Let us first discuss risk to commercial property in Texas as it relates to severe weather. I am from Florida & have always grown up around Hurricanes. So I have always focused my career research & experience surrounding Hurricane property claims. There is a saying here, “Everything is Bigger in Texas,” which certainly includes the cost of premiums to insure property. Texas is hot spot for severe weather events. Year in & year out, it is a huge risk for property insurers & owners. The data is trending toward an increase in severe weather events each year. It is a great state to live & the economic market is solid, but property insurance is expensive. There are many reasons for it, but mainly because Texas has sustained more severe weather events than most states combined. In my prior blog post, “To Hail With This Weather!,” I discuss many statistics regarding the pattern of weather data surrounding hail defining Texas risk exposure to insurance companies & property owners.
I want to discuss how technology is changing the face of the insurance claim business today. Drones, satellite imaging, thermal infrared cameras, & many other cutting edge technology is assisting the industry Risk management for commercial property insurers & owners are constantly evolving. A recent article in Property Casualty 360, “Rising Hail Claims Raise Questions From Insurers,” discusses how insurance companies are using the latest technology to minimize their risk against questionable & fraudulent claims. What is interesting is how they present the facts of this being such a large issue for adjusters & catastrophe managers. When you actually divide the questionable claims (1053) coming out of Texas in a two year (2010-2012) period due to hail by the total number of Texas hail claims (320,823) for same period it is 0.003% of the total. It is less than 1 percent of the claim volume. When you do the math it isn’t substantial.
Some of the technology is sourced from companies that strictly work for insurance companies so one with a questioning mind would wonder if the data is bias. I hope that is not the case. DamageRecon from Donan, who is an insurance company forensic engineering firm, uses an algorithm to determine what size hail fell in a particular location & then projects the likelihood of damage being investigated. I hope that this algorithm is not being used to “auto-adjust” claims. This is not fair or proper. Every claim should be adjusted based on it’s own merits. In my own Texas hail claims where Donan is hired as an engineer for the insurance company I have seen biased reporting that favored the insurance company. Although this is a small sample size based on my personal experience I do not think I am the only public adjuster with the same experience. I recently created a list of exclusive Insurance Company Engineers & Consultants to send to a potential client that is battling their insurance company who is getting suggestions from their agent to have a third party engineer to look into it. I wanted them to know who the “insurance pro” players were & Donan made the list of course.
I realize most commercial property owners would look at the risk of hail & wind damage as minimal due to the coverage under their property insurance policies taking on that risk. However there are issues at play that must be discussed. Let’s talk about the risk of hidden damage & not utilizing the latest technology to find all the damage. Many older commercial properties have BUR with gravel ballast roof systems. These are classically denied as no physical damage in a hail & wind storm, yet time & time again I find hail & wind damage with these types of roof systems. You will visually see damage to the HVAC units & metal flashings, but magically the roof system itself is unscathed. This is typically not the case when we use technology to visually see the “unseen.” We use thermal infrared technology to narrow down the areas where hail created
opening’s have penetrated the roofing system. One of the biggest risks is hidden damage. Don’t let the hidden damage go uncovered when it will be too late to get the insurance policy to cover the roof system failure. The risk of a roof system failure years down the line with substantial costs to the bottom line can be minimized with the right technology & investigation strategies. The Disaster Advocates Inc is the hidden damage specialist. We can help you “Claim What’s Yours!”