Colorado Insurance Consumer Freedom of Choice

What does an Insurance Adjuster do?

It is common for insurance companies to use adjusters for the purpose of saving billions of dollars in payouts annually. An insurance adjuster in Colorado has zero educational requirements or certification requirements (almost every other state in the US requires education and certifications for adjusters)—this puts undertrained and unknowledgeable individuals in positions of considerable power. Despite not having training or education as an adjuster, these individuals can try to limit the scope of work for any project with zero scientific knowledge or construction knowledge. This puts Coloradans at a huge disadvantage when it comes to getting proper restoration services administered and paid for.

Not only that, but adjusters are financially incentivized to save their company money with bonuses related to cutting down claim payments. Insurance companies also hire third party adjusters—meaning these adjusters don’t even work for your insurance provider, and their role
is designed to limit payouts in any way possible, regardless of the ethics involved to do so.

It is important to remember that adjusters in Colorado do not have any certification requirements or educational requirements. An adjuster will typically “negotiate” the payout of a claim. As assertive as they may seem, it’s important to note that they lack the technical knowledge of
restoration. There is nothing preventing them from slashing your services to a bare minimum, despite their lack of science and evidence to make those decisions. Its arbitrary and frustrating—worse of it all is how inconsistently adjusters treat their customers.

Since adjusters are heavily incentivized to save insurance companies money, this problem will persist. Some adjusters claim their companies pay (or don’t pay) for certain restoration tasks outright. Others even say their company has never paid for certain restoration tasks, which is extremely concerning when those tasks are required by the IICRC standard! These are all distractions from the core problem: which is that you need your home returned to pre-loss conditions and anything less is acting in bad faith.

Here are some common rebuttals used by adjusters, which you should be prepared to hear as a homeowner:

“Those services are not required”
➔ Restoration companies follow IICRC standards. Quality restoration companies use the standards fully to avoid creating health risks to clients. Performing the required scope for restoration work also helps prevent structural damage which may reduce the value of the home.

“I found a cheaper invoice for the same services with another qualified company”
➔ Adjusters sometimes use invoices from their “preferred partners” which are cut down to the minimum amount of work or less. Sometimes the invoices even represent inadequate restoration projects that were not fully completed. To save money on claims, they will say the services can be rendered for less cost by using invoices from large franchises with questionable relationships to the insurance companies.

A common manipulation tactic insurance companies will use is to state that the “estimate is too high.” This comment should be met with caution because restoration companies use Xactimate software to create estimates. Every company has access to the same pricing via Xactimate, which means the only way a preferred vendor can “save you money” is by cutting corners throughout the process to make the invoice seem more appealing to the insurance company. If an insurance company fights back and claims a restoration company is overcharging, it’s important to remember that pricing is universal in restoration because we all use Xactimate software. Comments about overcharging by the insurance company should be met with caution, especially because cutting corners can lead to detrimental health effects or further damage to your property.

The reason the insurance’s process is so predictable is because it is an extremely profitable set of patterns and processes.
➔ For example, if an insurance company refuses to pay an Emergency Call Fee (commonly used afterhours or when disaster volume is high) to 1,000,000 million customers annually, they are effectively generating $200,000,000 in savings every year.

➔ When they repeat this process with other commonly denied services, insurance companies are saving billions per year by avoiding paying for essential tasks at scale. Finding the cheapest invoice for comparison is irrelevant as jobs are on a case-by-case basis, and it does not provide the customer with an accurate assessment. Yet some insurance providers and adjusters will reach toward the bottom of the barrel to save money on their bottom line. Performing all required restoration services for customers as per IICRC standards is what objectively helps the customer.

“They do not need personal protective equipment”
➔ Another popular tactic used by insurance companies is to claim that personal protective equipment (PPE) was not required to be used by the restoration company. This is not just questionable and risk-inducing, it’s an attack on restoration companies who are obligated to protect their employees—this perspective also goes against OSHA’s core values to keep the US labor force in good health.

The restoration process will expose technicians and project managers to mold, biohazards, and carcinogens daily—sometimes asbestos is involved. There would be no point to manufacturing and sales of PPE in the United States if it wasn’t necessary to use when individuals are
exposed to water damage, fire and smoke damage, mold, biohazards, and more. There’s a great reason that PPE exists, and that is to protect the technicians that render restoration services. It also protects the client, which insurance companies will not mention. By wearing PPE, an exposed technician can safely roll up their protective gear and dispose of it without cross contaminating the environment. An unprotected technician contaminates unaffected areas whenever they don’t wear PPE while causing damage to their health. Cross contamination should be taken seriously when it comes to performing restoration services, especially mold remediation and fire damage cleanup. What is the point of performing these services if we are going to put our employees and clients at risk throughout the process by not wearing PPE?