LESSON 10: INSURANCE LOSS INSPECTIONS

Question 1

[LOSS DRAFT, INSURANCE LOSS, IL, CONSTRUCTION DRAW, PROPERTY DAMAGE INSPECTION]

Answer 1

Sometimes called by different names; Loss Draft, Insurance Loss, IL, Construction Draw, etc.

Hail damage, fire damage, water damage are examples of why a homeowner would file a claim with their insurance company.

After the insurance adjuster determines the cost of repairing the damages, the insurance company will send the homeowner a check that requires the endorsement of both the homeowner as well as the mortgage company.

Question 2

[LOSS DRAFT, INSURANCE LOSS, IL, CONSTRUCTION DRAW, PROPERTY DAMAGE INSPECTION]

Answer 2

The mortgage company gets involved and must endorse the check before the homeowner can deposit it. This is because the homeowner does not own the home outright. Hence the term “mortgaged”. The mortgage company has a stake in what’s involved with the home. If there are damages, the mortgage company has the right to ensure that the repairs are completed, and the property is brought back to a condition prior to when the damages occurred. This is a learning experience for the unfortunate homeowner. How can the repairs be made before the check is deposited? Most contractors who make repairs on insurance claims know that they cannot get paid until the work is completed and inspected for homeowner satisfaction. This is where you come in.

Question 3

Scope of Work:

Answer 3

is the insurance adjusters list of repairs that they are paying for.
(Explain in detail further down)

Question 4

PHOTO REQUIREMENT:

Answer 4

The 4 core photos
Photos of all completed repairs according to the Scope of Work
Photos of all unfinished or incomplete repairs according to the Scope of Work
A photo of the signature page that the homeowner signs

Question 5

The Six Most Important Parts to an IL Inspection:

Answer 5

MAKE PHONE CALLS TO THE CONTACT PERSON ON THE INSURANCE FORM!

Make the appointment with the homeowner within the first 1 to 6 hours of receiving the work order. (No calls before 8 AM and not after 9 PM)
Take photos of all completed repairs as well as those not completed.
Calculate the percentage of completion based on the Scope of Work.
Get the homeowner to sign the Insurance Loss form. Some call it a homeowner’s satisfaction form.
Snap a photo of the insurance form they homeowner signed and upload it with all the other photos.

Question 6

Every call attempt must be documented in the Info/Comments tab on the website version of InspectorADE

Answer 6

Our clients must report to their clients several times daily, and they call your clients several times a day requesting appointment updates. The quickest way to get your clients upset at you is by not making calls and setting insurance loss appointments with the homeowner.

Every day make at least one phone call attempt. The next day try the AM, then the PM. Alternate your times that you call each day. Enter your attempts on the work order of InspectorADE. Some Regional companies (your clients) will even make daily fee deductions for not making appointment call attempts.

Question 7

Every call attempt must be documented in the Info/Comments tab on the website version of InspectorADE

Answer 7

If the phone numbers provided are disconnected or no longer in service, you must inform your Vendor Manager immediately so they can attempt to get new phone numbers for you.

If you are on the road making appointment calls, or a homeowner calls you back while on the road, include the time that the call took place on the comments section when you return to your computer. You can also use your web browser on your cell phone to log into your account and make an update on InspectorADE.

Question 8

Tip

Answer 8

When speaking to the homeowner, just say ‘Your mortgage company wanted me to come by and take some photos of the completed repairs. Is everything 100% finished or are they still working on it?‘. If the repairs won’t be completely finished until next Tuesday, then maybe it would be best to set the appointment up for Wednesday or the following day.

Question 9

Due Date:

Answer 9

The “due date” will change to whatever you set the appointment for. So no need to worry about due dates. You may want to consider sending them a message to remind them to change the due date so that it does not adversely reflect upon your turnaround time for the month.

Once your appointment is set, write and record it in this format:

Question 10

Appointment:

Answer 10

Appt. set for Thurs, 4/29 @ 9 AM.

If all you were able to do is to leave a voice message, then just enter LVM. InspectorADE will put the time and date you made the call.
Many inspectors are seeing success by also texting the homeowner. If that is the case, enter LTM to let us know that was your form of communication.

Your Vendor Managers will copy and paste this information and send it to the client, so please use a capital letter to start your sentence.

Question 11

How Important is it to make, and set appointments?

Answer 11

If the contractor is hounding the homeowner for their money after completing the job, the homeowner calls and complains to the mortgage company for their inspector to come out and review the completed repairs. Then, the National company hired by the mortgage company to inspect the repairs calls the Regional company (the company you work for) and then they start yelling at your Vendor Managers asking why no appointments have been made. By the time this process goes downhill to you as the inspector, everyone gets angry and upset that you have not called the homeowner to set up an appointment.

Avoid all this by calling the homeowner for an appointment as soon as possible. It’s not when the appointment is scheduled for, it’s all about setting the appointment for a future date.

Question 12

Insurance Claim Homeowner Shock!

Answer 12

One of the biggest shocks that a homeowner faces after filing a claim is to see that the check issued by the insurance company has to be endorsed by the mortgage company. Most homeowners don’t have a clue as to why their mortgage company would get themselves involved in a matter that they feel is none of their business. But it is the mortgage companies business, and rightfully so. Mortgage companies have lost a great deal of money on repairs that were never completed by the homeowner who received the money, but never completed the repairs. This is called insurance fraud.

99% of homeowners have every intention of getting their properties back to the condition it was before the claim was filed. The next dilemma they face is finding out that the mortgage company will not endorse the check until AFTER the repairs are completed. This appears to be a very perplexing situation for the homeowner. They find out that they can’t use the money to pay a contractor to make the repairs until after the repairs are not only completed, but inspected by you!

Question 13

Insurance Claim Homeowner Shock!

Answer 13

Homeowners who have never gone through the claims process do not realize that there are thousands of contractors out there that know how the game is played. These contractors know that materials and labor must be bought and provided upfront, and the job must be completed before they get paid. This is why it is so very important to call to set up the appointment as soon as possible. The contractor wants to get paid upon completion of the work and may pester the homeowner until they’re paid. At that point, the homeowner is calling the mortgage company followed by the mortgage company calling your clients every four hours for updates. It’s a very vicious cycle. Don’t be the link that starts the bad cycle. The problems Insurance Loss inspections cause is easily remedied by simply getting the appointment set as soon as possible, and then letting your client or Vendor Manager know the time and date of that appointment.

It’s not so much that the inspection has to be completed right away, but that the appointment is set right away. Setting the appointment will cause everyone to relax and stay calm in what is otherwise a very intense situation. Anytime we are involved with other people’s money, there is a certain degree of tension involved. Setting the appointment as soon as possible will stop the calls to the mortgage company, and stop the calls from the mortgage company to your clients and then to you.

Set the appointment As Soon As Possible.

Question 14

(Did you notice how many times, this thought of making calls and setting appointments was stressed?)

Answer 14

Sometimes after your inspection, the homeowner or the contractor may be so impatient and frustrated that they may ask you to sign the check (endorse it).

No one other than the bank or mortgage company is authorized to sign the check. (PERIOD) Do NOT sign or endorse any check.

The work we inspect is not always 100% complete. Sometimes we are provided with the contractor’s phone number. Sometimes the contractor will ask for a draw inspection. In that case, we are there to determine the percentage of completion as it relates to the entire Scope of Work. Is the work 50% complete, 75%, 90%? In cases like this, take photos of the completed repairs, AS WELL AS ALL UNCOMPLETED REPAIRS!

Question 15

PHOTOS OF THE REPAIRS

Answer 15

Sometimes after your inspection, the homeowner or the contractor may be so impatient and frustrated that they may ask you to sign the check (endorse it).

No one other than the bank or mortgage company is authorized to sign the check. (PERIOD) Do NOT sign or endorse any check.

The work we inspect is not always 100% complete. Sometimes we are provided with the contractor’s phone number. Sometimes the contractor will ask for a draw inspection. In that case, we are there to determine the percentage of completion as it relates to the entire Scope of Work. Is the work 50% complete, 75%, 90%? In cases like this, take photos of the completed repairs, AS WELL AS ALL UNCOMPLETED REPAIRS!

Question 16

Do NOT use ladders:

Answer 16

You as an inspector are NOT authorized to climb ladders or to climb on the roof to inspect the roof. This is where the zoom on your cell phone camera comes in. [Since zoomed photos often come out blurry, you might want to take several zoomed photos just in case.]

Try to capture at least a couple good 5×5 square foot area shots of the roof to help show the condition of the roof close-up.

Question 17

Try to capture as much detail as possible

Answer 17

https://mortgagefieldservices.com/wp-content/uploads/2016/10/roof.jpg

Take photos all the way around the property, providing the best shots to help the mortgage company see that the roof was in fact replaced. When a roof is replaced, the contractor will install a new drip edge. The drip edge helps prevent water from entering underneath the shingle edges which would damage the roof over time. The drip edge when installed new or before painted is often stainless steel or aluminum. It may still be shiny and can be easily seen.

This is a good photo to take to help show that the roof has been replaced.

Question 18

Try to capture as much detail as possible

Answer 18

Sometimes it is hard to tell whether or not the roof has been replaced or not, especially in the winter. We do not proceed with a roof inspection if the roof is covered by snow. We have to be able to see the roof. In cases like this, the homeowner will have to wait until the snow melts for their inspection.

A new roof may sometimes appear to be sticking up in places. Asphalt shingles have tar on the bottom side of the shingle which needs heat from the sun to settle it down and to glue itself to the next shingle. Missing shingles, of course, is a warning sign that the roof was not replaced.

Whenever we encounter a situation where the old roof shingles were not removed, and new shingles were placed on top of the old shingles, this should be well documented. In most cases, the Scope of Work from the insurance company is paying for the old shingles to be removed. The homeowner or the contractor may be attempting to defraud the mortgage company and pocket the difference. It is not our job to approve or disapprove the job. We only have to carefully document that the second layer of shingles was placed on top of the old shingles. It then becomes a problem for the homeowner and mortgage company to resolve.

Question 19

Try to capture as much detail as possible

Answer 19

Often times a homeowner will do the repair themselves which is perfectly acceptable as long as the work appears to be in a workmanlike manner. However, if it appears the homeowner only replaced the “bad” shingles, make sure you document this. The Scope of Work will indicate if they were paid to remove the old shingles and replace the entire roof with new shingles, or just a portion of the roof with new shingles. Sometimes the insurance company will only pay for one side or the other of the roof, depending on the damages.

Download and print the form/instructions and Scope of Work (list of repairs) from InspectorADE in the work order which will appear as an attachment. The homeowner needs to sign it.

Question 20

Try to capture as much detail as possible

Answer 20

Every inspection has to be signed by the homeowner (unless the client does not require it for roof inspections) or unless your client otherwise states that you have permission to allow the contractor to sign it. The form they are signing is a statement as to the percentage of completion that the work was performed. It also proves that we actually conducted the inspection. If for any reason the homeowner does not agree with your assessment of completion percentage and refuses to sign the form, no problem. We just tell them that we can turn it in as is after indicating the homeowners’ reason for not signing the form.

Most of your clients will accept a photo of the signed form. Some require it to be scanned as a PDF.

Question 21

SOW – SCOPE OF WORK (LIST OF REPAIRS)

Answer 21

The “Scope of Work” is what most mortgage companies call the document from the insurance company that lists all the repairs that are to be completed. Others call it an Itemized List of Repairs. It all means the same thing. You have to have this before you can do the inspection. It should be attached as a document to the work order in InspectorADE. If an appointment is set and by the day of the appointment arrives and you still do not have the Scope of Work, you cannot complete the inspection. That is how important the Scope of Work is. Otherwise, you will not know what to inspect! We are not authorized to simply go by what the homeowner tells us. There may be times, however, that we are requested to ask the homeowner if they can provide us a copy of the Scope of Work given to them by the insurance company. In that case, ask them to prepare a separate copy for your arrival. Take the copy with you for reference.

Question 22

SOW – SCOPE OF WORK (LIST OF REPAIRS)

Answer 22

To save paper, if the List of Repairs is like a mile long, you might want to just write down in your notes the rooms you need to inspect. Sometimes even small rooms like closets need photos.

We NEVER take the word of the homeowner or even ask their opinion as to what they think the completed percentage is. That is what you, are getting paid for. If you meet a contractor on the job, they may try to tell you that the job is more complete than it is. (Of course)

Question 23

SOW – SCOPE OF WORK (LIST OF REPAIRS)

Answer 23

It’s not difficult to determine the percentage of completion. Experience in the construction industry is not required to be able to determine a bare cement floor does not have a new carpet! Take the list of repairs (Scope of Work) with you and go line by line down the list. Circle what is completed or not completed. Whatever works best for you. Bring a calculator with you.

After your inspection, you must use the Actual Cash Value (ACV) column and deduct from the total, the amount of work that has not been completed to come up with the total completed percentage. Enter the total percentage completed before the homeowner signs the IL form. If more time is needed, take the forms out in your car and figure it out there. Do not allow pressure to compel you to enter incorrect or inaccurate information. It has to be truthful and accurate. This is why insurance inspections usually pay more than standard fees. It takes more time to do the job right.

Question 24

Math problem :

Answer 24

Example Math: If the ACV total for the repairs is $18,969 and you determined that $14,388 worth of repairs have been completed so far, simply take the smaller number and divide it by the larger number:

14,388 ÷ 18,969 which equals .7585 or 76% complete.

Depending on the client, some forms will allow you to put whole numbers like 76, while others will only allow you to enter percentages as multiples of 5. (75, 80, 85, 90, etc.) In that case, round it to the nearest number.

Question 25

Special Things to Take Note of:

Answer 25

Materials on the job-site do NOT constitute a repair. A stack of sheet-rock is NOT a repair. It’s a stack of sheet-rock.

We can NEVER sign our name for the homeowner. In most cases, we have to get permission from our client if the contractor can sign it in place of the homeowner.

Completed and signed IL forms must be scanned as a .jpg file or PDF file. Some clients allow you to take close up photos of the form. Every client is different.

Question 26

Special Things to Take Note of:

Answer 26

Do not provide copies to the homeowner. If a homeowner asks for a copy, inform them that the mortgage company will provide them with any copies they ask for by calling them.

We never tell the homeowner when they will receive their money or when they can even expect to see their money. We do not have this information. Never guess or provide a procedure other than the fact that you conduct the inspection and turn it into the client. It’s up to the mortgage company to handle the documents from there.

Question 27

Special Things to Take Note of:

Answer 27

Always take photos of all repairs whether completed or not. It is just as important to show the work that has not been repaired yet.

If you are on the 2nd inspection for the homeowner, and they tell you the other rooms were already inspected and paid for, if the SOW has it on there, we have to take photos of it.

Question 28

PERFECT EXAMPLE OF AN INSURANCE FRAUD ATTEMPT

Answer 28

There was an insurance loss inspection on a house that had wind damage that blew off roof shingles. The rain got inside and made the ceilings wet, stained and damaged. Some of the water got on the carpets as well as ruining the attic insulation.

The roof wasn’t the problem, even though the homeowner completed the repairs himself.

The problem came when the interior was inspected for completed repairs. According to the Scope of Work, most of the ceilings in the home were to have the sheetrock removed and replaced. Acoustic (popcorn) ceiling texture (sprayed with ceiling texture) was to be applied to match the undamaged areas of the rest of the house.

Question 29

PERFECT EXAMPLE OF AN INSURANCE FRAUD ATTEMPT

Answer 29

The Scope of work stated that:

– A 32 SF section of the ceiling was to be removed and replaced

– 6″ of R20 ceiling installation was to be removed and replaced

– The remaining acoustic ceiling was to be scraped off and replaced with new popcorn texture

– The scrapped ceiling was to have anti-microbial agent applied to prevent mold

– Then it was supposed to be sealed with latex based stain blocker

Question 30

PERFECT EXAMPLE OF AN INSURANCE FRAUD ATTEMPT

Answer 30

The insurance claim for just the Living Room was supposed to be $360 dollars.

Instead, the homeowner thought he could make a buck or two by making the repairs himself with a few handy products from the hardware store…

Question 31

PERFECT EXAMPLE OF AN INSURANCE FRAUD ATTEMPT

Answer 31

https://mortgagefieldservices.com/wp-content/uploads/2016/10/bad-repairs.jpg

As you can see in the photos above, the ceilings were not repaired in accordance with the Scope of Work. If spot painting was all that the insurance company intended for the homeowner to do, then they would have written a check for $30 bucks to buy ceiling texture in a can!

The homeowner made the comment that the repairs were good enough for him since he is the one who has to live there. DO NOT fall for this type of sentiment. No matter how we feel about our homes, if it is mortgaged, we are not the ones to decide what is acceptable or not. The insurance company wrote a check to have the repairs completed professionally by skilled craftsmen. If we were to agree with the homeowner that the repairs were 100% complete, and later on down the road the mortgage company had to foreclose or otherwise found out about the shoddy workmanship, YOU would be responsible for the money it would take to get the property back to the condition that the insurance claim paid for.

Question 32

Another Example:

Answer 32

https://mortgagefieldservices.com/wp-content/uploads/2016/10/chicken-coop.jpg

Of course, according to the Scope of Work, the Chicken Coop was supposed to have a metal roof and had 14′ x 15.5′ measurements. It is not hard to see that this is just a 10′ x 10′ chain link fence dog enclosure.

Look at your Scope of Work carefully. Our job is to discover insurance loss claim fraud and report it to the mortgage company. In most cases, people will hire a contractor to have the job completed right. We are not home inspectors and we are not really qualified to determine the level of quality of craftsmanship. But when it comes to a case like this one, it doesn’t take a genius to figure out what is going on here. All we have to do is use the Scope of Work provided. Either it is completed and repaired as per the list of repairs, or it is not.

Question 33

Always seek the opinion of the homeowner for the percentage of completion.

True
False

Answer 33

False

Question 34

The purpose of an insurance loss inspection is to help prevent fraud.

True
False

Answer 34

True

Question 35

The “Scope of Work” is…

A list of detailed items that the insurance company is paying on.
Mounted on top of a rifle.
The part that sticks up out of the water in a submarine

Answer 35

A list of detailed items that the insurance company is paying on.

Question 36

Inspection forms must be signed by the homeowner.

True
False

Answer 36

True

Question 37

On a roof inspection we must always use a ladder.

True
False

Answer 37

False

Question 38

How many calls per day to the homeowner are required until the appointment is established?

17
14
8
2

Answer 38

2

Question 39

Making appointment attempts should be started within 6 hours of receiving the work order.

True
False

Answer 39

True

Question 40

Which is more important?

Call the homeowner to set the appointment for the earliest date possible.

Make and log the call attempts into InspectorADE to show that we are actively trying to set an appointment which could be for today, tomorrow, or next month. The important part is to start calling and log all attempts.

Answer 40

Make and log the call attempts into InspectorADE to show that we are actively trying to set an appointment which could be for today, tomorrow, or next month. The important part is to start calling and log all attempts.

Question 41

Photo requirements for insurance loss inspections include the 4 core photos in addition to the items repaired or not repaired.

True
False

Answer 41

True

Question 42

The next lesson is the final lesson. It only has one question which must be answered if you want the “Print Certificate” button to appear on the contents page that shows the lessons.

The most common question we receive after a person completes this course is “What is the next step”. Yet right there on lesson 11 are 5 Regional companies you can apply for, depending on the state you live in. If your state is not listed it is because none of the companies provided have work in your state. Below the companies listed are other ways to find more companies to work for.

Please do not write and ask what the next step is when it is very clear that you should click on the Contract Agreement or Application from one of the companies listed.

I understand that I must select a company to work for and either click on the Contractor Agreement, Keys, and Background check or select the application of one of the other companies listed.

Answer 42

I understand