Hurricane Matthew Let the CAT Out of the Bag: Too Many Claims, Too Few Adjusters

Mike Miller on February 1, 2017

Hurricane Mathew certainly tested a variety of catastrophe (CAT) plans, and some plans even had the dust flying off the covers! As Matthew made landfall in Florida, Coastal Carolinas, Georgia and Virginia; carrier CAT departments of all sizes immediately launched into action to support the incoming claims.

Most, if not all, CAT plans rely to some degree on the independent adjusting community to provide primary or secondary claim adjusting services. The reality of changing market conditions; however, has created a shrinking nationwide adjuster pool that has become a serious issue for many carriers and adjusting firms alike.

With Matthew, homes and businesses were not inspected in a timely manner, claim assignments were delayed and hostility ensued between the adjusting community and the carriers due to an unverified resource base. As you may know, many CAT plans are developed with contractual commitments that adjusting resources will be available. While this is theoretically true, the practical matter is that when a CAT of any significance makes landfall, the supply of qualified adjusters is quickly exhausted.

By the same token, it is certainly no secret that litigated claims cost insurance carriers excessive amounts of money and considerable time in defending the resolution of the claim. As John Rollins of Citizens Insurance pointed out earlier this year, in a presentation to the Florida Hurricane Catastrophe Fund, “AOB is a tool that has been weaponized” and unintended benefits are being reaped by organizations and individuals who may not have the policyholder’s - and definitely not the carrier’s - best interest at heart.

The reliance on independent adjusters is established by contract, and perhaps while severe penalties exist, and will certainly be litigated, a quote from Ronald Reagan might be in order; “trust but verify”. It is up to the periodic pre-CAT verification to provide valuable assurance to the carrier - that the named adjuster is an adjuster that has, indeed, a relationship with the firm (and moreover is deployable).

Yet, there is a simple solution… to accelerate the reporting of claims, to avoid third party intervention in the claims process, and to improve the overall relationship with the policy holder at a grueling time in their lives. The insurance carrier must be committed to Speed of Contact.

The fluid nature of the shrinking adjuster pool in the United States must be considered and, as such, the need for pre-CAT verification is essential. Get to the insured before any disinterested and unscrupulous third party does, and luckily technology has been built to achieve this.

Clear-Call a solution from Clear Point Claims (CPC), that is powered by SPLICE, can do this. To learn more, click here!

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