Hail Damage - The Insurance Industry's Dirty Little Secret

Hail Damage – The Insurance Industry’s Dirty Little Secret

Before my dad started our roofing company 47 years ago, he was claims manager for a large Midwest property casualty insurance firm. I have been with the family roofing company for 33 years and with that I have continued in my dad's footsteps of often swimming upstream by challenging insurance adjusters' hail damage assessments and theories, when facts dictate that.

A prominent engineering firm specializes in working with the insurance industry on property storm losses. Many years ago they wrote what became widely-recognized as the criteria by which hail damage was assessed on built-up roof. I am paraphrasing in order to avoid any legal tussles with them but the gist was that it takes a 2" hailstone to damage a gravel surfaced built-up roof. Every roofer in the hailbelt knows which engineering firm I'm referring too - no need to mention a name.

I worked with that engineering firm many times over 33 years on hail damaged roof claims, many of them where the damage was disputed. Curiously, last spring when I worked with them on a hail loss, according to the engineer I worked with, their criteria had changed - now it takes at least 2-1/2" hail to damage a gravel surfaced built-up roof. I'm not sure what changed it from 2â" to 2-1/2", because pea gravel hasn't changed, and I know of no significant changes in typical keg asphalt or fiberglass membranes in the last several years that would make them markedly more hail resistant than before. This is especially hard to understand given that they tend to use the same new criteria even when assessing 15-year old BURs that were installed back when they used to say it only took a 2" hailstone to damage gravel surfaced built-up.

I decided it was time to give another side of the issue. Most roofers are reluctant to take this position simply because they can get a lot more business by being friendly to the insurance adjusters, than they are likely to gain by arguing with an adjuster on a single hail loss.

As anyone who has ever picked up a spudbar in anger (is there any other way to operate a spudbar?) knows, hot bituminous asphalt is more brittle when cold, and more pliable when warm. Knowing that simple fact alone leads us to what most roofers already know: It takes a much larger hailstone to damage a roof when it was 95 degrees outside just prior to the storm, than it does if the outside temperature is colder or if the hail was preceded by cold rain. Yet I've yet to read a single engineering report that even mentioned the outside temperature at the time of the loss.

As an example, a small town in West Texas saw most of its commercial roofs receive major hail damage in the mid 1980's, by marble sized hail. The hailstorm was unusual in that it happened in February when the temperature was in the 40's, and the hailstones were rifled into flashings by 70 mph winds. The prominent engineering firm would have you believe that the roof damage was impossible because the hailstones were not 2".

The roofing industry has allowed the insurance industry, along with those engineering firms who they pay a lot of money, to set an erroneous standard. A standard that is too dependent upon hail size alone. This is used against the insured countless times to deny a legitimate hail damage claim. Too many times adjusters are allowed to deny a claim simply by producing hail swath reports that show that no hail was present in a size that their industry has determined that will cause hail damage. Oh, they also produce other supporting "evidence," such as lack of dents to sheetmetal cap flashings, vent hoods, etc. They produce scientific-sounding criteria that says a given sized dent in HVAC unit sheetmetal or condensing coils equals a given size hailstone. The problem with that theory is the sheet metal is not markedly more susceptible to denting when the outside temps are cold than when warm, as asphalt roofing material is. It is an unscientific standard at best, and a conflict of interest at worst.

In 33 years I have literally secured millions of dollars in insurance claims for insured who were underpaid or had their claim denied altogether. In many of those instances it seemed that the adjuster knew the damage was there, he was just going to make a roofer call him on it. Just one of dozens of examples was a school district in West Texas. The Supt asked me for an estimate to repair hail damaged flashing - he said the adjuster paid him $3,500. I asked him to get the adjuster back out for a reinspection because they had a lot more money coming than what they paid. The adjuster and I spent less than 10 minutes reinspecting the roof before he agreed to pay $60,000, not $3,500. He was an experienced adjuster and he knew the damage was there - he was just going to see if he could get by with paying less. And my guess is that for every time some roofer like me comes along who will shoot himself in the foot with an adjuster and make him pay what he owes, there are 9 roofers who are unwilling to lose the adjuster's goodwill.

Not all adjusters are out to cheat their insured, but there are enough of them that roofing contractors make a mistake in not going into every claim situation assuming that the adjuster is there to limit the claim settlement.

I have spent decades cultivating my bad reputation with the insurance industry, and I'd like to continue getting credit for my work. So please do not use any or all of this article without giving proper credit to its author.

Sincerely, Tim Adams Adams Roof Tech, LLC www.adamsrooftech.com

CIAK Said:

Roofguy Said:Are you saying the insurance adjustors are liars?

Without a doubt!!! Some are. Some are blatantly crooked and dishonest. Same as with roofers.

I would recommend a good read at Ben Muse Corruption and growth. B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

Interesting read, and maybe the first time I've heard "fly-by-night" used an a semi-positive tone. :-)

The term fly-by-night itself is misused, often by large cumbersome corporations as a means of discrediting competitors who lack their working capitol. It is also overused by smallish contractors for the same reason - they lack experience credentials and thus have a need to substitute other things.

I worked with/against a roofing consultant on a hail damage claim in Austin, Tx. recently. His long list of abbreviations on his sig-line made him look extremely qualified...to the uninformed. I knew that more than half of them were simply purchased memberships such as NRCA, MRCA, RCAT, etc. Heck, if he was a member of NRA he woulda had that in there, too. :-)

It is human nature for roofers to believe that what they're doing is just right, and that anything less is fly-by-night, and anything more is useless.

I don't waste a lot of time doing the things other roofers think I should be doing. I install roofs that last longer than any of my competitors, I do it for a very reasonable price, and we stand behind our guarantees even when an exclusion would give us an out. My customers like me and some have been using me for over 27 years - what the other roofers think about me isn't much concern.

Roofguy Said:Are you saying the insurance adjustors are liars?

Without a doubt!!! Some are. Some are blatantly crooked and dishonest. Same as with roofers.

Are you saying the insurance adjustors are liars?

Without a doubt!!! Some are. Some are blatantly crooked and dishonest. Same as with roofers.

Roofguy Said: Where did I say borderline?

If your customer has ANY damage and you ignore it, you arent doing them any favors. It is your duty to tell them what is there, not to make a moral judgement about whether or not they should file a claim.

Morality is too transcendental. I like to stick with logic. Insurance is all about the bottom line and that is profits. It doesn't care. People should care. I am first and foremost a roofer. I solve roofing problems. I like money but I also care. I tell every client to report their roofing problem to their insurance company but it is a crap shoot whether or not they will pay. Because of the new law, I can't even argue with their adjustors anymore (not that it did any good before).

I hate that the roofing businesses in North Texas have become nothing but racketeers in the insurance game. They don't care. They only care about slapping roofs on as fast as they can.

My problem is that all these people didn't have much damage. Some of them did, most got lucky. Now I'm giving free estimates to people searching for the right guy to argue to an idiot(ideally.)

I love finding a legitimate claim, which a lot of times are still on worn out shingles.

One Example: 10 baseball sized hail strikes per SQR to a mod bit roof over Fesco insulation which is now saturated due to extensive rain after the hail. Your options for repair are far few than the same hail damage, on the same roof type, but which has no insulation.

The adjuster needs to know a good bit about the construction of roof systems, rather than relying too heavily on a set standard.

Same goes for Haag's theory that it takes a certain sized hailstone to damage a certain type of roof. It's a decent starting place, but there are too many other factors involved to rely too heavily on those standards/criteria.

To me Tim, damage is damage and the cost to fix it vs. replace, whether it is hail on a roof or something else.

Arbitrary standards as you mention seem to fit the foot that the shoe is made for :dry: If quick closing of claims is the goal, then they gotta have something to serve that purpose

Also, I mark hail density only when there is a reason to do so. The insurance industry likes to pigeonhole claims by establishing arbitrary standards that they themselves promulgated, but which are not mentioned in the policy.

One example is XX number hail strikes per SQR. I realize that standard is widely accepted and it's a decent baseline, but I have successfully argued for replacement with fewer.

The insurance industry allowing Haag to establish that it takes 2-1/2" hail to damage BUR is not only unscientific and unsupportable, it is also the fox guarding the henhouse.

I never create claims that aren't there. In 33 years I have lost just 1 appraisal and that was because I let a friend fill in for me while I was out of town.

I've done 3 when Haag was appointed to represent the carrier. Won all 3. Appraisal is often/usually won or lost in the choosing of the 3rd "disinterested" party. I'll stop there lest I give away trade secrets. :-)

Roofguy Said: Where did I say borderline?

Contrary to what you think, adjusters rarely pay for roofs that arent damaged, nor do most adjusters get paid based on a percentage of the claim.

Not here. Local restoration contractors have been walking the streets and getting Organic Roofs bought

As there are less and less organics and more fiberglass shingles on roofs here, this will change.

I get called upon not only as an adjuster, many times as an umpire. Several times I am hired by insurance underwriters on large losses to verify the findings and give opinions. There are indications of experience levels on both sides, roofers and adjusters. Exhibit "A" shows an inexperienced roofer trying to get a roof "bought". About 10 feet away, the test square showed less than 4 strikes, the engineer's report concurred and claim was denied.

Exhibit "B" illustrates how you should document a loss or a totaled roof. If I see a test square by a roofer like Exhibit "A", I know I'm dealing with inexperience, dishonest or a hungry roofer.

If the roofer is aggressive and it becomes a "pissing match", and it may be harder to have a claim approved. From the insurance adjuster's side, a roofer trying to prove hail damage appears to have a "conflict of interest". From the roofers side, ALL insurance companies want to deny claims. Both can be true, but the adjuster's job is to watch out for the interest of their client, the insurance company and the insured. The adjuster is caught in the middle.

A point to remember: Just because hail is documented and you have soft metal damage doesn't necessarily mean the roof is damage beyond repair and must be totaled. If you know your stuff it makes the relationship with your client's adjuster much easier.

Natty.....spot on!

Many times roofers mistakenly mark a hail strike, (or bruise, breach, etc) when they are not. There is "good faith practices" that insurers and adjusters follow. If the roof is damaged it is "good faith" to bring it back to pre-loss condition. The issues arise when roofers are dishonest or ignorant and try to claim a loss when there is none. Remember; every time you have your client file a claim, whether it is paid or not, it is documented and there is a rule of three. If you feel there is legitimate claim then file, if not don't.

Now this is undeniable hail damage: Questions were, old or new, which storm, was coverage in affect, and was there a prior claim.

The "REAL DIRTY SECRET" is: If you want a claim paid have it done by an independent verses a staff adjuster, and as quickly as possible when a CAT is confirmed. Independent adjusters are paid in different ways- During a CAT, adjusters are paid on a fee bases, just day adjusting, mostly by the hour. The more claims paid the more money that is made for the IA. Staff adjusters usually less experienced make a salary and have no incentive to pay or not pay.

Tim is correct many times "legitimate" claims are denied, most (and I use "most" loosely) of the time by poor inspections and lack of knowledge by the adjuster.

As far as baseball size hail: This was in Granbury 2013. I denied the complete replacement of the roof and recommended repairs, which was less than the insured deductible.

Where did I say borderline?

Contrary to what you think, adjusters rarely pay for roofs that aren't damaged, nor do most adjusters get paid based on a percentage of the claim.

The opposite is true, I have been involved in hundreds of cases where the adjuster didn't want to pay legitimate claims.

If your customer has ANY damage and you ignore it, you aren't doing them any favors. It is your duty to tell them what is there, not to make a moral judgement about whether or not they should file a claim.