Claim: Frequency Kills: Part 1

How a few insurance claims can make your firm uninsurable

By: David Dybdahl | July 2018

When should you report a claim?

Here are little known facts in insurance:

What does this boil down to? Insurance Is Important! You need it to run your business as well as protect it!  With out it, you will be unable to get a majority of jobs and leave yourcompany open to loss that could bankrupt it! 

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Insurance Is Important! You need it to run your business as well as protect it!

6 Things to Know to Get Paid for Sewage Claims

By: David Dybdahl

A continuing conversation on getting paid, working with mortgage companies, and insurance dilemmas.

This is the third in a series of articles on how to get paid for insured restoration work. The first two articles focused on accelerating payments from insurance companies and from banks holding two party checks in escrow, mostly in homeowners insurance claims.

This article focuses on getting paid for water losses on commercial property. The writing is on the wall; it will become increasingly difficult to be fully paid for jobs involving a speck of mold/bacteria or Category 3 water in the future, if the property is not insured under a specially designed Environmental Impairment Liability (EIL) insurance policy. Restoration firms providing Emergency Response Plans to the commercial property owners and management firms in their area can cut the costs of this needed insurance by half.

Changes in claims payment practices combined with universal exclusions for restoration work involving fungi/mold/bacteria have created the situation where 99% of all commercial property owners are severely underinsured for any loss involving a speck of any type of mold or bacteria in any sequence in the job. Being underinsured creates problems in getting paid when a property owner is dependent upon insurance to pay for a loss.

The good news for remediators is 99% of claims adjusters do not know how to pay for claims when there is a sublimit on the policy for mold or bacteria-related losses. The result is uncovered claims for losses involving a speck of mold or bacteria have been routinely paid for the last 12 years. However, things are changing fast in the claims business. Today, there is a much higher chance that a remediator will be left holding the bag with a bad debt for the work performed for underinsured property owner or manager.

Here are six factors to consider to assure payment for mold or bacteria related (Category 3) water jobs:



Getting Paid for a Commercial Sewage Loss

By: David Dybdahl January 2018

A continuing conversation on getting paid, working with mortgage companies, and insurance dilemmas.

In December, you read about six factors to consider to be sure you get paid for commercial category 3 water jobs. It was part of an ongoing conversation about a shift in coverage on these claims. While most insurance policies exclude coverage for cat 3 water, for decades they were paid out anyway by adjusters. Now, things are changing, and getting category 3 water jobs paid for is not so easy.

For unknown reasons, claims adjusters must have read the 12-year-old fungi and bacteria sublimits on property policies in 2016 and started pulling the trigger on denying claims under the sublimits of coverage.



By: Kari Dybdahl

Stand out to commercial property owners and managers with an emergency response plan.


It is no secret that commercial properties are the holy grail for restoration contractors. This is true for many reasons — the jobs are larger, and it builds your reputation with other property owners and managers, to name a few.

The trick that can be difficult for small- to mid-sized restoration firms is how to get into the door of not only the property manager and owner, but also the insurance agent who writes their insurance.

You are not alone; you might be thinking: “Is there a magic trick that I don’t know about?” As with everything, it has a little bit due to do with luck and a lot of to do with intentionally positioning yourself to your prospect with a value that no one else has brought them. This value can be exhibited by a range of items.

Unlike my usual articles, I’m not going to talk about insurance for cleaning and restoration contractors at all. I am going to walk you through how to fill your sales pipeline with commercial properties to intentionally position your company for first calls on commercial properties in your area. We are going to go past the brochures and the doughnuts and go straight into an innovative value that many of your competitors are not utilizing.

Making a plan

So, what is the inside secret to filling your sales pipeline with commercial properties? Anyone biting their nails?

The secret to successful sales for commercial properties, both for the insurance agent and property owner and manager, are Emergency Response Plans (ERPs). ERPs are used similarly to a hold-harmless agreement. The contractor walks through a property and evaluates any existing or threatened indoor air quality issues. Some finish with a plan that they hand to the property owner and/or manager stating what to do when a problem arises, small or catastrophic, and when to call a professional.

In the perspective of the insurance agent and carrier, these plans are an incredible value and could very well avoid covering a pre-existing condition at the property that was not uncovered in the insurance submission items. To a property owner and manager, the ERPs are an incredible value to assist with keeping the property to a certain standard level and reducing their risk of liability from the tenants and occupants.



Introducing ARMR HPR™

We created ARMR HPR™, because we recognized the gaps in coverage created by the various pollution exclusions and fungi and bacteria exclusions and related sublimits on standard general liability and property policies sold today!

What is ARMR HPR™?

ARMR HPR™ is the newest and greatest environmental insurance and risk management program being offered only by American Risk Management Resources Network, LLC (aka ARMR).  It is specially designed to fill the coverage gaps created by various pollution exclusions and fungi and bacteria exclusions commonly found in most standard commercial general liability and property policies. 

There are five (5) key benefits to offering ARMR HPR™ to your commercial property owners and managers:

  1. It sets you apart from your competition.
  2. It provides a steady stream of prospects.
  3. It refers insurance work for commercial properties to restoration contractors in your area.
  4. It builds your current book of business.
  5. It protects your agency’s E&O.

ARMR’s newest and greatest environmental insurance program

Introducing ARMR HPR – ARMR’s newest and greatest environmental insurance program releasing Jan 4th, 2018!

This is the “most innovative insurance product design to ever hit the environmental insurance market” – JJ Iovino, Regions Insurance.

The best prospects to your agency for environmental insurance are no longer environmental services firms or gas station storage tanks – they are commercial property owners and managers! 

Environmental losses can happen to any commercial building, no matter the age, size, or location.

Did you know, last year alone mold in commercial properties was the number one source of claims in the environmental insurance marketplace?  It’s crazy to think that mold in a building is riskier than cleaning up a contaminated superfund site! Yet, we as insurance practitioners do little to nothing to offer environmental insurance coverage solutions to the underserved commercial property sector. Enter ARMR HPR™!


Register HERE  
Read More Here!

Buy Your Insurance Like a Pro

By; David Dybdahl

You should not send more than one agent into the marketplace, shop for the lowest price every year, or switch insurance companies year to year. You should buy a GL/CPL and PL policy to cover exclusions for mold and bacteria in the CGL policy that most contractors buy.

Last time we started looking at some things that your agent may not be telling you when it comes to your insurance. To wrap things up, today we’re going to examine five things you need to be aware of that will soon have you buying your insurance like a pro.

1. Sending More Than One Agent Into the Marketplace is Hurting You

Multiple insurance agents bouncing around in the insurance market place does not get you the best coverage or price. The restoration specialist insurance brokers all know where the best value is going to be for your firm. Going out to multiple specialist agents just neutralizes the work of the agent you would like to deal with. You rarely end up with a better insurance program after going through this extra work. More likely, you will buy the cheap insurance without knowing what you gave up in other important considerations of coverage and claims-paying capability. 

2. Shopping for the Lowest Price Every Year is Hurting You

Insurance underwriters can look into their systems and see every time you have spun their wheels by asking for quotes and not buying their products. After a few unsuccessful attempts you will have “burned the market” and that door will be closed to you. 

To avoid this unnecessary situation, carefully gauge the companies you will seek alternative quotes from. A specialist broker will be able to tell which markets will likely be your best options without going through the application process and running up a bad track record for you at an insurance company. Ideally you should shop for insurance every three years.

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5 Ways Adjusters and Contractors Can Stay in Sync 

By: David Dybdahl March 30th, 2010

5 Ways Adjusters and Contractors Can Stay in Sync. Clear communication based on reasonable expectations while following standard industry restoration guidelines will create satisfied customers for the adjuster and restorer. If a job goes wrong, the adjuster will normally side with the policyholder, not the contractor.


Believe it or not, insurance claims adjusters and restoration contractors share a common goal: creating a satisfied customer from a job well done. One major restoration services franchise organization strives not just for satisfied customers but for “delighted” customers, and they achieve this in 60% of their jobs.

This is truly a remarkable achievement, considering most of their customers have had an insurance loss and, no doubt, have endured the stress and inconvenience associated with these kinds of events.

The more a customer, adjuster and restorer get “out of sync” on a restoration project, the more likely it will be that the customer will not be happy and costs of the project will escalate. Seriously unhappy customers may turn to litigation to resolve their differences.

Here are a few of the most common denominators that arise from many liability claims. See if any or all sound familiar:

  1. The property owner becomes dissatisfied with the restoration services being provided by the first contractor on a project.
  2. The property owner reaches out to a second contractor, who usually points out to the property owner where the first contractor has made errors in the restoration which, for more money, the second contractor can fix. Interestingly, both contractors are usually working from the same set of industry guidelines.
  3. The property owner complains to their insurance company about the restoration work and refuses to pay the first contractor.
  4. The insurance company that recommended the first contractor shuts that contractor down for all future referrals of work until the problem with the dissatisfied customer is resolved.
  5. In an attempt to get paid for the original work, the first contractor puts a lien on the property.
  6. Angered by the whole process, the property owner sues the first contractor and the insurance company. This is where the claim for “Johnny not being able to learn in school anymore” as a result of the restoration work will get thrown on into the mix of compensatory damages, increasing the costs dramatically.
  7. The first contractor ends up paying, or their liability insurance company ends up paying, teams of lawyers to defend them. The first contractor is also responsible for their contracts with the insurance company to pay the defense costs of the insurance company or the claims network that hired them, plus the costs associated with the second contractor. Most restoration firms do not realize that their service contracts obligate them to pay the legal bills and escalated claims costs of multibillion dollar insurance companies on a job gone bad.
  8. The second contractor gets drawn into the legal mess with depositions and other internal costs and will usually also a have difficulty getting paid. (Only the lawyers win in this scenario, because the legal bills alone will commonly exceed the original job costs by a factor of ten to 100.)

Read The Full Article HERE

Ask the Expert: Insurance Check with David Dybdahl

Published on Feb 15, 2016

Ask The Expert: Insurance Check With David Dybdahl. Are you one of the 90% of restoration/remediation contractors with gaps in your liability insurance coverage? Do you have questions about insurance for your company? David Dybdahl has the answers!

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Mind the Gaps: Ensuring your business insurance covers the work you do

Mind the Gaps: Ensuring your business insurance covers the work you do.

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The cleaning and restoration industry is a great business to be in. Few sectors in the economy hold the growth potential as the cleaning and restoration industry.

Our firm assists in insuring more than a thousand cleaning and restoration firms. Over the past three years our clients’ average annual sales, as shown on their insurance applications, are growing over 15 percent each year with some firms posting 200 percent revenue gains.

Fueling the growth in our customer base is an underlying trend in extreme weather events. American Risk Management Resources Network LLC anticipates significant growth throughout the cleaning and restoration industry for many decades into the future due to an increase in extreme storm systems as a direct result of climate change. If you are interested in more information on this overall topic, please attend my presentation at the upcoming Experience Convention and Trade Show in Las Vegas.

Climate change will create more opportunities for larger jobs and more frequent jobs, which in turn increases your overall business risk. For you to be able to help people in need and reap the rewards of extreme weather patterns, your firm has to be in business when the storms come to your area.

Through the cracks

As you take on more risk, it becomes increasingly important to ensure your risk-management strategy is dialed in, and insurance can help with that strategy. Unfortunately, the insurance programs for nine out of 10 restoration firms contain material coverage defects. The statistics on cleaning firms are better, with only one out of three cleaning firms being fundamentally uninsured for things they do every day for a living.

In this series of articles, I will provide you with some advice on the nuts and bolts insurance that would pertain to your firm.

Insurance is used as one of many risk management tools for your business. However, if you were to purchase insurance for every risk your business takes on, you would be left with little to no profits at the end of the fiscal year.

Insurance should be used to protect your business from catastrophic risks that could potentially put your company out of business. In this article, I will touch on insurance products available to the cleaning and restoration industry and begin to focus more in-depth on the various insurance products you are most likely buying to protect your business.

Best Insurance Coverage for Your Cleaning or Restoration Company

Best Insurance Coverage for Your Cleaning or Restoration Company. CleanJeff Cross, executive editor of Cleanfax, interviews Kari Dybdahl of the ARMR network and asks what cleaning and restoration pros should look for when attempting to find the best, most comprehensive insurance coverage for their businesses. It’s not about just walking into an insurance company office, as some might think, and it’s not about making a few phone calls. This can be as tough as finding the best employee for your company. It’s all about asking the right questions. Check it out!