Restoration Drycleaning: A Proven Alternative That Improves The Bottom Line
The economics part is simple: An insurers bottom line is directly affected by reducing costs or increasing revenue. The challenge is finding a way to make a meaningful impact on one or both of those areas.
Of all the categories of household goods listed on insurance claims, clothing and textiles comprise the fastest growing and largest segment–approximately 23 percent, which is more than double the number for any other category of the average contents claim.
With an average cost savings of 84 percent compared to replacement, restoration of fabric items drycleaning offers a proven solution that can dramatically reduce costs and improve margins.
While done for years in a fragmented manner, restoration drycleaning is undergoing a significant transformation and becoming a highly specialized field, as skilled operators realize the higher level of professionalism required to serve as partners to insurance companies.
The premier restoration drycleaning professionals in our industry are developing processes for restoring clothing, textiles and other fabric items damaged by fire, smoke, water or exposure to mold and other contaminants. Professional restoration drycleaners also are adept at handling a wide range of specialty items, including window treatments, shoes, purses, hats, belts, leathers, furs, pillows and more.
Perhaps even more important is the development of, and adherence to, standardized, proper servicing procedures that provide additional efficiencies and benefits to insurance companies.
It starts with accessibility. Adjusters and contractors are called into service at all hours. The same expectation should apply to drycleaners.
Being available around the clock enables the restoration process to begin immediately, which is especially important when dealing with wet garments or mold remediation. A fast response and an ability to quickly process wet items will lead to a better restoration success rate by preventing dye migration and mold growth contamination. The expeditious removal of fabric items also allows structural and other contents cleaning companies to begin their work as soon as possible.
Once on site, the professional restoration drycleaner conducts a thorough, room-by-room inventory to capture the loss. Beyond saving time for the adjuster, such an inventory provides a reliable record of a homes contents and ensures that the homeowner acknowledges what items leave the house.
A proper inventory can reduce customer complaints by preventing most problems from occurring, as it identifies all of the affected items–with details about brand names and pre-existing conditions–and eliminates any potential discrepancy about the items value.
Take, for example, window treatments, which are often among the most expensive items purchased for a home. When such accessories have been affected by smoke or water, a trained restoration drycleaning specialist will evaluate the window coverings for pre-existing damage such as sun deterioration, shrinkage, snags and water stains. A detailed condition report, reviewed and signed by the homeowner, ensures that restoration efforts are directed at the damage from a loss.
The restorer should take photographs of the window treatments while still on the windows to create a reference for re-installing them and to document signs of pre-existing damage.
A proper inventory has other advantages as well. First, it provides a detailed, accurate scope of items that will need to be replaced, rather than relying on the insured to create a list. Next, an inventory that is conducted and tracked electronically creates a tightly controlled environment in which homeowners can quickly access items that have been restored. From a financial standpoint, an on-site inventory also enables the adjuster to reduce additional living expenses, as “rush” service can provide a portion of the restored clothing to an insured within 24 hours.
For insurance companies, the potential cost savings of restoration drycleaning is enormous. In our world of informed consumers, more homeowners choose full replacement cost coverages and specialty riders for home contents. Second homes or vacation homes that owners generally want fully insured are more prevalent. Also consider the greater average value of common clothing items, upscale wardrobe items, custom-made draperies and fabric accessories, and the net result is a much greater loss exposure for contents.
Based on the results of hundreds of actual claims, the average cost of restoring fabric items is approximately 16 percent compared to the replacement cost. This average cost savings of 84 percent signifies a proven, viable solution for increasing profitability for insurance companies.
Restoration drycleaning also benefits your insureds, as homeowners are especially appreciative of efforts to save sentimental items ranging from wedding dresses and christening gowns to stuffed animals to heirloom items (antique quilts, tapestries and wall hangings). Taking great care with delicate or fragile items, restoration drycleaning professionals will conduct repeated cleaning processes and multiple treatments with ozone to ensure complete restoration and homeowner satisfaction, a key factor in the process.
Professional restoration drycleaners understand that a fire or flood can be a harrowing experience and a major inconvenience for homeowners. Proper appearance and communication–namely uniformed representatives who are courteous, sympathetic and well trained–are imperative for conveying a high level of professionalism. An experienced representative can help the homeowner understand the benefits of restoration drycleaning, and insureds generally are relieved to learn that they can avoid the hassle of having to shop for new items, especially clothing.
Meeting the distinct needs of insurance companies and their insureds requires a focus on professionalism, a strict adherence to guidelines and a standardized approach to service. Fulfilling these prerequisites, restoration drycleaning is playing an increasingly important role as a valuable partner to the insurance industry.
Wayne Wudyka is president and CEO of the Certified Restoration Drycleaning Network (CRDN), a nationwide organization of premier drycleaners who specialize in restoring clothing, textiles and fabric items damaged by fire, smoke, water, mold and other contaminants. The organizations Web site is located at www.CRDN.com.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, October 24, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.