After a Fire or Flood, Public Adjusters Must Act Fast

This is the second of two articles on public adjusters.

Every calamity doesn't warrant hiring a public adjuster, as we reported yesterday. But when a co-op or condo board determines that logistics are too complex for the property manager or insurance broker to handle, and they bring in a public adjuster, things will begin to happen very quickly. A public adjuster’s work can begin the very day disaster strikes. If it was a fire, for instance, the adjuster might mobilize preferred vendors to go to the scene and mitigate the damage. “They board up the windows,” says Brian Evans, CEO of Eastern Public. “They go in and bring drying equipment to soak up any water from the fire suppression.” The adjuster’s insurance experts, meanwhile, are working on the backside, poring over the co-op or condo’s policies to ascertain exactly what the policyholder is entitled to and where one coverage leaves off and another picks up. 

“There’s a common misunderstanding of who’s responsible for what or who pays for what,” says Evans, describing a situation in which, say, a toilet overflowed and the condo or co-op board tries to hold the owner of that unit responsible. “But the reality is that the governing documents of the co-op or condo are going to work in concert with the insurance policy. In almost all situations, unless there is some kind of negligence on the part of the shareholder or unit-owner that resulted in the property damage, they are not going to be responsible for it and they are not going to be responsible for the repair.” 

To ensure that all necessary repairs are tallied, a reliable and effective public adjuster does an almost forensic analysis of the damage. “If these were cookie-cutter situations, it might be easier for the managing agents and boards to handle,” says Evans, noting that an experienced adjuster will spot biohazards that a general contractor might overlook or not know how to remove properly.

“Everything in your home is made up of some combination of chemicals,” he says, including glues, epoxies, paints and plastics. “All these different things, as they combust, become airborne and become part of that smoke and soot. And on anything they touch, they settle.” 

Some people question the way public adjusters pass remedial or construction work on to their preferred contractors, engineers, or architects. An example of unscrupulous behavior, says Jason Schiciano, co-president of the brokerage Levitt-Fuirst Insurance, “would be where a public adjuster recommends certain contractors to do repairs for the building or to provide quotes to do repairs – and then those contractors kick back money to the public adjuster sort of as a referral fee, if you will.” That said, he adds, “there are a number of good public adjusters who we feel confident in recommending and who we think do an outstanding job.” 

To quash any concerns of that kind, Evans, who is a member of  the National Association of Public Insurance Adjusters and the New York Public Adjusters Association, says his company has a strict non-referral policy and uses vendors who specialize in disaster recovery. 

He also takes pride in his company’s ability to draw up thorough, conclusive claims. For instance, when a condominium on the Bowery suffered buildingwide damage from a bulkhead leak, the condo board submitted a claim for approximately $700,000 in damages. The building’s insurance carrier countered with a low-ball offer in the $150,000 range. The condo board brought in Eastern Public. Right off, the public adjuster convinced the carrier to allow him to withdraw the original claim and resubmit it. He then put together a 200-page report itemizing every bolt, floorboard and piece of drywall. The adjuster priced out delivery charges and double-checked the updated cost of the imported premium-grade kitchen cabinetry. “The upshot,” says Evans, “is we ended up closing that claim at $800,000 – and fairly quickly.”

To find a suitable public adjuster, Schiciano recommends that boards interview at least two companies before making a decision. But he doesn’t think it’s necessary to find one in advance, to guard against some terrible event in the future, since property managers will quite likely have a couple of names on their shortlist. 

But Evans says Eastern Public does consultations every week with boards that want to know more about what the company could do for their co-op or condo if disaster should strike. Then, if the need arises, Evans says, “your first call is to 911 and the second one is to your public adjuster.”