Property Claim Adjusting

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Chapter 9

• Property Claim Adjusting

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Adjusters Must Answer

• Who has an insurable interest
• Who is insured
• What property is insured and where
• Insured against what causes of loss
• What is dollar amount of loss
• Procedures needed to follow

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Insurable Interest

• Anyone who would be financially harmed
• Can be more than one person
• Ownership in common
• Can be a new ownership interest
• Secured interest

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Other Interest

• Payments limited to extent of interest
• Other insurance
• Landlord/tenant relationship
• Mortgagors and mortgagees
• First named insured

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What Property

• Policy provisions What-when-where
• Real vs. personal
• Value differ ACV vs. replacement costs
• Real- land and everything attached to it
• Personal- all other
• Property not covered
• Additional coverage

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Cause of Loss

• Direct physical loss
• Indirect or nonphysical
• Loss of Use additional coverage
• Direct loss must occur
• Obsolescence, loss of market , investment loss

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Cause of Loss

• Water damage
• Collapse
• Theft
• Vandalism

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Trouble Exclusion

• Gradual cause of loss
• Ordinance or law
• Faculty design, construction or material
• Intentional acts of insured

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Indicators of Arson
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Dollar Amount

• Replacement Costs- the cost to repair or replace
  property using new materials of like kind and
  quality with no deduction for depreciation.
• Actual Cash Value- the replacement costs of
  property minus depreciation
• Depreciation- the physical wear and tear or
  technological or economic obsolescence of
  property.

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Other Definitions

• Ascertainable figure for replacement
• ACV fair market value
• Some property appreciates- collectables
• Broad evidence rule- requires adjusters to
  consider all relevant factors to determine value.
• Stated value- agreed amounts

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Other Options

• Repair or replace
• Appraisal clause
• Included in every policy
• May use impartial umpire

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Insured Duties

• Provide prompt notice
• Protect property
• Assist with loss adjusting process
• Provide proof of loss
• Submit to examination under oath
• Public adjusters

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Procedures to follow

• Determine cause of loss
• Determine the amount of loss
• Document both
• May
• Accept policy holders word
• Employ experts or personally inspect

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More Procedures

• Waiver and estoppel
• Salvage
• Subrogation rights
• Salvors
• Arbitration between insurers

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Residential Dwelling Claims

• Insured has concerns
• Conditional living expense
• Contractors
• Restoration and Cleaning Services

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Residential Personal Property

• Inventory
• Depreciation
• Sub limits
• Scheduled Property

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Commercial Structure Claim

• Architects and contractors
• Actual cash value
• Mortgagee
• Contamination and pollution clean up
• Arson investigation

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Business Income Claims

• Highly complex
• Three issues
• Best loss settlement approach
• Determine business income loss
• Determine the period of restoration
• Extra Expense
• Use of accountants

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Merchandise Claim

• Valuation
• Salvage
• Inventories- reporting form policies
• Negotiation

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Transportation and Bailment Claim

• Property in possession of non owner
• Insurance policy
• Legal liability
• Bill of lading
• Released bill of lading

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Crime Claims

• Property gone
• Fraud
• Verification
• Catastrophe Claims
• Pre loss planning
• Post loss planning