“I need a new career.” There are a thousand different ways that it can creep up on you. It can happen in a brilliant flash of revelation, or it could be the slow accumulation of years of small things. All of us, at one point or another in our lives, come to a point where the pain of going into work is greater than our fear and uncertainty of looking for new employment.

In January 2008 I finally came to the realization that I needed a new career. My career in construction was just too painful to continue. I had worked my way up from assistant lumber hauler and jobsite cleaner all the way to company owner. I had held every different job in the process. By the last half of 2007 the housing market was collapsing and it became clear that I was not going to remain an owner of an active construction company much longer. I had a choice to make. I could look for a new job, as an employee of someone that was not going out of business, or I could find a completely different line of work.

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This one is easily the most frequent question I am asked by those new to the career of claims adjusting. There are likely several ways to answer this question – and I won’t dodge it; I’ll give you mine – but first I’d like to attempt to provide a voice to the reason why this question is often difficult to answer.

To start: there are no guarantees in an industry that counts on bad weather and unforeseen catastrophic events, so it’s easy to understand an IA firm’s hesitancy to provide a straight answer to questions regarding income. On top of that, no one wants to be misunderstood or imply anything remotely promising an income of any kind. There are simply too many variables to make accurate predictions regarding something as important as adjuster compensation.

Take for example the number of fee schedules currently in use. I don’t mean a simple difference in rates (there are those too, by the way) rather there are differing mechanics as to how IA firms and therefore adjusters gets paid. Time and expense, sliding fee schedule, daily rate, fixed rate, component fee schedule – all examples of the variety of ways adjusters earn income. Next, there are a variety of commission rates generally ranging from 50-70% of the invoice for independent adjusters; and salaries with travel differentials for staff adjusters; and who knows how many other income plans are out there. The point is, measuring, much less comparing earnings across the claims world is not precise.

Then there are the perks – expense reimbursement? Cell phone allowances? Health insurance? Disability insurance? Errors and Omissions insurance? Profit sharing? Stock purchase plans? 401k? Laptops? GPS systems? All of these expenses equate to income in some fashion or another. Yes, there is a healthy variety of variables that impact the proverbial bottom line. So, ignoring all of these variances for a moment, perhaps it is simply best to describe earned income in terms of averages.

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This is a continuation of an earlier post on CAT claims vs. Daily claims.  In this post, I wanted to share some personal experience on the difference.

After my first significant CAT deployment, I knew I loved the industry and I knew for certain that I wanted to stay in it.  I enjoyed it, I was good at it, and I had never made so much money in my life.  Unfortunately, I also knew I had only one season of experience under my belt, and most of the IA firms advertised that they “required” three or more years of experience.  I didn’t let that get me discouraged; rather, I set about strategically and systematically working to get myself on the rosters of almost every IA firm I could find.

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We’re often asked by our students what certifications would be most valuable to pursue beyond our Total Adjuster Program.  There are several we mention and one of the more valuable ones we refer to is State Farm Certification.

State Farm represents the largest property insurer in the United States, and you must go through their certification program if you wish to handle State Farm claims.  This certification program is currently offered through the 4 independent adjusting firms that handle SF claims: Worley Cat, Pilot, Eberls, and E.A. Renfroe.

I recently sat down with Herb Carver, Director of Corporate Development at Worley Cat, to ask him more about the process of becoming State Farm certified.  His answer was extremely insightful – here is what he said:

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Many people I talk to who are interested in becoming independent claims adjusters are familiar with catastrophe claims and the catastrophe claims business.  In the minds of many, an independent adjuster and a catastrophe adjuster are one-in-the-same.

Although it is true that independent adjusters adjust a large percentage of catastrophe or “CAT” claims, many people are unaware that independent adjusters also handle a large percentage of local or “daily” claims.

Measuring a Damaged Roof

First, let’s make sure we understand the difference between the two types of claims. CAT claims arise out of some large-scale event, typically a natural disaster like a flood, hurricane or hailstorm.  When there’s a disaster like this, the massive spike in the number of claims generated in that geographical area overwhelm the capacity local staff adjusters.  If it weren’t for laws that require that claims be processed according to strict deadlines, these claims would simply require more time to process.  The reality is that there are strict laws, and –- although deadlines are exteneded a bit during catastrophes — penalties imposed on insurance companies for failing to comply with claims-handling deadlines during a CAT can be severe, into the multimillions.  Therefore, insurance companies use the services of TPA’s, which in turn deploy independent adjusters to handle overflow claims to ensure deadlines are met.  When the situation is back under control, most of the independent adjusters are released, and the staff adjusters take care of the now-manageable number of remaining claims or claims in dispute.  I say “most” because a number of independent adjuster do end up remaining behind on “clean-up” (but more on that in a future post).

Water Damaged Ceiling from HVAC Leak

Daily claims, on the other hand, are claims arising from losses that happen every day in every community throughout the country, but are not associated with a catastrophe; a pipe leak, a kitchen fire, a slip on a wet floor in a grocery store and a back strained on the job are all examples.  It might seem that independent adjusters would not be needed for these kinds of claims, because common sense suggests that local staff adjusters, working directly for the insurance company, could handle them.  In reality, however, a similar principle applies; insurance companies must dispatch claims according to strict statutory deadlines, and keeping enough adjusters on staff to handle spikes would be bad business; they’d be twiddling their thumbs during the lulls.  One of the ways that insurance companies get around the legal employment issues of needing more or less adjusters according to volume is to contract with IA firms for these daily claim spikes.  Basically, independent adjusters handle the overflow, thereby leveling out the claims volume for staff adjusters.  Insurance companies of every size, local and national, utilize TPA’s of all sizes and flavors for this purpose; some TPA’s even specialize in handling daily claims, avoiding CAT claims altogether.

What does this mean for independent insurance adjusters?  It means that there’s more than just CAT adjusting available as a career path.  This is cool news if – like me – you have a young family and extended travel is difficult. Let me set some expectations, though; if you’re planning on a career as an independent adjuster, you should expect to be ready and willing to travel at a moment’s notice.  It’s a lucrative job for a reason; it’s not easy and you have to pay your dues.  A can-do, heck-yes attitude is indispensable, especially in the beginning.  But as you get established in the industry, your options will expand, and daily claims are one of those options.

This was originally written in 2011 but is a timeless piece on the value of empathy and compassion. – AdjusterPro, May 21st, 2013

When I first came to the adjusting industry, I learned as much as I could as fast as I could.  I buried my nose in insurance policies, industry magazines, XM8 Integra-Claim, DDS, construction manuals, basically anything I could find relating to the claims industry.  I tried to learn everything I could in regard to the CAT industry. I became well versed in policy, fee schedules, IA firms, estimating software, necessary equipment and everything I thought necessary to become a great adjuster.

You see, as adjusters we are trained to handle the financial cost of a catastrophe whether flood, hail, hurricane, tornado, man made. One of the things I never thought about, at least in the beginning and one of the things I was NOT trained to deal with is the human cost of a catastrophe.
During my first year as an adjuster on my own, I learned a powerful lesson that will stay with me the rest of my career. The lesson I learned is simply the power of words.

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AdjusterPro sends our sincerest sympathies out to the many affected in and around Moore, Oklahoma today in the aftermath of what looks to be a truly devastating and horrific event.

As adjusters, situations like these are especially tough where lives have been lost or permanently altered.  And yet it’s our duty to respond quickly and professionally to do our own small part in helping people put their lives back together.

Towards that end, Oklahoma has made some provisions for emergency licensing and I’d like to share those with you.  NOTE: it could be that some of this information changes based upon the peculiar complexities of this situation in Moore.  We’ll be monitoring and updating appropriately so check back often.

Here are the basics:

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