Water Mitigation is the Homeowners Responsibility
Every homeowner understands the importance of having homeowners’ insurance, but according to private research conducted in house by Metrix Restoration, less than half all homeowners know how to use their homeowner’s insurance in case of a flood or fire emergency.
“Most people do not know that according to their homeowner’s policy, they are OBLIGATED to conduct day to day living in a manner that mitigates damages, which means its your responsibility to take action”
This is why educating the general public on this subject is near and dear to the culture of Water Damage, Mold & Flood Metrix. Homeowners want to trust their insurance companies, especially in emergency situations, such as a flooded basement or other water damage. With all the of the stress inherent to a mitigation project, most people do not have the attention units required to process the details involved with filling an insurance claim.
At Flood Metrix we estimate that CUSTOMER EDUCATION helps to reduce the stress of a water damage project by at least 60%. But why doesn’t your insurance company do a “better job” of educating their customers about the water, fire, & flood damage claims process?
Well, its not that this information is “top secret” or even “classified” information; in fact, this information is provided with ever policy. However; insurance companies are smart & they understand “statistics.” According to insurance bureau demographics, roughly 82% of policy holders will never study their policy. I don’t know whether this shows “trust” or “ignorance” on part of the homeowner, but I do know that it works in favor the company and not the customer.
What happens when your insurance company receives a claim?
First, the homeowner calls to report a flood, fire or water damage. During this process, the insurance representative will ask a few standard questions in order to gain a better understanding of the damages. At the end of this short process a claims number will be generated and an adjuster will be assigned to your water mitigation claim; typically within 48-72 business hours.
If you have not contacted Flood Metrix by now, the insurance representative will initiate the claim assignment process. This involves sending your claim to a program vender for water damage restoration services.
A program vendor is a mitigation contractor participating in your insurance networks’ “claims program.” If insurance companies had it their way, every flood, fire & water damage restoration property claim would be handled by a program vendor. Not because program vendors are better or more professional, but the reasoning all boils down to money.
“Your insurance company prefers to deal with program contractors not because the policy holder receives the best water mitigation services; but because it costs them less money.”
However; as the homeowner, you have the right to hire any water damage restoration contractor you choose. This water damage contractor is known as a “direct to customer water mitigation contractor.” So, what is the main difference between a program contractor verses a direct to customer service provider? The answer is that a water damage restoration program contractor incurs zero-dollar advertising or marketing costs for a job, because the job is provided by insurance restoration network. In exchange for this referral, the mitigation contractor agrees to forfeit 25%-50% of each water damage claim provided by the network.
Insurance program contractors do not and cannot work for the homeowner, because they already work for the insurance company and every decision made to mitigate water damage is made to benefit the insurance carrier.
Policy holders want to believe that the best way to avoid unwanted expenses is to use program contractors. Homeowners do not normally understand how homeowners’ insurance differs from car or health coverage. For example, unlike health coverage, there are no penalties or additional clauses to “restrict coverage outside of the insurance network.”
Sometimes a policy holder can report a basement water damage, but experience huge time delays when waiting on the insurance company to handle mitigation within the network. Vendor Profitability & availability are two major reasons why. Remember, program partners agree to forfeit a huge chunk of the mitigation invoice “gross fee” to the “TPA or third-party administrator. Check out study video associated with this article.
By law your insurance company cannot provide mitigation services directly. To solve this “technical problem,” the insurance industry created “third-party administration agencies” whose job it is to “screen and onboard” contractors & to over-see claims management by contractors.
However, it’s not easy to recruit & retain skilled contractors willing and able to participate in these programs due to company size requirements, reduced profitability & the “wait list.” The wait list refers to the time it takes for a new program contractor to receive enough program work to make it profitable. The only way for program work to be profitable for a contractor is to receive it in “bulk”, but bulk program work is reserved for large national franchise organizations and smaller businesses are used as “stand-by options.” This creates a vicious turnover cycle within the restoration industry.
Water damage restoration is a SCIENCE and the goal of a water damage professional is to become a Master of Mitigation. The more one progresses in the field of their chosen career path, the more valuable one becomes. Unfortunately, program work creates extremely marginalized profits for mitigation companies, making it difficult to fairly compensate experienced & certified professionals.
Metrix Has The Solution
The ideal Metrix client believes that the best business deals are “win-win” for each party involved and is willing to cooperate to make that happen. Water Damage, Mold & Flood Metrix made history as the first Damage Mitigation company in the DMV to offer the market a customer portal. Through your customer portal you can create a custom referral code, which is GOOD FOR LIFE. You can earn points exchangeable for cash and services by following Flood Metrix on all social media @metrixoverthematter. Points earned on social media can be tracked from your customer portal.
In part two of this article we will discuss advertising costs & direct to customer to better explain the benefits of the Metrix Solution to water and mold damage.
