Chicago Tribune, Friday, May 10,
Public adjuster helps
maximize return on insurance losses
Public adjuster Dorian
Bezanis sorts through a fire-ravaged building in Chicago last winter.
not exactly one of life's great philosophical questions, but Dorian
Bezanis has pondered it anyway: What's the value of a half-roll of
fire-damaged toilet paper?
Not exactly a question many homeowners have
considered and, faced with sorting through the rubble of a home ravaged by
fire, even fewer would likely contemplate such a thought. But finding
answers to such esoteric and detail-oriented questions is a part of
Bezanis' job as a public adjuster, a livelihood built around negotiating
insurance claims for homeowners, renters and property owners.
"When a fire occurs, most people make
only one call-to their insurance company," says Bezanis, a licensed
public adjuster and vice president of Chicago-based Alpha Adjusting
Company "They don't know public adjusters exist, so they try to
handle their own insurance claim, and a lot of them fail to negotiate or
provide an accurate accounting of the items that have been damaged. As a
result, they don't get the full value of their claim."
Seriously, though, a half-roll of toilet
"The point is that all of these things
cost money to replace, and that's money out of (the insured's)
pocket," Bezanis says.
Public adjusters such as Bezanis operate in
a little-known niche in the insurance claims business. In Illinois, there
are only about 100 public adjusters licensed by the State Department of
After a fire occurs, the first reaction of
many homeowners is to call the insurance agent. The insurer will send out
a claims adjuster, who works with the insurer to assign a value to the
damaged items that can be itemized and proven to have existed.
Public adjusters, on the other hand, are
paid to prepare, present and negotiate property loss claims to achieve the
greatest settlement for the insured.
"The (claims) business is very, very
subjective, and when you have a claims adjuster who's working for both the
insurance company and the insured, there's a conflict of interest,"
The fee for a public adjuster's services
typically is based on a percentage of the total settlement. The standard
fee in the Chicago area is 10 percent of the settlement. A claims adjuster
for an insurance company charges no fee to the insured party.
Bezanis got into the public adjusting
business in 1990, after more than a decade in building trades. Prior to
joining Alpha Adjusting, Bezanis renovated several fired-damaged buildings
on Chicago's North Side and in the suburbs. His first introduction to the
public adjusting business came in 1987 when Curt Yearwood, president of
Alpha, provided public claims adjusting on a burned-out building in Uptown
Bezanis was renovating.
Over the next 13 years, Bezanis and Yearwood
crossed paths on several other buildings. In 1990, Bezanis joined Alpha
Adjusting and moved in to adjusting on a full-time basis. Over the last
half-decade, he has seen a lot of home and property owners make common
- Not knowing what they're
entitled to. Whether it's a roll of tape or a plaster ceiling,
virtually all have some value, Bezanis says.
- Not taking the time to conduct
a proper inventory. Content claims are very laborious, Bezanis says. A
recent claim for a one-bedroom apartment dweller took Alpha Adjusting
two days for on-site inventory, plus additional time to input raw data
into the computers, he says.
- Not presenting the claim case
correctly. Having the claim inventoried and presented in an organized
manner are important, as is establishing a fair value for items. How
much, for example is a 5-year old sofa bed worth given depreciation?
- Estimating replacement costs.
When structural damage is involved, many homeowners get repair
estimates from contractors recommends by an insurance company or
they'll be solicited by a construction company, Bezanis says.
"Contractors, be they the best contractor around, look at things
and say, 'How do I fix this?' " A skilled public adjuster will
present more options than just a replacement by correctly valuing the
damaged property, he says.
- Whining. Policyholders often
forget that the insurer's claim adjuster is a human being, Bezanis
says. "The company adjusters constantly have people pulling on
their shirt sleeves saying, 'more, more, more,' and that's
counterproductive. It's not effective negotiating."
negotiating mistake many policyholders make is that they take things
personally, Bezanis says. "A lot of times, if the insured doesn't
like what the claims adjuster says, they begin to lose their calm, and
staying calm and presenting the facts is the best way to negotiate."
One of the hardest challenges in his
business comes when a client calls the insurance company adjuster first,
then decides he or she wants to hire a public adjuster, Bezanis says.
"It's human nature," he says.
"Once (the company adjuster) has made a decision, he wants to stick
to his guns. When a company adjuster goes to property before us and makes
out his scenario, that's where we end up butting heads."
"We're in a business about
justification," he says. "If you document the claim correctly,
you'll be able to justify the facts."
Talking To The Boss, February
By DORIAN BEZANIS
is a word that inspires fear in business owners. It can threaten
everything an owner has worked for. Most business owners have insurance,
but they may not have enough. Owners also must evaluate if they purchased
the right coverage and whether they will receive a fair settlement if a
owners often delay re-evaluating their insurance policies. Perhaps they
purchased only minimal coverage during the business' infancy and neglect
to increase the insurance package as the business grows. Then when a loss
occurs, it is too late for them to change those policies to match their
are some basics to consider when evaluating your coverage:
- Building coverage - If you own the
building, don't equate its purchase price with the correct value of
insurance. You should base coverage on the actual cost of
reconstruction in today's market. Also, try to stay away from policies
- Business personal property - Building
owners should make sure that coverage is included for fixtures, such
as stoves, refrigerators, tools and other equipment used at the
property. If you rent, everything you own would be under this
coverage, including raw materials and inventory, products in various
stages of completion, completed products, furniture, fixtures and
equipment, and improvements.
- Extra expense - What if you had to
relocate due to a loss? Maybe you need to install a three-phase
electrical service at your temporary location. Coverage for this kind
of expense is very important if you want to keep your business running
following a disaster. Bear in mind that the insurance companies are
usually only willing to incur such costs if they will offset the
business-interruption loss claim.
- Business interruption - This type of
coverage insures against the loss of net income plus continuing
expenses. The business' books and records are the primary basis for
this part of the claim, so they need to be monitored carefully
throughout the life of the business.
Loss and recovery
a loss does occur, the dollar amount of recovery on any property claim
hinges on highly subjective factors, such as scope, pricing, depreciation
refers to what is actually damaged. Rarely is a loss an obvious
"total." To an adjuster, "total" means the total
amount of the policy limits.
means the cost to repair or replace each of the damaged elements. In any
marketplace, costs vary for millwork and plaster, equipment, partially
completed products and other items.
initial insurance reimbursement for any loss is the depreciated value -
the actual cash value of the loss. In replacement-cost policies, the
depreciation is recoverable, but not until the property has been fully
repaired or the equipment and products replaced, the insurance company has
reinspected the property and the business owner has documented expenses.
commercial policies carry a co-insurance provision. In such cases, the
percentage of recovery is determined by the ratio of the amount of
insurance required. Proper presentation of this element can mean the
difference between 100 percent recovery and only a partial recovery.
assess a loss, both damage and cost of restoration must be calculated in
extensive detail. It is unrealistic to expect that the insurance company's
representatives will prepare these evaluations in a manner most favorable
to the insured. While the best companies strive to be fair, they still
must be concerned with the bottom line, just like any other business.
may want to consider hiring a public insurance adjuster. Public adjusters
are licensed to prepare and present claims and negotiate with insurance
companies on behalf of the insured. A good public adjuster will maximize
the insured's settlement and minimize the disruption and aggravation that
accompany a property loss.
your company won't have to deal with a fire or other disaster, but it's
worth your time to be prepared just in case.
Dorian Bezanis is vice president of Alpha Adjusting, Inc., a
Chicago-based public adjusting firm. He can be reached at 773-973-7100.
Learner Publications, August 14,
Adjusters Smooth Claims Process
By CHRIS LARSON
something you hope to never have to face: a fire or a storm destroys part
or all of your house. Of course, you'll probably have insurance against
such a loss, so there's at least some financial security. All you have to
do is call your insurance company, get the settlement check, and start
not so fast. There's someone else you may want to contact before the
claims process gets too far along - a public adjuster. Like their
counterparts employed by the insurance company, public adjusters are
charged with determining the extent and value of damages to your home and
personal belongings. The difference is that while the insurance adjuster
is working for both you and the insurance company (a situation that some
would say poses a conflict of interest). The public adjuster works only
for you, looking to make sure you get the most money possible from your
adjusters are able to operate because of the subjectivity inherent in the
claims process, says Dorian Bezanis, vice-president of Rogers Park-based
Alpha Adjusting. "What's damaged? What's the value of the damages?
Every contractor has a different opinion of what's damaged, and a
different estimate of the cost." Personal property damage can be
subjective as well; the value depends on factors like when and where it
was bought, current prices, and depreciation.
are over 180 public adjusters in Illinois, according to the state
Department of Insurance, the agency which licenses them. The majority
operate in the Chicago metropolitan area, so finding one shouldn't be a
problem. The best way to get one is probably to ask friends or co-workers
for a recommendation. That's the primary way Alpha receives new clients.
adjusters bring many benefits and conveniences to the insured, Bezanis
says. Experienced adjusters will survey the physical property, making sure
everything that's damaged or destroyed - even if it's hidden or
easy-to-miss - is accounted for. They'll also take care of the
time-consuming, sometimes-painful task of inventorying and pricing
personal items. And finally, they'll work directly with the insurance
company, negotiating the highest possible settlement for the homeowner.
the structural damages is a major part of a public adjuster's duties. In
addition to the obvious losses - shattered windows, smoke-stained ceilings
- a good adjuster will look for hidden damages, or things that may not
cause a problem right away. Wood floors are a good example, Bezanis said.
If he thinks the floor took in a lot of water from the firefighters' hoses
and will start to warp in a few months, he'll make sure it's replaced
personal property is another instance where a public adjuster can help a
homeowner. A homeowner on his own will be handed a stack of inventory
sheets by the agent, and must itemize and price everything himself.
a very laborious and sometimes gut-wrenching task," Bezanis says.
"Very few people have the patience and the acumen to do the inventory
accurately." Alpha makes sure every single damaged item - even old
shoes or a bottle of shampoo - is accounted for. "If you leave stuff
out, you're really losing money, money that you are entitled to."
adjusters will also do the inventory much quicker. "A homeowner going
through his home might take two weeks to inventory everything, while a
public adjuster will take three or four days," he said. That savings
in time speeds up the claims process, getting the money from the insurance
company to the insured quicker.
all public adjusting companies, Alpha stays familiar with the latest
changes in pricing and labor costs. After all the personal effects and
structural damages have been determined, Alpha calculates a dollar amount
for the loss. The damaged personal effects are organized into bags for
easy reference, and a thick printout, detailing the loss and the cost, is
presented to the insurance agent.
we leave that meeting with the agent with a clear understanding of what
was damaged," Bezanis says. That's not to say the insurance company
accepts everything and writes a check. "The agent goes back to the
office, sits down with his red pencil and changes the numbers." The
important factor, he adds, is that what is damaged is agreed on; the
negotiating turns only on the cost of those damages. The public adjuster
and insurance company typically make several offers and counter-offers
before and counter-offers before a final number is reached.
the settlement is agreed to by both sides, Alpha gets its percentage - 10
percent, the standard rate throughout the industry. While that amount may
seem high, Bezanis believes that, even with the fee, the insured comes out
ahead; the settlement is always higher than it would be without a public
adjuster, and the insured also gets convenience and expert advice.
we're essentially being paid by the piece, so the insured knows we're not
going to leave anything out."
emphasized that just because public adjusters can negotiate a higher
settlement doesn't mean the insurance companies are trying to rip off
their policy-holders. "It all comes down to a matter of perspective
and subjectivity, of knowing what the fair prices are, and arguing those
points." The insurance industry is relatively small, and Alpha tends
to see the same agents on a regular basis. "We have good working
relationships with the bulk of the insurance companies and agents,"
he says. "They know us, and we respect each other. Still, they aren't
fond of us."
public adjusters can be brought in at any point during the claim process,
it's far better if they're contacted right away, Bezanis said. "We
get calls from people who are pretty far along in the claims process,
maybe there's an offer on the table and it's not what the insured expects.
So they call us." While public adjusters can usually still negotiate
a higher settlement, "it's really an uphill battle," he says,
since the insurance company at this point has already done a lot of work
on the case, and is less likely to adjust its figures much higher.
the end, even with the conveniences, the money is what really matters.
Bezanis believes that a typical homeowner, going through a major damage
claim for probably the first time, is at a severe disadvantage without
help from an expert. Aside from buying the home, the claim is probably the
largest financial situation a homeowner will ever face, Bezanis says.
"Just like you wouldn't go to court without an attorney, we believe
that most people can't afford not to use a public adjuster."