Hail damage claims and neighbor inflammation | Property Insurance Protection Law Blog

The insurance claims industry has coined a new word and a new definition. A white paper by CapeAnalytics, How to automate hail claim processing with 96% accuracynoted the following regarding “neighboritis:”

Neighboritis

Another problem that leads to more frequent and larger claims is “neigboritis,” which starts when someone in a neighborhood gets a new roof through an insurance claim. Now their neighbors also want a new roof, triggering more claims. This phenomenon is driven by roofing contractors’ door-to-door sales tactics and human buyer psychology. Four demanding personas create four phases of activity seen after a storm:

1

. ‘Doers’ file a claim immediately and sign up with one of the first roofing contractors to show up.

2. “Watchers” make sure someone else replaces a roof before you file a claim.

3. “Waiters” wait for several neighbors to replace a roof and get referrals to contractors.

4. “Too-laters” have injuries that go unreported and unrepaired until it’s too late. This then becomes already existing hail damage at the time of drawing. Accelerating phases 1 and 2 with effective claims handling and “friendly” approved contractors can reduce the success of unscrupulous actors later in phase 3.

I can understand that people who live nearby can suffer similar hail damage. Yet I had not formally heard of this term. Indeed, I have seen no empirical data to suggest that this is an accurate depiction of policyholders rather than a projection of those involved in a sales pitch to an insurance company’s claims department.

Olympus Insurance Company further defined “neigboritis:”

Neighboritis – When a neighbor gets a new roof after a big storm

It’s hard to step out the front door and not notice what’s going on around you—specifically, what’s going on with your neighbors. Things like a new basketball hoop, a fancy vehicle sitting in the driveway, or even an addition to their home can make it hard not to feel a sense of envy. It is human nature to want to be “on par” with our neighbors and peers. This feeling of envy has resulted in a very specific condition that spreads through a society like a disease. It’s called Neighboritis, and today we’re going to talk specifically about ‘Roof Envy’.

What is Neighboritis?

Neighboritis is a term used to describe how you feel when you see a neighbor get a new roof after a major storm such as a tropical storm or hailstorm. You see your fellow neighbors getting a new roof and assume your roof must be damaged too. You are now convinced that you need a replacement. You are not alone in this scenario. Once word of roof replacement gets around in your neighborhood, everyone gets the “Neigborit Disease” and calls to have their roof inspected and replaced.

Shady contractors can be promoters of neighboritis disease. There are many stories of salesmen going door to door informing homeowners of the “damage” to their roofs.

How it happens

According to “The Independent Insurance Claims Adjuster”, gum inflammation can occur at the following stages:

1. A roofing salesman claims to be a hail expert and finds a neighborhood that has never really experienced hail damage, or experienced hail that did not cause damage. The salesperson knocks on a door claiming to be a roofing expert and explains to the homeowner/insured that they have been exposed to hail and that they have damage to the roof. The roofing salesperson then offers the homeowner a new roof at no cost, but only if he can inspect their roof directly and usually before the insurer has even been notified of any claims.
2. The roofing salesperson then works to smooth out any skepticism the property owner may have by explaining the different values ​​of a new roof in relation to the property value. Homeowners are catching on to the concept that they can get a new roof at no cost and it takes some convincing that hail may have fallen and damaged their roof when they weren’t aware of it.
3. The salesperson convinces the homeowner that they need to do a brief roof inspection to see the hail damage.
4. The seller pressures the homeowner into signing a “contingency agreement,” even though it’s usually not legally enforceable.
5. The roofing salesman incentivizes the property owner to “spread the word” (neigboritis) by offering $500.00, $1,000.00 and larger referrals if neighbors sign for their roof at no cost.
6. At worst, the roofing salesman tells a story about his or her work with neighbor John Doe on his roof for hail-related damage; all of which are a result of only having a contingency agreement.
7. One or two inexperienced property insurers pay for roof replacement when it was not necessary or by mistaking mechanical damage for hail damage, causing a roofing salesperson to claim that other roofs were replaced due to hail damage. In extreme circumstances, a roofing company may have been hired outside of an insurance settlement to replace an aging roof, and the same company comes back several months later, after hail in a remote area, advertising that a nearby neighbor had his roof replaced (not specifying why) and thereby start a frenzy in the area.

Too good to be true

It’s hard to turn down a salesperson’s offer to check out your roof for free. If your neighbor suffered damage and is going to get a new roof, why wouldn’t you? Right? When the seller does the inspection, there is always a damage report. And why not! Hail happens and damage occurs.

Olympus says policyholders get a “sickness” when they learn some of their neighbors are suffering hail damage and their insurance company is paying the damages through the roof. It even suggests that insurance companies paying their policyholders are “inexperienced” rather than acting in “good faith.” People who sell and buy Olympus insurance policies should really think about how this company’s claims handling views the people it contracts with.

In another newspaper, Myths about hail damagethe author, Doug Brown, also called it a disease:

MYTH NO. 2:

The neighbor’s roof is damaged… mine too. It’s a story often heard by adjusters and investigative engineers alike. Homeowners see their neighbors getting new roofs and assume theirs must also be damaged and need replacing. We call these neighbors. It spreads much like a disease. Once there is a rumor around that the roof is being replaced, everyone catches the bug and calls their insurance company to have the roof inspected. Contractors can often be carriers of the naghboritis disease, passing it from door to door when informing homeowners of the “damage” to their roofs. We expect hail of similar size and density to hit homes in close proximity to each other. However, as insurance professionals and investigative engineers, we cannot base our findings on what is supposedly found on another property.

I wonder what the named disease is when insurance companies, their property insurance adjusters and hail experts wrongfully treat policyholders with delayed, underpaid and denied hail claims?

These articles and methods of injury instruction call for a different look at otherwise obvious hail damage claims. The change in mindset will lead to more valid claims being denied and underpaid.

Today’s thought

It is good to remember that in crises, natural crises, people forget for a moment their ignorance, their prejudices, their prejudices. For a little while, neighbors help neighbors and strangers help strangers.

– Maya Angelou