Contractors are telling us RRP costs on pre 1978 homes are not being paid by insurance adjusters on properties damaged by fire, water or storms. Insurance companies and their adjusters are trying to get away with not covering legitimate RRP costs on claims. Many are claiming ignorance or are claiming it is included in the square foot costs of their estimating program.
How you can get insurance companies to ante up for required RRP costs on pre 1978 homes.
In December a contractor client hired me to do an insurance estimate for his customer on a claim from last winter. The homeowner had a structural damage claim due to the weight of ice and snow on the roof. The homeowner was fighting the claim since it was too low from the insurance company to cover the true costs of the damage and hire a legitimate contractor.
A former public adjuster my client pulled me in to help out. We reviewed the low ball insurance estimate and prepared a new complete estimate to reflect the true scope and costs of the damage. In our new estimate we included the costs of RRP work and items left out by the claims adjuster. The house was built in the late 1800's requiring compliance with the RRP law.
In our rebuttal we informed the insurance company that they were required to include the legitimate costs of RRP work required by the State of Massachusetts and EPA RRP Lead Law. The insurance claims adjuster wrote back and said show me the standard from the EPA where it says RRP is required. The adjuster said he would pay for it if it was required.
The project involved replacing a complete roof, painting half the exterior of the house and renovation of 6 interior rooms. The RRP material and labor costs were significant. Most of the interior would require complete plastic covering and temporary plastic walls. The exterior plastic must be run out 15 feet due to the 2 stories home. Workers will need to be protected with personal protective equipment. Administrative costs need to be factored into the RRP costs.
(Note; the insurance company also tried to get away with not paying for OSHA approved staging; see upcoming blog post on how to get OSHA approved staging included in storm damage insurance claims)
I sent the adjustor the links to the EPA and Mass lead laws and requested that he read them and consequently pay for the mandated RRP practices.
I do not know how much reading he did however he paid for the RRP costs. He claimed he was unaware of the RRP Lead law. He also tried to claim that it was included in his square foot estimating program. I said show me where by breaking out your costs. He didn't break out his costs in stead he paid it.
Steps to take;
- Reject the insurance company's premise that RRP is not covered on pre 1978 homes
- Do not accept the adjuster's claim that RRP is included in the insurance estimating program
- Do not accept the adjusters claim that administrative costs are included in overhead as they are direct costs.
- Write a letter stating your rebuttal on all scope items left out or improperly assessed in scope and price.
- Send him numerous links on the RRP law and demand that he read up on it.
- Ask the insurance adjuster to break out the costs he claims are included in their estimating program.
- Include the costs of buying all the RRP supplies in your costs. Don't forget PPE, bags, plastic and replacement hepa filters as direct costs.
An effective way of dealing with insurance adjusters is writing a letter to them asking them to break out their estimate to show where they have costs covered.
Inform your customers that you can help them with the insurance company claim process and win more work.