When faced with Water Damage or Mold, who gets to hire the restoration contractor? The Short Answer: YOU. Read on for important details about insurance claims and Preferred Vendors.
Having to call your insurance company is already stressful, right? And when you call, you’ll be faced with an important decision: Which restoration company are you going to hire? Who gets to decide? And what are Preferred Vendors?
Your insurance claims adjuster will confirm coverage for some or all of the loss. Then he may make a suggestion: “We have a list of Preferred Vendors in your area that we recommend you choose from. All are reliable and provide quality service. You can also choose a contractor of your choice. However, by choosing one of our Preferred Vendors we can guarantee the work and arrange repairs if the work is not completed properly for any reason.”
When you choose from a list of Preferred Vendors provided by your insurance company, your insurance company saves money. Preferred Vendors agree to complete the scope of repairs approved by the insurance company, or their third-party representative. The price is determined by the insurance company. Your insurance company’s goal is to save money by paying less for repair work. The Preferred Vendor wants to receive regular work and increased steady income. Since YOU, the insured, makes the final decision, keep the following in mind:
- Preferred Vendors are typically set up through third-party providers, who oversee the scope of repairs and determine the pricing. This frees up countless hours of time for the adjusters, so they can focus on other areas of their job.
- Insurance companies save money on tear out, repair or replacement of your property when they can use a Preferred Vendor. Less money paid out improves their loss ratios.
- You have “peace of mind,” assured by your insurance company that they have already performed background checks on their Preferred Vendors. They will guarantee the contractor’s work if the work is not completed adequately, or in some cases, not completed at all.
- Contractors on the Preferred Vendors list will receive steady work on a regular basis. And they will receive prompt payments from the insurance companies.
Sounds like a “Win-Win” for all parties involved, right? Not necessarily…
- A qualified restoration contractor will arrive in person. He will thoroughly inspect your property, then determine the scope of work needed to return your property to a pre-loss condition. However, if you hire a Preferred Vendor, the insurance company (or their third-party provider) determines the scope of work. When the initial estimate is submitted by the Preferred Vendor, they will review it, then decide what they will approve. This is determined by a pre-set formula as to how much equipment and how many days they will “allow” it on the project. Typically this could be less than what may actually be required.
- Preferred Vendors are more prone to accept the insurance company’s approved scope of repairs. Even in the event that they may disagree with the revised scope of repairs. Despite what they have been trained or certified to do, they have agreed by contract to abide by the decisions of the insurance company, or their third-party provider.
- Insurance companies pay Preferred Vendors only the current competitive rates, as determined by the insurance industry. They adamantly deny that they are “fixing the price” and claim that their rates are determined according to the area or region. The Gillette area and its surrounding communities are uniquely located, with special circumstances that aren’t always taken into consideration. For example, insurance companies are surprised when their Preferred Vendors in Rapid City or Casper are reluctant to travel to Gillette. Apparently, they haven’t looked at a map of our area!
- In addition, Preferred Vendors agree to pay a “Job Fee” for every job referred to them by the insurance company. This reduces, or even eliminates, the margins necessary to make a decent profit. This could force the contractor to produce lower-quality work, or even use lower-quality materials in order to avoid taking a loss on the project. When contractors don’t make enough profit, they go out of business, or remove themselves as a Preferred Vendor. This causes a turnover of contractors on the Preferred Vendors list.
- In some cases, Mold, Lead and/or Asbestos may not be properly addressed. There are higher costs for materials and time involved in following industry-standard procedures. This could put you, the insured, at risk for future health concerns.
BOTTOM LINE: As the insured, YOU get to determine which company you want to hire.
Is DISASTER RECOVERY on the Preferred Vendors list for any insurance companies?
NO. Here’s why:
- After years of experience, Disaster Recovery understands liability. We want to make sure that we have total control over the scope of repairs. For that reason, we handle every restoration project correctly, according to industry standards, and we do not cut corners. Otherwise, we do not accept the job.
- Our work is thoroughly documented from the moment we receive your call, and throughout the entire project:
- We take photos, and include them with the scope of repairs that we submit to your insurance company. We even use the Estimating software that most insurance companies use themselves to justify every single line item.
- In some instances, we provide GoPro Videos to further document the project. These can be sent to your insurance company. This is appreciated, especially when they cannot send a field adjuster immediately.
- Daily readings for all drying equipment placed on the project are monitored and recorded. We don’t remove any equipment until these readings indicate that the areas have reached a dry standard – period.
- Every conversation with you as our client, and with any representatives from your insurance company, is recorded daily.
- Typically, we interact with your insurance adjuster through emails. A copy of each email received or sent is also included in your file.
- All documentation for every water or mold project is kept in our files – forever.
- When you hire Disaster Recovery, we work for YOU. You benefit from years of experience, training, and continued education in the ever-changing field of restoration. We are happy to coordinate information with your insurance company, but ultimately you are our client.
- Disaster Recovery has declined invitations to become a Preferred Vendor for obvious reasons. However, we have developed a good working relationship with insurance companies and their adjusters throughout the years. Grudgingly, they admit that they may at times have to “pay more” on the claims that we are involved in. But they know that the job has been completed professionally, correctly, and safely.
Hopefully, you will never need the services of a restoration contractor. But if you ever do, we encourage you to consider this information carefully. Then, call your insurance company and say: “I need to start a claim… And I’ve already chosen Disaster Recovery for my restoration contractor.”
For more information about water damage or mold, READ the article: Water Damage Cleanup – Don’t wait!
If you have any questions, or need more information, please feel free to contact our Office at (307) 686-0078.