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AAPIA responds to Negative article on Public Adjuster Industry

AAPIA BLOG: AAPIA responds to Negative article on Public Adjuster Industry

May 10, 2016

Sent via email
Mr. Cesar Vanoye
KGNS-TV
120 W. Del Mar Blvd.
Laredo, TX 78041

Dear Mr. Vanoye:

   Please accept this letter from the American Association of Public Insurance Adjusters, known as AAPIA, in response to your recent news story and article entitled "Things you must know when dealing with insurance adjusters". Sadly, you have been misinformed about the role and value of a public adjuster in the claims process. As you mentioned in your news piece, extreme weather has been plaguing many parts of the country, including Texas, and home and business owners are often left feeling helpless and alone in the aftermath of these severe storms, or even after any type of property damage.   
   Contrary to what you have reported as Mr. Douglas M. Alford's opinion on public adjusters: "No positives. Zero positives. No positives. Only, no, nothing, nothing is positive. Guaranteed to lose", there are many positives in using a public adjuster. While public adjusters never guarantee a win, we bring a great value to our clients. Just as you do admit in your article, and in addition to the many intangibles provided, public adjusters use their expertise and training "to find more damage than initially reported." Much more damage, as verified by an independent study conducted in Florida. According to the Office of Program Policy Analysis and Government Accountability, homeowners who used public insurance adjusters on non-catastrophic claims received, on average, a 574% higher settlement amount than homeowners who did not use a public insurance adjuster (OPPAGA Report No. 10-06, p.8, 2010).

Why does this happen?

Without public adjusters, policyholders must rely on the insurance company to evaluate the extent of the loss, determine coverage, and provide a prompt and fair financial settlement, yet the interests of the insurance company in this process are directly opposed to the policyholder. Even though most insurance company adjusters act with professionalism, the homeowner is still at a great disadvantage. The insurance adjuster is not an advocate for the homeowner, but instead is a paid employee of the insurance company, or a third party who has been hired for the purpose of adjusting  the claim on behalf of and for the benefit of the insurance company, and will put the interests of the insurance company ahead of the consumer. This inequality leads to the undervaluing of claims, as discovered by the OPPAGA study.

   Further, Mr. Alford suggests that if a homeowner attempts to level the playing field on a valid claim by using a public adjuster as an advocate, such action would lead to a non-renewal of the policy. That statement by Mr. Alford, and any non-renewal on that basis, reeks of bad faith. In fact, it is this consumer unfriendly attitude that belies the argument that public adjusters are not needed by homeowners.

   Encouraging homeowners to use contractors as substitutes for public adjusters, as you do in your article, is bad advice for the homeowner on many levels. Contractors are not licensed to adjust claims, and violate the law when doing so. Public adjusters are licensed professionals who have spent many hours receiving training on reviewing insurance policies, using industry software to prepare detailed estimates, using current technology to aid in property inspections, negotiating with insurance companies, and many more areas. Contractors do not have training in these areas, and are not licensed to perform most of these tasks. Equally important, the conduct of contractors in attempting to adjust a claim is not overseen or regulated by the state, and they are not bonded for this work, as are public adjusters in most states. Unlicensed activity by contractors leaves homeowners with little recourse if things go south during the claims process.

   Unfortunately, the claims process is often long and difficult. Policyholders must navigate many obstacles to recovery. Public adjusters are licensed in almost every state in the country as advocates for home or business owners who have suffered property damage; we are on the ground every day fighting for policyholders.

For even more information on the value of a public insurance adjuster, please visit our website, at www.aapia.org

Respectfully Submitted,
Holly K. Soffer
Holly K Soffer, Esq., AAPIA General Counsel
Gene G. Veno, AAPIA President