Federal Judge in Mississippi 'Storm Surge' Case Upholds Home Insurance Flood Exclusion
National News • April 13, 2006
A federal judge in Mississippi has upheld the water damage exclusion in homeowners insurance policies in a ruling welcomed by insurers.
U.S. District Judge L.T. Senter, Jr. of the Southern ...
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Subject: Market Conduct Check List For Allstate-Travelers-State Farm
Posted On: May 18, 2006, 6:25 pm CDT
Posted By: Roger Poe
Comment:
Subject: Market Conduct Check List For Allstate-Travelers-State Farm
Posted On: May 18, 2006, 3:42 pm CDT
Posted By: Roger Poe
Comment:
5-18-2006
Synthetic Claim Settlement Check List
1. Are labor dollars needed for all materials installed missing from roofing, dry-wall, etc. trade labor costs?
Allstate believes that a 3000 SF shingled roof that needs 3300 SF of materials AND 3300 labor costs for the completed project, should only show 3000 SF labor costs in their "fair trade" estimates.
By the way Allstate, the extra labor line that the MS/B IntegriClaim program data has for clean-up work is VERY different cost wise from the unit labor costs that should apply to the 300 SF production costs.
Job site clean-up work costs throughout a projects' duration is QUITE different from ACTUAL trade production installation work unit costs.
2. Cross reference actual regional material and labor costs, especially in early estimate paperwork put out to claimants.
MS/B's storm damaged property reconstruction costs surge databases verses "new" construction costs data, and Craftsman Publishing's '2006 National Renovation & Insurance Repair Estimator' should give pretty close [post-catastrophe] reconstruction costs in a given region.
If [Allstate] used new construction costs as an estimation base, then MS/B data costs for different regions in Louisiana should be easily proven by referencing a copy of MS/B's software version used by the general construction public, not necessarily the version that Allstate had designed for their own use.
Since both Allstate and MS/B realize actual (before hurricanes Katrina / Rita) new construction price data for Louisiana, any synthetically LOW, or missing, MS/B construction COMPONENT costs for REconstruction labor, materials, sales tax, and primary-general-subtrade contractors overhead and profit, etc. values will show up throughout their estimates.
Be aware though that, from the start of forming a construction estimate, "NEW" construction labor, materials and overhead unit costs are going to be QUITE LOWER than historical REconstruction unit work costs, especially after a storm).
Reconstruction costs can easily be 30-50%+ higher than new construction costs, plus post storm materials, labor and business overhead cost market increases add even higher costs to reconstruction costs.
3. See if ALL Contractor Overhead and profit line items are missing from estimates. Replacement Costs depreciated = Actual Cash Value, and still have those collective loss value costs woven in.
4. If not line itemed seperately, have them prove that roofing, fencing, carpeting, etc. specialty trade contractors business overhead and profit costs are in the unit costs of each specialty trade.
Allstate has been using a basic 29% contractor's overhead and profit margin line item that some adjusters are touting as being THE primary-general Contractors business overhead and profit line item.
Actually, an additional 10%and10% (20%)overhead and profit factor is recognized by Allstate, if one's would, perchance, know to ask about those [basic] primary-general contractor mark-up factors.
5. See if Allstate claims that primary-general contractors are only "necessary" if there is structural damage included in the loss.
6. See if either company expects that premiums paid them for replacement procedures and costs of a structure anticipate the general public to act as their own contractor, OR does MS/B type data, used in part for actuarially estimating future replacement costs of a structure, at an insurance agents desk, historically accounts for primary-general contractor involvement first and foremost, with their own staff and sub-contractors support.
6. See if Allstate claims that 2-3 or more specialty trades work is required before a primary-general contractor is "necessary".
7. See how many field adjusters were required during the life of a claim.
(Was Pilot Claim Service involved?)
8. Audit claim estimates from the nicer neighborhoods verses claims from the less well off neighborhoods. See if just roofing damage was accounted for, and if said damage was only damage if roofing material was missing.
9. Interview a mix of claimants to see how they were treated in person, or by mail / e-mail, or over the phone.
Did the adjuster dismiss or play down legitimate exterior and interior (wind / wind driven rain) damage?
10. Interview Allstate / Pilot Claim Service, Saint Paul Travelers and State Farm adjusters, and contrast their claim handling views with other [independent adjusters] views.
11. Publish specific examination results based in part on the above check-list so as to benefit the general public.
12. Resist anyones notion that such [publically known] construction data, and/or insurers market conduct is a "trade secret" somehow.
rogerpoegc@yahoo.com
Subject: Market Conduct Check List For Allstate-Travelers-State Farm
Posted On: May 18, 2006, 3:42 pm CDT
Posted By: Roger Poe
Comment:
5-18-2006
Synthetic Claim Settlement Check List
1. Are labor dollars needed for all materials installed missing from roofing, dry-wall, etc. trade labor costs?
Allstate believes that a 3000 SF shingled roof that needs 3300 SF of materials AND 3300 labor costs for the completed project, should only show 3000 SF labor costs in their "fair trade" estimates.
By the way Allstate, the extra labor line that the MS/B IntegriClaim program data has for clean-up work is VERY different cost wise from the unit labor costs that should apply to the 300 SF production costs.
Job site clean-up work costs throughout a projects' duration is QUITE different from ACTUAL trade production installation work unit costs.
2. Cross reference actual regional material and labor costs, especially in early estimate paperwork put out to claimants.
MS/B's storm damaged property reconstruction costs surge databases verses "new" construction costs data, and Craftsman Publishing's '2006 National Renovation & Insurance Repair Estimator' should give pretty close [post-catastrophe] reconstruction costs in a given region.
If [Allstate] used new construction costs as an estimation base, then MS/B data costs for different regions in Louisiana should be easily proven by referencing a copy of MS/B's software version used by the general construction public, not necessarily the version that Allstate had designed for their own use.
Since both Allstate and MS/B realize actual (before hurricanes Katrina / Rita) new construction price data for Louisiana, any synthetically LOW, or missing, MS/B construction COMPONENT costs for REconstruction labor, materials, sales tax, and primary-general-subtrade contractors overhead and profit, etc. values will show up throughout their estimates.
Be aware though that, from the start of forming a construction estimate, "NEW" construction labor, materials and overhead unit costs are going to be QUITE LOWER than historical REconstruction unit work costs, especially after a storm).
Reconstruction costs can easily be 30-50%+ higher than new construction costs, plus post storm materials, labor and business overhead cost market increases add even higher costs to reconstruction costs.
3. See if ALL Contractor Overhead and profit line items are missing from estimates. Replacement Costs depreciated = Actual Cash Value, and still have those collective loss value costs woven in.
4. If not line itemed seperately, have them prove that roofing, fencing, carpeting, etc. specialty trade contractors business overhead and profit costs are in the unit costs of each specialty trade.
Allstate has been using a basic 29% contractor's overhead and profit margin line item that some adjusters are touting as being THE primary-general Contractors business overhead and profit line item.
Actually, an additional 10%and10% (20%)overhead and profit factor is recognized by Allstate, if one's would, perchance, know to ask about those [basic] primary-general contractor mark-up factors.
5. See if Allstate claims that primary-general contractors are only "necessary" if there is structural damage included in the loss.
6. See if either company expects that premiums paid them for replacement procedures and costs of a structure anticipate the general public to act as their own contractor, OR does MS/B type data, used in part for actuarially estimating future replacement costs of a structure, at an insurance agents desk, historically accounts for primary-general contractor involvement first and foremost, with their own staff and sub-contractors support.
6. See if Allstate claims that 2-3 or more specialty trades work is required before a primary-general contractor is "necessary".
7. See how many field adjusters were required during the life of a claim.
(Was Pilot Claim Service involved?)
8. Audit claim estimates from the nicer neighborhoods verses claims from the less well off neighborhoods. See if just roofing damage was accounted for, and if said damage was only damage if roofing material was missing.
9. Interview a mix of claimants to see how they were treated in person, or by mail / e-mail, or over the phone.
Did the adjuster dismiss or play down legitimate exterior and interior (wind / wind driven rain) damage?
10. Interview Allstate / Pilot Claim Service, Saint Paul Travelers and State Farm adjusters, and contrast their claim handling views with other [independent adjusters] views.
11. Publish specific examination results based in part on the above check-list so as to benefit the general public.
12. Resist anyones notion that such [publically known] construction data, and/or insurers market conduct is a "trade secret" somehow.
rogerpoegc@yahoo.com