After Harvey and Irma: Agent Funds and Adjustors for Hurricane Claims
The devastation caused by Hurricanes Harvey and Irma has left a trail of uninsured losses, prompting questions about the readiness of insurance companies to handle the aftermath. As the recovery effort begins, it is crucial to understand how insurance companies manage their resources to address claims effectively.
The Role of Adjusters and Investigators
Insurance companies rely on a network of adjusters and investigators to assess and handle claims. In normal times, these professionals work year-round across the U.S. However, during major disasters, they must often be redeployed from other regions and countries to ensure that claims are processed as swiftly and accurately as possible.
Relocation and Resource Management
A successful case in point is the relocation of my brother-in-law from New York City to Houston to help manage hurricane Harvey claims. He was part of a contingent of adjusters who were temporarily redeployed after Hurricane Sandy in 2012. His expertise and experience with complex claims have been instrumental in ensuring that claims are processed efficiently. This highlights the importance of having a robust network of adjusters who can be swiftly mobilized during crises.
Similarly, after Hurricanes Harvey and Irma, insurance companies will likely draw from their existing networks and potentially hire independent adjusters to handle the overwhelming volume of claims. This requires extensive coordination and organization to ensure that all aspects of claim handling are covered.
Documenting and Prioritizing Claims
To manage the volume of claims efficiently, insurance companies will prioritize those that are well-documented. Claims that present a clear and comprehensive picture of the damage—complete with photos, serial numbers, receipts, and appraisals—will be processed first. This helps to streamline the claims process and ensures that the most pressing and straightforward cases are resolved promptly.
Tools and Documentation
Comprehensive documentation is key to a successful claim. For example, photographic evidence, detailed room-by-room inventories, and item-by-item lists are essential. Insurance companies will favor claims that include detailed documentation, as it provides a clear and accurate picture of the losses sustained. This thorough documentation can significantly expedite the claims process and reduce the likelihood of disputes.
Long-Term Implications for Insurance
The sheer volume of work that lies ahead for adjusters and investigators will keep them busy for a considerable period. The aftermath of multiple devastating cyclones and bushfires in Australia has led to increased premiums as insurers seek to cover future losses. Many individuals and businesses have found it more viable to relocate to areas less prone to natural disasters, reducing the overall risk profile for insurers.
As the costs associated with natural disasters continue to rise, the precariousness of insuring certain regions, particularly Florida, has become more apparent. Florida is viewed by many experts as the most uninsurable place on earth due to the sheer number of direct hits from powerful hurricanes in recent years. The insurance companies' ability to manage these claims will impact the future availability and affordability of insurance in these regions.
The current situation demanding the relocation of staff and the prioritization of well-documented claims serves as a stark reminder of the vulnerabilities inherent in certain geographical locations. As the recovery process continues, it is important for individuals and businesses to carefully reassess their insurance needs and coverage in light of the increasing risks and potential changes in insurance policies.
For those affected by the hurricanes, the claims process may be challenging, but being prepared and gathering comprehensive documentation can significantly improve the chances of a timely and satisfactory resolution. The insurance industry's response to these disasters will have far-reaching implications for future risk assessment and premium setting.