James Swain heard his two giant ficus trees fall on his Oakland Park home as Hurricane Wilma tore through South Florida last October.
One tree smashed the carport. The other hit the front of the house, damaging windows, the roof and several walls, as Swain, his wife and 11-month-old son huddled in a back bedroom until the storm passed.
And that was just the start of his problems. Now Swain has seen three insurance adjusters, each giving him different guidance, and has received a ``final'' settlement he says is too low. He's had to call his state senator for assistance and filed a complaint with regulators.
None of the adjusters Swain saw actually worked for Citizens Property Insurance, his insurer. They were part of a platoon of thousands of emergency adjusters hired by insurers to handle the more than 500,000 claims from Wilma. The adjusters are licensed, but that carries no guarantee of experience.
Some of those adjusters - many from out of state - are leaving South Florida homeowners such as Swain frustrated by negotiation hassles and low settlement offers. From Hurricane Wilma alone, more than 3,000 consumer complaints about adjusters have poured into Tallahassee.
Insurance officials say these emergency adjusters are crucial to respond to homeowners quickly after a major hurricane. ``We use outside adjusters to supplement company adjusters in catastrophe situations,'' said Ryan Priest, an Allstate spokesman. ``. . . For economic reasons, we simply can't have a full team of adjusters on staff year-round.''
State records show that nearly 12,000 six-month emergency licenses were issued last year. In 2004, 17,128 were issued. Compare that to 2003, a much calmer hurricane season: 0.
Yet, while the state licenses the emergency adjusters and the firms that hired them, there are no minimum experience or training requirements set by regulators. The Department of Financial Services, which issues the six-month licenses, doesn't even do a criminal background check.
``Insurance companies have to take responsibility for hiring qualified people. Homeowners want to have their homes rebuilt and their lives restored,'' said Sen. Ron Klein, D-Boca Raton, who is sponsoring insurance legislation this year that includes several consumer protection provisions.
Many of these outside adjusters are employed by independent adjusting firms. For instance, Pilot Catastrophe Service of Mobile, Ala., has had nearly 2,000 licensed emergency adjusters working in Florida since Wilma hit. Pilot declined to comment about its adjusting services in Florida.
For their part, several insurers say they run outside adjusters through their own training to make sure they are well versed on company procedures, policy coverage and state insurance laws.
Citizens, created by the state Legislature in 2002, relies totally on outside contractors to provide claims adjusting and customer service. Last year, the company contracted with 35 adjusting firms. They provided more than 400 adjusters to work in Citizens' catastrophe center in Tallahassee and more than 1,800 field adjusters to visit policyholders after Wilma.
After the 2004 storms, Citizens was widely criticized because it had no internal supervision over the outside firms, hence no way of tracking progress on claims. Last year, it put in place a computerized system to track claims, and Citizens' staff now oversees the outside adjusting firms.
Last year, Citizens also provided a one-day orientation session for its adjusters, said Justin Glover, a Citizens' spokesman. Licensing verification is done by the adjusting firm that hires the adjusters, he added. Citizens can double-check the license status on the Department of Financial Services website.
Despite those efforts, regulators have received 3,170 consumer complaints from South Floridians about adjusters stemming from just Wilma, with nearly 500 other complaints specifically about unsatisfactory settlement offers, according to the DFS.
``Lack of training and lack of knowledge of Florida insurance laws are the primary problems when you bring in these storm troopers,'' said Richard Wilson, a Tampa attorney who works with homeowners contesting insurance settlements.
Swain said the first adjuster to visit his home disappeared. Only after Swain filed a complaint with the DFS, which contacted Citizens, did another adjuster provide a settlement offer to repair his house.
However, Swain says the $22,000 offered is far from sufficient. He says he spent $13,800 to remove the ficus trees that crashed into his house - an expensive job because of the trees' massive size and the specialized, time-consuming work needed to avoid further damage to the house. Swain also has estimates from three contractors for the repair work, ranging from $31,000 to more than $50,000.
Initially, the second adjuster told him that he could reopen his claim if he needed more money to complete repairs, but a third adjuster said that Swain has Citizens' final offer.
His claim is now in mediation, and he is waiting for an estimate from a fourth contractor for the repair work. Citizens told Swain that yet another adjuster would visit.
Wilson says consumers are often left with settlement offers that are too low to cover repairs because these outside adjusters are not familiar with current prices for building materials and labor. Other experts say adjusters are using outdated or incorrect software for estimating rebuilding costs. Less experienced adjusters also can miss damage.
Adjusters typically use software provided by the insurance company that should incorporate current pricing for building materials and labor to calculate the cost of repairs to a damaged home. Adjusters work for a flat daily fee, so they don't benefit from providing low-ball estimates. But insurance companies can save money on claims if low estimates are accepted. It is important for consumers to know that they can contest these offers.
Steve Kanstoroom, an insurance activist who has been working with victims of Hurricane Isabel in Maryland for three years, found that adjusters working there for the Federal Emergency Management Administration to settle flood-insurance claims were using prices for materials and labor that were for new construction. Such costs are lower than for rebuilding existing homes.
When it comes to Wilma, ``same story, different storm,'' Kanstoroom said. He added that adjusters and their insurers will typically settle small claims quickly, but when the bill tops $15,000 to $20,000, negotiations get tougher and disagreements arise.
Sharon Davis needs to repair roof and interior damage after Wilma ripped through the Florida room of her Wilton Manors home. An adjuster visited her in December, nearly two months after the storm hit - and after she complained to Sen. Klein's office. ``It's been pretty much a nightmare,'' Davis says.
Now Davis believes that the settlement offer for $11,000, after her deductible, isn't enough to pay for the temporary repairs she has done and the permanent ones still needed.
Insurance regulators encourage consumers who have problems settling claims to file a complaint. If negotiations reach an impasse, they can seek mediation. It's a free service provided by the Department of Financial Services, with an outside mediator provided by the Collins Center for Public Policy.
A settlement through mediation is nonbinding. If policyholders disagree with it, they can still go to court. But Robert Rosenberg in Wilton Manors doesn't see that as a viable option.
A Citizens adjuster told Rosenberg it would cost $2,200 to repair damage to his roof and 100 feet of damaged fencing that surrounds his home - but that's less than half of his $5,700 deductible. Rosenberg is frustrated because the fence alone cost more than $3,000 to install.
``They're absolutely low-balling policyholders on repairs,'' Rosenberg said. ``But I'm not going to sue. The amount is too small, and [the company] knows it.''
CONSUMER TIPS ON THE CLAIMS PROCESS
Homeowners who believe that their insurance settlement offers are too low have options:
* Most insurers, including Citizens Property Insurance, will reopen a claim if a homeowner objects to the settlement amount, requests mediation or files a lawsuit.
* To file a complaint with the Department of Financial Services' Division of Consumer Affairs, call 800-22-STORM. Some insurers said they weren't aware that the consumer had a problem with the claims process until a complaint was made.
* To request mediation to resolve a dispute on a windstorm claim, also call 800-22-STORM. The mediated settlement is nonbinding, meaning that consumers still have the right to sue in court if necessary.
* About going to court: Disputes over windstorm claims start in county circuit court because insurance companies are state-regulated. Appeals would go through the state court system. Flood-insurance claims are taken to federal district court. There is a one-year statute of limitations, starting from the time a homeowner rejects the final wettlement offer, to go to court.
* Consumers can hire a public adjuster to estimate and negotiate a claim for them. For more information: www.fapia.net (Florida Association of Public Insurance Adjusters) or www.napia.org (the national association).
* Always get multiple estimates for repair work, document damage with photos and keep receipts. For more consumer tips: www.fldfs.com
* Emergency and permanent adjusters are licensed by the state. License status can be checked at www.fldfs.com/Data/AAR_ALIS1/index.htm.