Catastrophe adjusters chase disasters
They came to Long Island by the hundreds, arriving from across America in motor homes, pickup trucks and customized sport utility vehicles to calculate the toll of superstorm Sandy.
They are catastrophe adjusters: men and women who migrate from disaster to disaster, sleeping in cars, motels and campgrounds as they estimate claims for insurance companies. They work East Coast hurricanes in fall, New England ice storms in winter and Midwest tornadoes and hailstorms come spring. In between, they watch the Weather Channel.
"We call it the money channel," said Wanda Hogan, 69, an adjuster from Alabama who arrived on Long Island shortly after Sandy.
For more than two months, Hogan and her colleagues trudged through storm-battered homes from southwest Nassau to the North Fork, working 15-hour days determining what insurance should cover and what it should not.
In the end, these nomadic adjusters calculated flood settlements for tens of thousands of Long Islanders whose homes and businesses were inundated by the surge. And now, as their work here runs short, they are hitting the road again, en route to the next catastrophe, wherever it may strike.
"If I stay in one place too long, I get bored," said Art Labrecque, 51, who has been an adjuster for eight years and lives full time in a 45-foot motor home, towing a pickup truck and BMW motorcycle.
Why they do it
What draws people to a career of following the wind, chasing disaster and calculating loss?
In many cases, it's money. It's the tales of jackpot years, when the hurricanes blow through the alphabet and hailstones are as big as softballs. In years like that, catastrophe adjusters can make $300,000 -- even $400,000, according to industry experts.
But a big chunk of that money gets swallowed by gas, hotels, restaurants, medical coverage and the other expenses of being a freelancer on the road. And the bumper years, they say, are fleeting. Most catastrophe adjusters are independent contractors, paid by the claim. They can go months without a paycheck when the weather is calm.
So in the long haul, adjusters say, it's a combination of wanderlust and the intermittent freedom in a feast-or-famine work schedule that keeps them in the business.
"You work like crazy for a short period of time; then you sit and wait to chase the next storm," said Kevin Hromas, 55, a former catastrophe adjuster and claims manager who now works as an expert witness at insurance trials.
Catastrophe adjusters -- or "cat adjusters" as they call themselves -- make up a slim percentage of the roughly 264,000 men and women who the U.S. Bureau of Labor Statistics says calculate insurance settlements for a living. Cat adjusters' ranks tend to shrink and swell with storm cycles, with an estimated 10,000 to 20,000 of them in the business at a given time, industry experts said.
After widespread disasters, however, they account for 80 to 90 percent of adjusters on the ground. Some work directly for major insurance companies. But the majority are independent contractors, hired temporarily by little-known companies that provide armies of adjusters to Travelers, Allstate and others companies when disasters hit.
Their backgrounds vary
Some cat adjusters come to the businesses with insurance backgrounds. Others are former roofers, painters or contractors. Husband and wife teams are common. Siblings work together, too.
Wanda Hogan made the trip to Long Island with her daughter, Michele, 46, also an adjuster. Wanda broke into the field about 17 years ago, after decades as a paralegal. She worked her first hurricane a few years later.
"Was it Charley?" she asked, sitting in a Long Beach diner. "I can't remember. There were so many."
Hogan, who has a degree in chemical engineering, is president of the National Association of Catastrophe Adjusters.
Like many, she learned on the job. Others attend trade schools. Most states require licenses. Anyone working flood claims needs to be certified by the federal government.
During busy times Hogan, who is licensed in 22 states, is on the road as much as 10 months a year, crisscrossing the country in a Cadillac Escalade. She favors hotels with kitchenettes so she can cook dishes from home like gumbo and shrimp stew. On Christmas she deep-fried a turkey in the parking lot of a Plainview hotel.
"We are probably a little nuts," said Hogan, whose own home was destroyed by Hurricane Katrina.
On a recent afternoon, she and Michele snapped photos and took measurements of an apartment in a house in Long Beach that was swamped by the storm. The floors and drywall had been ripped out. A damp smell hung in the air, tinged with disinfectant.
"Did the water get up to your upper cabinets here?" Wanda Hogan asked the homeowner. "No," he said. "OK. Then we will replace the lower ones," she said.
Twenty-four hours later, the Hogans were ducking into a crawl space of a flood-ravaged home in Freeport, taking photographs of a ruined boiler. And so they went, driving town to town from Inwood to Oakdale, slogging through gutted living rooms and sodden basements with clipboard in tow. "I still climb roofs, too," Wanda Hogan said.
Like most adjusters, the Hogans calculate estimates with computer software, which spits out labor and material costs based on ZIP codes. Critics say it doesn't work well on older and custom-built homes. Adjusters say experienced hands can make up for any shortfalls in the software.
Most cat adjusters are paid based on the size of the claims. The insurance companies pay their fees, which adjusters split with the companies that hire them. A flood settlement of $10,000, for example, pays a fee of $1,100. A $20,000 settlement pays $1,200, and so on.
Because of that sliding scale, some adjusters say they have incentive to push for the biggest settlements possible for homeowners. "I want to treat them the same way I treat my mother," one said. But they deny padding claims. Insurance companies require reams of documentation before approving a settlement. And adjusters who squeeze in extras won't last, veterans say.
"If word gets out, you won't be able to beg, steal or buy a job," said Charles Norton, 65, who has been adjusting claims since the 1970s. "You have to go by what's in the policy."
Not everyone buys the idea that adjusters go out of their way for people. Their chief critics are public adjusters, who are hired by homeowners to win larger payouts from insurers. They argue cat adjusters will always err on the side of the one that pays them: the insurance companies.
"If you tried to break into the business as an independent adjuster and always gave homeowners everything in their policies, you would slowly run out of customers," said Matthew C. Kotzen, an attorney who represents homeowners against insurance companies.
Despite the increased frequency of massive storms, veteran adjusters say recent years have been hard on the profession. Those big storms have attracted legions of inexperienced adjusters who give the field a bad name, some say. The insurance companies are cutting fees. And sometimes the work is dangerous.
Adjusters tell of angry homeowners pulling guns on them after past storms. In 2004, a 25-year-old woman was bludgeoned to death while adjusting a claim in Tampa.
Still, new adjusters continue to flock to the field after every storm, signing up for a life on the road, following the wind.