The North Carolina Insurance Commissioner, Mike Causey, gets an A+ grade for his recent bulletin requiring greater investigation of otherwise hidden areas behind walls to ensure losses are being adjusted properly. This bulletin will certainly help victims of Hurricane Florence with hurricane claims.

The November 30, 2018 bulletin states in part:

For the exterior of walls, a weather–resistant barrier (sheathing paper, Tyvek) is currently required behind exterior siding or veneers. The weather–resistant materials resist moisture but allow vapor to pass under normal conditions.

In adjusting hurricane damage claims for homes within the 1968–1997 applicable residential code period, it is important that the inside of the walls be checked more carefully than newer construction to ensure that moisture hasn’t seeped into the walls that will eventually result in mold and interior wall rot. If adjusters do not look for moisture build–up trapped inside the wall, then this damage could be missed, causing mold and rot to proliferate and resulting in bigger problems for homeowners in the future.

To detect moisture behind the walls may require the use of specific equipment, such as a deep scan moisture meter or a FLIR heat image camera. Adjusters cannot simply rely upon a visual inspection because evidence of the interior moisture damage may not be present on the walls for a long period after the claims have been settled and paid. It is imperative that adjusters be aware of this problem and follow inspection protocols to ensure that properties are thoroughly cleared.

The bulletin is extraordinary because of the detail he requires to ensure that adjusters find the hidden damage. I cannot recall another insurance commissioner bulletin noting the exact tools adjusters are required to use to find damage otherwise hidden from view. This should be the minimum standard in all states.

Some insurance company adjusters are like a variant of the three monkeys when it comes to loss investigation — “see no evil, hear no evil and speak no evil.” I use the proverb to refer to a lack of moral responsibility on the part of insurance company adjusters who refuse to thoroughly investigate and seek the full measure of the loss.

Insurance company adjusters are initially taught that they have an obligation to thoroughly investigate a loss to find all the damages they can. This usually means that the insurance company mandate that its adjusters be motivated and trained on how to find the damage. They also must be given the time necessary to investigate the claim. As the bulletin implies, these adjusters have to be provided all the tools including the use of experts to find and determine the scale of the damage.

Great insurance companies make these teachings part of their claims culture. Great insurance companies vigorously prevent company profit goals from interfering with these obligations and fully providing all benefits due under the policy.

Thought For The Day

“What the public hates the most is when they think the politicians aren’t listening to them. They understand that we can’t solve all their problems with a snap of our fingers, but they sure want us to try because we are public servants.”
—Chuck Schumer