How It All Works Part 1 - Insurance Claims
(Plus 40 years Experience Shared With You)
Q - If I had a claim today and I came to you or you came to me and you walked up to the house; tell me how that would go?
John Giordano: I’m here to see if I could help you present this insurance claim to your insurance company.
For example, you have a fire. But you need to now present that claim. The insurance company will come out if you don’t do anything and just write a building estimate, write your contents and say, “Here’s what we saw. Here’s your damage.” But I know that’s not the way you should handle this claim. You should be proactive. You should present an insurance claim, especially since it’s not going to cost you anything.
Interviewer: Well, then I have two questions. Why isn’t it going to cost me anything? Why should I present the claim? Isn’t that what they do?
John Giordano: They’re going to present you with a claim that they feel is the least amount that they have to pay to replace your property.
How do you know when they present you that offer, that it’s accurate or its right?
Who’s going to review that for you? Are you just going to say, well, I’m just going to take it?
This is what they said, because you didn’t want to pay a commission to a public adjuster to have to represent you and try to fight for you to get you a better settlement.
Interviewer: So you’re telling me that my insurance company I can’t trust.
John Giordano: Absolutely.
John Giordano: What’s the incentive for them to want to put this house back for you as quickly as they possibly can?
Interviewer: I’ve been paying my insurance for the last 15 years. Isn’t that what they do?
John Giordano: Oh, they will give you a settlement offer.
Do you know if that settlement offer is accurate or not?
Interviewer: I trust them.
John Giordano: Well, then if you assume and you trust them, then there’s very little I could do to change your mind.
Interviewer: Why shouldn’t I trust them?
Insurance Adjusters... They don’t work for you. They work for the insurance company. The insurance company is here to see how much they can negotiate with you.Mr. John Giordano
Please share some stories or some real examples of how you help people or how the insurance companies didn’t necessarily work towards their best interest
Tell me some of those – I guess I’m going to call them horror stories because I’m thinking the insurance companies should help me. But the more I learned about your business, I realized that’s not true. Most of these big companies are big corporations that are looking just to save their own money. So give me some examples.
John Giordano: Well, we do residential and commercial and industrial claims, damaged property.
On one that we had, we represented Yale New Haven Hospital.
They’re a cancer center. Before they built the Smilow Facility and they had a water pipe in the basement, a main, a water main line actually break and it caused a tremendous amount of water to go through the facility. While we were hired by Yale New Haven Hospital to represent them against their carrier, they did send out adjusters from Chicago and it was very complicated because we had to coordinate a great many things to get this facility back up and running.
A big part of it was that now, they were not going to be allowed to operate their facility. So we had to find another hospital that could take the patients, the cancer patients that were coming in daily, to service them. We also had equipment, machinery that the cancer center used for helping patients with cancer.
One piece of equipment in particular, it was the only piece of equipment like this in the world. It was built and developed for Yale many, many years ago. So it was not replaceable and we had to get there with the insurance company and find a suitable replacement for that piece of equipment, which we were able to do. We also had to find a way to calculate their business interruption loss, which they did not even consider Yale New Haven Hospital and someone might say, “
Well, how do you have a business interruption loss when it pertains to a cancer facility and in particular where they get their fees from cancer patients.”
Well, there was a fact that they were losing money every time a patient went to another facility because now that patient would stay at that facility. So it was something that was tough for us to have to deal with. But the reality and the financial loss to Yale New Haven Hospital was considerable and I was able to bring in a forensic accountant from New Jersey that had expertise in that area and together from working with them in the past, we were able to get a $10 million business interruption loss for Yale New Haven Hospital and another $7 million for them for their damage to their structure.
We had to rebuild the entire unit. Even though there were plans to build another cancer center we still had to get that facility up and running again and we did. By the way, they ended up having another loss to their emergency, children’s emergency room facility and the first person they did call was us. So they were very pleased with our services and that’s just one case of a commercial loss.
A residential loss is
- we’ve helped thousands of families try to put back their lives after a fire loss or a flood,
- in which you lose everything and
- you have to recreate what was in your attic,
- what was in your basement,
- what was in the closets,
- what were in the medicine cabinets,
- what was in the refrigerators,
- what were in the cabinets,
- the kitchen cabinets and armoires
- and that’s just on inventory.
Then we have to recreate the building and make sure that it’s put back in the condition that it was before the fire loss, even though most people, when they have a residential fire loss, end up changing and making alterations to their house, which they’re allowed to do by the way, with the funds.
So then we find them suitable housing because when you have a fire loss, your children still need to go to school. There are school districts. Your family still has to work. So it’s not like you can just have a fire and there’s a house up the street that you can rent. It takes a lot of coordination to put things together, whether it’s a fire or a flood.
Over 39 years, I’ve become the best at doing that. I love what I do. Attorney Frank Kolbe was right in steering me into this profession because when I was in the legislature, I was there to serve people and it’s a service business being a public adjuster.Mr. John Giordano
You have to really want to help people...
and want to go out and make sure that their lives are as comfortable as they possibly can be during this very difficult time and I think a lot of my clients have found that putting their trust in me has made things go along smooth. Their houses have been put back ASAP and their personal belongings have been restored.
Interviewer: So you’re doing way more than just trying to get additional money or get the right amount or get the fair amount for the insured.
John Giordano: Well, I do because that’s what I did when I was in the legislature. People would come to me with one problem. But then in life, people have so many problems.
So even though I don’t get a fee:
- I help them in their selection if they need it for building contractors.
- I attend meetings.
- If they select a building contractor to go along and work with them, to make sure things are smooth.
- I also help with the additional living expense and finding a suitable place for them to live because the insurance companies, they fight.
- They don’t want to but people get burned out of their houses and they want to put them in a hotel room.
Your policy states you should be able to be put in like kind and quality for where your residents are and there’s a lot of work to that.
By the way, we don’t take a fee on additional living expense.
The only property that we take a fee on is the building loss and the personal property loss because through our experience and negotiating, we definitely can increase that settlement, so that in all cases that I’ve had with people that have hired me to do their losses, very seldom has there been a situation where our fee wasn’t 100 percent covered by the insurance company.
I have a great many clients that I have helped and am able to tell stories and their experiences, what we’ve done.
I like what I do. I enjoy helping people. Mr. John Giordano
What’s the worst situation that you’ve seen from an insurance company perspective?
When 9/11 took place, I was hired by the May Davis Group, which is a stock brokerage firm, and also an investment banking firm.
John Giordano: And they were one of the first clients, one of our first clients from that horrible loss, to be reimbursed by the insurance company. At that time when that incident took place, stocks were not on the rise. They were on the fall. So what was happening with the insurance companies – and there were so many stock brokerage firms in those two towers. They were getting nothing on their business interruption losses because there was no loss. Actually profits were down. I took the approach that from our firm, our firm’s position that the investment banking profession was on the rise.
So I took that aspect of their business and applied it to their policy and was able to save their company and get them full reimbursement and that’s a story that I will always remember going down into New York City, to have meetings with them and seeing the damage and the destruction that was all over New York City.
It was very hard. But it was very gratifying at the end to have been able to help so many people that work for the May Davis Group and that’s one that I could recall.
Interviewer: We talked about Yale New Haven. We talked about May Davis. So it sounds like they’re a really big commercial operation. Can you handle smaller commercial accounts?
John Giordano: Well, yes I handle smaller commercial and residential accounts. I’ve handled stockade fences that were blown over in wind storms or people; my motto has always been that when someone calls with damage to their property and it doesn’t seem like it’s a large claim it’s going to be a large insurance claim settlement, if you say no to that person, you might as well close your doors because you’re there to help people settle losses, insurance claims against their insurance carrier.
So still to this day, we handle all sorts and all size losses for residential homeowners and commercial businesses. But we probably do more residential claims because it seems that on a daily basis, more people have claims to their personal property, their homes, through floods and through fires and vandalism. The larger claims do seem to come from the commercial side but there are fewer of them during the course of the year. So that’s basically how our business runs.
What’s the most common way that an insurance company tries to not pay someone?
John Giordano: Oh, they will come out and look at the policy and interpret the policy the way they feel it should be presented to the carrier. There have been many times that we’ve disagreed with them on how the damage has occurred. That’s a big portion of insurance claim settlements that happen.
John Giordano: We did a fire loss about two years ago for a Bernard and Anna Rose Russo in East Haven. When I got to their house, it was completely destroyed and it started with a cigarette and a trash can in the basement. The basement was packed with merchandise that Mr. Russo had gone out and procured from years of going to the dump. That was one of the things Bernie loved to do is go to the dump and he found things that he thought were just great and his basement through the years was just packed.
I mean it was like a maze going through it. So he was down there one time, fiddling with his – what I call artifacts that he got from the East Haven dump and he smokes and he put the cigarette in a trash can and went over his neighbor’s house for some coffee and all of a sudden, by accident, the fire started and it just gutted his whole house and they felt horrible.
They hired me to be their public adjuster and I met with the insurance company adjuster and it was a funny thing that we were able to recover value for all of Bernie’s treasures, right? Dump treasures that he got through the years because they were his property. Once he got them and brought them in, they were viewed as his personal property. So his contents loss was fabulous and he and his wife put back the home and made changes to it and were very happy and made a sad story turn out very well for them.
Interviewer: Can you think of any others off the top of your head?
John Giordano: We’ve dealt with many flood losses on Cosey Beach Avenue in East Haven and in Milford where people have had tremendous water damage from Long Island Sound and in most cases; those are very difficult losses to settle because they send in adjusters from all across the country. It’s not like dealing with your local – if you have a fire to your home, they will send an adjuster from Connecticut in most cases.
These adjusters are from the National Flood Insurance Program. They have their own way of doing things, their own way of looking at losses that are going to be settled.
They come in, write an estimate, hand it to you. That’s it.
That’s not the way a loss of that nature can be properly adjusted because it takes time especially with water because water, when it dries out, you see a lot of the additional damage, the warping of sheetrock, mold and mildew come out. Not within the first three or four days but probably after, about five or six days, you start to see that.
So it is good to get someone there and have the estimate started. But there’s no way you could go through a wet building and write an estimate and say, “Here it is,” and know that that’s going to be all the damage that’s going to occur to your property.
So we’ve gotten involved with a lot of losses like that where adjusters come through very quickly and people are happy. Oh, I’ve already had my adjuster here. We got our claim.
The claim that they’ve written in 90 percent of the cases isn’t the actual damage that has occurred because they just write down what they see and they don’t write down what is going to occur from damage that they can’t see behind the walls that’s wet.
So chances are pretty good if I ever had a claim, it might be one claim in my life, maybe two, and the first time anything happens, you never know everything.
Interviewer: Right. So you’ve been doing this for 39 years.
This was a damage claim to the Carbon Elementary School from a series of roof leaks in the town of East Haven.
Interviewer: How did they find out about it? How did you get contacted? What did you do? What ended up happening?
John Giordano: Well, they ended up having some roof damage and they contacted us because of the water that was infiltrating the school. And I immediately contacted our mediation company to come in and start containing the water areas. We had a problem with this that we needed to get the school opened as I recall. And so, it was an interesting case and I worked on it with the Superintendent of Schools, Martin DeFelice Jr. and we all worked together.
They brought me in to try to expedite this because we had the schools opening you know the end of August early part of September and we had to you know get this school up and running. So, it all worked out well. We’re able to open the school, we’re able to get all the damages repaired and I enjoy working with Municipalities on losses. And this one worked out very well and very well for the town.
Interviewer: So in that case, you end up getting involved in a case where you’re very familiar with. You’ve been doing this kind of stuff for a long time. The municipality or in this case the school isn’t used to this kind of thing happening so they don’t know what to do, where to go, how to start. They may contact their insurance company but their insurance company if I understand isn’t always not in their best interest. But I know that what happens is if they keep their losses down; the insurance company gives them money back. They give them a little bonus.
John Giordano: It’s a system that’s put in place to encourage agents to seek out good clients not just insure just anyone. So, it’s a commission that they get for writing good business.
Interviewer: Ah, that’s a good way to put it.
John Giordano: There’s no question about it, Insurance agent’s do not want to see large dollar amounts go out because it does affect their loss ratio. That’s what the insurance companies like to put it down as, their loss ratio for writing good business. And if they write business with a carrier and they do not have a lot of claims or the dollar amount is within a certain acceptable limit, they get a bonus for writing good work.