Do You Follow IICRC Guidelines Too Strictly
The following is a question submitted to me by a client:
"How does it affect insurance marketing and reputation when you follow the IICRC guidelines too strictly and tightly on a loss? Does being too cumbersome and rigid on a loss hurt your business even though you are achieving superior quality? What “generally matters” to sources of business? Value, cost, quality? How is it weighted? I know this is a lot to ask, but was hoping you may shed a little light." JF
First let me say that you do need to follow the IICRC guidelines and the S-500, because that is one key document to help keep you out of court or at least out of trouble!
One of my motto’s for many years is “If you subscribe to situational ethics, you will always be compromised.”
Having said that, I think like so many things in life, we need to be flexible to accommodate the multitude of various situations we encounter on a mitigation or restoration project. Flexible doesn’t mean abandon what is right, it means being creative with the circumstances so you can maintain your principles AND properly take care of the policyholder, insurance agent, adjuster, insurance company, property owner, etc.
If the insurance company (adjuster) doesn’t want to pay for PPE, such as rubber gloves or face protection when health and safety of staff is affected, then you need to make some decisions: First; can you have a civil conversation with the adjuster, show him the guidelines, compromise on the costs in another area of the invoice? Second; should you make your employees protect themselves and “eat” the cost, Third; should you continue to work for that adjuster?
If you (the contractor) are purely concerned about Health, Safety, Perfection, Rules, Regulations and Superior Quality, then it’s NOT about the money. When these are the guiding factors, do what is right for the customer, employees, and the public. If you are struggling with the associated costs that may not be reimbursed, it may not be the right line of work for your company. We all want to get paid for all the work we do - it is human nature. We all need to be paid so that we can support our business and our families.
A good friend of mine is an emergency room doctor, and they contract those ER services to the hospital. They are required to do the right thing, regardless of whether they are paid. He tells me that more than 50% of the services they bill are never paid, either because the insurance company denies the claim, or a portion of it, or the patient never makes payment. (If he doesn’t do all the tests, he risks being sued if something is missed). Regardless of whether you think medical fees are too high, when a substantial portion of your customers don’t pay your bills, you will either choose another line of work, or raise your prices to offset the unpaid portion.
When an insurance company, or adjuster, or even a property owner refuses to pay for appropriate and legitimate services, especially those specified in Standards protocols, the decision is not whether to fight for every dime you are entitled, rather the decision is whether to do work for that company (or adjuster) again. So many times, (in fact MOST of the time) contractors compromise their principles out of fear of retaliation. In other words, they fear that by holding firm to a line in the sand about their prices they will be blackballed by that adjuster or insurance company, or sometimes even the agent.
For all practical purposes, insurance companies are exempt from the Price Fixing laws that govern almost all other industries. Therefore, they are in a great position to ram their prices and dictates down our throat. “Estimating” programs preferred by most insurance companies and usually required of the contractor on residential jobs are supposed to be just that – an ESTIMATE. Sadly, they are called Estimating Programs, but the insurance companies make them their “LAW.” Even worse are the arbitrary rules dictated by many insurance carriers requiring you to accept their “even more reduced” price list created as a proprietary price list within the estimating program. If you want to be a preferred vendor with them, you will accept their prices and all of the other demands them impose upon you.
Bottom line: it is a fine line between doing the work correctly and getting paid fairly. Good Luck!
Dick Wagner is a Disaster Restoration and Commercial Marketing Consultant. 419-202-6745