INSURANCE 101: Tornado claims and getting a fair settlement

By Denis Rowe AIC, SPPA, PCLS

As a licensed advocate for policyholders I am frequently asked a couple of questions: One, should a property owner trust the insurance company’s adjuster to fairly, and equally, represent their employer’s interest and also the homeowners? And two, what can someone do if the carrier appears to be paying them less than what they believe is fair?
My answer to the first question is rather simple: the adjuster assigned to your claim should be given the benefit of the doubt and, at a minimum, allowed to do their job of producing a detailed estimate of what he or she believes it will cost to repair the damage to your dwelling or building. But I also believe in what President Reagan was famous for saying: “Trust, but verify”.
Since it is likely that the person who put the estimate together has a greater loyalty to his employer (the insurance company) than he does to the policyholder then there is a strong chance that their loyalty may influence the kind of estimate that he writes. In other words “trust” that the adjuster is going to treat you honorably but “verify” it’s fairness by asking an independent party, like a Mississippi public adjuster, to give you a second opinion (it shouldn’t cost you anything). An ancient manuscript long ago said that a person “can’t serve two masters”. That principle is as applicable today in Louisville as it was two thousand years ago in Jerusalem. The adjuster assigned to your claim represents the insurance company’s interest in the claim, not yours.
As to the second question, if you have reason to believe that the amount of money being offered within your estimate is not enough to put you back to a pre-loss condition then you have options. One is to request, in writing, a date for a re-inspection of the damaged property. Then you or your contractor can meet the adjuster at your home and go over the differences. Another is to hire your own insurance claims professional to level the playing field and attempt to increase their offer. In our industry someone who negotiates settlements on behalf of the policyholder is called a “public adjuster”. An experienced one with good negotiating skills should be able to add more money to your claim. However, I think a better option is utilizing the APPRAISAL provision of the policy. It’s the only real option that gives the policyholder some leverage in their claim.
The appraisal process is an alternative dispute resolution format that provides a civil way to remedy differences the two parties have regarding the value of the loss. Every policy I have ever read in Mississippi had it. It is very similar to two other formats you are probably familiar with: arbitration and mediation. In appraisal each side hires their own “competent and impartial” appraiser and then the two appraisers agree to a third member of the panel referred to as the umpire. Due to the “impartiality” requirement the insurance company cannot use the adjuster who wrote the estimate nor can they use another employee, so they have to hire someone from outside the company to handle their interests. When two of the three members of the panel agree on the value of the loss the appraisal process is complete and the settlement agreed to is binding upon the insurance company. I have found this to be an extremely effective method for resolving questions about the value of the loss. It ensures that the policyholder gets a fair hearing and inevitably results in a lot more money for the insured.
My last bit if of advice is this: you don’t have to accept the insurance adjuster’s offer as “gospel”. They are human just like you and me and they often make mistakes. You can disagree with them in a respectful way and still advance your claim. As I said in my last article staying patient, and persistent, will help you from becoming a “victim” a second time.
Mr. Denis Rowe AIC, SPPA, PCLS is an insurance claims consultant with The Howarth Group ( He has over 25 years of experience in helping property owners with their insurance claims: specifically with their contents and their structure. He and his company have an office in Hattiesburg (601-596-3344), are members of the BBB of Mississippi, and are licensed in MS to advocate exclusively for policyholders.