Thinning of the herd - REO Property Preservation Forum
 
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post #1 of 7 (permalink) Old 02-10-2013, 10:51 AM Thread Starter
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Thinning of the herd

An asset management company and city I work for a s a sub are looking for new insurance clauses that indemnify them from having their insurance as the primary. In other words I go do a distresed house board up to the cities specs then a claim comes up my insurance is the front runner and has to pay.

Don't get me wrong in the cities case I don't see a problem.

Asett servicer HELL YES.

People when losing their house are very suit happy. For Anything or just cause they want to try to make Some money. So now if I mow a yard and the fromer home owner decides to file suit for trespass OUR insurance has to defend this?? Where other than being a pimp does the assett company get away from any Liability??. They have been losing their duffer in suits and I see this as they are trying to stave off a bankrupcy or not meeting earnings expectations, since they have hired a Business consultant group, further reinforcing they don't have a CLUE about whet they are doing in house. Once the company went public it has been a constant beat down on pricing and now they want no accountability for issuing potentially illegal work orders.

NO

Time to RUN
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post #2 of 7 (permalink) Old 02-10-2013, 12:01 PM
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Quote:
Originally Posted by Splinterpicker View Post
An asset management company and city I work for a s a sub are looking for new insurance clauses that indemnify them from having their insurance as the primary. In other words I go do a distresed house board up to the cities specs then a claim comes up my insurance is the front runner and has to pay.

Don't get me wrong in the cities case I don't see a problem.

Asett servicer HELL YES.

People when losing their house are very suit happy. For Anything or just cause they want to try to make Some money. So now if I mow a yard and the fromer home owner decides to file suit for trespass OUR insurance has to defend this?? Where other than being a pimp does the assett company get away from any Liability??. They have been losing their duffer in suits and I see this as they are trying to stave off a bankrupcy or not meeting earnings expectations, since they have hired a Business consultant group, further reinforcing they don't have a CLUE about whet they are doing in house. Once the company went public it has been a constant beat down on pricing and now they want no accountability for issuing potentially illegal work orders.

NO

Time to RUN

Are Talking about FAS?
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post #3 of 7 (permalink) Old 02-10-2013, 12:11 PM
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CGL policies issued from "your neighborhood" Insurance Agent is not suitable for the Property Preservation business since there is no "flow-over" type clause to the Service Provider. Through many discussions with Ins Co's it is being found that the "p&p contractor" is applying for coverage as a landscaper, janitorial services and a multitude of other job classifications. This has led to many policies being voided upon a claim investigation. This is accomplished by the Ins Co by enacting the Concealment/misrepresentation/fraud clauses. The "right to defend" is then nullified and all expense/liability is burdened by the contractor.

It is easy to understand WHY a certain P&P Service Company wants the contractor to purchase a policy from their "list" of approved Ins Providers. We all know the reason. I foresee in the very near future the premiums skyrocketing on the P&P Service Companies AND the field contractor due to the disproportionate amount of high risk. A "regular" Insurance Company would not be allowed, by law, to assume the Property Preservation classification under a normal General Liability policy so a Surplus Lines Company is/will be the only option remaining thus NO price controls.

A recent ruling in Mn (Jan 31, 2013),although not specific to P&P, allows ALL liability and Ins Proceeds paid out to be reimbursed to the Ins Co if there is ANY misrepresentation of a claim. Ask yourself: As a contractor do you fully understand ALL the actions/work that has been performed, or better yet what has not been performed, over the course of the foreclosure file? Very rarely and impossible for any contractor to ascertain what a prior contractor has or has not completed. What and HOW you document a property will provide the contractor limited protection when the Ins Companies come asking for all related facts and affidavits for the property losses.

I see it only getting worse. Service Companies and banks are looking for other parties to pay for the high cost of repairs...heck its a good business model.... its all by design IMO.
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post #4 of 7 (permalink) Old 02-10-2013, 07:05 PM
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How this applies to you? Besides you basically becoming the underwriter for Nationals, if you are not covered for lead or mold abatement, winterizations, roofing work, HVAC, etc, you may be paying for claims out of pocket. Some folks thought the money was good and then 6 months later they find they are giving it all back and then some.
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post #5 of 7 (permalink) Old 02-10-2013, 07:12 PM Thread Starter
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How this applies to you? Besides you basically becoming the underwriter for Nationals, if you are not covered for lead or mold abatement, winterizations, roofing work, HVAC, etc, you may be paying for claims out of pocket. Some folks thought the money was good and then 6 months later they find they are giving it all back and then some.
I have been VERY firm and up front withthem and don't play their games. I don't do alot of what they are looking for just To's and ongoings. Thats pretty safe I figure NO rehabs and deep repairs. ABSOLUTELY no mold or paint. JUst toooo much liability.Stick to the conservative side and definitely don't allow them to suck me in to their "WEB" of mind games. I have played this one long enough to tell a FNG on the other end of the airwaves.
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post #6 of 7 (permalink) Old 02-11-2013, 10:55 PM
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I'm covered as an Artisan Contractor with a 2M/4M policy. I was sitting right across the desk with my agent when he called the underwriter and explained my business and this is what the underwriter, (Farmers Truck Insurance Exchange) said was the classification i needed. So far nobody has questioned it in 4 years.......
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post #7 of 7 (permalink) Old 02-11-2013, 11:07 PM
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till the first significate claim anyways....
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