The business of claims handling is a very rewarding business with a diverse selection of areas of specialization one may choose to explore. The fact that the business is so diverse can also deliver some conflicting issues that have to be dealt with from an adjuster’s point of view as well as that of the claims management firm. One of the key areas that I will discuss is daily vs. catastrophe (CAT) claims.
Most people that I speak with about the independent claims adjuster business are somewhat familiar with what it means to be a storm chaser and handle catastrophe claims. They hear stories from friends and relatives who are in the business relating to the destinations they travel and the financial rewards. What they probably do not understand is there is a key difference in being a catastrophe adjuster (storm chaser) and an independent adjuster. The terminology used is what distinguishes the difference. One key aspect of many firms book of business revolves around daily claims. These are normal business claims that occur from normal everyday perils insured against. These claims are geographically local to the independent adjuster’s home. These typically do not get classified as catastrophe claims.
Daily claims may range from a ruptured hot water heater, fire, theft and vandalism, or a multitude of other perils. These are normal business claims that occur from normal everyday perils insured against and generally, they are geographically local to the independent adjuster’s home. The independent adjuster assigned to these daily claims must be astute in his/her profession and have a general understanding of all facets of home construction as well as be a student of the policy. The daily claims business is a good avenue for the adjuster that wishes to stay at home with the family or for one who is not interested in long term travel obligations. Some key things that a daily claims adjuster must stringently adhere to are the laws and deadlines set forth for claim handling by the respective states board of insurance. Many times in catastrophe situations these laws and deadlines are extended given the volume of claims. In some scenarios, daily adjusters may be used to fill in during staff adjuster’s absences due to vacation, family emergencies, pregnancy or retirement.
The catastrophe claims business is very different in regards to volume, longevity, scope of damages, etc. The catastrophe adjuster needs to be packed and ready to deploy usually within 24 hours of the phone call. Many times they will have 48 hours to be on location in order to attend a storm orientation meeting. This means they will need to have all of their personal affairs in order at home, already have obtained all of the equipment necessary to perform their job, secure housing (hotel, RV park, apartment, etc.), all in short order. A good support system in the background is critical to the catastrophe adjuster’s success. Another thing that the catastrophe adjuster must be able to do is support themselves financially for typically 30 days until the first paycheck arrives. You now have to consider that you are paying for two households. A credit card, a handful of cash, additional fuel, food and water are a must. In some situations there is no electricity, therefore ATM’s and fuel pumps will not work. I can remember vividly the hurricanes of 2004. I was deployed to Orlando for Hurricane Charlie. I prepared with an additional 25 gallons of diesel in cans and I’m very thankful I had them. I got down to my last 5 gallons before I found a working diesel pump. Preparation prior to the event is imperative to survival.
To sum it up, both daily and catastrophe claims have their pros and cons. You must evaluate your particular needs and situation to determine which direction is right for you. The first step to pursuing a career in claims, regardless of which type of adjuster you choose to be, is to obtain your license. Learn more by clicking here.
Authored by Randy Allgood – Lead Instructor at American Adjuster Academy