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Insurance Adjusters

 
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Old 01-05-2010, 09:21 PM   #1
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Insurance Adjusters


So, I am new to the forum and I hope restoration companies are not looked down upon. I just read a reply that seemed to appear that we might not be welcome. Anyway, I want to get some feedback from anyone who deals with restoration work, Xactimate and Adjusters. I have one right now that is just not budging. I don't mind getting the HO involved, but I really want to better myself and my negotiating skills with these guys. My main problem is I used to strictly do renovation work and I know what things cost. It seems that adjusters or some of them are using Xactimate as the bible and not just a tool, which is all it is. How do I get them to cough up more money per unit cost when they just flat out say no. I have a hard time for example trying to get someone to paint for .58 /sf. I am in Atlanta by the way. Any advise would be great.
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Old 01-06-2010, 09:37 AM   #2
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Re: Insurance Adjusters


It's not my line of work but you could be upfront about it and ask the adjuster to recommend painters at that rate because the ones you got quotes from are higher.

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Old 01-06-2010, 12:02 PM   #3
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Re: Insurance Adjusters


AllState or Foremost? Just guessing...

I Posted this on another forum - hopefully this helps on the Xactimate pricing issue (Certified Level 3 on the program if you are wondering - you might also want to research posts made by BuildPinnacle)

Part 3 – What certain Insurance Companies don’t want you to know / common mistakes
1. No Base Service Charges
Most insurance companies do not want to pay what is referred to as the Base Service Charge (BSC). The BSC used to be listed as a minimum charge, but it was changed when they realized that it created some major confusion. The problem with using the term “minimum charge” was that it did not adequately describe what it was really for. (i.e. “The base service charge for the Framing Carpenter is inclusive of one trip charge, mobilization and planning costs.”) A Base Service Charge is supposed to be used along with the regular price listed for the work per the company - period.

2. Not using the minimum charge listed
In some cases, the work to be completed is so small it that it would be nearly impossible to get a legitimate or even an unlicensed contractor to do it for the price listed.

Let’s look at one quick example --- replace 16 SF of drywall (using the description in the first post) would only pay out $26.24. Ouch, not good – but wait let’s add in the Base Service Charge of $201.64 which equates to “The base service charge for the Drywall Installer/Finisher is inclusive of three trip charges, mobilization and planning costs.” So now we are up to $227.88 – can you honestly find someone reputable to do that repair for that price? I know around here most people wouldn't touch a job like that for less than $500. Ah here we go – Minimum Charge $325 “Includes: One 4'x 8' sheet of gypsum board, 10lbs of joint compound, 50' of perfotape, and 6 hours labor. Note: Minimum charge for drywall repair. 6 hour labor cost is based on a 3 hour initial trip, and two 1.5 hour return trips.” Now we are sitting at $526.64, which is truthfully more like it

Quick note – please notice how the BSC & Minimum Charge tie in together, the BSC takes care of the tech driving there, while the Minimum Charge deals with the actual labor when they are on site.

3. Carpet, Vinyl & Roofing
Every pricing line item in the program accounts for waste with the exception of carpeting, vinyl & roofing. Why don’t those three? It is actually quite simple – there is no simple formula that applies. But wait, roofing is easy – it is 15% right? As any roofer can easily point out – it depends on how cut up a roof is. The amount of waste (i.e. starter strips, ridge shingles, weaving in a valley) will vary dramatically between a ranch house and a Victorian

Carpet comes in 12’, 13’6 & 15’ wide widths and in some cases, you might need a 5% waste factor while at other times it could easily be around the 35% mark. They do include an automatic layout tool but it is not the greatest when it comes down to where seams should be located & is only setup for 12’ wide rolls.

Vinyl comes in a 12’ wide roll generally and in a small bath the waste factor can easily be over a 100%

4. Not selecting all applicable items
Seeing I am still looking at the drywall line item, let’s look at it a little closer. I don’t see anything listed for high ceilings or walls, bull nose, resilient channel, masking area’s off or even painting it. While doing an estimate up, you should click on the Related link – it will pull up items related to that item – including

5. Homeowner vs. Contractor pricing
Yep, they actually have pricing for Home Owners that want to do the work themselves. Needless to say the HO’s rate is less than the Contractor’s rate that includes the associated Labor Burdens associated with them (SS, Medicare, UI, etc…). Using the drywall listed above again, for a contractor, they are paid $1.44 a SF, while a Home Owner would only receive 0.73 a SF.

6. Not reviewing the Summary Report, or changing prices elsewhere
Here comes a few catches, this is the only place you should change a material price or the tax will not apply to it properly. Next is you will occasionally catch things like .08 gallons of stain or paint, or my favorite one that I laughed at - 1.34 sanding belts. Unfortunately, you cannot change how much of an item you are going to use, but if you know that, you are going to buy a quart of stain & leave the remainder with the customer – here is the place to change the total dollar value for that item. If you are buying a vanity that runs $400, but only $250 is allocated, same deal you can change it here.

Misc. Items:
· You can easily add in custom furniture or built ins by adding in a Misc. Item which allows you to collect the proper tax and your overhead
· For those insurance companies that will not, whatsoever allow BSC’s – you can easily select the “Factor Into Unit Pricing” & it is now added in and doesn’t show up as separate line charge
· If an insurance company says the BSC have been factored in – ask them to print out the Rough Draft where it will show up
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Old 01-06-2010, 03:18 PM   #4
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Re: Insurance Adjusters


Quote:
Originally Posted by SLSTech View Post
AllState or Foremost? Just guessing...

I Posted this on another forum - hopefully this helps on the Xactimate pricing issue (Certified Level 3 on the program if you are wondering - you might also want to research posts made by BuildPinnacle)

Part 3 – What certain Insurance Companies don’t want you to know / common mistakes
1. No Base Service Charges
Most insurance companies do not want to pay what is referred to as the Base Service Charge (BSC). The BSC used to be listed as a minimum charge, but it was changed when they realized that it created some major confusion. The problem with using the term “minimum charge” was that it did not adequately describe what it was really for. (i.e. “The base service charge for the Framing Carpenter is inclusive of one trip charge, mobilization and planning costs.”) A Base Service Charge is supposed to be used along with the regular price listed for the work per the company - period.

2. Not using the minimum charge listed
In some cases, the work to be completed is so small it that it would be nearly impossible to get a legitimate or even an unlicensed contractor to do it for the price listed.

Let’s look at one quick example --- replace 16 SF of drywall (using the description in the first post) would only pay out $26.24. Ouch, not good – but wait let’s add in the Base Service Charge of $201.64 which equates to “The base service charge for the Drywall Installer/Finisher is inclusive of three trip charges, mobilization and planning costs.” So now we are up to $227.88 – can you honestly find someone reputable to do that repair for that price? I know around here most people wouldn't touch a job like that for less than $500. Ah here we go – Minimum Charge $325 “Includes: One 4'x 8' sheet of gypsum board, 10lbs of joint compound, 50' of perfotape, and 6 hours labor. Note: Minimum charge for drywall repair. 6 hour labor cost is based on a 3 hour initial trip, and two 1.5 hour return trips.” Now we are sitting at $526.64, which is truthfully more like it

Quick note – please notice how the BSC & Minimum Charge tie in together, the BSC takes care of the tech driving there, while the Minimum Charge deals with the actual labor when they are on site.

3. Carpet, Vinyl & Roofing
Every pricing line item in the program accounts for waste with the exception of carpeting, vinyl & roofing. Why don’t those three? It is actually quite simple – there is no simple formula that applies. But wait, roofing is easy – it is 15% right? As any roofer can easily point out – it depends on how cut up a roof is. The amount of waste (i.e. starter strips, ridge shingles, weaving in a valley) will vary dramatically between a ranch house and a Victorian

Carpet comes in 12’, 13’6 & 15’ wide widths and in some cases, you might need a 5% waste factor while at other times it could easily be around the 35% mark. They do include an automatic layout tool but it is not the greatest when it comes down to where seams should be located & is only setup for 12’ wide rolls.

Vinyl comes in a 12’ wide roll generally and in a small bath the waste factor can easily be over a 100%

4. Not selecting all applicable items
Seeing I am still looking at the drywall line item, let’s look at it a little closer. I don’t see anything listed for high ceilings or walls, bull nose, resilient channel, masking area’s off or even painting it. While doing an estimate up, you should click on the Related link – it will pull up items related to that item – including

5. Homeowner vs. Contractor pricing
Yep, they actually have pricing for Home Owners that want to do the work themselves. Needless to say the HO’s rate is less than the Contractor’s rate that includes the associated Labor Burdens associated with them (SS, Medicare, UI, etc…). Using the drywall listed above again, for a contractor, they are paid $1.44 a SF, while a Home Owner would only receive 0.73 a SF.

6. Not reviewing the Summary Report, or changing prices elsewhere
Here comes a few catches, this is the only place you should change a material price or the tax will not apply to it properly. Next is you will occasionally catch things like .08 gallons of stain or paint, or my favorite one that I laughed at - 1.34 sanding belts. Unfortunately, you cannot change how much of an item you are going to use, but if you know that, you are going to buy a quart of stain & leave the remainder with the customer – here is the place to change the total dollar value for that item. If you are buying a vanity that runs $400, but only $250 is allocated, same deal you can change it here.

Misc. Items:
· You can easily add in custom furniture or built ins by adding in a Misc. Item which allows you to collect the proper tax and your overhead
· For those insurance companies that will not, whatsoever allow BSC’s – you can easily select the “Factor Into Unit Pricing” & it is now added in and doesn’t show up as separate line charge
· If an insurance company says the BSC have been factored in – ask them to print out the Rough Draft where it will show up
Very educational post for this contractor. Thank you.
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Old 01-06-2010, 04:06 PM   #5
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Re: Insurance Adjusters


I have had the privilege of working with this same type of adjuster. I don't do much restoration work (unless I am the sub) so I have little need for Xactimate or any other similar software.

My answer to the adjuster is simply why does Allstate, State Farm, etc need you then? Any monkey can type numbers in software.

Said in a different way than SLS, but I would tell the adjuster to bring in 10 guys from his own company and he would get 10 different estimates, and if he brought in 10 different contractors he would get 10 different estimates, all using the same software.

The adjusters job is right in his title, he "adjusts" things, otherwise he would be called a "set-in-stoneer" and that just does not flow off the tongue at all.

Also, if you tell an adjuster how great his is at his job and that he is working you over on the job, most fall for it like a drunk fat chick who is about to get nailed by the dude telling her how pretty she is.
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Old 01-06-2010, 04:40 PM   #6
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Re: Insurance Adjusters


I used to do insurance work for one general contractor. I understood that the adjusters get paid a bonus of sorts to keep the numbers as low as possible, the lower the bigger the bonus.
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Old 01-06-2010, 06:10 PM   #7
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Re: Insurance Adjusters


Quote:
Originally Posted by Arstivers View Post
So, I am new to the forum and I hope restoration companies are not looked down upon. I just read a reply that seemed to appear that we might not be welcome. Anyway, I want to get some feedback from anyone who deals with restoration work, Xactimate and Adjusters. I have one right now that is just not budging. I don't mind getting the HO involved, but I really want to better myself and my negotiating skills with these guys. My main problem is I used to strictly do renovation work and I know what things cost. It seems that adjusters or some of them are using Xactimate as the bible and not just a tool, which is all it is. How do I get them to cough up more money per unit cost when they just flat out say no. I have a hard time for example trying to get someone to paint for .58 /sf. I am in Atlanta by the way. Any advise would be great.
You shouldn't have to argue with the adjuster, because once you do, you are acting as an adjuster.

In Florida we can't negotiate pricing with insurance companies as contractors on behalf of our clients unless we are licensed adjuster's and then since you are acting as a public adjuster, you wouldn't be able to do the work.

Give the client your bid and do the work, let the client deal with the adjuster.
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Old 01-06-2010, 07:44 PM   #8
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Re: Insurance Adjusters


Quote:
Originally Posted by bwalley View Post

Give the client your bid and do the work, let the client deal with the adjuster.
Most of ours was bid to the adjuster not the client.
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Old 01-06-2010, 07:57 PM   #9
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Re: Insurance Adjusters


If the customer signs a contract for a fair market value contract for the agreed upon scope of work needing remediation work, then the insurance company is obligated to reimburse their contracted customer for the proceeds paid out, minus their deductible.

Now, get the home owner to have enough back-bone to pursue it in that manner and you both win, although the adjuster will claim that they can not or will not pay the amound contracted, they must.

Very informative response up above also, by the way and I thank you for the time and effort put into that.

Ed
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Old 01-06-2010, 10:21 PM   #10
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Re: Insurance Adjusters


I'm working a bid for a fire job, I asked the home owners if the Insurance adjuster had given them his job quote, they said they haven't gotten one. I have put a bid together for them and now they have changed the job scope. so here I am rewriting this for the third time. But I have a price of .53 cent a sqft for painting another .23 cent for primer, that's .76 cents sqft. plus another 9%. I have no problem with that the thing is you have all the woodwork is priced out linear feet. plus the square foot prices, but with insurance companies they want trades to work for pennys. years ago you could make some good money, with the hits they have taken since 9/11 the insurance companies have tighted the purse strings, but if you do the math it can work out for you.
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Old 01-06-2010, 10:36 PM   #11
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Re: Insurance Adjusters


I have had years of experience with Xactimate and Adjusters. First thing I can say is get yourself very familiar with Xactimate, there's line items there that people forget about or don't realize they can use. For painting enter in line items like masking light fixtures, floors, trim, remove wall covers, registers,final clean up ect...ect.. Often times it will make up for pricing short commings.

Also use the feature on Xactcentral to upload pricing changes directly to them and they will change the price if its verified. If you don't do this they wont change it. In my experience they are pretty fast about verifying prices and changeing it either immediately or in the next quarter when the new pricelists for your area come out. Do it, it works.

As far as adjusters are concerned they have to justify what they are doing too. Give them concrete evidence on pricing, such as actual materials costs and what not. Make it easy for them to justify suplements or price changes to their bosses. Many of them have no clue about actual construction and follow the price list like a bible unless you make it absolutly clear to them.

Insurance work is different but once you learn the system it can be steady and profitable work.

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