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.

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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:

https://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.


Outstanding article by the President of the CA Assn of Independent Adjusters on Fee Schedules Contributing to Independent Adjusters leaving the Industry

May 16, 2010

I ran across this newsletter from December 2008 in the California Association of Independent Insurance Adjusters December 2008 newsletter which is the best written article  I’ve come across discussing a topic of great importance to all Independent adjusters which is the perception/reality that carriers no longer are treating independent adjusters as independents. Specifically, it addresses the change in fee schedules and billing procedures as well as the fact this is driving off the independent adjusters from this business. Great job to the then President -Pete Vaughn- for putting this President’s message together.

I think every conversation I have with a claim manager and/or adjuster these days always turns to the problem with fee schedules. Among the rumors folks have shared with me- some I can confirm- some are rumors at this point as far as my knowledge goes- include a state carrier requiring adjusting firms to offer a 5-10% discount off of the CARRIER fee schedule to be a selectee on an RFP (ludacrist!), rumors about carriers reducing THEIR fee schedule by large percentages in 2010 allegedly due to the glut in numbers of adjusting firms, and probably the largest complaint is that the insurance companies are putting out RFP’s for adjusting firms to bid for their work and agreeing to one price based on one set of terms such as limited assignments and now requiring more file requirements and more be done and expecting it to be done for the reduced fees a firm may have agreed to. In addition, when an insurance company brings on too many firms, this limits the number of assignments one firm may get. This does not give an independent adjuster enough files to even justify the monthly cost of estimate software to work daily (non- catastrophe claims).

On top of the fee schedules being reduced, independent qualification criteria is much more costly for attending the ever growing number of carrier certifications which requires independents incur travel and lodging expenses to attend these tests. The second major change in the past few years is the requirement for independents to acquire and maintain up to 15 non resident licenses which I hear are costing them about 1,000 for the fees if they do obtain them all in the gulf coast states. While it makes sense to obtain the non resident licenses from the standpoint an adjuster can be used for cat and non cat claims even when an emergency has not been declared in a state with a smaller storm yet there is a reason that states have emergency adjuster licenses available once a governor has declared a catastrophe to allow non resident adjusters to come into a state to work storm losses.

Well enough of my comments in response to this great article written by the then President- Pete Vaughn – so here is the link to the December 2008 issue so you can read the article yourself. I hope this generates a comment from the writer of the article on new trends he is seeing in 2009 and 2010 since this article has been written. From what I’m hearing- the fee schedules are much worse if anything. I’d be interested in your thoughts as well as his as to what you are experiencing out in the field.

Here is the link- http://www.caiia.org/sr/1208caiia_sr.pdf

I agree whole heartedly with this article- do the carriers want a cheap price or do they want the quality work which policyholders deserve? At this point, it certainly appears their overriding decisions are based solely on price driving many experienced adjusters to leave this industry based on the lack of work and when their is work, the fee schedules are unreasonably low which do not begin to cover an independent overhead to cover their software expenses, travel and lodging expenses, and their equipment needs and maintenance issues for vehicles, computers, ladders, and annual certifications.


Please Participate in the 2008 Claims Magazine Annual Claim Salary Survey

August 21, 2008

 

We have been asked by Eric Gilkey, Editor of Claims Magazine to distribute this link to as many staff and independent adjusters and managers as possible in hopes of great feedback on this year’s claim salary survey. Below you will find the information to participate:

 We are excited to see many questions specific to independent adjusters are included in this year’s survey.

Please pass this email on to all you know in the Claims industry to make this
the most helpful survey possible!

Here is the email received:

Every year, Claims Magazine asks its readers to participate in a salary survey
in an attempt to better understand and convey the working conditions and
salaries of the claim professionals for whom we write. Today, your input and
opinions are requested.

Below is a link to a short online survey. It should only take about five minutes
to complete. The survey is confidential, and respondents’ identities will be
concealed. Answers will only be used in tabulation with others, and comments
will not be directly identified.

Since the number of subscribers being asked to complete the survey is small,
your participation is critical to the accuracy and usefulness of the survey’s
results. We value your input and thank you in advance for your assistance.

Sincerely,

Eric Gilkey

Editor in Chief

Claims Magazine

http://www.zoomerang.com/Survey/survey.zgi?p=WEB2286BN5L7Q4

Thanks Deb. Hope everything is going well for you.

Sincerely,

Eric Gilkey

Editor | Claims Magazine

Conference Chair | ACE America’s Claims Event

The National Underwriter Company

 

*********

Note- we had previously published the results of the 2007 Claim Salary survey results. If you missed that blog, here is a link:

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

Thank you for participating!


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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

https://dimechimes.wordpress.com/2008/04/23/registration-deadline-42508-for-next-40-hour-fundamentals-of-claims-online-live-class/
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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!


Adjuster Fees in the news- The time is now to educate the public and Insurance media and press

August 14, 2007

We talked about adjuster income a week or so ago here in this blog due  to the frequently asked question by new adjusters about income. I commented in that blog about comments often made on forums that we shouldn’t discuss it in public as it’s not appropriate. Well, I hate to be the bearer of the news but adjuster income is regularly discussed by the news media and it’s time we speak up and set the record straight so the media understands the reality of independent  and staff adjuster income and the many types of payment methods and schedules that exist.

Sam Friedman, Editor/National Underwriting, runs  a blog I particularly enjoy following. Sam invited Bob Hunter of Consumer Federation of America to address the wind/water issues and the allegations of damages being moved to NFIP here in this article on “Hunter  blasts Insurer Conflicts on Flood “. Hunter was invited as he is a past federal administrator of the program. His comments indicate the financial incentive is to move the claim to flood in these comments from the article:

“Worse, the insurer gets fees for settling the flood insurance claim that go up as the size of the payout goes up. The temptation for insurers to determine greater flood damage than is justified—and less wind damage—is great. ”

Apparently, Mr Hunter isn’t familiar with the September 21, 2005  FEMA directive on NFIP claim handling expediting procedures put out to  WYO(write your own)carriers which instead limited fees under the 2005 to flat fees if 2 of the 3 claim handling procedures were used by carriers. Here is a copy of that directive. See page 2 for those fees. I’d imagine you could poll any experienced adjuster who could verify the carrier wind fee schedules paid more to adjust serious losses. A bit off topic but it might also interest you to read the Single Adjuster program by FEMA for WYO companies dated in 2005 just prior to Katrina since Mr Hunter advocates for seperate adjusters on the wind and flood program. In addition, staff adjusters that work directly for a carrier are not paid on fee schedules but are normally salaried employees earning a base salary with possibly a daily additional small flat rate per day out on the road plus per diem to cover expenses and meals while traveling. Staff adjuster hotels are located and paid for by the carrier. They do not perform under fee schedules used to compensate independent adjusters brought in to help with the burden of a large influx of claims during major catastrophes. Let me be the first to apologize to the well respected Mr Hunter if I have misinterpreted his comments on incentives to move the damages to flood.

Rebecca Mowbray of the Times-Picayne also commented on the fees in this article in June 2007. I’ve read many other news articles around Florida misinforming or providing incomplete information to  the public on the way adjusters are paid. These are just a few of the examples out there.

While it’s difficult to post carrier wind fee schedules for independent adjusting firms, we’ll use this published schedule  found on the web  by the NC  Joint Underwriting  Association for comparison. This is a typical type of gross damage fee billing schedule where the fee bill is based on the amount of damages which is what Mr Hunter apparently was referring to. This type of schedule is commonly used on losses but the figures on the gross sliding scale differ greatly from carrier to carrier. During 05, I reviewed many schedules and fees for the same amount of gross loss on a major stuctural loss varied from $1,700 to $3,500 depending on carrier for the same amount of damage. Factors included differences in residential schedules versus commercial fee schedules and other issues.

There are component based fee billing schedules that rather than pay based on a gross fee schedule, the carrier will pay based on the item inspected until meeting a dollar threshold such as $15,000 in damage then the schedule moves to a percentage of the loss such as 2-3%. This would include a fee allowance for inspecting the roof such as $150.00, another allowance for inspecting the interior, another for handling the contents,etc. I don’t have one I can find on the web but this is a common practice with some of the large carriers and adjusting firms.

There are daily rate schedules often used for adjusters such as inside adjusters, reinspectors, claim managers and adjusters remaining to handle reopens on files which occurs frequently on claims as insureds get in higher estimates in from contractors due to market price increases or supplemental damage to roofs and interior leaks as new rain storms happen prior to completing repairs. Here is an example of daily fee rates on page 8 in this  publicly posted Citizens FL RFP manual for adjusting firms servicing their claims. Note also this includes a gross fee schedule on page 7 and time and expense billing information found on page 8.

Don’t overlook other limitations and additions to these fee schedules. You can see an example on Citizens schedule above which are common with carrier fee schedules such as the limit on this one to hold the reinspection allowances (good luck finding adjusters to handle reinspections for new damage to $50.00 and only if it’s new damage- they apparently aren’t thinking ahead to the fact an adjuster staying for clean up handling reopens for other adjusters who have left will not reinspect a claim for free when it’s a case the original adjuster missed damage in their scope….that’s why you move adjusters staying behind to handle reopens to a daily rate!). There are allowances such as shown on this schedule for steep/two story losses due to the extra training and equipment needed for rope and harness qualified adjusters.

Time and Expense billing is another fee schedule option used by some adjusting firms to handle fees. You will often find this type of fee arrangement on large commercial losses, daily claims, and liability losses. Here is an example from an adjusting firm publishing theirs on their website. Normal ranges seem to run between $65.00- $125.00 per hour with other allowances for expenses such as mileage, photos,etc. while the one above for Citizens allows $58.00 per hour. We ran into this in 05 with the state of LA wanting to pay only $50.00 per hour on some large commercial claims ( I’m not sure how that story ended).

Should insurance news reporters come across these type of published fee schedules they don’t seem to have any idea of how those published figures are then distributed to adjusters so let’s discuss some of the fee schedule deductions for adjusters.

All fee schedules are not handled the same. Some carrier fee schedules are the same for daily and cat claims. Some carrier fee schedules have different rates depending on the strength of the storm such as a Category 1 or 2 being X schedule while a Category 3 or 4 brings a higher fee schedule. Supply and demand of catastrophe independent adjusters plays a part in the reason for these different allowances by severity of the storm. Carriers also differ on full versus partial assignments further limiting an adjusters income when the carrier handles the contents and additional living expense and other claim components that independent adjusters used to handle for them. Carriers and even adjusting firms are in greater numbers using preferred contractors or unlicensed estimators to scope the damage at much lower adjusting fee allowances for scopers with their staff adjusters settling the claims although the staff adjuster has never viewed the damage or personally met in the field with the insured.

First there is a fee split. The adjusting firms typically place the fee schedule split in their contracts with adjusters. Typical fee splits are 60% to the adjuster and 40% to the adjusting firm. Daily claim (non catastrophe losses) may be less to the tune of 50/50 splits. Some firms do reward the more senior adjusters by paying a larger fee split such as a 70/30 split to retain a more experienced staff. Last year, newer adjusters advised  many of the firms were offering them 40% of the fee schedule due to the increased need for trainers, helpers, and additional management needed to supervise less experienced adjusters.

In addition to deducting the adjusting firms percent of the fee split with the adjuster on the damage, firms vary on what miscellaneous expenses they also take a percentage of on photos, mileage, gas allowances and the like. Adjusters need to be sure this is spelled out in their contracts. This can make a remarkable difference in an adjuster’s gross income.

Adjuster expenses are much more than the public can imagine. Here is a great outline on expenses an adjuster incurs annually to work on the road as a catastrophe adjuster found on a catastrophe training firm’s website. You have to remember these dedicated adjusters are seeking out of town housing facilities under the worst possible of conditions when insureds are also seeking temporary housing when their homes are damaged. While carriers pick up the tab for housing for their staff adjusters, independent adjusters must pick up their own tab. I have personally driven adjusters around for days after Ivan seeking any possible location to house. During 04, I actually slept in our small cat office on a lawn chair for six weeks joining a local gym nearby to go in and shower each morning before the support staff came in for the day. We do what we have to to handle insureds claims- stories abound on just such deplorable living situations for independents trying to find housing the first few weeks of storm while still trying to meet quotas carriers set and deadlines the insurance department sets for carriers. There are few exceptions when housing may be paid for an independent manager or as the Citizens schedule shows per diem allowances may be made to Q & A reinspectors,etc. but the norm is for an independent to pay their own housing running into thousands each month. The expense problem is compounded by the fact independent adjusters go 30-60-90 days or longer before seeing their first dime due to the delays having closed files reviewed and approved and the lag time from carrier payment to adjusting firm who then passes the split fee payment to the adjuster.

Gas expenses are  also becoming a major issue for field adjusters with gas in the $3.00 range even prior to a major storm hitting. Here’s the headline from an AM Best special report A.M. Best Special Report: U.S. Hurricane Catastrophe Review — One Blow Away From $10 Gas in May 2007 – here’s a quote from it:

“A Category 5 storm moving on Houston through the northern Gulf would dwarf energy industry disruptions from Katrina and Rita. Forty percent of U.S. refinery production could be shut, as well as nearly all offshore production facilities. In the short term, a spike in gasoline prices proportionate to that seen as Katrina targeted the Gulf and made landfall would take the national average for all grades within striking range of $5 a gallon. In a protracted disruption to supplies, $6 a gallon or more would not be out of the question.”

Here is also another article from CBS4 News indicating that FL now requires generators at the gas stations which may further drive up gasoline costs.( Adjusters should keep this link as there is a link to the stations that will have generators should you have to go there on storm duty).

This article found on the Fl Dept of Financial Services site reminds us of other problems adjusters faced with fee schedules in 04 with the firms who did not share the carrier schedules with the adjusters who were underpaid based on the fee split type of billing. Luckily, the RFP’s  for this carrier are now published and adjusters should not experience that issue this year.

We need to do our part in helping educate the press so the real facts and issues regarding adjuster income is known. The time to remain silent is over. I’ll refer everyone once again to the reality of adjuster’s income in this Claims Magazine article here. The title Overworked, Underpaid, and Under Appreciated accurately describes the real world of adjuster workload and payments. I hope you’ll take the time to look this over. Share it with a reporter when you see articles misinforming the public to help educate everyone on the realities. We are getting bad press and need to work to enhance understanding of our jobs in the media.