More often than ever before I am running into situations where the insurer and/or field adjuster are pushing a program called the “managed repair” program, or it is sometimes referred to as the “VIP” program. Rest assured, the program is far from “managed” and it’s definitely not fit for a “VIP.”
So what is it? To answer this question we must start with the policy itself. As homeowners, we like to think as long as we pay our premium, and the loss is covered, we should be paid for the damage minus our deductible so we can begin repairs. In other words, a check will be issued to us and we go find someone to fix our damage. In the policy, usually towards the end of the policy, there is a provision called the “Right to Repair.” The definition of this provision goes something like this…”At our (the insurer) option we have the right to invoke our right to repair. A preferred vendor (contractor) will be assigned to repair your damage…..” What this means is there will be no check issued to you, the policyholder. The insurance company will call all the shots; what the scope of the damage is, what the valuation of the damage is, and who will repair the damage. Sounds unfair; it is. You have very limited control, if you have any at all. So if you’re handy around the house, or your brother is a General Contractor, forget it; you’re stuck with the carrier’s program and their dictation of it. In fact, there are some carriers, I will not mention here, that will actually sue you as the policyholder if you do not follow through with the program. Remember, your policy is a contract; a unilateral contract at that.
Unfortunately, insurance agents don’t explain these program to their potential new clients. If they do it explain it, it’s very glossed over in terms of the details. Why? Because they want you as a client and you want lower premiums.
In the business of insurance, you will never get what you pay for, but you can get better coverage and not be forced to take a managed repair program with a take it or leave it scenario. When I first got into this business, there were only two companies that really enforced the managed repair program 100% of the time. Now there are more than I count.
The insurance companies are double even triple dipping with these programs. They own the restoration companies, they own or are contractually tied to General Contracting companies. I recently had a conversation with an insurance field adjuster with 20 years experience. He said, very candidly, he has yet to see a managed repair program do exactly what is being promised. Many times the scopes are changed, for the less, many times the contractors don’t show up, many times they quit midway through the job, many times there are unqualified workers on your property; the list goes on.
Having the freedom to negotiate a claim and choose who you want to do the work should be a right, not a choice. If you would like more information regarding this topic you can always call our office and we’ll be more than happy to answer your questions.
