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Friday, August 13, 2010

When Adjusters Go From Denial to Buying

No way they'll buy that roof. No hail. Yet sometimes they do. It has to do with the color of the check.
When no snap, crackle, pop occurs and the wind doesn't blow, the business gets a little slower. In times like these State Farm has blue checks. The money is right out of their account. The adjusters are calling the shots very conservatively. They enforce policy regulations down to the T and dotted I's.
Insurance companies are pretty smart and they believe in what they sell, so they get insurance. They are all tied together in one way or another. Usually all the way back to the Mother of them all, Lloyd's of London. That company has a strange beginning and an even stranger way of raising cash.
So hear comes the storm bringer, with deep purple colors, and Dallas or Fort Worth is about to be hammered with wind and hail. The trucks start to pull out of Oklahoma and the motels fill here. In some areas you can hear "daddy, daddy" while Sancho beats it out the rear door. For those who don't know, Sancho is Jody but you need not lose your girl while you're in a foreign land.
Ding dong, knock knock, roofers everywhere. The checks turn pink. Why? Because it's not State Farm's money, or at least most of it isn't, and if we've learned anything from Congress, it's that you are not as careful with somebody else's money as you are your own. So they buy, and buy, and buy some more. Everybody body gets a new roof.
Why would they do that? Because if all your clients have new roofs there will be less wind and hail claims until the roofs get old.
Plus the reservists are called up. These are independent adjusters, broke from waiting for a storm to come. Did you know that the larger the claim, the larger their commission. I've had adjusters ask me to help them find $50.00 damage more so they could make it to the next level.
I've seen new roofs that hadn't even experienced their first bird dookie get totaled.
Folklore has it that the manager of each company reenacts the Pope's "Line of Demarcation" that split South America into Portuguese and Spanish realms. If you're outside the circle, you don't get a roof and you loose your chair.
The normal staff adjusters, when times are slow, are tough and uncompromising. If you've waited too long to call in a claim, you lose your rights.
When the smash and grab of Mother Nature demolishes the roofs as far as you can see, and that is usually Aledo , Mineral Wells, Sulpher Springs, Denison, and Waco, because outside that the Earth ends for me, the local economy gets a big stimulus. The adjusters buy more roofs but the independents are unleashed like the dogs of war. Pink everywhere.
Restaurants, building supply companies, roofers, carpetbaggers, motels, bars, bail bondsmen, beer stores, all get big boosts in sales. Sales tax revenues go up. Kids learn to read. And the insurance companies do their part by returning the money they've extorted from the masses, albeit from the British and not their own pocket.
Then the British go and kick English investors out of their homes and liquidate everything the family owns to pay for the new roof in Garland. The door gets a knock and the former homeowner is told to get out now. He can't even get his nail clipper. I saw a report on Sixty minutes years ago but I can't back it up on Google. If you can find it or have better info please send it to me.
Lloyds was formed by merchants wanting to protect their investments. They wanted to spread the losses around so no one could be wiped out by one hail storm in the Atlantic. We use the word "copper bottom" to describe a good investment because copper bottom boats were safer.
The ships were rated for value, upkeep, cargo, and risk. Then a proper fee was paid to join their lottery.
The Sicilians took it further because the payments weren't voluntary and if you have a mortgage you must have insurance too. If you don't you can roll the dice and hope you don't burn down.
If you ask me, the insurance companies should forget all the politics of trying to look good in comparison to other insurance companies or trying to prevent future losses by giving out free roof candy. They should just buy the damaged ones for the right amount, or close to it, quit losing faxes, start accepting e mails, answer the phone, quit saying nobody has ever asked for that before, and just conduct business like a good neighbor with good hands.
What a concept:do the right thing. That is what everybody should do. But there are those guys this summer fabricating hail and I hope they meet there. Not really. Wouldn't wish that on anyone.

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