Dealing with Catastrophes: Personal Touch Is Key Element

I’ve written a great deal about how technology can make a difference in how an insurance carrier reacts to a catastrophe, but all the tools in the world are meaningless if a carrier doesn’t offer the personal touch that people need when they are in the midst of a tragedy.

That point was brought home to me again last week as I read the accounts and watched the incredible videos of the tornados that ripped though the southern United States.

Twenty-one years ago, I was in a similar situation. Fortunately, the storms that ravaged portions of southeast Indiana and Cincinnati on June 2, 1990 did not take any lives, but they gave me a first-hand look at how well—or not so well—insurers can react to the needs of their policyholders.

My family huddled in the basement that night after seeing a television report that a tornado was headed in our direction. Within minutes we could hear windows popping on the floor above us, but had no idea how devastating the storm really was.

When the winds calmed, I went upstairs and saw that our first floor was a mess. I made my way to the steps leading to the second floor and shined my flashlight above. There was no reflection from the light. As I made my way up the stairs I discovered there was no longer a roof above our heads.

In the days that followed I experienced the true kindness that lies in people’s hearts. Friends and family helped us secure what was left of the house and our belongings and helped us find a place to live.

The day after the storm, I called my agent and told him that I would be filing a claim. He in turn contacted the adjuster to come to what was left of my home and help with the claim.

I was leery of doing anything right away, in part because catastrophes are disorienting and also because rumors circulated quickly that neighbors were having problems with their insurers.

The adjuster and my agent wanted me to get started on a list of personal property in the house that was lost or ruined. A week after the storm, the adjuster met me at my house and explained what he had discovered and what needed to happen.

My house was listed as a total loss, he told me, and the only thing left to determine was how much the insurer would pay for the items inside my home. My policy placed a cap on the amount of loss.

“I wouldn’t be surprised if your losses exceeded your coverage,” he said. “Why don’t we go through a list and see where we stand.”

For the next hour, he and I sat at the kitchen table and I told him what was in each room and whether it was damaged or not. He dutifully wrote down everything with a pen and paper—there were no laptops for adjusters back then. Finally, he suggested we take a break. He got out his calculator and began adding things up and 10 minutes later he called me back in and told me what he was authorized to do.

Within minutes he wrote two checks—one for the insured value of the house and a second for our personal property as well as for some expenses while we relocated.

Suddenly, a huge weight was lifted. The road to recovery for my family was about to begin. But it wasn’t that way for everyone. A popular independent agent was forced to follow the wake of his company’s adjuster and apologize to his customers for the harshness of the adjuster. All the sponsorships of youth sports and community activities couldn’t make up for the bad feelings caused by one person.

My insurer was Nationwide. What I initially interpreted as pushiness on their part to reach a quick settlement was instead their experience in dealing with disasters and knowing that the longer we waited to address our situation the more difficult it would be for us to put our lives back together.

They understood that our lives were in chaos so now was not the time to demand to see a receipt for the 19-inch TV we had in our bedroom.

Insurers talk all the time about how important the claim process is to them. If they mess it up not only do they lose that customer, but they also get horrible publicity. In today’s world with social media, the verdict on an insurer’s performance will be out immediately to hundreds of Facebook friends or followers on Twitter. There was no social media in 1990, but there was plenty of word-of-mouth communication. People who did not have storm claims wanted to know who insurered your home and if you felt they were fair with you. Some things never change.

You can’t imagine the relief that comes from telling others that one of the worst moments of your life was made better by the professional manner in which the people you paid to help you responded to the situation.

It’s still in my mind. My premiums over the last 21 years don’t even come close to matching what Nationwide paid us that June afternoon, but they have a loyal customer for life because they were there for me and my family.

The storms of last week and the ones that inevitably will follow test the service arm of insurers. Hopefully this is a reminder of how they wish to be perceived in the worst moments of a person’s life.