Overhead and Profit

Anyone want to explain the insurance game regarding overhead and profit?

Knowledge or cannon fodder?.....OMG!

larryb Said: Colburn - FYI, ICCOA is free to all contractors as a source of information re what the busy-body do-gooders are up to that negatively affects our businesses. 3RS Profit MAX / The Playbook is the training program that is available for purchase that will advance any contractor years ahead of where they are now at.

State Farm - Ed Rust, CEO (P&C ins co Police Chief) Farmers - Jeff Dailey, CEO - as of Jan 1, 2012 (P&C ins co Police Chief)

I once called Farmers parent co Zurich Financial Services in Switzerland at 3:00 am to get their attention regarding Farmers lack of forthrightness on their claims paying. That call went to LA (Farmers US main office) then to the Minnesota Executive who began showing up on all of my claims with the adjusters - and all were then properly paid.

What incredible customer service. Meeting a claims adjuster out in the field. leaving the Ivory Tower to do field work. This again proves the insurance industry is concerned about their customers.

B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

Colburn - FYI, ICCOA is free to all contractors as a source of information re what the busy-body do-gooders are up to that negatively affects our businesses. 3RS Profit MAX / The Playbook is the training program that is available for purchase that will advance any contractor years ahead of where they are now at.

State Farm - Ed Rust, CEO (P&C ins co "Police Chief") Farmers - Jeff Dailey, CEO - as of Jan 1, 2012 (P&C ins co "Police Chief")

I once called Farmers parent co Zurich Financial Services in Switzerland at 3:00 am to get their attention regarding Farmers lack of forthrightness on their claims paying. That call went to LA (Farmers US main office) then to the Minnesota Executive who began showing up on all of my claims with the adjusters - and all were then properly paid.

all great info i appreciate it all i have all intention of becoming a purchaser of the iccoa program after winter is done ............. im at a stand still ive spoken to 10 adjusters at state farm i cant get anyone of any rank on the phone............ so now isnt the next logical step a letter certified mail ...................

aj Get a lawyer. Pay him to do what you didn't do. Open a supplement for O&P? Everything is in front of you, the more you think about yesterday, the less prepared you are for today. Good luck pal. B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

yes the homeowner has signed for full contract including ovp and work is finished ......... lets say i have some older claims i want to go back and pursue overhead and profit with my new found knowledge what is the timeframe i have to go back and go after that money on the table

colburn Said: larry i have read article and have the bulletin from tdi stating how it is to be paid as a matter of fact i sent the link to the adjuster who asked for it i am currently going up the adj chain of command having each one give me in a letter why they are declining to pay overhead and profit but at this point im my most recent demand is being reviewed by higher up.... i even used a state farm case as an example anything else you can recommend [/quote can someone give me a higher up at state farm and farmers that i can speak with

???????. Has the H/O signed with you? If not it is just an estimate.

B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

can someone give me a higher up at state farm and farmers that i can speak with

ok larry im attempting to go up the ladder at state farm they wont give me the supervisor name i even emailed them a copy of the bulletin .... we read it together he was def upset

Larry, Well said, hear him, hear him. I am in agreement with the point. hear,hear. Ignorance is not bliss. Thank you. My message for years now on this site "There is good honest money to be made with insurance claims." Knowledge is power.... B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

The position of a Police Chief is usually a political one while the position of all of the people under the police chief is that of an employee. When a cop goes bad (an ee) and it comes to the attention of the media and the public in general, the chief (police department CEO) has to respond and take action which entails righting the wrong or wrongs committed by his/her ee or ee's.

The same applies to P&C ins co CEO's. The CEO of a P&C ins co is the "ins co police chief" who has to answer to shareholders (if not a mutual), policy holders, the media and the public at large. When the Ins police chief percieves that the pressure being put on him as a result of an ee or ee's not paying O&P, he/she will likely transfer that pressure to his/her underlings which make up lower level execs then claim execs then claim supervisors then in house claim reps then staff or independent adjusters. That's when things start happening and O&P starts getting paid more regularly and P&C ins refrains from their typically specious arguments regarding their reluctance or refusal to pay O&P.

I've dealt with the CEO's of all the top P&C ins companies and have gotten positive results overall. Tom Wilson at Allstate, for example...an additional $12,500 (approx) with O&P paid on 100% of the work. Took an additional 8 hours to do but netted me an additional $680 per hour in profit. Not bad pay for a day's work. His and other P&C ins company CEO's I've dealt with decisions to order the payment of O&P also set a precedent that they can't legally, morally or ethically back down from (although they will try on a regular basis).

My argument is a simple and logical one that I teach and have expressed at the ICCOA site. The insured pays a premium based on future costs to fully demo and rebuild a totally destroyed property at codes current and applicable to the date of the rebuild which includes full O&P on 100% of the work. Therefore, considering that payment of O&P and code upgrades have already been paid through the insured's premium - at future costs, any attempt to hold back O&P on a smaller job results in bad faith and unjust enrichment. The P&C ins co "police chiefs" know this. They also know that most contractors don't think of it that way which is why they continue to play the "we don't pay O&P" game and get away with it. The adjusters - staff or IA's, just do and say what they are told to do and say because of their concerns over job security and contractors who don't have the proper training will continue miss out on the money owed to their customers and ultimately to them.

I started ICCOA as a way to help educate contractors on the ins claim process with the full knowledge that only 20% of all contractors will ever consume and act on that knowledge. For those that do however, they will have a positive overall effect on the way ins work is done and the way it gets paid - if they come together and are on the same page. P&C ins has gotten away with under paying claims by many millions for decades because they know that too many contractors believe they are "ins claim specialists" even though the vast majority of them have no real ins industry training which is mandatory for the contractor who wants to earn what they are really worth. The information is out there, one just needs to open their eyes to see, then consume it. When they do, they'll advance their skills and their incomes by 5, 10 or more years in just a couple of months.

Larry Burtis - 3RSystems, LLC / ICCOA

jimAKAblue Said: Anyone want to explain the insurance game regarding overhead and profit?

Knowledge is power is all there is to understand. B) :) :) B) Deep Down In Florida Where The Sun Shines Damn Near Every Day

in addition i have made it clear should they not pay it ill be reporting it to tdi fraud division

larry i have read article and have the bulletin from tdi stating how it is to be paid as a matter of fact i sent the link to the adjuster who asked for it i am currently going up the adj chain of command having each one give me in a letter why they are declining to pay overhead and profit but at this point im my most recent demand is being reviewed by higher up.... i even used a state farm case as an example anything else you can recommend

Independent Construction Contractors of America

November 23, 2011

"Withholding Overhead and Profit is Wrong if Insurance Companies Are Trying to Act Right"

Read the article at www.iccoa.com. I think all will find it informative.

I can guarantee that, in most cases, no true and correct, if any, allowance for “Overhead & Profit” will be shown on your customers loss reports. Lack of full and proper O&P equates to an unfair and improper reduction of your profits.

While some insurance companies are starting to slowly get the picture regarding the payment of O&P on all claims, regardless of the number of trades involved (we’re aggressively working on that issue) it will, unfortunately, still be some time before they all finally start doing the right thing.

This subject is important and fluid and the opinions vary widely. Insurance companies think they should only pay on minimum of 2 or 3 trades with roofing deducted, if they include it at all. Contractors, some legal experts, and several State insurance commissioners believe and/or have opined/ruled that O&P should be paid on 100% of all claims (as does 3RSystems.) The subject will be regularly addressed in more depth on the ICCOAâ„¢ members only website.

Ultimately, since, as pointed out previously, all of the costs discussed are already factored into the insured’s premiums, P&C insurance cannot legally or otherwise refuse to pay for O&P.

Remember – the insured pays the premium and that always makes them the boss, not the insurance company!

Larry Burtis - 3RSystems, LLC / ICCOA