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We are a small fire and restoration contractor in the inland Empire. Our core business has been as a sub for several of the major restoration contractors who sub out all their work and do no work themselves. Over the last several years our profitability has continued to erode as we have been asked to absorb more and more of the concessions they have made with the insurance companies to maintain their preferred contractor status.

We are now at a point we are having to establish ourselves directly with either the insured or try and establish some relationship with an insurance company. This is something we have never had to do and would appreciate any advise we can get.
 

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We are a small fire and restoration contractor in the inland Empire. Our core business has been as a sub for several of the major restoration contractors who sub out all their work and do no work themselves. Over the last several years our profitability has continued to erode as we have been asked to absorb more and more of the concessions they have made with the insurance companies to maintain their preferred contractor status.

We are now at a point we are having to establish ourselves directly with either the insured or try and establish some relationship with an insurance company. This is something we have never had to do and would appreciate any advise we can get.
If you want to be in business for yourself then don't give concessions to insurance company's , button line is they will be you down to nothing until you're a minimum wage worker for them.

Welcome to the forum.:thumbsup:

You might want to start this thread in the general discussion section so you get some reply's or even have a moderator move it for you.
 

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Discussion Starter · #3 ·
HARRY304E said:
If you want to be in business for yourself then don't give concessions to insurance company's , button line is they will be you down to nothing until you're a minimum wage worker for them. Welcome to the forum.:thumbsup: You might want to start this thread in the general discussion section so you get some reply's or even have a moderator move it for you.
Thank you.
 

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Have Trowel, Do travel
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try and establish some relationship with an insurance company. This is something we have never had to do and would appreciate any advise we can get.
buy a lot of ky jelly.
having a relationship with them is gonna burn
 

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I'm pretty sure that Bruno is dead correct.

I do not have any experience contracting with an insurance company (thankfully).

However, I have half a dozen experiences overseeing/inspecting the work of insurence company's "preferred/referred providers".

In every instance but one, their work has been ranging from sub-standard to ridiculous hack initially. In those instances, we have subsequently prevailed in obtaining corrected work, but after alot of fighting, letter writting, picture taking.

This tells me that they are promoting/referring the dirt cheapest providers, and squeezing them so hard, they grossly try to cut corners on novice labor and the uninformed HO.

(Although I do not actually know/prove that it is the insurence company at cause, and just not bad providers.. but considering it seems to be prevalent with insurance company providers, it makes me think it's the insurance company soliciting the cheapest providers.)

When we have demanded appropriate corrections, I would love to know if the provider can rebill the insurance company, or if the provider eats it.?

Maybe an insider can tell us.??????????
 

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Those hacky contractors as just to the bone hacky. When properly done, insurance work will pay accordingly, just gotta know the game there is no reason to work that way.

If I was the OP I'd recommend a Xactimate Subscription if you not already have one. Nothing speaks the language of Insurance Claims with Adjusters like it.

Previously I was interested in becoming a "Preferred Contractor" but there goes your ability to get paid right.

Want to meet Adjusters for fire restoration get a scanner and go to fires, join your local volunteer fire department. With this I'd be very careful fires are tragic, people are devastated and instantly homeless. Get their family a room or rooms in a local hotel- not a dive- if you get the project great, if you don't you've reached out and helped someone truly in need and it will feel good in a bad situation.
 

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I'm pretty sure that Bruno is dead correct.

I do not have any experience contracting with an insurance company (thankfully).

However, I have half a dozen experiences overseeing/inspecting the work of insurence company's "preferred/referred providers".

In every instance but one, their work has been ranging from sub-standard to ridiculous hack initially. In those instances, we have subsequently prevailed in obtaining corrected work, but after alot of fighting, letter writting, picture taking.

This tells me that they are promoting/referring the dirt cheapest providers, and squeezing them so hard, they grossly try to cut corners on novice labor and the uninformed HO.



(Although I do not actually know/prove that it is the insurence company at cause, and just not bad providers.. but considering it seems to be prevalent with insurance company providers, it makes me think it's the insurance company soliciting the cheapest providers.)

When we have demanded appropriate corrections, I would love to know if the provider can rebill the insurance company, or if the provider eats it.?

Maybe an insider can tell us.??????????
It is not the funnest job in this industry could be a reason. The smell of mold and fire are not easily forgotten.
 

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Have Trowel, Do travel
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I will expand.
my big brother does insurance work(masonry) and i tagged along once.
he got in with them a few yrs ago for obvious reasons and wants to drop it, but for obvious reasons its to early still.
gets called in at any moment and has to be anywhere they call within a 200mile region.
they want swift and mostly has only apict. to price.
one thing that stuck out he told me is that they will hammer you into the ground price wise.
they wanna see everything, detailed invoice, and will question every markup.
i also don't think they are all like that, but what do i know
 

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Residential fire is the tightest business on the planet....

Edit: ... as far as I can tell. I've done some other insurance work, but never won a residential fire project. I've tried a few, but have been off by as much as 5X, and that was after estimating carefully. I've followed up on a couple of them afterward. As far as I can tell, there's no standard for quality. Not a low standard, but no standard at all. Quote only the work in the report - nothing else, even if it's obvious and needs to be done. I can't do it.

The company that beat me on the 5X job had a great reputation as a fire and restoration contractor. Tons of work, preferred contractor for one of the big insurers. They went out of business right after finishing the 5X job.
 

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Interesting......

And I'm sure Bob that you are not a preferred/referred "captive" contractor.

There appears to be a difference here to me.

The preferred/referred contractor seems to almost have to take the job at a squeezed price/squeezed quality.

However, the insurance claimant does not have to use the preferred/referred contractor. When I've overseen / consulted for work done by a non-preferred contractor, I've not seen these quality problems... and in talking with those contractors.... I've not seen/heard of any price/quality squeezing by the insurance company.

So it seems to me, that insurance work can be fine/legit if you have the job as a third party... but for the insurance companys preferred/referred status, you may pay dearly.

Just my experience with no inside knowledge and limited exposure.


EDIT: In principle, it's much like corporate relocation company referrals to RE agents.

For their referral (agent obtaining a buyer or seller), the relocation companys demand 35% of the commision. ... Well, what do you expect you get if your referred agent is working for 65% of their normal market revenue/income.... DUH
 

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Discussion Starter · #11 ·
I'm pretty sure that Bruno is dead correct.

I do not have any experience contracting with an insurance company (thankfully).

However, I have half a dozen experiences overseeing/inspecting the work of insurence company's "preferred/referred providers".

In every instance but one, their work has been ranging from sub-standard to ridiculous hack initially. In those instances, we have subsequently prevailed in obtaining corrected work, but after alot of fighting, letter writting, picture taking.

This tells me that they are promoting/referring the dirt cheapest providers, and squeezing them so hard, they grossly try to cut corners on novice labor and the uninformed HO.

(Although I do not actually know/prove that it is the insurence company at cause, and just not bad providers.. but considering it seems to be prevalent with insurance company providers, it makes me think it's the insurance company soliciting the cheapest providers.)

When we have demanded appropriate corrections, I would love to know if the provider can rebill the insurance company, or if the provider eats it.?

Maybe an insider can tell us.??????????
Thank you for your insight.
 
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