I saw the most beautiful and most tragic sights from the air yesterday. The space shuttle was clearly visible, like a flying yellow fire torch, above the clouds in the bright morning blue sky. As it came through the cloud cover, Endeavor was an inspiring sight.
The path of Tuscaloosa's F5 tornado was also clearly seen from the air and awe inspiring. The magnitude of catastrophic damage viewed from the ground is hard to describe. These photographs may give you some appreciation for the horror beset of those in its path:
Mary Fortson and I accompanied the Windstorm Insurance Network's Executive Director, Michelle Griffin, to Tuscaloosa yesterday. The Windstorm Network gave much needed donations to the Salvation Army and the Red Cross. Both are stationed in temporary quarters because their permanent locations were damaged by the tornados.
At the Red Cross operation headquarters, I was shown a Tuscaloosa County map showing the path and breath of each tornado that ripped through Tuscaloosa. The F5 was more than a mile wide as it left Tuscaloosa headed for Birmingham. Red Cross officials told us they were lucky to have closed their previous Red Cross office shortly before the F5 hit.
Tuscaloosa tornado damage eerily reminds me of the worst damage from Hurricanes Charlie, Ivan, Katrina and Ike. Hurricanes typically give people some opportunity to evacuate. Tornadoes do not. I cannot imagine the terror felt by those who faced the F5.
Tuscaloosa joins the list of blue tarp towns; tarps now cover hundreds of roofs throughout the city to mitigate further damage. They will remain for months until repaired.
The recent tornadoes in Mississippi, Alabama, Georgia and Tennessee caused an unprecedented swath of destruction, and left hundreds of people dead or injured. The tornados completely demolished thousands of homes and damaged thousands of others. In the city of Tuscaloosa alone, there are reports of 200-mph winds which swept homes off their foundations.
Once again, those fortunate enough to not have personally experienced the disaster of the horrendous storms are looking for ways to help. An easy way to do so is through the American Red Cross: The Red Cross is providing relief to people across the hardest-hit states, providing shelter, and relief to survivors. To make a donation to the American Red Cross Disaster Relief, visit its online donation page. You can also call 1-800-RED-CROSS or text "REDCROSS" to 90999 to make a $10 donation.
As an attorney who represents folks whose homes and property are devastated by perils such as these windstorms, when I first learn about these catastrophes, my thoughts quickly and naturally turn to the affected property owners. I hope that their insurance companies will step up and do the right thing for their policyholders who have been paying their insurance premiums, praying they never need to file a claim, but believing that if they should, they will be taken care of by their providers. Sadly, we know that is not always the case.
However, there are some things you can and should do when a disaster strikes your property. I don’t think we can ever remind people enough about some of the essential steps to take for a proper recovery on an insurance claim:
First, call your insurance company to report the claim. Ask where you can send written notice of the claim, and then send notice of the claim in writing, either by mail, fax or email. A simple written description of the incident and the possible damage will suffice. If the insurance company tells you that written notice is not necessary, do it anyway. You’ll also want to be sure to write down your claim number.
If appropriate, ask for an advance. Many insurance companies will routinely make an immediate payment of $1,500.00 to $5,000.00 when the policyholder has had significant property damage. An advance payment can provide you with much-needed emergency cash. Be sure to keep all receipts for which you use this money.
Read your insurance policy. Find out what it covers and what it doesn’t. Don’t read just the declarations page. You have to read the whole thing to find out what is covered under your policy. Mark portions of the policy that you don’t understand, and ask the insurance adjuster to explain them. If you have lost your policy in the storm or simply can’t find it, ask your insurance company to send you a copy.
If your home is inhabitable due to storm damage, ask your insurance company if your policy pays the expenses your family incurs living elsewhere while the home is repaired. Most homeowner policies reimburse the policyholder for reasonable expenses of establishing and maintaining a second household while the insured residence is being repaired. If your home was completely destroyed, it could take six months or more to rebuild it. That is a long time to live with the in-laws! If the policy does pay “additional living expenses,” then you are entitled to reimbursement for the cost of renting a home similar to your own. Your policy may also reimburse you for the cost of other expenses such as hotels, restaurant meals, laundry, and mileage traveling to and from your temporary home. Once again, be sure to save all of your receipts to give to the insurance company for reimbursement. If you decide to enter into a lease, be sure to get advance approval from your insurance company.
Your initial impulse after a disaster damages your insured property is to clean up and throw away the damaged items. Resist that impulse for just a bit, and take the time to record the damage. Take your camera or video camera and record the tree on the roof, the collapsed ceiling in your living room, the rain-soaked mattresses, furniture and books. Record as much as possible; too many pictures are better than too few. Once your home is cleaned up, it will be easier for you to explain to the insurance company exactly what kind of damage you had if you have pictures. Do this even if the insurance adjuster comes out immediately to view the damage. Insurance companies often switch adjusters during the life of the claim. You cannot rely on the first adjuster to adequately document your damage.
Inventory the damage to the building and contents. Write down everything you think is wrong with your home and give that list to the insurance adjuster. If there is a new crack in the ceiling or a leak in the kitchen, point that out. Make a list of everything that was damaged inside your home --- furniture, computers, picture frames, and so on. Again - take a picture of everything. Do not discard anything before the insurance adjuster has a chance to look at it. Ask the adjuster before throwing anything away. It seems sensible to drag unsalvageable items to the curb for disposal, however, the insurance company could dispute that you owned, say, a 52-inch plasma TV if it’s already gone.
Communicate with the insurance company in writing. If you have a telephone or in-person conversation with the insurance adjuster, confirm it in writing afterwards. Write or email the insurance company to get a status on your claim. This prevents misunderstandings. In the confusion that follows a major catastrophe, things sometimes fall through the cracks, so it is good to have things in writing.
Make notes regarding what happens with your claim. Write down the date of each time you call your insurance company, the name of the person who took your call, and what was said on the call. Also note the date each time an adjuster comes to your property or contacts you --get the name of the adjuster, and write down exactly what was said or agreed.
Take immediate action to remedy any condition on your property which could lead to further damage. For instance, if you have a hole in your roof, put a tarp over it until you can make permanent repairs. Insurance policies generally require the policyholder to mitigate his damages. Discuss with your insurance adjuster whether the policy will pay for temporary repairs.
Provide the insurance company with the documentation it requests. Insurance policies require the policyholder to cooperate with the investigation of the claim, which includes producing certain documents or papers on request. If the policyholder fails to produce the requested documents, the insurance company may be able to refuse to pay the insurance claim on that basis. Sometimes the insurance company may request a “proof of loss,” which is a sworn statement setting out the amount of the loss. Merlin Law Group recommends that you obtain legal advice before submitting a proof of loss.
You should also obtain legal advice if the insurance company asks you to submit to an Examination under Oath. Most policies allow the insurance company to require the policyholder to be examined under oath. That means that you will be giving testimony as if you are in court, and the insurance company will typically send a lawyer to question you. Insurance companies generally do not ask for an examination under oath unless there is a serious question about whether the insurance claim should be paid because of fraud or other issues. For that reason alone, we recommend that you obtain legal advice before submitting to an Examination under Oath.
Demand frequent updates from your insurance company on your claim. The squeaky wheel gets the grease. In turn, keep the insurance company updated with your contact information.
Most insurance claims are initially handled to the policyholder’s satisfaction. However, the policyholder often discovers damage for which the insurance company failed to pay, or that it will cost more to repair the damage than the insurance company paid. If the insurance company denies or underpays your claim, immediately consult an experienced insurance attorney.
The recent rash of tornado catastrophes across the country has left a path of obvious destruction. This is an example of the obvious damage:
What about structures that were not completely destroyed and those next to the most obvious destruction that remained standing? Did they escape the high winds and pressures without any damage?
A noted insurance company expert, Tim Marshall of HAAG Engineering, wrote a paper, Building Damage Issues in Tornadoes, which warns adjusters and policyholders to carefully inspect structures close to the tornado path for subtle but significant windstorm damages:
The assessment of property damage begins immediately after a tornado. Homeowners, insurance adjusters, contractors, engineers, and architects examine buildings and their surroundings to determine the extent of tornado damage. While catastrophic damage is easy to recognize, the more subtle signs of building distress are not.
The ever vigilant expert for insurers, Marshal notes that "inspectors often erroneously link these conditions to the storm." My impression is that most inspectors fail to look for these subtle tornado damages which add up to sizable losses because they fail to do an adequate inspection, if any inspection at all.
Nevertheless, Marshall provides a good description of how high winds impact structures:
Tornadic winds encountering a building are deflected over and around it. Positive (inward) pressures are applied to the windward walls and try to push the building off its foundation. Therefore, it is important that the building be anchored properly to its foundation to resist these lateral forces. Negative (outward) pressures are applied to the side and leeward walls.
The resulting "suction" forces tend to peel away siding. Negative (uplift) pressures affect the roof especially along windward eaves, roof corners, and leeward ridges. These forces try to uplift and remove the roof covering.
The roof is particularly susceptible to wind damage since it is the highest building component above the ground. Wind pressures on a building are not uniform but increase with height above the ground.
I have found that the important aspect of damage caused by these winds is the fastening system of the structure. Nails, clips, joints, brick ties and other assorted connections tend to get pulled, bent, cracked or weakened by tornadic winds and pressure. These damages are often difficult to find and, once eventually discovered, can be expensive to repair. Buildings suffering these damages will age, deteriorate and increase maintenance costs at much faster rates than buildings not damaged by tornadoes.
Adjusters should retain honest and unbiased investigators to look for these subtle but significant damages. "Drive by" adjusting, without close inspection and possible testing, is improper for structures in the vicinity of a tornado’s destructive path. While the Marshall article tends to provide possible explanations why these damages may be related to perils other than windstorm, educated policyholders will ask their insurer to investigate for these serious damages.
The Associated Press reported that more than 60 tornados ripped through the South last Saturday. The violent weather started last Thursday in Oklahoma and took lives in Arkansas, Alabama, Mississippi, North Carolina, and Virginia. The storms are being called one of the largest single-system tornado outbreaks in United States history, and there were confirmed tornadoes across at least 14 states.
This spring has been particularly bad for this region and the effects of the tornados will be far reaching- even after the debris is cleaned up.
On Thursday, the Wall Street Journal reported that Nationwide Insurance Company was dealing with an unprecedented number of claims for the spring storm season. Nationwide had more than 14,200 claims in North Carolina alone. As of Thursday, State Farm had received more than 15,000 claims for damage as a result of the severe storms in the region. The National Weather Service has indicated that on average, the month of April has historically more tornados, but the numbers for 2011 are topping the charts.
The Wall Street Journal article reported prompt actions were taken by many insurance companies after the tornados. Hopefully, this is an accurate report and policyholders are being helped after these devastating losses. But will these claims be properly handled to their finality and paid in full? Living through a catastrophe is incredibly taxing on policyholders. Often, when policyholders hire experienced public adjusters to assist with a claim, their claim payment increases (see my post referencing the OPPAGA study) and the policyholders can devote their time to putting their lives back together.
One public adjusting firm in North Carolina, The Baldwin Company, explains why a public adjuster can assist with claims:
If you try to do this yourself, you may as well face it: you are going to have to change professions and become a professional claims adjuster. You’ll have to become an expert in pricing everything from roofing nails to original artwork, and you will have to develop organizational and negotiating skills miles beyond any you have ever had to use in the past. What is more, in many cases, this will become your full time job.
Wes Baldwin, the 2003 President of the National Association of Public Insurance Adjusters, is the president and founder of The Baldwin Company. Baldwin’s website explains that after a loss many companies will come to a loss site, like building contractors and cleaning/restoration companies who want to work on the property and help with insurance claim. Baldwin cautions:
This fairly recent development is causing confusion for many policyholders: Salesmen and building contractors are presenting themselves as being qualified to help you understand the intricacies of your insurance policy as well as purporting to have the expertise to help you get your insurance company to pay for all your repairs and clean-up. However, for the most part, these people are not licensed by any state’s insurance department to act as claims adjusters of any sort, nor do they have the training to do so.
Sadly, in times of tragedy, there are likely to be those looking to take advantage of the situation. If you have concerns about individuals or companies offering to help you, trust your instincts and ask for qualifications and license numbers. Most of this information should be on a business card. Then be sure to verify the credentials with the regulating authority.
Georgia Insurance Commissioner Ralph T. Hudgens says deadly storms that struck the state this week have caused insured losses of about $50 million.
The commissioner toured Jonesboro, Ga., yesterday to inspect damaged areas. The estimate includes damage to vehicles, homes and business, he says.
State Farm spokesman Justin Tomczak says strong straight-line winds and some hail throughout the state have generated more than 1,800 claims.
“There is no one central affected area,” Tomczak says. “The damage is scattered everywhere.” Claims have also been filed due to fire started by lightning strikes, Tomczak reports.
The National Weather Service (NWS) says the storm system produced strong, gusty winds, heavy rain, pea- to baseball-sized hail and one tornado. Georgia was not the only state affected, as damage reports have come from states throughout the Southeast.
Severe rain and flooding swept through Tennessee last May, causing catastrophic damage which made the headlines around the globe. Lives were lost, people were separated, drinking water was rationed and the homes and businesses many residents were severely damaged.
A house is surrounded by floodwater Tuesday, May 4, 2010, in Nashville, Tennessee. (AP Photo/Jeff Roberson)
Now, some three months later, citizens of Tennessee continue to try to put their lives back together after this disaster. It is not an easy task. In an attempt to find out first-hand more details about the damage in Nashville and the surrounding areas, I contacted FirstCall, a public adjusting firm located in the heart of Nashville.
Many residents and business owners have realized the value of hiring a public insurance adjuster. This particular Nashville based firm was founded by Phil Breeden.
FirstCall has 20 employees and has been adjusting claims for policyholders since 1989. The company has gained a great reputation for helping folks with their insurance claims and has offered to share information about how they have been able to help the policyholders of Tennessee with their recent losses. FirstCall also explained the hurdles they face adjusting claims in throughout Tennessee (FirstCall is also licensed and practices in TX, OK, OH, MS, MI, LA, KY, KS, IL, GA, FL).
One hurdle facing FirstCall may be familiar to PAs all across the country. Stephanie Allen, the director of marketing for FirstCall explained:
Many people do not know the public adjusting profession even exists until after disaster strikes or after their claim has problems.
I have heard similar sentiments like this from countless public adjusters. Tennessee and its neighboring states have suffered extensive property damage recently and still insureds are not aware that adjusters are available to advocate for them. FirstCall is working to change the status quo.
To help people find out about public adjusting FirstCall has implemented the following business practices.
1. KISS-- Keep it simple. The language used to advertise your services should be written in a way the average person can understand. Too often, those of us in the industry speak, write and advertise using the insurance terms. Instead of using the terms insurer and insured, use homeowner, policyholder, person, etc. Remember the searches your potential clients might be entering into search engines may be something as simple as “help insurance company wrong”.
2. Differentiate yourself from the insurance company. Many clients do not have a grasp on who is on their side. Many clients call the insurance adjuster “their insurance agent”. Many clients refer to the independent or company adjuster as “my adjuster.” Provide literature and information which explains who works for whom and explain the benefits of leveling the playing field.
3. People are more comfortable hiring a professional to assist them when they realize the matter is complex. You take your clothes to the dry cleaner, your taxes to the accountant, why not your insurance claim to a public adjuster? Sure, you can try a dry-clean product at home and you can prepare your own taxes, but you run a much higher risk of a problem--perhaps an irreversible problem-- which could have been avoided if you sought professional assistance. Insurance policy provisions, exclusions and limitations are complicated. If this is explained to the consumer, they have a better understanding of the value of the service public adjusters provide.
4. Don’t wait until after the catastrophic event to educate the public. Billboards are less expensive than you may think and many people are visual learners. They have the ability to retain and recall information in a visual format more easily than auditory information. In addition, yard signs for current clients, community events, and advertising in trade association magazines are all ways to get in front of potential clients before they have a need.
To capitalize on these ideas, FirstCall has a marketing department devoted to showing the public that insurance claim advocates exist and are available to help policyholders reach advantageous results. While marketing departments may be out of the budget for smaller firms, the work done by the marketing team at FirstCall may give you an idea for your firm. FirstCall teamed up with local meteorologists in their area and sponsored events called “Surviving the Storm.”Nashville’s local NBC affiliate and FirstCall’s public adjusters put on live events where viewers were able meet their favorite meteorologists and learn about severe weather and how to prepare for it. The event occurred over a six week period and, coincidently, ended just days before the flood. FirstCall provided handouts and ‘Disaster Survival Kits’ to all attendees.
Almost exactly one year before this year’s disastrous flooding, tornados ripped through Murfreesboro, Tennessee, just 30 miles from Nashville. FirstCall was able to get free airtime on the local news to explain the need for adjuster advocates for homeowners. This saves on the cost of TV ads and reaches many potential customers at one time. Here is a look the media describing the work of public adjusters and explaining the benefits of hiring a PA.
You can always say something . . . you can never "un-say" it
Professional pet peeve:
Passivity. Doing nothing is almost always the wrong choice. Scott Jamison, our operations manager has coined the phrase: "Do the hard thing". If you do, you will get ahead of the crowd, because most choose to NOT do the hard thing.
We look forward to following up with Phil and others in Tennessee to learn more about the outcomes of the insurance claims arising from the recent losses. Stay tuned.
Winter and early spring storms often bring violent tornadoes into the south. A recent article highlighted how even insurance company adjusters know that many damages from tornadoes are often overlooked.
Experts said you should turn on all of your faucets, then open your cabinets to check the plumbing and flush all of your toilets to check for leaks.
Insurance adjusters said not all tornado damage is easy to spot.
"Generally what you'll see is pock marks on the roof," said Gary Smith of Farmer's Insurance. "If you can look out a second story window for example and look out on the roof and see pock marks, it'll be obvious on the roof."
Smith also recommends checking other places for dents caused by hail or flying debris. "Other metal things around the house, might be the air conditioning housing, compressor housing," he said. "You look for dents in that or the gutters around the edges of your roof."
Checking your home's foundation and walls for cracks is also a good idea. Pay special attention to the areas around windows and doors, as they tend to be the weakest spots in construction.
You also want to make sure your floors are level, a change could indicate a lift in your foundation. Some other things to keep an eye out for over the next few days and weeks, are water stains or yellowing on your walls and ceilings, which could indicate some hidden roof damage.
Insurers and their engineers have been sued for not recognizing these types of damages and claims following tornadic losses. As reported by CNN in "State Farm Penalized in Suit Over Tornado Claims :"
State Farm acted "recklessly" and "with malice" in handling insurance claims from dozens of families whose homes were damaged when a wave of tornadoes, including the strongest in recorded history, swept through Oklahoma in 1999, a jury has decided.
The verdict...delivered millions to the lead plaintiffs...
The jury in the District Court of Grady County, Oklahoma, awarded Donald and Bridget Watkins almost $13 million in total damages for their part in the class action suit against the nation's largest insurer....
Tornadoes have very strong winds which place significant pressures on buildings that push and pull on structures. Damage often occurs to the fasteners and component parts, although most are happy the building is still standing and everybody is safe. Following a tornado, my advice is to have a qualified engineer inspect your building for these subtle but significant expected results from such severe winds.
Insurance claims decisions cannot be made in good faith without full investigation and honest consideration of the resulting information. Some adjusters are not truly listening to their policyholders and considering what their policyholders tell them. Some carriers seem to conduct investigations with cursory expert work or only consider the opinions of the typical insurance expert without giving full consideration to other opinions. Many insurers are not conducting full investigations of Hurricane Ike claims, instead doing just enough looking to find reasons to deny or underpay.
Most policyholders do not know where to find experts familiar with issues of windstorm damage. Many cannot afford to do so. Today, I am making available a client’s meteorologist report to help demonstrate that many areas in Galveston, Bolivar and Houston sustained tornado type wind events.
The report notes that there were sufficient wind speeds to cause extensive damage by tornadic events along the Bolivar peninsula and other areas:
"Using the collected NEXRAD data and knowing the limitations of NEXRAD to detect these phenomena, I estimate that there were over 60 mesocyclones that moved over the Bolivar peninsula. Based on this estimate and using the percentages from previous studies, this would place between 18 to 30 tornadoes on Bolivar peninsula as early as 10:43PM, September 2008.
There are several pictures I took during the site visit that show distinct rotation based upon how remaining structures and poles were oriented. This indicates tornadic activity.
At 7:00PM, September 12, 2008 there were measured winds of 115 knots (126 miles per hour) only 2000 feet above the surface along the edge of the Bolivar peninsula. This measurement was recorded by a rawinsonde observation. With the numerous convective cells over the Bolivar peninsula, it is very plausible that winds from 2000 feet above the surface were transported down to the surface causing gusts as high as 100 miles per hour. These winds would not be detected by NEXRAD because the radar beam would be located above the 2000 foot level over Bolivar peninsula."
Anybody can use this report for any purpose they wish. The bottom line is that the insurance company experts typically do not conduct this kind of in depth investigation to find evidence supporting higher payments. Get your own analysis if you suspect your insurer is underpaying your claim.
As founder and president of Merlin Law Group, Chip Merlin has dedicated his practice to the representation and advocacy of insurance policyholders in disputes with insurance companies in in Florida, Texas, Colorado, California and nationwide. Since 1983, Chip has served...More...
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