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Anyone now how Loss Adjusters work?

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Anyone now how Loss Adjusters work?

edited 16 March 2011 at 10:06PM in Insurance & Life Assurance
17 replies 16.7K views
HappychappyHappychappy Forumite
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edited 16 March 2011 at 10:06PM in Insurance & Life Assurance
Embarrasing not to check the title, I meant Know how

Hi

I am coming to the end of a very long claim process where I have answered question after question from the Insurance underwriters and the loss adjuster sent on behalf of the Insurance company.

The loss adjuster when she called out mentioned they had a building firm where they had the work done, I want to employ my own builders, plasterers, decorators and can do some of the work my self to a decent standard.

My question is, say the claim is for £20k which is the figure quoted by the Insurance company as their value of the claim, I can get the work done for around £15k and would far prefer to use tradesmen I know and who are local, therefore will the Insurance company or will it be the Loss adjusters who inform me if the claim has finally been approved and do I have to use their building firm? who do I attempt to negotiate with.

Also would the Insurance company or the Loss adjuster make a cash offer allowing me to get the work done and sign off the claim as finished and my responsibility, without having to continually produce invoices for everything.

This would allow me to spend three or four weeks doing a lot of the repairs such as the decoration etc myself, but I would have no invoices to show the expenditure, however, in doing some of this work myself I can spend more on the property and bring it up to a higher spec, therefore can I insist on a cash payment and should I expect them to reduce the payout by a certain percentage, and if so what is reasonable ? I have never had an insurance claim before.

Thanks
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Replies

  • theJudgetheJudge Forumite
    58 posts
    My question is, say the claim is for £20k which is the figure quoted by the Insurance company as their value of the claim, I can get the work done for around £15k and would far prefer to use tradesmen I know and who are local, therefore will the Insurance company or will it be the Loss adjusters who inform me if the claim has finally been approved
    The insurer will make the decision but it will be the claims management company, if outsourced, who'll inform you.
    and do I have to use their building firm? who do I attempt to negotiate with.
    No.

    Also would the Insurance company or the Loss adjuster make a cash offer allowing me to get the work done and sign off the claim as finished and my responsibility, without having to continually produce invoices for everything.
    You'll need to get quotes. I'd advise 3. The insurance company will pay out the lowest of the 3 quotes. Make sure that you ask for everything needed for your restoration before going for the quotes. Also ask that the claims management company/loss adjuster provide you with the spec of works that they have to have prepared after your site visit.

    This would allow me to spend three or four weeks doing a lot of the repairs such as the decoration etc myself, but I would have no invoices to show the expenditure, however, in doing some of this work myself I can spend more on the property and bring it up to a higher spec, therefore can I insist on a cash payment and should I expect them to reduce the payout by a certain percentage, and if so what is reasonable ? I have never had an insurance claim before.
    Once you've got the cash, you could do the work yourself as the insurers won't be warrantied for the work. However, the law requires that you mitigate i.e. reduce to the minimum your losses, so if you can reduce the costs in this way then you should bear this in mind when asking for the cash settlement. The insurers will helpfully oblige you in keeping your losses to a minimum :) As above my advice would be to get 3 quotes to cover all of the work knowing that it'll be the lowest of the 3 that they'll pay out on. If the insurance company is paying why not get a professional to do the work. DIY will inevitably lower the value of your house. The insurers will probably try to hammer you down on even the lowest quote but so long as your quote covers work that is necessary to restore your property, any attempt by your insurer to reduce this amount is unlawful.
  • Technically speaking the amount you are suppose to be getting is the amount to repair the house not to make a little extra for youself.

    You are welcome to do the work yourself but insurance dont like it for some reason, but if you do it yourself it is best to get a building examiner, the builder will know what Im talking about. This report will prove the work was done to a competant level.
    My roof was redone a few times after completion, until it was acceptable, and I didnt have to pay for the extra tear down and redo.
  • HappychappyHappychappy Forumite
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    Technically speaking the amount you are suppose to be getting is the amount to repair the house not to make a little extra for youself.

    You are welcome to do the work yourself but insurance dont like it for some reason, but if you do it yourself it is best to get a building examiner, the builder will know what Im talking about. This report will prove the work was done to a competant level.
    My roof was redone a few times after completion, until it was acceptable, and I didnt have to pay for the extra tear down and redo.

    There is no intention of making a little extra, the point is, I want control over the repairs, and dictate who does the repairs and to what standard, rather than use one firm I would have a separate kitchen fitter, plasterer, plumber, electrician, etc, etc but this involves getting in a variety of tradesmen before the work is ready.

    I would rather get the first part organised and finished, and then when I am sure of exactly what is needed, find someone for the second part etc, etc, obviously some trades have to work together such as the electrical fittings and plumbing and yes it will take longer but the finish in my opinion would be better, and by being paid a cash amount, I could get a far better deal, than an insurance builder could provide, the problem being as soon as you mention it will be paid by insurance, a 0 or two is added to the bill.

    Thats why I was interested in whether the insurance company or loss adjuster would make a cash offer with no strings attached and no further liability or warranty, yes it would be discounted, but by how much and is this ever done?
  • edited 17 March 2011 at 6:07PM
    bingbong1978bingbong1978 Forumite
    99 posts
    edited 17 March 2011 at 6:07PM
    There is no intention of making a little extra, the point is, I want control over the repairs, and dictate who does the repairs and to what standard, rather than use one firm I would have a separate kitchen fitter, plasterer, plumber, electrician, etc, etc but this involves getting in a variety of tradesmen before the work is ready.

    I would rather get the first part organised and finished, and then when I am sure of exactly what is needed, find someone for the second part etc, etc, obviously some trades have to work together such as the electrical fittings and plumbing and yes it will take longer but the finish in my opinion would be better, and by being paid a cash amount, I could get a far better deal, than an insurance builder could provide, the problem being as soon as you mention it will be paid by insurance, a 0 or two is added to the bill.

    Thats why I was interested in whether the insurance company or loss adjuster would make a cash offer with no strings attached and no further liability or warranty, yes it would be discounted, but by how much and is this ever done?

    I am a Loss Adjuster and i am usually quite happy to make a cash settlement offer for repairs providing i can demonstrate to an insurer a saving by doing so. You should be aware though, a cash settlement is based on you doing the repairs yourself therefore, the offer will be substantially less than what a builder would charge. If you intend to use builders for part of the work and want paid the full builders rates then, you will need to accept that you will have to prove the work was undertaken by that particular company. I would not expect to see every purchase made by your builder in terms of materials, normally an invoice on headed paper from the builders is sufficient.
  • theJudgetheJudge Forumite
    58 posts
    Having just received a cash settlement myself, the process was described as in my more comprehensive response above. i.e. you get 3 quotes, the insurer tries to hammer you down on the lowest and then you receive the cash settlement. After that it's impossible for the insurer to insist that you use the builder that the cash settlement was based on as you won't have signed a contract with the builder at the point that you've agreed the cash settlement with the insurer. For a variety of reasons the original builder may not wish to proceed, the insurer dragging out the settlement process for weeks and the builder getting fed up waiting for work which he's got no guarantee of getting being one of many reasons why your suggestion wouldn't work in practise.

    Of course, insurers/loss adjusters could simply agree the lowest builder's quote and insist that they pay the builder directly which would avoid that scenario but that didn't happen in my experience. My guess is they didn't pursue this seemingly more efficient method because their usual practise is to offer less than the lowest quote.
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  • edited 17 March 2011 at 6:45PM
    bingbong1978bingbong1978 Forumite
    99 posts
    edited 17 March 2011 at 6:45PM
    theJudge wrote: »
    Having just received a cash settlement myself, the process was described as in my more comprehensive response above. i.e. you get 3 quotes, the insurer tries to hammer you down on the lowest and then you receive the cash settlement. After that it's impossible for the insurer to insist that you use the builder that the cash settlement was based on as you won't have signed a contract with the builder at the point that you've agreed the cash settlement with the insurer. For a variety of reasons the original builder may not wish to proceed, the insurer dragging out the settlement process for weeks and the builder getting fed up waiting for work which he's got no guarantee of getting being one of many reasons why your suggestion wouldn't work in practise.

    Of course, insurers/loss adjusters could simply agree the lowest builder's quote and insist that they pay the builder directly which would avoid that scenario but that didn't happen in my experience. My guess is they didn't pursue this seemingly more efficient method because their usual practise is to offer less than the lowest quote.


    That's maybe your one off experience but i do it for a living and and its not how i do business!!

    You seem to be tarnishing every insurer/la with the same brush because of your bad experience.

    Many insurers i work with will not permit settling a non approved contractors account because it legally implicates them with the repairs so if anything goes wrong they are obliged to pay to fix the problems such as poor workmanship.
  • theJudgetheJudge Forumite
    58 posts
    That's maybe your one off experience but i do it for a living and and its not how i do business!!

    You seem to be tarnishing every insurer/la with the same brush because of your bad experience.

    Many insurers i work with will not permit settling a non approved contractors account because it legally implicates them with the repairs so if anything goes wrong they are obliged to pay to fix the problems such as poor workmanship.

    I remember now, you're right that's why they don't like to pay the builder directly as the warranty will remain with them. I'm not sure how the insurer can force you to use the lowest quoted builder if they pay you direct, however.

    I may be tarnishing every insurer with the same brush but the insurance industry only have themselves to blame. Under the current system, there is no protection in law for consumers, the insurance industry could lobby to have this changed which would significantly improve the trust element.

    What the brokers say about insurers is revealed here:- http://www.insuranceage.co.uk/insurance-age/opinion/1563999/the-bad-average
    There aren't many good insurers but I'll apologise for tarnishing Hiscox, Chubb, Evergreen and Ansvar who are identified as good insurers.
  • From my own personal experience the reason claims sometimes take longer to deal with is due to the weather.

    There is now more episodes of severe weather than there was say 10-15 years ago.

    LA's are staffed to handle normal workloads however when a bad weather event comes along and we are given 500-600% more work than normal, it is not possible to maintain the same service level.

    Customers don't realise that burst pipe claims can be ongoing for months and months which mean that during this time, LA's & Insurers will be busier than normal. I wish I had the answer to get round this but i don't.
  • theJudgetheJudge Forumite
    58 posts
    From my own personal experience the reason claims sometimes take longer to deal with is due to the weather.

    There is now more episodes of severe weather than there was say 10-15 years ago.

    LA's are staffed to handle normal workloads however when a bad weather event comes along and we are given 500-600% more work than normal, it is not possible to maintain the same service level.

    Customers don't realise that burst pipe claims can be ongoing for months and months which mean that during this time, LA's & Insurers will be busier than normal. I wish I had the answer to get round this but i don't.

    The brief 2 week cold snap that we had in the middle part of December was the worst weather since 1978, hardly a black swan event. The purpose of insurance is to indemnify a policyholder for unexpected events.

    In my particular case, the cowboy builder that I was eventually offered was based 1.5 hours commute from me and when I turned him down I was told that he was the only builder that covered my postcode (and presumably plenty of other postcodes between me and him). The LA also upgraded the cowboy builder to limited company status even though he didn't claim that himself, presumably to try and make him look more reputable. I live in SW London. If what the LA told me is true they wouldn't be able to cope if 2 householders in the whole of South London had burst pipes silmultaneously.

    At the end of the day, if the LA had told me that I shouldn't expect a builder until the end of January, I wouldn't have been that bothered. The fact that they told me that my claim would be investigated and a drying company appointed within 1 week and then proceeded to ignore my emails and phone calls for 5 weeks is what caused a rapid deterioation in trust that I had in them. This was then compounded by the cowboy builder incident and the insurer's reputation crushed when they still tried to hammer me down on my claim and strong-arm me in to a settlement by sending a cheque for less than the lowest quote and then telling me that another cheque would be delayed for an indeterminate amount of time due to my sending back the unsolicited cheque.

    The delays on their own could be passed over as unfortunate due to the unexpected weather, the cowboy builder could be deemed as the LA being stretched lowering their usual high standards, the strong arming tactics to try to get me to accept an unlawful cash settlement was handled by the insurer directly as I'd rejected the LA by that stage. The 3 together points to an industry which really seems to care nothing for the reputational damage that treating their policyholders like this will inevitably incur.
  • Did a main contractor sub contract??

    Who was the builder?
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