The Loss Adjuster : Friend or foe?

Both the broker and loss adjuster are keen to assist the Iinsured in their time of need and are intent onby resolving and settling the loss. It makes no sense, therefore, that so, why then do so many brokers resist or feel threatened by the appointment of a loss adjuster.

The broker is involved early in the process. He Has the broker must considered each and every eventuality prior to policy inception and taken into account the Insured’s insured’s exposure to incidents which could have a detrimental effect on their operations. Are they familiar with the insured’s geographic location and have they considered the potential for loss in every operational aspect of the business, for example.

What, for example, would the impact be on a fruit juice manufacturer if its only access road was washed away by flood waters? The manufacturer would be unable to get its product to market for weeks or even months. If not correctly insured, there would be no and/or limited cover and the broker would be found wanting at the time of loss.

Other questions include: Is the Ssum Insured insured aadequate, will the Insured insured be entitled to settlement on a re-instatement and/or indemnity basis if the property is extensively damagedand, what will happen if the insured fails to adhere to a warranty. Problems can occur when attending to complex and/or large losses.

A free flow of communication between all parties is essential in ensuring that any issues are dealt with swiftly and with as little impact to the Insured insured as possible.

The role of a loss adjuster is to gather and report on the facts of a loss, having regard to the cover provided. Brokers cannot and sshould not interfere with this role.

In the case of a shopping centre fire, where the insured is the landlord, the loss adjuster would typically begin by gathering information relating to the circumstances surrounding the loss. The initial investigation could involve eyewitness accounts, reviewing CCTV video footage and examining alarm activation records among other things.

Discussions will also be held with parties that reported or responded to the fire, including the fire brigade, police and security company. and iIf reports have been compiled, copies will be obtained.

The loss adjuster has discretion to appoint a forensic investigator to determine the cause of the fire and, if warranted, will also instruct a building code expert to ascertain whether the insured has complied with all relevant building codes and regulations. as nNon-compliance could result in the loss being rejected.

Such an The inspection may also entail involve aa detailed assessment of the insured’s fire fighting equipment. This will determine whether an, was an automatic sprinkler system was installed, when last was tthe system was serviced and what role it played in limiting or curtailing the fire damage.

In the final stages of the investigation a professional team comprising a structural engineer and quantity surveyor will analyse the nature and extent of the damage, costs involved in reinstatement and the expected duration.

Contractual documentation such as lease agreements will then be reviewed and risk and responsibility for fixtures and fittings ascertained. The adequacy of the sum insured will be tested and if the loss adjuster believes a recovery is possible then appropriate actions will be taken, including briefing attorneys if necessary.

In addition to the material damage, the policy may have been extended to incorporate cover in respect of a loss rental/loss of gross rentals. and tThis being the case, the loss adjuster will need to calculate the financial impact to the insured as landlord, due to a portion of the site being unfit for occupation.

Each loss presents the broker and qualified loss adjuster with a different set of challenges. The value function performed after an insured peril is made much easier with the assistance of a willing insurance broker. Both loss adjuster and broker must work together towards the same goal – a reasonable and speedy claim settlement.