Customers are flooding insurers with unacceptable claims, say Richard Coles and Paul Ryan

' The sharp end of insurance claims is getting sharper. It is now recognised that as many as 20% - and in some categories an even higher percentage of claims - are at best exaggerated and at worst fraudulent.

But it isn't only these black and white cases which have changed claims handling in general and loss adjusting in particular.

There are also more policyholders who are deliberately misinterpreting their policies in an effort to squeeze more out of insurance companies.

Ten years ago it was virtually unheard of for a policyholder to demand compensation for the time taken in discussing the claim, but today that happens quite regularly.

In one case where the policyholder had chosen the builder to repair storm damage he demanded compensation from the insurer because his builder was taking more than the originally agreed time.

In another case the policyholder claimed that the slowness of the builders had cost him the sale of his house, the profits from which he would have put into Brazilian bonds and therefore the insurance company owed him £36,000.

In fact, the repair bill was £5,000 and that was what the claim was settled at.

Of course policyholders come in all shapes and sizes. One claimed that overnight someone had come and replaced her patio doors with inferior models and she wanted compensation to put back her original doors.

This case involved a certain amount of tact. We said we had better check with the original builder about the specifications and sure enough, the builder confirmed that the doors in place were the doors he had installed.

But it isn't just the oddball claims that are changing the face of claims. It is the number of claimants who expect the insurance company to pick up maintenance costs and bills for property wear and tear.

Typically, after a storm where there has been some damage to a roof, maybe a few tiles lost the policyholder will demand that his whole roof be replaced.

Flat roofs are famous in this regard. They often deteriorate after seven or so years, but that does not stop many householders trying to get the insurance company to pick up the replacement tab.

In one case, the policyholder stated that the roof had leaked almost from day one and when we pointed out that as this was the case, he should have taken it up with the shoddy builder, he was most offended and insistent that his insurers should replace it for him.

Another case had a man who on moving into his house discovered that there was asbestos in the ceiling boarding. He demanded that the insurance company pay for its removal. Another having moved into a new house with timber floors demanded that the insurance company pay to stop the floors creaking when any of the family moved around upstairs.

Poor maintenanc
One claim which almost went wrong involved the policyholder demanding that the insurance company replace all his window frames which he claimed had been storm damaged. When it was pointed out that they were all rotten because of very poor maintenance the man complained.

To illustrate his point the loss adjuster jabbed his pencil into the window sill and the sill crumbled. The policyholder then made a complaint to the insurance company about what he stated was the destruction of his property.

Some are not so much trying it on but just a little naïve. One made a claim for subsidence on the basis that all the pictures in his living room were askew. The loss adjuster straightened the pictures and assured him there was no subsidence just that someone had nudged the pictures.

When these attempts at getting extra from the insurance company are turned down by the loss adjuster, many will just say: "Well it was worth a try, I thought I would give it a go."

Where policyholders and loss adjusters can clash is over the consequences of underinsurance. According to AA Insurance as many two thirds of insured householders are under insured. So when it comes to the claim this can be a painful moment of truth.

One way is to point out that if they are 50% underinsured how does the insurer know which 50% is covered, in which case with average, paying 50% of the loss becomes suddenly a quite reasonable solution.

Research by the Chartered Institute of Loss Adjusters (Cila) into claims handlers views of the public found that while most were either neutral or polite when making a claim, over half said recently the public had become less reasonable.

Typically, many claims handlers complained of the public demanding extremely high standards of the insurance companies while making little or no effort to assist themselves. Many blamed the continuous diet of consumer programmes on TV for creating unbalanced expectations.

The Cila research also highlighted that around 10% of the public became angry when asked straightforward questions about their claim. Somehow the insurance industry has got itself in something of a bind.

While no one complains when a railway inspector asks to see their ticket some policyholders will fly into a rage when asked for proof of purchase of some recently lost or stolen item.

But in the end difficult customer or not, the loss adjuster has to provide a service and reach a solution.

Mature, experienced adjusters being demonstrably professional, calm and fair and explaining to the claimant about a claim goes a long way with even the most difficult customers-though sometimes turning the other cheek is not enough.

Most policyholders when they recognise that you know what you talking about and are being impartial accept that you, in the situation of the claim, are the 'man in the white suit' - the expert. IT

' Richard Coles and Paul Ryan are associate partners with Carmichaels Loss Adjusters