WHAT DO YOU KNOW ABOUT INSURANCE?
If you know me, you know I am a property field adjuster. I have been employed for 22 years in the insurance industry as an adjuster. There have been many, many things that have turned me off of Insurance as a whole. So as Erin Brokovich once said, "I am not a lawyer, I hate lawyers, I just work for them". I know what she means. The items that irritate me in my job are many. Let me start by going over what the general view of the public is of insurance adjusters.
Myth #1. They don't care about the policyholder, they will deny everything or get out of paying what's owed and they only care about the premium.
Truth: Insurance carriers would go broke if they relied only on premiums to make money. The actuality of it is they spend on average $1.08 on claims for every $1.00 they take in. So how do they make it you ask? By investing the premium they take in. If the investment makes money they can make some money. Most of the time they re invest it to better serve their policyholders by buying updated equipment, researching better products and training their personnel. So, if they are to stay afloat, the stock market has to be returning better than 8% in order for your insurance company to be solvent. If they are not going to have success in their investments they won't be around. Guess who will be insuring your possessions if there are no insurance companies? The U.S. Government. (not a good idea huh?).
Myth #2. Agents take care of you when there is a claim
Truth: The agent might show up or ask you how the claim is going, but beyond that, they have nothing to do with claims. If you have ever watched any advertisement for insurance, it seems like the agent is the only person there to help when the tornado hits or the fire destroys the house. The adjuster and the claims department are the only people you will have any meaningful contact with in the process of getting you back to where you were before your disaster.
Myth #3. The contractor has my best interest at heart and the adjuster doesn't care.
Truth: The contractor does provide a valuable service to you. The adjuster will not be the one rebuilding your home, or making any suggestions for changes you may want in your rebuilding. But, let it be known; Staff adjusters are salaried employees, they will be paid whether your roof has hail damage or not. The contractor has a vested interest in replacing your roof. He doesn't make a dime, if the roof doesn't get replaced. So who do you think has a more biased opinion on what might be storm damaged?
Myth #4. The adjuster will be able to give you all the attention you need.
Truth: Insurance companies do not have the resources to give an unlimited amount of attention to every claim. They attempt to have the minimum amount of staff to cut costs. When a storm hits, there are not enough staff adjusters to give fast service (I don't care what they tell you, you might not get an inspection on your house in 24 or 48 hours).
Myth #5. You have all the coverage you need.
Truth: You may have a lot of coverage, everything from Replacement Cost (which only applies if you actually replace the damaged item, otherwise it's paid on face value, or whats called Actual Cash Value) to Additional Living Expense You have a limited amount of coverage for living elsewhere while your home is being repaired if it is uninhabitable. You have limits of insurance on your house, and contents. And, there are many exclusions, limitations, and duties you are responsible for as a policyholder.
Myth #6. People know what their policy states
Truth: Most people don't even know where their policy is, let alone, they have never even read through it. Likely they purchased the policy based on two factors, the sales ability of the agent, and the price of the policy, and not necessarily in that order!
