Carrier, IA Firm, and Adjuster Advice
on Reducing Supplements
Claim supplements – a necessary evil in the claims process, right? Well, kind of… We all know that supplements to claims are a fact of life in our industry. There’s no denying the fact that some claims are, by their very nature, going to involve unavoidable supplements. It’s a given that for some claims, once repairs are underway, additional unforeseen damage is going to come to light that needs to be covered by the policy. After all, a good adjuster is usually instructed to “write what you can see”, and without x-ray vision, they obviously can’t see inside the walls to assess hidden damage. Being realistic – at the end of the day it’s pretty clear that some supplements are necessary, but let’s be honest – other supplements happen due to preventable reasons, like human error, poor adjusting practices, or a lack of training. The tips below will focus on trying to help Carriers, IA Firms, and Adjuster in reducing the number of the latter type.
Reducing Supplements – Carrier & IA Firm Tips:
Create the best guidelines possible. Carriers, if at all possible, don’t leave anything up to chance. If you know you typically do or don’t cover something, include it in your guidelines. It’s not an adjuster’s job to guess as to what may or may not be covered by any particular carrier when it comes to common coverage. (actually, it kind of is, but that’s not for this discussion) The more detailed your guidelines are, for every type of situation, the more you can start to trust that in the long run, you’ll be able to see real results in supplement reduction. IA Firms – if you’ve received clear guidelines from your carriers, its 100% your job to make sure that information makes it out to the field and is implemented properly. And even if or when you don’t have always that clarity, it’s still up to you to try to do your best to carry out the carrier’s wishes. If you see specific patterns in item approvals or changes in standard coverage details, make sure to discuss it with your carrier partner, and verbally make your field adjusters aware of the modified requirements to try to generate the best estimates possible.
Train. Simple as that. Carriers, once you have your guidelines set, train your internal staff, including field and desk adjusters, so that as they work through the day, they produce consistent results. Especially train the staff that communicates with your outside resources (IA’s) as they are your daily go to people for your IA’s, and should have the most up to date answers possible should any questions arise. For IA’s, put together a plan to train your field and desk staff on the specific requirements of each of your carrier partners that works best for your business model. If you deploy adjusters specific to one carrier, make sure you give them monthly or quarterly training and updates on the current requirements. If your adjusters work cross-carrier, then make sure that you train carrier specific requirements across the board, and more importantly, track who has received what training, so you only deploy adjusters who you are confident will produce the right results for the specific Carrier who’s claims you are assigning them.
Build better relationships with everyone involved in the process. It can be easy in this industry to sometimes feel like a cog in the process. Lather, rinse, repeat, on to the next claim… But properly reducing unnecessary supplements requires a wider view and involves a longer-term approach. The more we build deeper relationships between Carriers, IA’s, and field staff, the more each participant will feel invested in the process, and that their contributions will have a lasting and valuable impact. With better relationships, communication is increased, and vital trends and information that may have previously been hidden can come to light. Additionally, creating better relationships will help immensely with staff retention, reducing the need to train and bring new recruits up to speed on your specific policies. Once you’ve got the perfect people in place, make sure to keep them engaged and happy and enjoy the benefits.
Increase communications. Building on tip 3 (creating better relationships), increase supplement specific communications across the board. Carriers and IA’s, don’t wait until your standard reviews to discuss these topics. When relevant information or changes surface, schedule specific meetings as needed to address the issues and changes that may be necessary, and follow up with written expectations and outcomes. Carrier’s, when you’re discussing supplement reduction, include your IA Firms in the process to gain additional insight and perspective. IA Firms, when you see building code or other impact changes in the field, pass the information along to your Carrier Partners. The more that you are able to build an effective channel for two-way communication between carriers and IA’s, the more effective your supplement reduction process will be.
Let’s not forget the adjusters in this process. Past their initial training, make sure you relay specific changes and advice in your ongoing adjuster communications related to supplements. Work it into your staff / team calls and email updates, send out critical changes immediately, and in general, get them used to supplement reduction being a priority part of the process.
Reducing Supplements – Adjuster Tips:
Slow down. Remember, speed kills. Take the time to do a thorough inspection, and make sure you’ve completely covered all angles and properly documented everything related to the claim. A quick inspection may seem like it will help cycle times, but if the claim reopens or there are unnecessary supplements, that benefit is out the window. Every preventable trip back out to the claim adds cost and time. Don’t be more worried about speed or your daily claim volume than quality. Which leads us to…
Document, document, document! Investigate thoroughly and take impeccable notes. Take clear photos. In this day and age, digital photos are cheap, so take multiple angles of complex scenes, take pics of damaged and non-damaged areas (both are critical), etc. Pay attention to detail – make sure you note and document absolutely everything. Especially situations where there is potential for discrepancy. Properly detailed claims give anyone who might have to follow up behind you (for whatever reason) the ability to make decisions that aren’t available on poorly handled claims, that lack this required info. It may very well be the difference between a supplement being issued because of lack of information thereby reopening the file, and a (much more satisfied) desk adjuster or Carrier representative easily making a remote determination and moving the file on to closure and final payment.
If allowed by the Carrier you’re working for, review your scope notes with the policyholder. Plan a part of your inspection dedicated to going over your findings with the homeowner and ensuring they know what you’ve found and what you are submitting. It gives them the confidence to trust you as a professional, shows that you are thorough, and allows them the opportunity to point out things that you might have omitted. Doing this can increase their level of involvement and satisfaction with the process, and ultimately, help boost the Carrier’s retention rates.
Know your Carrier’s guidelines. This should go without saying, but in the same vein as “you can only write what you see”, read, understand and more importantly, follow the guidelines of the Carrier you’re writing estimates for. If you know that they don’t typically cover a certain item or process, leave it off your estimate, but do take the time to document it and any other possible exceptions in your notes. We all know its usually not the adjuster’s job to make policy decisions, but providing the Carrier representatives with the proper level of detail in your submission that gives them the ability to make decisions, or dispute questionable additions without being there can only reflect better on you when it’s time for them to decide who they want to rely on in the field.
Know the local rules. If you don’t have a construction background, this can be a little more challenging, but take the time to get to know local building codes, and how they’ve changed over the years. A common cause of supplements is when local building codes have requirements that aren’t necessarily obvious to an adjuster writing the estimate. Spend the time to research the code for the types of claims you specialize in, speak with the contractors you interact with to get insight, and try to gather as much knowledge as you can so that you can write the most complete estimate possible for the specific cities and states you work in.
As we’ve said, we all know supplements are an expected part of the claims process. But we can promise you, that by following the tips above, we’ll be able to reduce the number of unnecessary supplements tied to our claims. Train well, communicate often, slow down, document everything, respect the policyholder, and follow carrier guidelines, and we’ll all help reduce unnecessary costs and workload, and continue to make the customers happier as we help them through the process.