Mirror, Mirror On the Wall Part 2

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Read part 1 of this series by Tim Hull HERE


The same day our insurance carrier rendered their official liability opinion regarding my wife’s auto accident, I had a very pointed discussion with my agent. I let him know that I was not pleased with the way the claim was being handled and that we would be challenging their decision. To my surprise, he was very stoic about the issue, even letting me know that we had accident forgiveness on our policy and that it would not be held against me for future premiums (yeah, right!) Rather than thanking him for comfort’s sake, I informed him that we would be requesting the security footage from the convenience store parking lot where the accident occurred and, once we received it, I wanted the decision reversed and a full reimbursement for our deductible.

Five weeks later, with a little assistance from the local police, we secured the video evidence which clearly shows the other party backing into my wife’s stopped vehicle. I forwarded this to the claims adjuster with a request for liability reversal and deductible reimbursement. Both were received by the end of the business day, absent an apology, of course. 

The moral of this story is that you need to be your own advocate. Had I chosen to play the role of the victim, I could have complained to everyone who would listen about how terribly crooked my insurance company is and how the other party in the accident lied and stuck us with the bill; none of which would have changed the outcome of the situation or my reality.

Perception is Reality

We all recall the Disney version of Snow White, where the evil queen constantly asks the magic mirror who is the fairest in the land. That movie line was actually, “Magic mirror on the wall, who is the fairest of them all?” In almost every other version of this story, including the original German text from the Grimm Fairy Tales, it is “Mirror, mirror on the wall …” Regardless of variation, the meaning is still the same, we choose our own reality when we look in the mirror. There is no judgment or opinion in the mirror, only reflection. How we perceive that reflection becomes our reality.

If you are reading this after reading part one of this article, I’m going to assume you have chosen to accept the reality that our struggles with claims settlements may have as much to do with restorers as they do with insurance carriers. If this is the case, read on, and we’ll explore how contractors can communicate more effectively, document more thoroughly, and strengthen their resources to make the situation better.

Communicate to be understood!

Effective business communication does not have to be eloquent. The only criteria that matters is the degree of accuracy with which the information is transferred from one party to the other. With this in mind, I would encourage contractors to focus on WHAT information needs to be communicated to WHO and WHEN. This should be an integral part of project planning. It should also include a preferred method of delivery so stakeholders can know when phone calls, emails, text messages, or face-to-face meetings are expected. In Violand Management’s Restoration Project Management course, we provide attendees with a simple and easy to use communication planner, which we encourage contractors to use on every job, regardless of the size and complexity. This keeps all parties on the same page.

Another recommended tool, which is standard in the world of project management, is a statement of work. Also referred to in other industries as a project charter, this document summarizes all aspects of the project from stakeholder identification to deliverables, budget, and even assumptions. When executed correctly, this document serves as a universal guide to govern activities by all parties throughout a project. The use of this document greatly reduces opportunities for misunderstandings by setting appropriate expectations at the onset of the project.

In my opinion, expectations go hand in hand with assumptions. When either understated or overstated, failure is imminent. This is why it is so important to assume very little going into a project. And when assumptions are made, they are clearly stated to all parties. This way, a customer or adjuster has the opportunity to correct those assumptions so things like insurance coverage, approvals, negotiation, timeliness of payment, and other common issues don’t wind up being unpleasant surprises at the end of the job.

Proof the Documentation so it’s not a Burden.

Project documentation can be one of the most tedious aspects of this business. We are all taught the clichéd saying, “If it’s not documented, it never happened.” As a result, this element of project management becomes an increasingly burdensome time suck for most contractors. Fortunately, we live in an era where advances in technology are lending some assistance in the form of 3D imaging, video capture, and voice-to-text dictation.  With so many options for really good documentation, it’s hard to imagine this is even an issue. But it is, and it’s a big one.

The issue, however, is not with the quantity. It’s with the quality. Now we’re not talking about photo resolution or composition. We’re talking about providing the RIGHT documentation necessary for adjusters to do their job. Remember, it’s the insured’s contractual obligation to present their claim to the carrier. This is made clear in the terms of the policy. If restorers are going to provide this service to their customers, they need to understand what the RIGHT documentation is and looks like.

If we come back to my wife’s auto claim to articulate this point, some would say that the adjuster should have taken the time to call the convenience store and request the security video. Unfortunately, this wasn’t in his realm of responsibility, per se. But, when presented with this documentation, he was able to make the correct determination of liability without objection. 

The same can be said for property damage claims. Sometimes the documentation needs to be fed to adjusters in a manner that leaves little to no doubt about what the correct course of action should be. Don’t confuse objection with disagreement. Most adjusters don’t know enough about restoration or repair procedures to disagree. Instead, they offer objections because they don’t have the RIGHT documentation to approve estimates or to justify checks they are empowered to write. Give them what they need, not necessarily what you think they might want.

Smoke and Mirrors

Staying at a Holiday Inn Express does not qualify a PCP (or anyone else, for that matter) to perform heart surgery. Neither does being a restoration estimator or project manager qualify someone to settle insurance claims. Putting individuals in these roles and expecting them to negotiate with only partial training and experience is futile. 

If you ask the most reputable contractors who they enjoy negotiating with, I expect their responses to be those who possess adequate knowledge of the topics so they can have informative and professional exchanges. This includes insurance adjusters who have some degree of experience in restoration and construction, allowing for a respectful debate about both scope and price. My advice to contractors in this regard is simple: educate yourself and your staff in matters of insurance claims and settlement practices. Read, attend seminars and classes, and interview adjusters and claims managers. You’ll be surprised by what you learn.

Aside from education and awareness, if restorers want to bring real value to the claims settlement process, they need to dedicate resources to it. Just as car dealers and real estate agents bring finance and settlement resources respectively, restorers need to do the same. Think of this as Claims Settlement As a Service (CSAAS). I know the mere suggestion of this will raise the brows of my legal counterparts, so let me explain this in more detail.

Claims adjusting is regulated from state to state. Being a licensed insurance adjuster and a restoration contractor is a conflict of interest because bias exists to make a profit. I am not suggesting that restorers become licensed adjusters. What I am suggesting is that restorers dedicate experienced, educated, and trained personnel to prepare, present, and negotiate estimates with their counterparts on the carrier side of the table. By specializing this function, it relieves the burden on project managers and allows them to focus their efforts on getting the insured put back toget her again and made whole. The result is a win-win-win for all parties (customer, carrier, and contractor).

The Fairest in the Land

None of us possess a magic mirror that will proclaim the current state of affairs in the restoration industry. Nor do we have a way of predicting what the future holds for property insurance claims. However, research and observation show that it will continue to evolve, and contractors must evolve with it. Understanding the critical role contractors play in the claims settlement process, it’s imperative that self-improvement be the best first step. For most, reputation is the greatest referral source for business growth. This can be whatever you want it to be; biggest, best, fastest, or most reliable. Remember, “Life is 10% what happens to you and 90% how you react to it.” Putting our best foot forward, it’s hard to argue with someone who is the “fairest” in the land.

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Timothy E. Hull, CR

Tim is a leading expert on operations and organizational development in the restoration and cleaning industries, having served as a general manager and a national disaster response manager for two well-respected, high performing restoration companies. As director of operations and a business development advisor for Violand Management, Tim works one-on-one with owners, managers, and key employees of restoration companies throughout North America. To reach him, visit Violand. com or call 800-360-3513.

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