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The Cheap Missouri Policy Problem: Why a Chapter 380 Insurance Company Isn’t the Same Bargain It Looks Like

June 11, 2026 By in Property Insurance Tags: , , , , Leave a comment

Hoping for the insurance coverage at a cheaper price.

Imagine you need a prescription medication. You can buy it from a licensed pharmacy down the street in Missouri, where a pharmacist checks the dose, the drug is FDA-regulated, the supply chain is inspected, and someone is accountable if the pill in the bottle isn’t what the label says. Or you can buy the “same” medication from an unregulated website for a fraction of the price — no pharmacist, no inspection, no guarantee of what’s actually inside the capsule, and no one to answer to if it does nothing when you finally need it.

Most people understand instinctively why the second option is cheaper. It isn’t cheaper because someone found a clever efficiency. It’s cheaper because the things that cost money — oversight, accountability, a regulator standing behind the product — have been stripped away. You’re not buying the same thing at a discount. You’re buying a thing that looks the same right up until the moment it has to perform.

Property insurance in Missouri has a version of this exact problem, and almost no consumer knows it exists. It comes down to two different chapters of Missouri law: Chapter 375 and Chapter 380.

Two Kinds of “Insurance Company” Under Missouri Law

When most people think of an insurance company, they’re picturing a Chapter 375 insurer. Chapter 375 of the Revised Statutes of Missouri is literally titled “Provisions Applicable to All Insurance Companies,” and it is the body of law that governs the carriers you’ve heard of. A Chapter 375 company is subject to the full regulatory apparatus of the Missouri Department of Commerce and Insurance (MDCI): solvency oversight, market-conduct examinations, rate and form review, and — critically for anyone who ever has to file a claim — the Unfair Claims Settlement Practices Act, found at sections 375.1000 through 375.1018.

Chapter 380 is a different animal. It governs “County, Town and Farmers’ Mutual Property Insurance Companies” — Missouri’s small, member-owned mutuals, many of them rooted in rural and small-town communities. The chapter splits them into two groups: “Missouri mutual insurance companies” (sections 380.011 to 380.151) and the larger “extended Missouri mutual insurance companies” (sections 380.201 to 380.591). These companies have served Missouri farmers and homeowners for generations, and many of them treat their members well. This is not an argument that every Chapter 380 mutual mistreats policyholders. It’s an argument about what recourse you have when one does.

Because here is the part the brochure doesn’t mention: a Chapter 380 company is, by statute, exempt from most of the insurance laws that apply to everyone else.

The Exemption That Changes Everything

Two short statutes do the heavy lifting.

Section 380.031 says that a Missouri mutual operating under sections 380.011 to 380.151 “shall be exempt from all provisions of the insurance laws of this state,” and that no later-enacted insurance law applies to it unless that law expressly declares that it applies to such companies.

Section 380.511 says essentially the same thing for the larger extended Missouri mutuals operating under sections 380.201 to 380.591: they are exempt from the other insurance laws of the state except where a statute is “specifically made applicable,” and no future law reaches them unless it expressly says so.

Read those two sentences again, because they are the whole ballgame. The default is exemption. For a regulation to bind a Chapter 380 company, the Legislature has to have specifically named it. And in 2024, the Legislature reinforced this structure with the “Protecting Missouri’s Mutual Insurance Companies Act” (section 380.621), which frames Chapter 380 as the controlling authority over these companies.

So the question becomes simple and consequential: Does the Unfair Claims Settlement Practices Act expressly declare that it applies to Chapter 380 companies? It does not. The claims-practices regime that protects every Chapter 375 policyholder in Missouri — the rules that tell a carrier how it must behave when you file a claim — does not reach down into Chapter 380.

That is the unregulated online pharmacy. The policy looks like insurance. It is priced like insurance, only cheaper. And the claims process behind it is operating without the guardrails that make the regulated version trustworthy.

What a Missouri Regulated Insurer Is Held To — and an Unregulated One Isn’t

This is not abstract. Missouri law spells out, item by item, the claims-handling conduct that a Chapter 375 insurer is prohibited from engaging in. Section 375.1007 lists fifteen specific “improper claims practices.” Every one of these is a standard a regulated carrier can be held accountable to before the MDCI. For a Chapter 380 company, this list is, as a matter of administrative enforcement, simply not in force.

Here is what a regulated insurer answers for and an unregulated one does not:

  1. Misrepresenting to claimants relevant facts or policy provisions relating to the coverage at issue.
  2. Failing to acknowledge pertinent claim communications with reasonable promptness.
  3. Failing to adopt and implement reasonable standards for the prompt investigation and settlement of claims.
  4. Not attempting in good faith to make a prompt, fair, and equitable settlement once liability has become reasonably clear.
  5. Compelling insureds to file suit to recover what they’re owed by offering substantially less than what they ultimately recover in court.
  6. Refusing to pay claims without conducting a reasonable investigation.
  7. Failing to affirm or deny coverage within a reasonable time after proof-of-loss statements are completed and submitted.
  8. Trying to settle a claim for less than a reasonable person would expect based on the insurer’s own advertising material.
  9. Attempting to settle on the basis of an application that was materially altered without the insured’s knowledge or consent.
  10. Making a claim payment without identifying the coverage under which it’s being paid.
  11. Unreasonably delaying investigation or payment by demanding both a formal proof of loss and duplicative subsequent verification of the same information.
  12. Failing, on a denial or a lowball compromise offer, to promptly provide a reasonable and accurate explanation of the basis for the action.
  13. Failing to provide the forms necessary to present a claim within fifteen days of a request.
  14. Failing to ensure that repairs by a repairer the insurer owns or requires you to use are done in a workmanlike manner.
  15. Failing to promptly settle a claim where liability is clear under one part of the policy in order to influence settlement under another part.

Look closely at that list, because it is a catalog of exactly the things policyholders complain about most: the carrier that goes silent for weeks, the denial letter with no real explanation, the offer so low it’s designed to make you give up, the demand for the same paperwork three times to run out the clock, the “we’ll pay this if you drop that.” Against a Chapter 375 insurer, every one of those behaviors is a defined violation with a regulator behind it. Against a Chapter 380 company, that enforcement framework — and the related prompt-payment and acknowledgment timelines built on it through MDCI’s regulations at 20 CSR 100-1 — generally does not apply.

“But Can’t I Still Sue?”

This is the fair question, and the honest answer is: maybe, but it’s a different and lonelier road.

Missouri’s vexatious-refusal-to-pay statute, section 375.420, lets a policyholder recover a penalty and attorney’s fees when an insurer refuses to pay without reasonable cause. Whether and how that judicial remedy reaches a particular Chapter 380 mutual is a genuinely contestable legal question — one that belongs with coverage counsel, not a public adjuster, and not a blog post. But notice what that remedy is: it’s a lawsuit. It’s you, hiring a lawyer, financing litigation, and proving bad faith to a judge or jury, possibly years after your roof caved in.

That is precisely the difference between the regulated pharmacy and the website. With a Chapter 375 carrier, there’s a regulator whose job is to police claims conduct before you ever get to a courthouse, and a defined list of practices the carrier can be cited for. With a Chapter 380 company, the administrative safety net is mostly gone, and your fallback is to go to court on your own dime to enforce rights the regulator would otherwise have helped protect. Cheaper premium, costlier remedy.

Cheap for an Undesirable Reason

I’ll say plainly what I tell people who call my office: a lower premium is not automatically a better deal, and in insurance it can be the opposite. Price reflects what you’re actually buying. When a property policy is meaningfully cheaper than the regulated competition, the responsible thing to do is ask why — and “we’re exempt from the claims-handling rules everyone else has to follow” is a very different answer than “we found a way to operate more efficiently.”

The medicine you buy from the unregulated website is cheaper because nobody is checking what’s in it. You discover the difference at the worst possible moment — when you actually need it to work. A Chapter 380 policy can be the same trade. The day you find out which kind of company you bought from is the day a tornado takes your roof off, and that is the worst possible day to learn that the claims process behind your policy was never regulated in the first place.

Before you buy — or renew — find out which chapter your insurer is organized under. Ask the agent directly: “Is this company licensed under Chapter 375 or Chapter 380?” If it’s Chapter 380, that’s not a reason to panic, but it is a reason to understand that the consumer protections you assumed were standing behind your policy may not be there. Read what you’re actually buying. Cheap is not free, and in insurance, you usually pay the difference exactly when you can least afford to.

📞 314-803-2167
🌐 missouripublicadjuster.org

James H. Bushart is a Missouri-licensed public adjuster and Senior Claims Law Associate (SCLA). This article is general information about Missouri insurance regulation, not legal advice. A public adjuster represents policyholders in the valuation and settlement of property claims; questions about whether a specific statutory remedy applies to a specific company or policy should be directed to qualified coverage counsel. Statutory citations are to the Revised Statutes of Missouri as currently published by the Missouri Revisor of Statutes.

Protecting Yourself from Claims Predators After a Disaster

April 13, 2026 By in Property Insurance Tags: , , , , 1 Comment

Don’t sign ANYTHING.

A fire has just torn through your home. The flames are still being beaten back by firefighters. Hoses snake across your lawn. Smoke fills the air and your eyes sting from the heat. Your family is standing in the street in whatever you managed to grab on the way out. You don’t know yet what you’ve lost, what’s left, or where you’ll sleep tonight.

And then someone walks up and hands you a contract.

It sounds almost unbelievable. Unfortunately, for far too many Missouri homeowners, it’s a scene that plays out all too often.

Who Are These People — and Why Are They at Your Fire Scene?

Some public adjusters — mostly from out of state who work claims here, but a few licensed and working in Missouri — hire paid local solicitors specifically to drum up business at disaster scenes. These solicitors are often the first non-emergency personnel to arrive at a loss. They scan police scanners, monitor fire department radio frequencies, and show up while smoke is still rising from the rubble, clipboard and contract in hand.

Their job is simple: get your signature before you have a chance to think.

Public adjusters are professionals who represent policyholders in insurance claims — and legitimate ones can provide real value, especially in complex losses. But the tactics used by the predatory fringe of this industry are a different matter entirely. When someone approaches a grief-stricken, disoriented homeowner at the scene of a disaster and pressures them to sign a legal contract, that’s not advocacy. That’s exploitation.

The Problem with Signing Under Duress

In the immediate aftermath of a fire, flood, or other catastrophic loss, you are not in a position to make clear-headed legal and financial decisions. That’s not a character flaw — it’s simply human nature. Trauma, shock, and fear are powerful forces, and they impair judgment in ways that even intelligent, capable people don’t always recognize in the moment.

Public adjuster contracts are legally binding agreements. They typically grant the adjuster the authority to communicate with your insurer on your behalf and entitle them to a percentage of your settlement — often between 10% and 15%, sometimes higher. Signing such a contract at the scene of a loss, before you even know the full extent of your damages, means you are committing a significant portion of your recovery funds to someone you met minutes ago, under circumstances no reasonable person could call voluntary.

Many homeowners who signed these agreements later reported feeling they had no choice, that the solicitor implied it was necessary to get the claims process started quickly, or that they were simply too stunned to push back. Some didn’t even fully understand what they had signed until weeks later.

A Legislative Gap That Leaves Policyholders Vulnerable

You might expect that showing up at an active fire scene to solicit business from disaster victims would simply be illegal. In many states, it should be. But legislators have often been reluctant to outright prohibit this kind of solicitation, instead attempting to address it through disclosure requirements, waiting periods, and contract cancellation rights.

While those protections have some value, they rely on policyholders knowing their rights and having the presence of mind to exercise them at one of the most disorienting moments of their lives. That’s a fragile safety net at best.

Until stronger protections are in place, the burden of self-defense falls largely on you.

How to Protect Yourself

The single most important thing you can do in the aftermath of any disaster is this: do not sign any contract, agreement, or authorization with anyone until you are ready.

That means waiting until you are somewhere safe and calm. It means waiting until you have had time to assess the full scope of your loss. It means waiting until you have spoken with your insurance company, understood what your policy covers, and had the opportunity to consider every option available to you.

You have time. Despite what a pushy solicitor may imply, your insurance claim will not be lost or compromised because you took a few days — or even a few weeks — before hiring a representative. Your insurer is legally obligated to work with you. Your rights as a policyholder do not expire.

Here are a few practical steps to take immediately after a loss:

  • Call your insurance company directly to report the claim and begin the process. You don’t need a third party to initiate this.
  • Ask for identification from anyone who approaches you at the scene claiming to represent your interests. Get their name, company, and license number.
  • Never feel pressured to make decisions on the spot. Any legitimate professional will respect your need for time.
  • Consult someone you trust — a family member, attorney, or financial advisor — before signing anything.
  • Know your cancellation rights. Missouri law gives policyholders the right to cancel a public adjuster contract within a set period after signing. But it’s far better not to sign under pressure in the first place.

The Bottom Line

Disasters are devastating. The recovery process is long, complicated, and emotionally exhausting. There are honest, ethical professionals who can genuinely help you navigate an insurance claim — and if you decide you need one, you should have the time and clarity to choose one wisely.

Don’t let anyone take that choice away from you in the chaos of the worst day of your life. Put the contract down. Step back. Breathe. The decisions you make in the days and weeks ahead will shape your recovery for years to come — and you deserve to make them on your own terms.

James H. Bushart, Licensed Missouri Public Adjuster
MO License #8207067 | SCLA | NAPIA
314-803-2167 | missouripublicadjuster.org

Missouri Policyholders and Missouri-Based Public Adjusters

April 9, 2026 By in Property Insurance Tags: , , , Leave a comment

The Great State of Missouri

Why Missouri Policyholders Are Better Served by a Missouri-Based Public Adjuster

After a significant property loss, the decisions a policyholder makes in the first few days can shape the outcome of the entire claim. One of the most consequential of those decisions is who to hire to represent them. Public adjusters from outside Missouri sometimes work claims in this state, and some hold valid Missouri licenses. But licensure alone doesn’t make someone the right advocate for your claim. Where a public adjuster lives, works, and has built their career matters — and for Missouri policyholders, hiring someone with deep roots in this state carries real, practical advantages that an out-of-state adjuster simply cannot match.

Missouri Law Is a Specialty of Its Own

Insurance is regulated at the state level, and Missouri has its own statutes, administrative rules, and regulatory history that govern how claims must be handled. The Missouri Department of Commerce and Insurance sets the rules carriers must follow — including how quickly they must acknowledge a claim, respond to communications, and issue payment decisions. Missouri courts have interpreted policy language and insurer obligations in ways that are specific to this jurisdiction.

A public adjuster who primarily works in other states may hold a Missouri license, but that doesn’t mean they have a working command of Missouri’s regulatory environment. Knowing when an insurer is out of compliance with Missouri’s prompt payment requirements, understanding how the Department of Commerce and Insurance handles complaints, and being familiar with how Missouri arbitration and appraisal processes tend to unfold — these are things that come from sustained experience working Missouri claims, not from passing a licensing exam.

They Know the Market — Your Market

One of the most important functions a public adjuster serves is helping to create an accurate, well-supported estimate of what it will actually cost to restore your property. That estimate needs to reflect real-world costs in your area, not national averages or figures derived from markets hundreds of miles away.

A Missouri-based public adjuster who has worked claims across the state understands what licensed contractors charge in your region, what materials cost in your local supply chain, and what code upgrades are commonly required by Missouri municipalities during restoration work. They’re familiar with the contractors who do quality insurance restoration work and can identify when an insurer’s estimate falls short of what the job will genuinely require.

An adjuster who primarily works in coastal markets or high-population metros may rely on estimating software defaults that don’t translate well to Missouri conditions. Those discrepancies can cost policyholders real money.

Relationships With Missouri Carriers Matter

Missouri’s insurance market has its own cast of carriers, third-party administrators, and independent adjusting firms. A public adjuster who has worked this market for years knows how different companies approach claims, which carriers tend to engage constructively and which ones require more pressure, and which individuals within those organizations are empowered to make decisions. That institutional knowledge informs strategy at every stage of the claim.

Out-of-state adjusters encounter Missouri carriers as relative strangers. A Missouri-based public adjuster walks into that negotiation with context that shapes how the conversation goes.

Accessibility When It Counts

Property claims can move quickly, especially in the early stages. An adjuster who can be on-site promptly — to document damage before it’s disturbed, to meet with the carrier’s representative during inspections, or to walk through the property with a contractor — provides a level of engagement that’s hard to replicate remotely. A Missouri-based public adjuster can be there. Someone operating primarily out of Florida or Colorado cannot offer the same responsiveness.

This matters not just at the start of a claim but throughout it. Claims often require follow-up site visits, reinspections, or additional documentation as new damage is uncovered during demolition or repairs. Ongoing, in-person engagement is part of thorough claim representation, and proximity makes that possible.

Accountability That Outlasts the Claim

An adjuster with an established Missouri practice has professional reputation and community standing at stake in every claim they handle. They work in this market year-round — not just after major storm events — and they depend on referrals and repeat business from Missouri policyholders, attorneys, and contractors. That ongoing accountability shapes how they work.

An out-of-state adjuster operating in Missouri on a temporary or opportunistic basis has fewer long-term stakes here. If a dispute arises after the claim is closed, or if supplemental issues emerge months later, a locally rooted adjuster is far more accessible and motivated to see things through. Their reputation depends on it.

The Long Tail of a Claim

Many policyholders don’t realize how long a property claim can remain active. Supplements arise. Disputes over scope or pricing can extend negotiations. Repairs reveal hidden damage that wasn’t visible during the initial inspection. The policyholder’s need for representation doesn’t always end when the first check arrives.

A Missouri-based public adjuster is positioned to stay engaged through all of it. They’re a phone call and a short drive away, not a flight and a time zone difference.

Choosing the Right Advocate

When you hire a public adjuster to represent your Missouri property claim, you’re not just hiring a license — you’re hiring a person’s knowledge, relationships, and commitment to your outcome. A public adjuster who has built their career in Missouri brings all of that to the table. One who is passing through brings a credential and a plane ticket.

For Missouri policyholders, the choice is clear.

 

James H. Bushart, Licensed Missouri Public Adjuster
MO License #8207067 | SCLA | NAPIA
314-803-2167 | missouripublicadjuster.org

Public Adjuster Hannibal, Missouri

April 8, 2026 By in Property Insurance Tags: , , , , Leave a comment

Welcome to Hannibal, MO

Hannibal and Marion County sit along the Mississippi River in a region that sees its share of severe storms, hail, flooding, and high winds every year. Property damage claims in northeast Missouri are often disputed by insurers — and many policyholders don’t realize they have the right to push back.

I’m James H. Bushart, a licensed Missouri public adjuster serving Hannibal and the surrounding area. I represent policyholders, not insurance companies.

Free Hannibal area claim review: 314-803-2167

Who I Represent

Hannibal homeowners and business owners whose claims have been denied, underpaid, or disputed after storm, hail, wind, fire, water, or flood damage. If the insurer’s offer doesn’t cover your actual losses, that number may be negotiable.

What I Do

I review your policy, independently inspect all damage, document what the insurer missed, and negotiate on your behalf. SCLA designation. NAPIA member. Missouri-licensed since 2012. I’ve handled disputes with all Missouri insurance providers, including Allstate, Nationwide, State Farm, Church Mutual, Shelter, Columbia Insurance, and others across Missouri.

No Fee Unless I Recover More

Contingency basis — you owe nothing unless I recover more than the insurer’s offer. See all Missouri areas I serve.

James H. Bushart, Licensed Missouri Public Adjuster
MO License #8207067 | SCLA | NAPIA | 314-803-2167
missouripublicadjuster.org

Mistakes To Avoid When Filing an Insurance Claim

March 17, 2023 By in General Home Issues, Home Owner Insurance Issues, Property Insurance Tags: , , , , , Leave a comment

 

James H. Bushart, Public Adjuster LLC

 

Insurance claims for property damage can be a complicated process and avoiding mistakes can be a challenge. It requires proper documentation and timely submission of relevant paperwork. Any mistake in filing the claim could result in delayed or denied coverage, leaving the policyholder to bear the entire cost of the damage. Therefore, it is essential to understand the do’s and don’ts of filing an insurance claim for property damage and to know when to get help. In this essay, we will discuss the mistakes that policyholders should avoid when filing an insurance claim for property damage.

Failing to Document the Damage:

The first and most common mistake that policyholders make is failing to document the damage properly. It is essential to take pictures and videos of the damaged property as soon as possible after the incident occurs. This documentation will serve as evidence for the insurance company to determine the extent of the damage and the amount of coverage required. Without proper documentation, it can be challenging to prove the damage, and the insurance company may deny the claim. 

Photographs or video of the hailstones that struck the property, for example, are valuable evidence since some weather reports might report the nearest hailstorm to have been miles away on the date of loss.  Photographs of interior water damage taken before clean-up measures began help preserve evidence of fresh damage.  Proving your claim is YOUR responsibility.  Leave it up to the insurance company to prove it for you and you are likely to be disappointed in the result of their half-hearted efforts.

 

Waiting Too Long to File the Claim:

Another common mistake that policyholders make is waiting too long to file the claim. It is crucial to report the damage to the insurance company as soon as possible after the incident occurs. Most insurance policies have a specific timeframe within which the policyholder must report the damage. Failing to report the damage within this timeframe could result in a denied claim. Additionally, waiting too long to file the claim could result in delays in the claims process, which could cause further damage to the property.

Failing to Provide Accurate Information:

When filing an insurance claim for property damage, it is essential to provide accurate and detailed information about the incident. This includes the date and time of the incident, the cause of the damage, and the extent of the damage. Providing inaccurate or incomplete information could result in delays or denials of the claim. Additionally, it could result in the policyholder being accused of insurance fraud, which could result in legal consequences.

Not Reviewing the Insurance Policy:

Before filing an insurance claim for property damage, it is essential to review the insurance policy to understand the coverage and exclusions. Many policyholders make the mistake of assuming that their insurance policy covers all types of damage, only to realize later that the damage is excluded from the policy. Therefore, it is essential to review the policy and understand the coverage and exclusions before filing the claim.  Your insurance policy is a contract worth hundreds of thousands (sometimes millions) of dollars.  READ IT.

Attempting to Repair the Damage Before Filing the Claim:

Some policyholders make the mistake of attempting to repair the damage before filing the claim. It is essential to notify the insurance company before making any repairs to the property. The insurance company will likely send a claims adjuster to assess the damage and determine the amount of coverage required. Failing to notify the insurance company before making repairs could result in a denied claim, as the insurance company will not have the opportunity to assess the damage.

Failing to Mitigate Further Damage:

When property damage occurs, it is essential to take steps to mitigate further damage. This includes taking steps to prevent water damage or securing the property from further damage. Failing to take steps to mitigate further damage could result in a denied claim, as the insurance company may view the policyholder as negligent in protecting the property.

Not Understanding the Claims Process:

Filing an insurance claim for property damage can be a complicated process. It is essential to understand the claims process and follow the guidelines provided by the insurance company. Failure to understand the claims process could result in delays or denials of the claim.  If you need help with this, contact a licensed public adjuster or attorney for advice or assistance.

Not Following Up on the Claim:

After filing an insurance claim for property damage, it is essential to follow up with the insurance company regularly. This includes following up on the status of the claim and providing any additional documentation required. 

Not Seeking Assistance from Unbiased Sources:

When you find your insurance provider putting more effort into denying your claim than paying it or you feel that you are getting unfair resistance or treatment, consult a licensed public adjuster or an attorney to assist you.

The Insurance Company’s Adjuster and Your Claim

July 4, 2021 By in Property Insurance Tags: , , , 2 Comments

The insurance company adjuster and your claim

Successfully navigating through the insurance claims process can be challenging for a home or business owner who has suffered loss or damage to their property. Knowing the process and its boundaries and setting reasonable expectations will play a key role in achieving success with the minimum amount of frustration. Knowing what to expect (and what not to expect) from your insurance company’s adjuster is important.

Once an insurance carrier has been notified that a loss has occurred to the property that it insures, the insurer will assign one of its employees or an independent adjuster to investigate and gather information about the claim.

Many policyholders begin this process under the mistaken impression that the adjuster’s job is to assist the policyholder with their claim, but quickly learn that this is not true. It is the burden of the policyholder (not the insurance company’s adjuster) to prove that his loss was caused by a covered peril. The adjuster assigned to the claim is tasked to protect the rights and interests of the insurance carrier and assist the carrier in obtaining and presenting evidence of a policy’s exclusion when it exists.

While it is the burden of the policyholder to prove his loss was caused by a covered peril, it is the burden of the insurance carrier to prove that coverage is excluded under the policy. Presumably, both sides are prepared or preparing to meet their burdens of proof. How does the insurance company’s adjuster go about doing this for his employer?

First, he confirms that the damaged property is the property described in the policy and was at the location described in the policy. If you are claiming an item that you did not insure, or if the insured item was not on the insured property when it was damaged, you might not have a valid claim.

Next, he confirms that the loss occurred during the time period when the policy was in effect. If your roof was damaged by hail and the last hailstorm in your area occurred two months prior to the beginning of your coverage, his job is to discover and record that fact.

He will then determine whether the loss was caused by a peril covered by your policy. There are many causes for damage that are specifically excluded from an insurance policy.

The adjuster will then determine the extent of the ownership interest of the policyholder in the insured property and the extent of the ownership interest of others in the insured property. If the policyholder shares ownership of the property with others, how much of the damage is his loss and how much might be shared with others?

He will investigate to confirm that the policyholder did not commit fraud or material misrepresentation to procure the insurance policy. If the policyholder withheld material information in his application used to determine risk, for example, coverage under the policy may be rescinded.

The adjuster will confirm whether the premises were occupied as permitted or required by the policy. Certain policies negate coverage for loss when the property had been vacant for more than 60 days during the term of the policy.

He will also confirm that, at the time of the loss, there were no conditions that would cause suspension of the coverage.

This is the investigation that the adjuster conducts at the same time he is taking his measurements and photographs of the damage to determine the value of the loss, should it be paid. These are the purposes behind his questions as he conducts his investigation to first determine IF the insurance company will pay before determining how much money the carrier might offer.

It is imperative and required by the insurance contract that the policyholder fully cooperate with this investigation and be precise, accurate, and truthful when responding to these inquiries. Fraud and/or misrepresentation of the smallest degree can result in complete denial of the entire claim.

When the adjuster believes that there is a possibility of the existence of an exclusion to the peril that you have reported a loss from, he is likely to seek the assistance of someone the carrier can use as an expert (should you sue) to support their use of that exclusion. Therefore, the carrier will hire an engineer or other expert to look at the damage. Policyholders who disagree with the carrier’s decision regarding coverage of their claim and do not understand how and why insurance companies use experts will sometimes demand on their own that the insurer pays for an engineer to evaluate the damage that they believe should be paid. In doing so, they are unwittingly providing the carrier with ammunition to use against them instead of meeting their own burden to prove their loss – since the insurance company’s engineer is not going to be paid by the carrier to assist the policyholder to defend against them.

Understand the process, be fully prepared to prove that your loss or damage was caused by a covered peril when you file your claim and seek the advice of an attorney or public adjuster if you are not fully confident in handling the claim on your own or at the first sign of trouble with your insurance carrier.

 

What Must I Prove When Filing an Insurance Claim?

July 2, 2021 By in Property Insurance Tags: , , , , 2 Comments

 

Burden of proof with insurance claim

Filing an insurance claim is often more complicated than it first appears. Someone who has never filed before may assume the process is simple: notify the carrier of the loss and wait to be paid. What many don’t realize is that the responsibility to show that covered property was damaged by a covered cause of loss falls on the policyholder. A common and costly misunderstanding is the belief that the carrier owes payment unless it can prove otherwise. That’s backwards, and it usually leads to frustration.

Before deciding to file, a policyholder should understand two points about how property claims generally work:

  1. The policyholder is responsible for showing that a covered cause of loss damaged covered property.
  2. The insurer is responsible for showing that an excluded cause of loss produced the damage, if the insurer intends to deny on that basis.

Too often, a policyholder notices a symptom — a ceiling leak, for example — and files a roof claim without knowing what actually caused the leak or whether that cause is covered. They ask the carrier to send an adjuster out to “pay the claim,” having done nothing to establish coverage.

The company’s adjuster works for the insurance company and protects its interests. That adjuster has no duty to prove a covered cause of loss caused your damage. The adjuster’s job is to gather information and evidence — and, where an exclusion may apply, to build the support the company would need to deny or limit the claim. When the adjuster is unsure about what he’s seeing or whether an exclusion applies, he may bring in a third party such as an engineer, architect, or consultant to assist.

By the time that investigation is done, the carrier is prepared to argue against coverage — while the typical policyholder, who never built a case that a covered cause of loss damaged covered property, is not.

So the prudent policyholder investigates the claim before inviting the carrier to investigate it. Here’s what I generally recommend:

  1. Know what is damaged and what caused it — as best you can. If you can’t determine this yourself, get the opinion of a trusted professional who is skilled with the damaged material. If your roof is leaking, have a roofer identify the source of the leak and what caused it.
  2. Collect the evidence. Preserve physical and photographic proof of the damage and its cause, and obtain a written repair estimate from a trusted contractor to restore the property to its pre-loss condition. (Avoid letting your contractor negotiate directly with the carrier. A contractor typically doesn’t know your coverage and has a financial interest in the work — a combination the adjuster can exploit.)
  3. Determine whether the damage is covered. Read your policy and talk with your agent. If a question turns on what your policy language legally means, that’s a question for an attorney. If you want help organizing your claim and presenting your damages, a licensed public adjuster can represent you in that process.
  4. Give your evidence to the carrier when you file — or when the adjuster inspects, if that’s more convenient. If you aren’t comfortable handling this yourself, a public adjuster can manage it for you.
  5. If the carrier won’t cooperate after you’ve documented your loss, get help. A public adjuster can represent you on the claim itself; an attorney can advise you on your legal rights and options.

The goal is simple: don’t hand your claim to the insurance company before you’ve done the work to support it. Prepared policyholders get better outcomes.

James H. Bushart is a licensed Missouri public adjuster. This article is general information about the claims process, not legal advice.

Fighting the Good Fight

May 5, 2021 By in Home Owner Insurance Issues, Property Insurance Tags: , , , , , , Leave a comment
Fighting the good fight

Photo by Pavel Danilyuk on Pexels.com

 

     I recently read a touching and inspiring tribute written by an attorney who advocates for policyholders and who had recently lost a valuable partner and fellow advocate to cancer.  Together, they would fight the good fight. There are not enough fighters like them in this arena, and in his tribute to his partner, he described her drive and enthusiasm for battling with insurance companies on behalf of their clients.

     Being one who shares in the same fight (though not at such grand of a scale), I felt a great sense of personal loss.  Even though I did not know her, personally, I know her heart and I have shared similar pain with the clients who had purchased insurance for peace of mind but found, when disaster came to their door, that this peace was only a temporary illusion.

     Though Missouri law tasks an insurance company to provide prompt and fair assistance to its policyholders in exchange for payment of premiums, minimizing risk, and filing a claim only upon sustaining damage – some insurance companies, to protect their own financial interest, inflict more stress and financial harm upon their policyholders than the destructive event that prompted their claim, and at a time when the policyholder is most vulnerable with the least financial reserve.  Instead of providing the warm professional care and assistance projected by their televised mascots, the policyholder is frequently met with fierce opposition and obstruction intended to exasperate, wear down, and break the resolve of the most committed policyholder defending his own rights under the very insurance policy he bought for “peace of mind”.

     Fighting through a barrage of tactics used by insurance companies to delay, deny, and defend against the policyholder is certainly not an enjoyable experience for either the policyholder or his advocate.  It is, however, something that must be done in order to receive a dollar-for-dollar payment for the incurred loss.  That is the reality that is not shown on friendly and warm television commercials.

     We lost a fighter.  Who will take her place?

 

 

 

 

 

Why Missouri Contractors Cannot Negotiate Your Insurance Claim.

April 18, 2021 By in Home Owner Insurance Issues, Home Repairs, Property Insurance Tags: , , , , , , , , , 2 Comments

missouri contractors cannot represent your claim

Missouri contractors cannot negotiate your insurance claim on your behalf with your insurance company.  On August 28, 2011, the Governor of Missouri signed into law Senate Bill 101, which prohibits home exterior contractors from representing a policyholder or negotiating with their insurance company for exterior work on their home as a part of an insurance claim.

Here is a link to the law:   It is obvious.  

So why do insurance companies continue negotiating with residential contractors despite this law?  Perhaps it is because, when they do, they can get away with underpaying your claim.

An insurance adjuster can say things to your contractor that he cannot tell you, your Missouri attorney or your Missouri licensed public adjuster because, unlike you (and those who lawfully represent you), the contractor is not a party to the agreement (the policy) between you and the insurance company. 

Insurance adjusters will often withhold certain information from the contractor, misrepresent or not fully disclose your coverage to the contractor, and say things to your contractor such as, “We are not paying that much for that building material … Your estimate is too high for labor, and you need to revise that … We are not going to pay more than such and such dollars for this claim … We won’t pay your overhead and profit” … and so forth because they are not communicating with you or anyone lawfully representing you.

It would be an act of bad faith, and perhaps a vexatious act carrying severe penalties, for the adjuster to say such things to you or your lawful representative.  Why?  Because certain communications and actions between insurance companies, their policyholders, and their lawful representatives are regulated by the Missouri Department of Insurance. Such regulations, however, do not necessarily extend to their relationships with contractors and other vendors.  In their opinion, your contractor represents his interests and not yours. 

For example, when an insurance adjuster makes a statement of fact regarding your coverage to you or your lawful representative, he must respond with supporting language from your policy upon demand.  Not so, however, when your contractor makes the same demand.  Since the contractor is not a party to the agreement or lawfully representing anyone who is, he is not entitled to know all of the critical information the policy contains.  Withholding this information about your specific coverage from your contractor puts him in the dark and the insurance company’s adjuster in complete control. 

Some contractors mistakenly believe that since they have worked with certain insurance companies or adjusters in the past, all policyholders with that company have the same or similar coverage – which is not true.  The same insurance carrier can insure three or four neighbors living side by side on the same street and have different policies with different coverage. Some contractors quote what they believe to be “state law” regarding what an insurance company must pay for, which is also untrue.  In Missouri, state laws do not govern or control all of the information contained in an insurance policy, and policy interpretation disputes are settled in civil court and are generally not legislated.

I hold skilled and experienced exterior contractors in very high regard. They are essential advisors for you and your lawful representatives in settling a claim.  Their skillful and experienced input in determining the full scope of the damage and what they charge for restoration of that damage is often vital in settling your claim.  It is when they extend beyond their valuable construction skills and expertise and go beyond the “low hanging fruit” that the adjuster would pay anyway and (as some contractors advertise) “push” the adjuster toward a larger settlement, complete documentation, communicate with the carrier on your behalf and settle your claim, those and similar actions may not be in accord with the law and their results may not produce all of the money that you are entitled to.

On your own, reflect as to how an independent roofing contractor negotiating a claim for hail damage to shingles is likely to overlook and omit hail damage to windows, siding, screens, wood trim, decks, and HVAC equipment from his estimate as he argues with an insurance company’s adjuster for a complete roof replacement.  Then consider why an insurance adjuster would be willing to negotiate with him even though the law forbids it.  It could be a bargain for the insurance company at your expense.

Most damaging is the harm some do to your claim before you finally bring in qualified and lawful representatives, such as your attorney or licensed public adjuster, to assist you.  While their lack of ability to correctly interpret your coverage or communicate your rights under the policy may have limited their ability to help you fully resolve your claim, what they spoke to the insurance company (correctly or incorrectly) can interfere with a fair resolution and must be identified and resolved before progress can be made.

I work with many exterior contractors and help them operate within the boundaries outlined in Senate Bill 101, allowing them to focus on their areas of skill and expertise to serve their customers’ construction needs fully.  Their customers can recover from their insurers what they require to restore their home to its pre-damaged condition, and the contractor makes what he bids for the needed work.  When done correctly, all parties are served in a win-win position.  However, when done improperly, some or all come out on the losing end.

Not all claims require an attorney or a public adjuster to handle them.  Most can be taken directly by the policyholder with no representation if they understand their rights under their contract with the insurance company and have a skilled contractor they trust to inform them of their damage correctly and what must be done to restore their property to its pre-loss condition.

No one but you, your Missouri attorney, or your Missouri licensed public adjuster should be communicating with your insurance company on your behalf and remember that a “no” from the insurance adjuster to your exterior contractor is not the final word on your claim for damage.

 

 

 

This Blog/Website is made available by James H. Bushart, Public Adjuster LLC, for educational purposes only and to give you general information and a general understanding of the work of a public adjuster, not to provide specific legal advice. The authors and site manager make no representations as to the accuracy, completeness, currentness, suitability, or validity of any information on this site and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use. Using this blog site lets you understand there is no public adjuster/client relationship between you and James H. Bushart, Public Adjuster.  The Blog/Website should not be used as a substitute for competent legal advice from a licensed professional attorney or for capable maintenance or repair advice from a qualified contractor licensed to perform work in your state.

Engineer Speak – “Functional” v. “Cosmetic” Damage

April 18, 2021 By in Home Owner Insurance Issues, Home Repairs, Property Insurance Tags: , , , , , ,

 

Photo by Laker on Pexels.com

Here is a story about how an engineer might record the functional damage versus cosmetic damage in a fictional situation, first.

Once there was a maintenance man who worked in a famous art museum and was directed by his supervisor to touch up the white paint on the wall of a certain gallery within the museum.  As he was ascending his ladder he accidentally tipped over his gallon of white paint and it splashed across the surface of a 550-year-old painting from a world famous artist that hung in the gallery.

Of course, the painting was insured and the curator immediately filed a claim.  The insurance adjuster took a few photos and shared them with his boss who said “We need to send out an engineer.“

The engineer arrived to examine the painting and noted that the framed canvas was designed and intended to hold paint of various colors.  Since the canvas and frame were still intact and obviously able to retain paint, he recorded that the painting was still “functional”.  The painted surface had white paint splashed across the smiling face of a woman named “Lisa” or something, but he reported the damage was only “cosmetic” in that it did not interfere with the “function” of the canvas to hold paint.  It was, after all, paint on a painting … and the gallery was filled with various paintings with random splashes and colors.  He concluded that there was no “functional” damage and the insurance company denied the claim.

This story is fictional, of course … but the actions described are quite common.

Let’s look at the shingles on your roof, for example.  The manufacturer of your shingles produces them in a wide variety of colors, shapes, and styles.  When you selected them (or selected a house that already had them), you noted their color and design in context with the features of the rest of the structure, didn’t you?  Of course, their designed purpose is to protect the roof from wear and water intrusion but they also were carefully and creatively designed to enhance the beauty of the home.

When a sudden Missouri storm erupts and pounds them with hail, along with the metal appurtenances, gutters, downspouts, and other surrounding materials, they will often be damaged.  When they are damaged, you might contact your insurance carrier to file a claim for direct physical damage or loss to your roofing materials.  The insurance adjuster will arrive, take a few photographs, and return to speak to his boss.  When the boss does not want to pay you for your damage, he might send an engineer.

The engineer will often look at your shingles and the surrounding metals for holes.  Finding none, he declares that the shingles and metals are still shedding water as they were designed to do, and the damage to them is not “functional” but merely “cosmetic”.  Based on this report, the manager may deny the claim, depending upon the language in your policy.

Denying the claim because of an engineer’s definitions of “functional” or “Cosmetic” damage rather than the insurance policy’s definitions of damage can be improper.  Try as some might, engineers neither write nor interpret Missouri insurance policies and, when they attempt to do so, they are often incorrect. Some insurance companies have been successfully sued for such actions when it happens, as in the case of North-Shore Co-Owner’s Association versus Nationwide Mutual Insurance Company.

When you believe that your insurance carrier is trying harder to deny your claim than pay your claim, you may be the victim of improper claim handling, bad faith, or vexatious actions on the part of your carrier.  When this happens, seek the advice of your Missouri attorney or a Missouri licensed public adjuster. 

 

 

This Blog/Web Site is made available by James H. Bushart, Public Adjuster LLC for educational purposes only as well as to give you general information and a general understanding of the work of a public adjuster, not to provide specific legal advice. The authors and/or site manager make no representations as to accuracy, completeness, currentness, suitability, or validity of any information on this site and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use. By using this blog site you understand that there is no public adjuster/client relationship between you and James H. Bushart, Public Adjuster LLC.  The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state, nor should it be used as a substitute for competent maintenance or repair advice from a qualified contractor licensed to perform work in your state.