information on the reputation of adjusting firms for payment of adjusting fees, adjuster support in the field, forms and endorsements, and other important details

Navigating Independent contracts to protect yourself before you sign independent firm contracts

Expenses of defense costs should you be sued if your E and O policy does not cover

Errors and Omissions cost to provide your own if the adjusting firm does not provide

No guarantee of work

Transportation and maintenance cost of your own vehicle as well as insurance cost

Handling your own CE requirements- costs of courses

Complying with the non resident emergency adjuster requirements and fees on your own

Obtaining a mentor to help train you in the field is very difficult

Keeping up with important developments in claims if you are not a CORE adjuster with an adjusting firm. This year alone we have about 5 states with new licensing developments as an example.

No clear cut path to recovery of your adjusting fees should a vendor not pay you

Very long tails to receive adjuster payments-not uncommon to be 60-90 days before you see your first payment on a catastrophe if you are working for a firm who pays after the carrier pays

Extra layer of management since you report first to adjusting firm manager who then moves your closed file to staff management for closed file review.

Misconceptions I often see in response to the question about the pros of being an independent adjuster center around the expectations of an independent. We get answers such as less file quota, less paperwork, freedom to turn down files in a territory you don’t want to go to if it’s out of your assigned territory, no management, loose dress codes, bringing in assistants, freedom to turn down adjusting firm assignments for a firm you are considered a core (regularly assigned) adjuster and many other false assumptions.

You need to understand if you accept an assignment as an independent that you are working in a carrier’s world. They have the same high standards set for you as they do for their staff adjusters upon arrival at their cat assignment or acceptance of their files for daily work.

The same time service requirements, timely inspection and closure of files applies. You will be required to use the same report forms, pattern letters, and good faith claim handling standards that a staff adjuster must abide by. Your production numbers and quality of file documentation must still meet carrier directives and matches the same file standards for a staff adjuster. This is in addition to specific guidelines your adjusting firm may have for submitting documents for invoicing the carrier.

We hear many comments from adjusters who know the ropes…… ” how independent are you really” ? If you look at many states case law on determining if you are an independent or are you an employee……you do have to wonder in spite of the fact that most adjusting firms deploy independents on a 1099 basis. There is little room for working on your own once you arrive on assignment. All of your actions are directed by those we serve to include the adjusting firm and the carrier. You do not have the choice of what software you use in most cases, what forms you will use, what closing and inspection requirements are,etc. You do have the same freedom as a staff adjuster to set your inspection appointments and schedules but don’t be naive to think your numbers will not be monitored to be sure you are meeting customer service standards.

These partial lists of pros and cons should help you decide which position best meets your background, preferences, and pocketbook. Feel free to add to the list if you have additional thoughts to add to these pros and cons!


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