Explain what a supplement is. That was a new term for me.
Ya, so, say you’re in a car accident and your body shop says that it’s going to cost $15,000 to fix your car and the insurance company comes back and says no, it can be done for $10,000. So, then they send a check for $10,000 minus your deductible, right? Your deductible is the part that you coming out of pocket like a copay at the drugstore. But, it’s going to cost $15,000. So a supplemental claim would be no you don’t owe me $10,000 you owe me $15,000 so, pay me the $5,000 more that you owe me so I can get the work done correctly. It’s the same thing with, maybe you have a kitchen fire. It’s a $50,000 fire and they want to pay $35,000, so a supplemental claim would be I’m claiming the additional $15,000 to do the work the right way and to put my kitchen back the way it was before the fire occurred. That’s what a supplement is.
So, now you know what a supplement is. Let’s talk through the first step to making to knowing and identifying that you are getting underpaid. I wouldn’t even know where to begin. I’m like oh okay, it’s $10,000, how do you know that there’s a need for more? Does that make sense?
Find A Great Contractor You Can Trust
Sure. So, this is the deal, as a consumer you don’t know how much it costs to replace a roof, or to redo a kitchen that had a house fire, or a bunch of water damage from a water heater that’s flooded the house. What you have to do is find a contractor that you can trust who is actually competent, honest, and will get a good estimate back to you. Ask around and you find a referral. The truth is, 90% of contractors out there do substandard construction. Only about 10% of them do exceptional workmanship, which is what most people want. You never bargained for substandard construction when you bought your policy, but carriers love it when the 90% of the contractors out there that do substandard construction come in with a lowball price and you can’t get the good contractor who does exceptional workmanship to work for that low of a price.
So, the consumer finds themselves in a squeeze because they don’t know how to handle a claim. How often does a consumer ever have a claim? They don’t even know how claims work. The adjuster has a tremendous advantage over the unsophisticated consumer because the consumer doesn’t know what’s going on. The adjuster does this all day long, every day, and the consumer can be taken advantage of very easily by these adjusters. Back 15 to 20 years ago the adjusters were allowed to do the right thing. Nowadays, they’re not even allowed to do the right thing. If they don’t do what they’re told, they’ll be fired. So, you, as the consumer have to educate yourself so that you have a level playing field and you can make the adjuster do the right thing by asking the right questions and documenting the loss properly.
So, step one would probably find a good contractor you could trust. The very first thing you have to do is find a good contractor who does exceptional workmanship, that’s honest, and that you can trust.
Ask For References
Okay, so let’s say I’m a sales rep and I’m selling for a contractor. How do I know that we do a great job and we’re not part of the 90%? How do I know we’re part of the 10 %? What’s the difference?
You ask for references. Give me three clients that you’ve done work for and call up those clients. Ask if they can tell me about Sam’s working for this XYZ roofing company. Did Sam do what he promised that he would do? Tell me about the workmanship and ask all those kinds of questions so that they can do their due diligence and actually vet the contractor and make sure that they’re honest and they do good workmanship. The people who have used Sam and his company, they’ll know. So, call those three references and check the companies out.
Scope Of Work
So, I’m a company where we’re doing great workmanship and it’s like crap, all these companies that are not doing good workmanship are actually pushing the pricing of insurance carriers to the bottom. They’re in a race to the bottom. We don’t want to be the company that’s in a race to the bottom. How do we show the insurance company that we’re not in a race to the bottom? We’re really just trying to do the job right and we’re trying to do it with good craftsmanship. What’s the way to show the insurance company that?
What the contractor does is they put together what’s known as a scope of work. Whether it’s hail or wind damage to a roof or a fire in the kitchen or whatever the case may be, this is all the damaged property and these are all the building components that are going to have to be replaced to properly repair your home or your commercial building. Then they show all the labor that’s required to do that as well; to put your building back using materials of quality so that it’s back to the way it was prior to the event. Whether it’s a hail storm or fire or whatever the case may be.
How Do We Know What Is Legitimate?
How do I know what line items I need to put on the scope? There’s a lot of different things you could put and sometimes people draw it up and they’re just like shingles, gutter and that’s it. But, you’ve got to put all these other little things on there as well. Where do we find what I can put on there? What is being too aggressive and what’s not being aggressive enough?
So the question is, is every single line item on your contractor’s scope of work legitimate and reasonable? Or are there line items on their estimate that are illegitimate or unreasonable? All you have to do is tell the adjuster. If my contractor has put line items on my estimate that are illegitimate or unreasonable, I want to strike those. However, I would like to first hear from the contractor. I want to know how did you arrive at the conclusion that those line items are illegitimate or unreasonable. Not just because you say so or we don’t pay for that. No, I want to know how did you arrive at your conclusion that they’re illegitimate or unreasonable. Because if they are and you arrive at that conclusion in a legitimate valid manner, then awesome it should be stricken. However, if you just don’t want to pay it and you’re not able to articulate how you arrived at your conclusion that they’re illegitimate, then those line items should remain.
I wrote a book called Level The Playing Field. Which you can actually download for free. You could read through there and I wrote it to educate the consumer. I mean if you have a claim for thirty, forty, fifty thousand dollars and they’re lowballing you ten or twenty thousand dollars, it is worth a few hours of your time to read the book to educate yourself so that you know what the heck’s going on with your insurance claim. You can then ask the proper questions of the adjuster that will compel them to do the right thing and be able to settle their claim in a righteous manner. Righteous being what’s right not a penny more than what they owe, but not a penny less either.