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2015 Winter not over 4 thousands of MA homeowners, waiting on insurance claims

Posted by Mark Paskell on Thu, Jul 02, 2015 @ 08:11 AM

So you thought the winter of 2015 was over? Well ask over 100,000 Massachusetts homeowners who are still dealing with the devastating damage caused by ice dams, pipe bursts and structural collapse from the weight of ice and snow. They will tell you differently.img_2043

Thousands of homeowners are still waiting for their insurance companies to settle claims. I spoke with an insurance claim adjuster this week and he gave me a rough approximation of how many claims are still open in Massachusetts from the winter of 2015.

 

 

  • Travelers Insurance over 23,000
  • Commerce Insurance; over 33,000
  • Arbella Insurance; over 20,000
  • Hanover Insurance over 23,000
  • Safety Insurance over 15,000

Other insurance companies with thousands of open claims include USAA. Liberty Mutual, Metropolitan, Vermont Mutual and Chubb.

He was not sure on the counts for all other insurance companies but said peers estimate there are likely over 200,000 open claims currently in the Massachusetts and Southern New Hampshire areas. Yes that's right over 200,000 open claims from damage that happened in February 2015!

Did you know that insurance companies are required by statute to act in good faith to promptly estimate, settle and pay claims?

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Contractors and homeowners are telling us they saw an insurance adjuster in March and they are still waiting for an estimate! Worse many are telling us that the estimates received from the insurance companies are ridiculously low on scope of work and price.  We are seeing estimates from insurance companies that are as low as 30% of actual repair estimates from professional contractors.

The insurance companies brought in hundreds of Catastrophe (CAT) adjusters from other states. Homeowners report that the original adjuster is gone and a new adjuster has to re look at the claim.Some of our contractor clients are meeting with a third adjuster.  

Homeowners are realizing that the estimates do not include thousands of dollars for Mass building Code required code upgrade work, permits or RRP Lead protocol. We are discovering that many of these Independent adjusters are completely ignorant of Mass Building Code are not licensed builders and they are telling homeowners what they get or don't get!

For example we had a call from a retired senior citizen who was offered $15,000.00 to repair a sun room and balcony that were destroyed by falling ice and snow. The snow ripped off the balcony and crushed the roof of the sun room. Our contractor client used the skills taught in our Insurance Claim Estimating Workshop and coaching program to produce a construction estimate for the real damages. The insurance company sent out a new adjuster and said the first adjuster wasn't thorough enough. Then after we produced an accurate scope of work and estimate for the damaged areas they proceeded to offer a settlement of $95.000.00 to replace the sun room, rebuild the balcony and replace the torn off gutters. 

What do you think would have happened to the homeowner if they didn't know who to call? 

Insurance companies are playing the wait it out game knowing that many homeowners will not wait months for claims to settle. They know most homeowners will just take the first incomplete low ball offer and move on. In fact statistics show many homeowners never question the first offer from the insurance company.

If you are a contractor and have homeowner clients who are in insurance claim limbo there are ways you can help them. Here are some tips to help you guide your clients;

  • Insureds have 720 days (2 years) to file a supplemental claim if the first settlement was not enough to cover the damages. DON'T SETTLE IF YOUR CLAIM IS TOO LOW!
  • Even if the insured cashed the check they can still file a supplemental
  • They do not have to accept the insurance company supplied contractor..in fact they are better off not working with a hired gun from the insurance company who agrees to very low prices with the insurance company. This leads to minimum work at best.
  • DO NOT ACCEPT THE FIST OFFER: EVER. Only 1% of people question the claim scope of work and estimated price. Yet over 50% of those who question the claim receive additional scope of work and funding that is covered in the policy. In my experience claims that do not settle for 1 to months, tend to increase by at least 50%.
  • Squeaky wheel gets the grease; be politely persistent and call the insurance company, the adjuster, the agent every week. Send emails and keep a log of all dates and conversations. If you have a large claim and they play hardball this will be helpful if you need to hire a lawyer to sue them.
  • Read your policy. Many homeowners never read their policies until they have a claim. There may be coverage for items that the insurance adjuster neglects on purpose to tell the homeowner during the visit. There are 2 major examples;
Code upgrade or Ordinance or Law; many policies have a clause called Ordinance or Law in the policy. Ask the homeowner to call the insurance agent or company to ask if they have the endorsement. This coverage covers code upgrades up to a certain amount. Homes built years ago were constructed to codes prevalent at that time. Now with newer codes the damage repairs may trigger code upgrade work such as insulation, wiring, hardwired smoke detectors, framing updates and more. This work if covered will have to be incurred but the insurance company must pay for it if the coverage is there.
Loss of Use or Additional Living Expense; some repair projects will make the property unbearable to live in. Your client may be entitled to have the insurance company pay for them to live somewhere else while the repairs are taken place. This is always in base policies under Coverage D and is usually 20% of the coverage listed in Coverage A or Dwelling. Insurance adjusters do not usually mention this when they look at the claim even though they know it is covered in policies.
I predict that we will be hearing about open claims in Massachusetts from the winter of 2015 well into the fall. We are hearing back from many of our Insurance Claim Workshop students that they are helping their clients by doing construction estimates for them as a Contractor Consultant. Often times the estimate is leading to claim settlements three times the original estimate from the insurance company. 
If you need help on how to navigate the insurance claim quagmire to help your clients attend our Insurance Claim Workshop or contact us for a consultation.