Propaganda

It’s no mystery…

Big businesses lobby in this country, and the insurance industry is one of the biggest. Insurance companies routinely spend more than $130 million annually to lobby, and more than $70 million annually in campaign contributions to influence politics, politicians, and legislation in their favor, and that’s just what we know about.

Before you ever make a claim, the deck is being stacked against you and it’s been stacked against you, for years.

As part of that strategy, insurance companies also rely on news articles and favorable reporting on issues that are often misrepresented to the public.

Let’s look at an example in the Miami Herald, before hurricane Irma.

South Florida’s leaky pipe problem poses risk to homeowners insurance

A brief introduction referencing the decade without a hurricane, followed by the presentation of a new boogey man. LEAKY PIPES! YOUR PREMIUMS ARE GOING TO SKYROCKET! CONTRACTORS ARE CHARGING TOO MUCH!

Don’t get me wrong, YOU should always remain in charge of your claim, and the contractor issue does need to be dealt with, BUT the main point of this article is that as homes age (or construction booms for new homes results in subpar workmanship), there are a LOT of pipes leaking.

Prior to Irma, plumbing claims were easily more than 50% of claims.

This is a job for underwriting though. If this were actually the problem, a better investment in underwriting and actuaries would solve this problem. But instead, for years, insurance companies in Florida have been fighting plumbing claims head on attempting to continually increase record profits. In addition to that, behind the scenes, they’ve been slipping in policy changes that work against you, before you even have a claim.

Plumbing leaks completely excluded from coverage? We’ve seen it.

$10,000 cap on plumbing claims? We’ve seen it.

$3,000 cap on emergency repairs to protect the property? We’ve seen it.

Complete exclusion on emergency repairs? We’ve seen that too.

The kicker is that these policies are often being sold with a negligible premium discount. For example, on one of our own homes, we got a quote from an insurance agent for a policy that completely excluded plumbing claims, and it only resulted in a $40 premium discount FOR THE YEAR! That’s a difference of $3.33 a month, for the most common type of insurance claim.

If plumbing problems were truly that much of a burden, would the premium difference really be $3.33 a month?

I don’t think so. That smells of a trick to trap the people just looking for insurance at the lowest price.

The lesson here?

Stay vigilant, educate yourself, and seek representation.

To help with that education, we’re working on compiling a bunch of information, both to let you know about our services, and to give you insight into what you’re up against. Feel free to check out our pages on:

What to expect if your home has suffered a break in; or

What to expect if your home has been flooded

Why you should hire a public adjuster

We've been meaning to start our blog for some time, sharing our thoughts on a variety of topics and some of our experiences, but got a little distracted after hurricane Irma.

It's probably cliche, but it's necessary. We want to tackle the question: Why should you hire a public adjuster?

This isn't an all inclusive answer. More of a general overview.

As we mentioned in Our Mission, insurance started as coalitions of neighbors who pooled their money for that inevitable time when a whole neighborhood would catch fire (because apparently everything was on fire constantly in the 1700s) but , like everything else has become a behemoth for-profit industry that has (largely) become another way for investors to make money.

In order to sustain that business model, insurance companies have relied on consultants to provide business strategies with regard to claims that are similar to the underwriting process. Claims handling is mostly done large scale, as opposed to on a case by case basis, and as I tell the majority of my clients, involves a psychological component designed to wear a homeowner down so they'll either drop their claim entirely (seriously, there's a major Florida insurer that if you call to check the status of your claim, you will be put on hold and forced to listen to a recorded message that repeatedly talks about going to their website where you'll find a form  that you can complete to withdraw your claim), or just mentally break you over time so you're willing to accept less money. 

If you'd like a good analogy to think about what insurance has become, you can compare the classic sport of basketball, that is subject to a very specific set of rules and guidelines, to the carnival game that purports to be basketball. Sure, insurance is not a game of luck or skill, but if one person is operating under the traditional set of rules, and suddenly find themselves holding an overinflated basketball that has a different weight and diameter, and the rim is 6 inches higher and bent into an oval, then the deck is stacked against you (and if you do win, the prize was made with inferior materials in China for $.05, but we digress). Your shooting percentage from a certain distance may have just dropped from 75% to 10%. And that IS the point. To the insurance company, insurance is a long game of odds with many different variables that are almost exclusively in their control.

This applies more especially in Florida, where not only do we have to compete with standard insurance hazards, as well as increased risk due to shoddy construction, and the risk of being one of many in a high volume claim situation like a hurricane.

Florida's Office of Program Policy Analysis and Government Accountability (OPPAGA), which is the research arm of the state legislature, completed a study of  homeowners making claims with and without a public adjuster following the 2004, 2005 hurricane seasons, which saw significant activity. 

The results of that study found that homeowners making a claim with the assistance of a public adjuster recovered an average of 747% more than homeowners pursuing their claim alone.

Now, that number can be a little bit misleading in a number of ways. First, people love just harping on the number itself, with no context. 747% is not a guarantee that you will get that much more on your claim. Further, claims at or around the deductible can skew the figure. The actual figures from the study are that the average claim of a homeowner alone received $2,029, and the average claim with a public adjuster received $17,187.

The point of the study isn't so much the number itself, but the fact that homeowners that choose to retain a public adjuster received significantly more for their claim, more than justifying the fees a public adjuster would charge.

If you have suffered damage to your home or business and want to discuss your situation, contact us through our web form, or give us a call at 772-600-4663, today.

You might also be interested in:

Our most frequently asked questions

What to expect if your insurance company won’t play ball (a lawsuit)