A public adjuster is a professional claims handler who advocates for the policyholder in appraising and negotiating a claimant’s insurance claim, the need to hire a public adjuster is a tough decision for any homeowner who is faced with negotiating a claim like a major fire. Who wouldn’t want an advocate, especially when it pertains to dealing and negotiating with and insurance company. Insurance companies are in the business of collecting money, not paying it out….right? I suppose if their fees where reasonable the answer would be kind of simple but the reality is that they often charge a hefty percentage of the overall payout given to a homeowner. The unknowing homeowner who hired a public adjuster to advocate for them didn’t just hire an advocate, they also hired a “middle man”, and middle men get their cut of the action.
Advocating on behalf of the client sounds like such an altruistic endeavor, it’s not quite like that though. The public adjusters job is to maximize a homeowners payout and to access a portion of the maxed out payout monies to his / her benefit, and I don’t have a problem with that, that’s sounds like a great business practice. A restoration contractor does exactly the same thing. When a loss occurs the restoration contractor will generate a proposal for the repairs and then compare their proposal to the adjusters from the insurance company. The restoration contractor will be working off the same database used by the insurance adjustors (Xactimate restoration software) and will also have the advantage of advanced, intimate construction knowledge & industry standard pricing of labor & materials, whereas a public adjuster may have no contracting experience. More importantly, the public adjuster (the middle man) will be soaking up funds that might otherwise have went to the actual people rebuilding the structure (the restoration contractor). Who would you like rebuilding your house, a contractor that was making a nice wage or a contractor who is working super cheap because the middle man took a really nice chunk for himself? Do the best contractors work super cheap? Do the super cheap contractors take the necessary time to do the right job or do they cut corners and overlook things so they can finish faster? I could rest my case on that note alone!!!!
It can actually get worse, some public adjusters will get involved in guiding the homeowner to certain contractors for the rebuilding process, which sounds helpful, right? Well once you understand what happens next, you might not think so. The unscrupulous public adjuster, can, and often times does, dole out work in exchange for hefty kickbacks from contractors that they line up to do the repairs. If you have ever been at a fire scene, and I have been at hundreds of them as a NYC firefighter for 20 years, just about every fire brings a parade of public adjusters, all of them lined up in front of the building drooling at the prospect of securing an easy payday as the “middle man”, and this occurs before the fire is even fully extinguished. This is no joke.
I will leave you with one bit of logical advice and it’s a reiteration of a point brought up previously but worth stating again. If you are willing to compensate someone for advocating on your behalf let it be the individual / company that would be rebuilding your home for you (a restoration contractor), not a middle man.
President True Restorations, Inc.