Insurers will appoint a loss adjuster when a claim reaches a certain size. However, policyholders are completely within their rights to appoint their own independent loss adjuster to manage their claim
According to Government statistics, there were 175,000 fires in England and Wales in 2013-2014, out of a total of 55 million households. At 0.32 per cent, thankfully that makes your chance of being involved in a fire very small indeed. So it is very unlikely that, in the event of a fire in your home, you will have the knowledge and experience you’ll need if you come up against a difficult insurer.
Many people assume that because they’ve been paying their home insurance routinely, they are covered and that their insurance company will look after them in the event of a disaster at home. In lots of cases this does indeed happen, but unfortunately in a growing number this is actually the start of a very difficult journey.
Once a claim reaches a certain size and an insurer decides that the damage warrants it, they will appoint a loss adjuster to ‘adjust’ the claim presented to them by the policyholder. While officially this person is independent, they are appointed by – and their fees are paid by – the insurer, so they will often lean in the insurer’s favour when it comes to deciding between actions to take in restoring a property: for example, do they strip saturated plaster from walls and replace it, or could they get away with drying the plaster out and painting over it at very little cost at all?
There are all sorts of reasons why insurers and their loss adjusters could make the claims process difficult. Primarily though it’s all about saving money: insurance premiums these days are part of a very competitive market, and the loss adjuster’s job is in effect to make the final settlement as low as possible. There have been many cases where a more unscrupulous loss adjuster has employed tactics aimed at lowering claims, or even having the claim refused altogether.
Typical tactics include making a ridiculously low offer and warning that unless it is accepted, there will be no settlement at all. Or they may claim they have the technical expertise to decide that the damage can just be patched up, when in truth a properly-qualified chartered surveyor is really needed and a full replacement is the only acceptable solution. Or they may just cause delay after delay so that the claimant gives in because all they want to do it get back in their home. Or sometimes they go as far as accusing people of negligence or even arson to scare them into taking a lower settlement or going away altogether. While such examples are not commonplace, they are tactics that the policyholder should be aware of and watch out for.
This is why many people, once they start on their claim, realise they need help from an independent professional loss assessor who will fight their claim on their behalf. Loss assessors are employed directly by the policyholder to handle the claim, oversee the reinstatement of their home and – perhaps most importantly – negotiate with the loss adjuster to overcome all those tactics and to ensure their client gets what they are entitled to under the terms of their insurance policy.
Claimants are completely within their rights to use a professional to manage their claim. Insurers are often happy about this as well, as it can make their lives easier as they are dealing with someone who knows the process inside out.
Sometimes though, if the loss adjuster digs his or her heels in, there is a need to fight on behalf of the policyholder. Here are just two examples of where a loss adjuster initially made life very difficult for a claimant after a fire had devastated their lives. In both of these cases the adjuster tried to deny liability but this was overturned after a period of challenges and arguments:
- Mr & Mrs Dyer had an unoccupied annexe in their garden where they stored some of their clothes. They occasionally used a dehumidifier to remove moisture and one day this caught fire: the building was gutted and all contents were lost. The annexe and its contents were insured separately from the main building so Mr Dyer thought all would be fine – but when the loss adjuster arrived he implied that the Dyers had set fire to the building themselves and they would be lucky if they received anything.
Mr Dyer decided to employ an independent loss assessor who then took over all dealings with the loss adjuster. It was agreed that a forensic examination was needed to confirm the cause of the fire – and this concluded that it was indeed an accident.
Eventually Mr Dyer received a full pay-out covering all contents and the re-building of the annexe – but only because he and his loss assessor had refused to give in. According to Mr Dyer, “at the beginning I wondered if I would get anything out of the insurer and in the end I got what I believed I was due.”
- Mr & Mrs Allison were moving into the house they had inherited from Mrs Allison’s mother, and they were living temporarily elsewhere while building works were carried out. The existing home buildings insurance ran out two weeks before they were due to move in so they took out a new policy to cover any damage until the works were completed.
Almost immediately, a smouldering fire in a pile of compost ignited a gas pipe which led to an explosion and the house suffered substantial damage. But, according to Mr Allison, “as the policy had only just been taken out, it seemed that the insurer was trying to find every possible reason not to pay our claim”. He faced the prospect of receiving nothing.
But then he brought in an independent loss assessor who took over all negotiations with the insurer and their loss adjuster and, after protracted negotiations, the insurer finally accepted liability. With a full settlement agreed, the house could be re-built.
These salutary tales illustrate how having insurance can give you a false sense of security: it’s no guarantee that you won’t face a very tough time if you have to make a claim. The moral of the story is that you shouldn’t give in to the insurer’s initial decision or offer of settlement if you believe it is unfair, and you are perfectly entitled to turn to a third party for help to ensure you receive what you’re entitled to under the terms of your insurance policy.