Xactimate construction price expert Steve Shannon told me that Merlin Law Group should make a seminar called, The Price is Right! I was listening to him and OSHA expert witness, Kevin Dandridge, discuss various issues of construction worker and site safety and where those costs should show up in insurance claim estimates.

All insurance adjusters should make certain that a construction estimate is made which is legal. If a construction estimate does not have inclusion of OSHA laws, it is an estimate of illegal construction. Insurance company adjusters should not be writing estimates which are illegal. Yet, it is common because many adjusters lack education or experience regarding OSHA laws and how construction is done.

Here is a list of some OSHA items which all contractors and subcontractors have to comply with and which insurance adjusters and estimators have to consider:

  • 1926.20 General safety and health provisions
  • 1926.21 Safety Training and Education
  • 1926.23 First aid and medical attention
  • 1926.24 Fire protection and prevention
  • 1926.25 Housekeeping
  • 1926.26 Illumination
  • 1926.27 Sanitation
  • 1926.28 Personal protective equipment

Steve Shannon made a point that older versions of the Xactimate training workbook had a specific section on OSHA requirements for roofing estimates because it is so complicated. It has been removed from more current workbooks, but the line items still exist for the adjusters to add the line items. A copy of that portion of the workbook is attached.

Dandridge and Shannon have extensive experience with actual construction and practices. They told me of significant fines placed on contractors and subcontractors for not doing legal construction complying with OSHA. They emphasized the point that OSHA laws apply to residential and commercial construction.

I encourage all property insurance adjusters and their managers, whether you are a company, independent or public adjuster, to get education on OSHA and Certification from Xactimate. Your estimates will be more accurate and reflect legal construction.

Thought For The Day

OSHA’s core mission is to ensure a safe and healthy workplace for every working man and woman in the Nation.
—Charles Jeffres

  • Bob

    Are you kidding? The carrier adjusters or their hired guns don’t even ever consider/ include building permit costs (a local mandate) in their estimates which they know or should know is necessary to effectuate repair for their own admitted scope. Nor do they ever consider asbestos testing or lead based paint testing (a federal mandate in certain circumstances as with OSHA).

    • Tim Varga

      Respectfully, their estimate doesn’t really matter in the first place when it comes to the proper restitution of the loss. What the estimate does do, is that it provides a written proof of reasonable liability for the coverage of the loss. The real estimates come from competent experts that are ultimately liable for the work being performed; the contractors.

  • Edward Fako

    Bob,

    Don’t shoot the messenger.

    In Courts, those items would be Approved And Paid For 100% of the time.

    In the real world, life is different. Yet, Chips polite observation about Insurance Adjusters is off the mark in most cases:
    Quote:
    “Yet, it is common because many adjusters lack education or experience regarding OSHA laws and how construction is done.”

    Nope!!! That is NOT Why. They honestly believe that Roofing Contractors make too much profit and/or that these REQUIRED Legitimate Costs for OSHA are to be considered as the Contractors Cost Of Doing Business.

    • Tim Varga

      The reality is that most adjuster have no training in the construction arena and only adjust according to the carrier’s “best practices” for settling losses. Some only have to complete watching a 2 hour training class video. If adjusters are going to be anointed with the responsibility of writing for any construction loss, then they should have to be required to complete certified construction courses that are relevant to the losses they investigate.

      • David Reggiani

        I’m gonna vent for a minute. Sorry for the tangent guys, but here goes.
        Better yet. It would never happen, but I’d love for it to be a requirement that ALL Insurance Adjusters have a minimum 5 years employment in residential construction. Yes, hands-on experience. Black fingernails and all. Large Loss adjusters an additional 2 years Commercial construction. Most Adjusters I know have never picked up a screwdriver, and they’re going to telling me how to write an estimate? Some insurance companies (I’ll leave names out of it) hire college kids hungry for employment right after graduation. No experience required. This needs to change. I’m growing tired of adjusters who don’t know the difference between thincoat plaster and drywall. Or that a boiler replacement also requires an expansion tank, circ. pumps, check valve, ball valves, vent pipe, and needs to be wiring for about $300. Thanks for the 100 amp panel Mr. Adjuster. Where are the circuit wiring runs? Did you really deduct for door and window openings? That’s wallpaper (or paneling) you can’t!

        • Tim Varga

          You are on point, as far as I am concerned, and that is why my response to Bob’s post was as follows:

          Respectfully, their estimate doesn’t really matter in the first place
          when it comes to the proper restitution of the loss. What the estimate
          does do, is that it provides a written proof of reasonable liability for
          the coverage of the loss. The real estimates come from competent
          experts that are ultimately liable for the work being performed; the
          contractors.

  • Bob and Ed,

    Thank you for your comments.

    I am aware that some (I do not know the percentage) insurance company adjusters routinely refuse to prepare a good faith estimate and intentionally lowball amounts which should be paid. Some just accept this illegal activity and moan about it versus trying to do something about it. The first step is to recognize the wrong. The second is to take action to correct it.

    It also does not release contractors and subcontractors from complying with all the laws which they are required to comply. Some pay workers in cash to avoid workers compensation documentation and there are a myriad of other actions which they do including refusing to pay for the costs of OSHA compliance. These actions are illegal.
    Texas is probably the worst state because there is so much illegal construction activity taking place and a total lack of licensing or enforcement.

    • Tim Varga

      Chip, this is only the tip of the iceberg. I will send you, and anyone that request it, the actual OSHA compliance pamphlets for residential re-roofing, residential roofing repairs, and residential decking repairs. OSHA has specifically created these documents to address the minimum core safety requirements in these areas due to the serious issue for fall safety in the residential sector.
      Please keep in mind also that proper estimating is only as good as the actual compliance incurred by the contractor. OSHA compliance to safety and incurred costs are measurable once the job is complete and the contractor validates they implored the actual safety compliance requirements. This is a double edged sword as we work as Public Adjusters to insure that carriers pay for the incurred laws for safety by including those values in the RCV and supplement arguments; however, insuring that contractor actually implored the safety protocols that are being billed for is imperative to proper settlement payments for the insured as owed by the carriers for the comleted work.