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29 » VISIT US ONLINE @ DSNEWS.COM HAZARD CLAIM RECOVERY: QUESTION EVERYTHING Are you really in good hands? Ask yourself, what are insurance carriers' motives? Is it to serve its clients or maximize shareholder value? It is time we look at the realities of the insurance marketplace. And the reality is this: insurance companies deploy sophisticated strategies to avoid or minimize claim payments. Improperly denied or underpaid claims represent money taken from your bottom line. e result is increased out-of-pocket corporate costs to repair damaged properties. e hidden cost of accepting improperly dispositioned hazard claims are enormous and unquantifiable. us, it is imperative to have an expert on hand that will critically scrutinize every settlement decision and recover every insurance dollar owed under the policy. Historically, the function of filing and managing insurable loss claims was an inefficient and muddled administrative task designed to accommodate operational, investor, or guarantor requirement. At one time, the administrative machine served its purpose – to process large volumes of claims as quickly as possible. Unfortunately, while the direct costs of the machine were quantifiable, the opportunity cost was larger than anybody realized. Times have changed, and we must change with them. Hazard insurance claims, like all of mortgage servicing, must question and re- evaluate old processes, evolve, and innovate. e business-as-usual approach to hazard claims may give the illusion of safety, but, in reality, it can be one of the riskiest and most costly decision an organization can unconsciously make. In this article, we will evaluate the most common approaches and pit-falls to hazard claim management. Why you should not rely on your insurance carrier to manage hazard claims. Some servicers rely heavily on their insurance carrier to identify insurable damages, self-initiate claims, assess a value of the loss, and issue payment in a timely manner. As discussed, insurance carriers have substantial self-interest to avoid or minimize claim payments. An arena with nearly zero checks and balances, and unbridled discretion on the part of the insurance carrier is ripe for abuse. While this service may be advertised as free, the hidden costs of insurance proceeds never realized are massive. Managing the hazard claims process in-house is a tricky business. Insurance policies are anything but intuitive. It takes a dedicated expert to parse each clause, decipher coverages, and reach a correct and informed decision regarding the merits of each claim. In addition, with contract and insurance acumen, the expert should be well versed in property repairs, cost estimating software, and investor guidelines. In addition to hiring and training skilled specialists, servicers must be prepared to scale staffing requirements based on ever-changing volumes. In lieu of attempting to specialize in all processes and juggle staffing overages or constraints, servicers should hire an accountable insurance expert that is exclusively devoted to protecting their interests. Insurance carriers have seemingly unlimited resources and sophisticated strategies to protect their bottom line. Unless you are prepared to devote the same resources, you should hire somebody that is. Symmetry works in nature and in business: When an insurance carrier exerts force, you should be prepared to exert equal or greater force. e best approach to handling hazard claims is to partner with an expert that is exclusively devoted to hazard insurance claims with an emphasis on holding insurance carriers accountable. Working with an insurance expert that specializes in identifying all claim-able perils, valuing nuanced losses, and fighting invalid claim denials will level the playing field. Choosing the right hazard claim expert will decrease internal costs, increase recoveries, and positively impact your bottom line. I Property Claims (IPC) is the industry leader in hazard claim recovery and a partner in the industry's first end-to -end FHA Portfolio Solutions. IPC's unique blend of insurance, property preservation, and repair knowledge; and strategic partnerships puts money toward your bottom line while improving turn times and compliance with investor guidelines. Together with MSI, and Williams & Williams Real Estate Auction they have developed a true "Default to Disposition" Strategy that solves many of the challenges created by inherent process gaps, lack of communication between vendors, and non-aligned process strategies. All designed to reduce our client's risks, minimize losses, and improving their ability to protect and dispose of assets in default. Sponsored Content

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