Engineers and Insurance Claims: How an Engineer Inspection Could Influence your Claim
Your insurance company could hire an engineer to document the damages and source the cause for your insurance claim.
Engineers play an important role in insurance claims. They analyze damage to ensure your claim is accurate.
Unfortunately, engineers often represent the best interests of the insurance company – not the policyholder. In some cases, insurance companies and engineers have even been accused of teaming up to commit insurance fraud, finding faults with your claim where there are no faults to find.
Yes, engineers could influence your insurance claim. Today, we’re explaining the role engineers play in insurance claims.
Why is the Insurance Company Sending an Engineer?
Insurance companies send an engineer when there is a dispute between the two of you regarding damages and the cause of the damage, or the accurate way to repair or replace the damaged item.
The engineer will check various aspects of your claim to verify damage. They will often document all other damages in the home as well, whether they are related to the claim or not. Then, the engineer will produce a report.
Your insurer may send a notice about an engineer inspecting your claim. When this happens, it is often time to reach out to a Public Adjuster or another engineering firm to represent you at the time of the inspection.
In the past, engineering firms have been accused of falsifying reports, publishing erroneous reports, and conspiring with insurers to deny legitimate claims.
Engineers Analyze your Insurance Claim to Verify Damage
An insurance company usually hires an engineer to verify damage related to your insurance claim when there is a dispute about coverage, repair methods and the cause of damage.
Your insurance company’s adjuster may be unable to determine the difference between hail damage and windstorm damage or water damage and wear and tear. An engineer, however, can determine the difference.
The engineer will check the damage, then produce an engineer’s report based on the findings. This report is based off of a visual inspection. So if you don’t agree with the report, hiring your own expert to dispute the report and perform some additional invasive testing might be necessary to prove your claim.
Sometimes, the insurance company lets you see the engineer’s report. In other cases, the insurance company only discloses the results upon request. This report can often take 4 to 6 weeks to become available to you. You should always request a copy and make sure that you agree with the explanations that were provided to the insurance company.
If you need help handling a dispute or any aspect of a property damage insurance claim, contact a licensed Public Insurance Adjuster for a free consultation.
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What is an Engineer’s Report?
An engineer’s report is a document explaining the engineer’s findings for your insurance claim.
Engineer’s reports are designed to look impressive. Some even seem designed to intimidate the policyholder using big terms, scientific language, and jargon.
You might see citations of studies, articles, and other reports on the engineer’s report. It’s a formal, professionally-formatted document featuring the engineer’s findings.
The engineer’s report will disclose the engineer’s opinion on the damage, including the cause of the damage, the extent of the damage, and whether the damage took place suddenly or over a long period of time.
Why the Engineer’s Report is Important
Based on the engineer’s findings, your insurance company could adjust the value of your claim – or even deny your claim entirely.
Insurance companies are for-profit businesses that are not on your side. Their goal is to make as much money as possible.
The best way to make money is by limiting payouts on claims. By hiring an engineer, the insurer may discover a reason to deny or reduce your claim. They often use the report from the engineer as a type of “plausible deniability”, so they did not fully make the decision to deny your claim, the engineer did.
Example: Let’s say there is a hurricane and you make a claim for wind damage to your home. Most insurance policies cover wind damage, and you assume your insurer will cover the cost of repairing the damage. However, the insurance company hires an engineer. The engineer determines the damage was caused by flooding that took place after the windstorm – not the windstorm itself. Your insurance policy does not cover flooding, so the insurer will deny your claim.
Despite what insurance companies claim, they are not on your side and they do not have your best interests in mind. That’s why many homeowners hire Public Adjusters.Contact A Public Adjuster
Forensic Engineers and Insurance Companies Could Have a Close Connection
When your insurer hires an engineer for your claim, you expect the engineer to be unbiased.
However, many forensic engineering firms are closely connected to insurance companies. In fact, some even claim there’s a natural conflict of interest:
When an insurance company hires an engineering firm, the engineering firm may feel pressure to side with the insurer.
If the engineer sides with the insurer, then the insurer will continue to use the engineer on future claims.
If the engineer sides with the policyholder, then the engineer loses future business.
Forensic engineers specialize in analyzing insurance claims for clients. The insurer hires the forensic engineer to assess the damage, and the forensic engineer produces a report.
In major large loss insurance claims, the insurer could pay the forensic engineering firm millions of dollars to create the reports after a disaster such as a hurricane.
As a forensic engineer hired by the insurer, it’s in your best interests to keep the client happy. You want more multi-million dollar projects.
For all of these reasons, many people have accused forensic engineering firms of producing engineering reports that are in favor of the insurer – not the policyholder.
Forensic Engineering Bias: Is your Forensic Engineer Being Honest?
Insurers hire forensic engineers to review insurance claims. Theoretically, the forensic engineer is an unbiased third party. In reality, the forensic engineer may be biased towards siding with the insurer instead of the policyholder.
Dealing with insurance claims and property damage can be messy. In some cases, it’s impossible to distinguish the difference between the initial cause of flood damage and windstorm damage.
In cases where the cause of the damage is ambiguous, the engineer may want to side with the insurer. In this situation, the “tie” goes to the insurer.
Not all forensic engineers are biased towards the insurer. Many forensic engineers are honest professionals.
However, a growing number of insurers have been accused of using biased engineers. These engineers claim to be neutral third parties, yet they consistently produce reports that help insurers avoid liability.
After Hurricane Sandy, Engineers Were Caught Falsifying Reports for Insurers
Engineering report fraud isn’t a myth: it’s a real problem in the insurance industry. We saw it after Hurricane Sandy.
After Hurricane Sandy, insurers were caught working with engineers who falsified reports. Engineers produced reports that helped insurers escape liability. Engineers made money, insurers avoided liability for claims they rightfully had to pay, and customers lost millions.
The problem got so bad that 60 Minutes did a report on the issue. They described the engineering report scam as “the storm after the storm,” claiming many families “didn’t get the help they deserve.”
At a time when homeowners needed their insurer the most, and at a time when insurers should have been liable for damages, insurers and engineering companies may have conspired to deny claims.
One homeowner interviewed by 60 Minutes received just $79,000 of his $250,000 policy after Hurricane Sandy. An engineering report found that there was no structural damage to the home caused by Hurricane Sandy. Instead, the home already had structural damage before Hurricane Sandy. Because of this report, the insurance company avoided liability.
Here’s how one lawyer interviewed by 60 Minutes described the rampant insurance fraud perpetrated by insurers and engineering firms:
“The fraud is taking engineers’ reports and changing them from saying there was structural damage to saying there’s no structural damage or giving the engineers a form to fill out that already has the conclusion of no structural damage.”
That lawyer claims he has found “thousands of cases” with similar issues. When insurance companies see a chance to avoid liability, they’ll often take it.
Other Lawsuits Have Been Filed Against Insurers and Engineering Firms
Insurance fraud is common. You can find plenty of lawsuits filed against insurance companies and engineering firms.
In Daigle v. Haag Engineering Co, for example, homeowners sued an engineering company that sided with their insurer, State Farm, after hailstorm damage.
State Farm hired Haag Engineering Co. to perform certain engineering services on five homes after the hailstorm. Prior to the inspection, Haag submitted documents to State Farm suggesting that hail stones smaller than one inch in diameter would not cause damage to composition shingle roofs. Although the homes were damaged, the hail stones were smaller than one inch. Because of this, the claimants argued that State Farm’s rejection of their claim was “preordained.”
The lawsuit eventually made its way to the Texas Board of Appeals.
You can find plenty of similar cases from other states. Some engineering firms have been accused of denying millions of dollars in homeowner compensation based on fraudulent reports.
With false engineering reports, insurers win big, engineering firms get paid, and homeowners lose.
How Public Adjusters Help Avoid Fraudulent Engineer’s Reports
Public Adjusters can help navigate complex insurance claims. A good Public Adjuster manages your claim from start to finish. Public Adjusters can also increase the amount of compensation you receive from your insurance company. In some cases, a Public Adjuster could triple the insurance company’s initial offer.
It’s easy to get intimidated by an engineer’s report. The report is loaded with jargon, scientific information, and technical data. You might struggle to decipher any of it. Often times, the reports contain more information about damage that is not related to the claim than the claim related damage that is in dispute.
Public Adjusters, however, have plenty of experience reading engineer’s reports. They can spot errors and omissions on the report – including fraudulent and non-fraudulent mistakes.
Public Adjusters know the tricks insurance companies use to deny and reduce claims. When you hire a Public Adjuster, you get a licensed professional on your side who can spot errors in engineer’s reports, correct those errors, and maximize compensation for clients.Find a Public Adjuster
Public Adjusters Spot Errors and Omissions on Engineering Reports
Engineering reports aren’t perfect. They may have errors and omissions.
Public Adjusters spot these errors and omissions to ensure policyholders like you get fair treatment.
Engineers make mistakes too. Not all errors and omissions are based on fraud. Engineers may overlook items, make mistakes, and forget to check certain aspects of your claim.
In other cases, errors and omissions are based on fraud, and the engineering firm is intentionally trying to deceive the policyholder while siding with the insurance company.
Whether the engineering report errors and omissions are intentional or not, a Public Adjuster has the experience to spot these errors, ensuring you receive fair treatment for your claim instead of having your claim denied because of an erroneous report.
Other Things to Know Before an Engineering Inspection
Did you receive a notice from your insurer about an engineering inspection? It is in your best interest to stop your insurance company before they send an engineer and seek outside representation to help with your claim. This call for an engineering inspection is often the first sign that something is going wrong with your claim.
Engineering inspections are a normal part of many insurance claims. However, there are certain things you need to know before the inspection takes place, including:
- The Engineer May Inspect Everything: Engineers have a serious job to perform. To make a thorough report, the engineer may need to inspect everything related to your claim in and around your home. Expect the engineer to do a deep dive into your property and your insurance claim to determine the truth. If you have damage that is clearly not related to the claim, such as deferred maintenance, you should attempt to repair these items before the inspection, so the engineer can focus on the items that are claim related.
- Wait for the Engineer’s Report: The insurance company is sending an engineer to your property to assess the claim. The engineer will assess the claim, then produce a report determining the cause of the damage. You should be able to see the engineer’s report after the inspection, including the findings from the report and how they relate to your claim. However, this can often take 4 to 6 weeks, so be prepared to wait.
- Talk to an Adjuster or Attorney to Prevent Insurance Fraud: Engineering reports can be difficult to understand. A Public Adjuster or attorney can help you decipher an engineering report. If you’re concerned about the items discussed in an engineering report, then sit down to discuss the issue with a Public Adjuster or attorney. Most offer free consultations. Whenever possible, it is always best to reach out before the inspection so there is someone there to help point out damages and try to ensure the first report is accurate, and if not, at least the inspection is documented by a claims professional or another engineer.
What to Do If Your Claim is Denied After an Engineering Report
If an engineering report has led your insurance claim to be denied, then you may need to hire an attorney or Public Adjuster.
Let’s say your home was damaged in a disaster. The disaster was a covered event, and your insurer should be liable for the event. However, the engineer’s report finds there was damage before the event. As a result, the insurer denies your claim.
In this situation, the insurer may have a legitimate reason to deny your claim.
However, it’s also possible the engineer’s report was not accurate. It’s possible you’re dealing with insurance fraud, a bad faith insurer, and a clearly biased engineering firm. It’s also possible the engineering firm made a simple mistake.
A Public Adjuster or attorney can help you navigate the claim, overturn the denial, and ensure you receive the compensation owed to you based on the terms of your insurance contract.
When insurers hire forensic engineers to inspect insurance claims, it’s a clear sign something could be going wrong with the claim.
Insurers hire engineers who do good work for them. When an engineer sides with the homeowner, it means the insurer has to pay. That’s bad for business.
Every day, homeowners across the United States become victims of insurance fraud because of engineers and insurance companies. If your claim has been denied or reduced because of an engineering report, consider hiring a Public Adjuster today.
Contact ClaimsMate for a free consultation with a Public Adjuster.
ClaimsMate’s Public Adjusters have a proven track record of overturning denied claims, challenging erroneous engineering reports, and ensuring you receive every penny owed to you based on the terms of your insurance contact.