This is the longest blog post I’ve made so far. It might be more of a novella than a blog post. In my single blog post last week about customer loyalty, I mentioned that I had been buying my own insurance since 1973. During that time, I have never had a personal auto claim (knock on wood). And, until a modest tornado claim a few years ago, I had only had one homeowners claim. In that claim, I wasn’t looking for money because I doubted I had any significant property damage…I was looking for help in identifying a water intrusion problem and getting it fixed.

My experience resulted in the following article I wrote over 20 years ago for the Insurors of Tennessee magazine where I worked and it also prompted me to create a seminar with my co-conspirator John Eubank, CPCU, ARM called “How to Battle an Adjuster…and Win Every Time!” (There is a story behind the title of this seminar that I’ll share in another blog post.) So, without further ado, here is my first claim experience story….

Anatomy of a Claim

It was a dark and stormy night. A drip rang out…

It was bound to happen sooner or later…my first claim. Although I spend a significant amount of time assisting agents in resolving claims problems, I had not had a claim myself in 21 years of purchasing auto and homeowners insurance. In mid-November, my wife and I had arranged for the carpeting in our home to be replaced. When the old carpeting was removed in the living room, we discovered a large black stain on the floor between the fireplace and window.

It was raining that day, so sticking a finger between the flooring and baseboard quickly revealed a puddle of water. Somehow, water was getting in from the outside and had obviously caused damage—the extent was unknown, nor did we know how long the problem had existed, since there was no visible evidence of damage when the carpet was in place.

At that point in time, I was less concerned about any insurance proceeds than I was in getting the problem corrected and determining if there was any structural damage. At the least, I figured the “experts” in the claims department of my insurer could refer me to a competent contractor. So, I called my agent and reported the claim. I have to say that the process went smoothly and that afternoon I received a call from the claims department of my insurer.

The claims rep advised that the adjuster would be calling me soon to arrange to inspect the damage and, sure enough, within the hour, an independent adjuster called and we scheduled an appointment for the next day. I thought to myself, “Not bad, we’ll have this taken care of in short order.” Little did I know.

The adjuster showed up about 30-45 minutes late…he got lost. That should have been the tip-off that this wouldn’t be such a smooth ride. After the obligatory ‘how do you do’s’, one of the first things out of the adjuster’s mouth was, “You know this probably won’t be covered.” More on this later.

I had the carpet pulled back from the baseboard area and had stuck a paper towel between the baseboard and floor to show how wet the area was. I offered to pull the carpet back further to show him the size of the water spot and mildew, but he said that wouldn’t be necessary—I wondered how he could ascertain the nature and extent of the damage without looking at it—although he did poke around the baseboard with a ballpoint pen and proclaimed that I had a leak somewhere. A revelation!

He then got a ladder out of his car, climbed to the eave, looked around the roof, and stated that I probably had a leak: (a) between the vinyl siding and exterior wall, originating from (1) the chimney, (2) gutter or (3) window molding, (b) around the chimney flashing, (c) from under a bad shingle, (d) from puddling ground water, or (e) from unknown sources.

He reiterated in an authoritative voice that probably, of course, none of the inside damage was covered by my homeowners policy—only windblown shingles—but he would turn the report in anyway. His recommendation was, “You need to get this fixed.” And, of course, he pointed out that my insurance didn’t pay “for that kind of thing.”

I wondered where he had received his insurance training since he appeared to be making an official determination that there was no coverage. Certainly, there was no need to question his knowledge or expertise since he was meeting all state requirements for claims adjusters—he had a clipboard, flashlight and ladder. And, I almost forgot, his indispensable combination ballpoint pen / wood rot testing device.

[Note: Has anyone ever wondered why you have to be licensed and meet state-mandated educational standards in order to sell insurance…but you don’t have to have any credentials (at least in our state) to adjust an insurance claim? But, I’ll save this diatribe for another time.]

Before leaving, the adjuster reminded me one last time that this loss probably wasn’t covered. I finally asked him why, and he mumbled something about rainstorms and broken windows, and some exclusions for “water damage” and “leakage.” He also suggested that I get this “taken care of right away” since the policy required me to do so and wouldn’t pay for any subsequent damage—a correct statement—although I wondered how the policy could require me to do something regarding a loss that wasn’t covered anyway. But I didn’t belabor the issue and wished him a nice day. As he waived good-bye, he said someone would be contacting me soon.

I don’t know his definition of soon, but “soon,” in claims-adjusting parlance, apparently means at least ten days because that’s when I finally heard from someone…after a few phone calls to my agent and insurer.

I had actually called my agent after a week to advise that I hadn’t heard from anyone and I still had a small lake in my living room from a recent rainstorm. My CSR told me she’d need to make another claim report since this was another “occurrence” and, of course, there would be another deductible.

This is an excellent philosophy from the insurer’s standpoint—delay a claim settlement and don’t assist in any way in correcting the problem. Then, every time it rains there will be another deductible, with only minimal additional damage. If you can put it off long enough, you can accumulate enough in deductibles to never have to pay a claim! Of course, I’m being facetious…the adjuster would never be taught such a thing, particularly, I’m convinced, since the adjuster had never been taught much of anything. [Note: As you be able to tell, the seething has started.]

I told her to forget it and just give me a recommendation on a contractor. She gave me the name of a contractor, I called them, and they told me they didn’t “fool around” with repair work, but they did give me the name of someone who apparently does “fool around.”

Before I could contact the recommended contractor’s recommended contractor, a newly-assigned company claims rep called about my “second” claim and I told him I was just kidding and to forget it. Shortly thereafter, the original independent adjuster called and I told him to forget it too, although we did have a brief, but cordial, philosophical discussion about insurance exclusions and conditions (I’ll discuss this later).

I finally reached, after several phone calls, the recommended contractor’s recommended contractor. He came to the house and proclaimed it must be a chimney flashing problem because…it usually is. He said I would need to get the vinyl siding contractor out to remove all of the siding from around the chimney and off the back of the house, then he would redo all of the flashing (as well as some other work that he noted I needed during his inspection), then I could get the siding company to replace everything. If that didn’t work, he’d try something else.

In the meantime, my wife had gotten the name of a roofing contractor from our five-year-old son’s former baby-sitter’s son’s construction company receptionist. This guy came out three times and did some sealing and caulking around the roof and siding. The leak got worse. After his third visit, he indignantly proclaimed that the roof was fine—he’d fixed it—so it must be the window molding that needed “fixin’,” and that we should contact the vinyl siding people. We did.

The vinyl siding folks gave us the name of a guy who does roofing and siding. After a half-dozen phone calls, he finally came out one weekend while we were out of town to inspect the roof and said he would give us a call, when we returned, with his diagnosis. He never called.

About that time, the recommended contractor’s recommended contractor called back to see if we were ready to begin our contributions to his retirement fund. We told him about the baby-sitter’s son’s contractor’s determination that it was a window molding problem. He said that guy didn’t know what he was talking about and he could see that in the sloppy work he did when he attempted to seal around the chimney and siding. It does look awful, so we thought maybe this guy knows what he’s talking about.

In the meantime, we got a check from the insurer! The amount was a whopping $20 to pay for the damages (in excess of the deductible) that the independent adjuster said weren’t covered to begin with. At this point, I didn’t want a check—all I wanted was to fix the problem. We didn’t even know what was causing the leak, what the damages were, or what it would cost to repair the leak.

The claim report, though, was interesting. The adjuster’s diagnosis was “Problem: Not any flashing around area of roof near chimney.” In fact, the chimney is flashed, but how can you argue with a man with a clipboard, flashlight, ladder, and a wood-rot-testing ballpoint pen?

The estimate components were all in $25 and $100 increments—very scientific. I could have given them actual invoices to-date if someone had ever asked…and they would have learned that they were less than my deductible. Included in the estimate was $100 to “re-lay and clean” the carpet. If the adjuster had just pulled back the carpet a few inches or listened to anything I said, he would have discovered that we had just laid new carpeting (that’s how we discovered the leak) and there was no expense actually incurred.

Now, back to the vinyl siding company recommended contractor. He didn’t call, so I called him…fourteen times (no kidding). I called his office. I called his home. I beeped him. I called at 5:30 a.m. and 10:30 p.m. I talked to his secretary, his wife, two of his children, and some guy with a Turkish accent that I think was ransacking his house (only kidding about the last one). Finally, I gave my wife his number(s) and she, of course, got him on the first attempt.

He said he thought he knew what the problem was and, if so, could correct it quickly. If that didn’t work, he’d try something else. At least it didn’t sound like he intended to rebuild the entire roof. Finally, he came out and made some sort of adjustment to the chimney cap and charged us $35. We’ve had five straight days of rain since then and the floor is as dry as a bone. It appears the problem has been corrected.

However, the original adjuster had made it clear in our last phone conversation that repair costs are never covered—only actual damages. But, in my particular case, even the damages, according to the adjuster, are not covered, although the insurer must disagree since they sent me a check.

When the adjuster advised me of his expert opinion, I asked him few questions about my homeowners policy. For example, where specifically did my policy exclude this loss? What did the Additional Coverage 2.Reasonable Repairs mean when it said it would pay for “necessary repair costs to protect against further damage?” What is the meaning of Section I – Condition 2.d.? After a long pause, he said I should talk to the company because, in his words, “Insurance usually doesn’t cover your kind of loss.”

Despite the claim report estimate, we still don’t yet know what actual damage, if any, has been done. We’re in the process of locating a contractor to determine if we have any structural damage and arranging for a termite reinspection. Please pray for us.

Our out of pocket expenses for all of the repair estimates and work done to stop the leak is somewhere around $200 (still within the deductible) and I’m anxious to see what happens when I turn in these expenses. Moreover, God only knows the cost of this claim in terms of the time involved and the frustration endured. Regardless of the outcome of this entire affair, it certainly has been a learning experience.

First, I’ve learned that, even though the response to a reported claim can be prompt and courteous, that still doesn’t mean that the claim itself will be settled expeditiously—particularly if you’re dealing with contractors.

Second, I’ve learned that some insurers seem more concerned about procedures, paperwork and paying (or not paying) claims than actually helping a customer resolve a problem—it’s easier to hand out a check than to actually provide any real service.

Third, I’ve learned firsthand what agents have told me for years—that there really are people out there interpreting insurance contracts that are equally qualified to perform emergency tracheotomies—the results sometimes seem about the same. I wonder how many insureds have had claims wrongfully denied because an adjuster said “We just don’t cover those kind of things”?

Fourth, I’ve learned that claims adjusters say “probably” a lot.

What’s the moral of this story? At this point, nothing about this incident seems “moral,” but I can give you one bit of advice that I plan on taking myself: increase your deductible. Because of this experience, I plan to increase my homeowners deductible to at least $1,000, pocket the savings, and take care of the problem myself next time.


It has now been over a year since this article was [originally] published. My house is dry…and I still have the $20 check, uncashed and suitable for framing. I figure it’s only a matter of time before this uncashed check brings the insurance company’s accounting system to its knees. This experience has taught me much, and was a motivation in publishing this book. Although I’m convinced that my experience was something of an aberration, and that the vast majority of adjusters are highly skilled at what they do, agents and consumers will still continue to encounter similar situations…some much worse than mine.

Photo by andrew steinmetz

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Bill Wilson

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One of the premier insurance educators in America on form, coverage, and technical issues; Founder and director of the Big “I” Virtual University; Retired Assoc. VP of Education and Research from Independent Insurance Agents & Brokers of America. Reprint Request Information