A New Approach for Minimum Charges

December 22, 2011

One of the most difficult challenges construction estimators face is how to handle small repairs. Small drywall repair is a great example. It may take just minutes to repair a hole in the wall and to apply each coat of drywall mud, but drying time is needed between coats, so accounting for the trips and setup required–even for a small repair–is an important part of a complete estimate.

The Xactimate software offers a variety of tools that can help estimators when estimating a minimal amount of work in a trade. In addition, our Pricing Data Services department closely monitors costs and trends, including how estimators use minimum costs. Recently they surveyed more than 1,600 estimators, including contractors, subcontractors, specialty service providers, and adjusters, about the preferred method to estimate small repairs. This included more than 500 estimators who did not use Xactware products.

The results of the survey pointed to a shift in the industry toward a model that uses labor minimums to account for small repairs. To address this shift in the market, Xactware recently announced that we will support an automated approach to Labor Minimums in the next major release of Xactimate, which is scheduled for 2013. The new approach will be supported by changes in the Xactimate software to help calculate Labor Minimums. Additionally, extensive cost research is already underway by our Pricing Data Services group to ensure that published prices in the current Xactimate version support this new model. For more information, please see the Labor Minimums white paper in the eService Center.

We have also elected to announce this new automated approach more than a year in advance so customers can learn about the change and provide feedback and information before the implementation occurs. Customer feedback is an important part of the research and development for this new approach. If we haven’t heard from you yet, please take a moment to read the white paper and send us your thoughts.

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Weather-related Losses in the United States

December 8, 2011 TAGS: , , ,

The results of a recent survey from A.M. Best confirmed the numbers we’ve been reporting throughout the first nine months of 2011. A.M. Best estimated that catastrophe losses in the United States more than doubled in 2011 over the losses reported in the first nine months of 2010. In 2010, A.M. Best calculated catastrophe losses at $16.1 billion for the first nine months of 2010 compared to their recent estimate of $38.6 billion for the first nine months of 2011.

Most of the losses were from the violent spring storms in the Midwest and southeast, but flooding, blizzards, wildfires, and Hurricane Irene also contributed to the high numbers. Severe thunderstorms continue to be a leading cause of damage, with AIR Worldwide reporting that over the past decade, 36% of all U.S. catastrophe losses were caused by severe thunderstorms.

The 2011 Atlantic hurricane season that recently ended on November 30th was also very active—in fact, it tied 2010, 1995, and 1887 as the third most active season since 1851 with 19 named storms. The early-season storm Hurricane Irene was milder than feared but still caused an estimated $7.2 billion in damages and killed 55 people.

In spite of back-to-back highly active hurricane seasons in 2010 and 2011, the United States has not seen a Category 3 hurricane or stronger make landfall since the devastating storm season of 2005. According to the Wall Street Journal, that’s the longest period between major landfalling storms in more than a century.

Xactware User Conference 2012 will feature some searching discussions about catastrophe losses and the lessons learned. We will introduce some new technology that will help and we will have a panel discussion with a focus on handling catastrophes. As noted in my previous post, we will also hear from Kyle Beatty of AER on managing weather-related risk, and we will hear from meteorologist Reed Timmer, star of the popular TV show Storm Chasers.

 

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Reed Timmer, Kyle Beatty to Speak at Xactware User Conference

November 17, 2011 TAGS: , , ,

I’m pleased to announce two new keynote speakers for Xactware User Conference 2012. Reed Timmer, author of Into the Storm and star of Discovery Channel’s Storm Chasers, and Kyle Beatty, managing director at Atmospheric and Environmental Research (AER), have both accepted invitations to speak at general sessions.

Reed TimmerIf you’ve watched Storm Chasers, you know that Reed is a fearless pursuer of violent weather, principally tornadoes and hurricanes. But Reed is not just a thrill seeker, he is a serious scientist whose close encounters with severe storms have provided new and valuable information for researchers. This research can ultimately help save lives as forecasters develop faster and more effective ways to predicts storms.

Kyle BeattyKyle Beatty is also actively involved with the weather in his work at AER, a member of the Verisk Insurance Solutions group at Verisk Analytics and a sister company with Xactware. Kyle will talk about how insurance carriers and others are using meteorological data to make decisions about risk. He will also talk about the future of the science, including how weather risk management will be transformed within five years.

I’m excited for the addition of these leading professionals to the slate of industry experts who have agreed to present many of our breakout sessions. With three full tracks this year, there will be plenty of excellent sessions from the industry’s best and brightest.

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Introducing XactPRM

September 14, 2011 TAGS: , , ,

Xactware recently announced XactPRM, a comprehensive new product for the foreclosure services industry, at The Five Star Default Servicing Conference and Expo in Dallas, Texas. The announcement was the culmination of many hours of hard work and many conversations with leading professionals in that market.

We received some excellent feedback at the conference and I am looking forward to working closely with the industry. XactPRM includes a desktop estimating system, an assignment network, a smartphone estimating app, management tools, reporting tools, analytical tools, and pricing data research that is updated each month.

XactPRM (PRM is an acronym for Property Repair and Maintenance) builds on our expertise in estimating repair but also adds many new features specifically for experts in maintaining and repairing foreclosed structures. These include unique needs for documenting conditions and work, pricing research, communication requirements, and tracking and reporting for a variety of stakeholders.

XactPRM allows everyone involved in maintaining and repairing foreclosed properties the ability to seamlessly connect and to handle everything from a request to regularly mow the lawn to a remodeling makeover. This helps asset owners to maximize their return and professionals in the field to save money and time by working more efficiently.

To learn more about XactPRM, please visit XactPRM.com.

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Hurricane Irene

September 1, 2011 TAGS: , , ,

Hurricane Irene left a trail of damage along the Eastern seaboard last week. Photo: Jocelyn Augustino/FEMA (l.) and Yuisa Rios/FEMA (r.)

Our first user conference in 2010 featured a keynote address by Dr. Nicholas K. Coch of C.U.N.Y.’s Queens College. Dr. Coch spoke about the little understood danger of a hurricane striking the northeast coast of the United States. Dr. Coch’s study of past hurricane activity showed that a major hurricane hits the region about every 75 years. Dr. Coch noted that the population and building density in the northeast have increased significantly since the last large storm creating a high potential for substantial property damage and loss of life.

Hurricane Irene came close to realizing Dr. Coch’s concerns. Although the storm hit with less force than feared, the impact was still significant. In fact, it may end up being one of the 10 most costly catastrophes in U.S. history. At least 45 people are reported to have died from the storm, 2 million are still without electrical power, and damage estimates range from $7 billion to $10 billion.

As bad as it was, Irene could have been much worse. Dr. Coch notes several reasons New York City is particularly vulnerable, including the right angle formed where New Jersey and Long Island meet. Fortunately, this caused few problems with Hurricane Irene. With Hurricanes Katia and Lee strengthening in the gulf, many are taking a closer look at Dr. Coch’s research.

It was also nice to see one of our Xactware User Conference 2011 keynote speakers, Julie Rochman of the Insurance Institute for Business & Home Safety, hard at work providing advice and resources for those in regions affected by Irene. Xactware and our parent company, Verisk Analytics, were among the founders of IBHS’s multi-peril Research Center.

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Claims Satisfaction and Xactware Tools

August 17, 2011 TAGS: , ,

The kitchen was all that was left standing in this house after a tornado struck Bartow County, Georgia on April 27, 2011. FEMA/Judith Grafe

J.D. Power and Associates recently released their annual Property Claims Satisfaction StudySM. This year’s report is particularly interesting because it came on the heels of the spring storms that caused an estimated $15 billion in damages in April and May alone.

As we’ve come to expect, the study shows that insurance companies are doing a terrific job even when handling a huge influx of claims after a series of catastrophes.  The report shows overall satisfaction of which the industry can be proud.

The report also documents issues that lead to lower satisfaction, and I was happy to see that Xactware tools can help claims professionals address many of them. For example, policyholders reported declining satisfaction rates as the number of people they have to talk to increases. A key source of this dissatisfaction was caused by repeating the same information multiple times. XactAnalysis helps companies excel on both points. Seamless integration with claims management systems means information needs to be entered just once.  When it is unavoidable to reassign a file, previously collected information and work goes with the file so the transition is as smooth as possible.

The report also shows that contents claims are a key source of declining customer satisfaction, and I’m convinced that many of the issues can be effectively addressed by XactContents. The XactContents database can provide policyholders with current prices from national retailers, and Contents Collaboration can solve many of the communications issues that drive satisfaction down. XactContents also can make it much easier on the contents estimator.

Effective communication, especially at the first notice of loss, can have a big impact on setting expectations and helping customers understand what to expect. The bottom line is that 80 percent of the most satisfied customers said they would definitely renew, and 77 percent definitely will recommend their insurance company to family and friends.

 

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XactScope for iPhone, iPod touch, and iPad

July 21, 2011 TAGS: , , ,

One of the most common questions I’m asked on this blog and when I visit with customers is, “When will XactScope be released for the iPhone?” I’m pleased to announce that product was released today and is ready for download from the Apple store. Keep in mind that the app is free, but you must have Xactimate Professional to communicate with it. My thanks to all of our beta testers, including many of our user conference attendees and many of you who follow this blog.

The new release of XactScope is the latest in a series of what some have called our “year of efficiency.” For many types of estimators, our new releases have dramatically increased the speed and detail of estimating and claims handling. For example, in a recent Xactware Webcast, Xactimate Project Manager Ryan Johnson sketched a complex roof in about 10 minutes using Aerial Sketch. This roof would have typically taken many hours to document and sketch with any previous method.

We’ve also focused on little things. Speed issues, security, slight Sketch enhancements, and similar “small” upgrades can add up to significant efficiencies over time.

We aren’t stopping there. We are continuing to aggressively develop new and improved features and working on new projects. As always, we welcome and value your feedback on the tools that can help make your work easier and more efficient.

 

 

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Contents Collaboration for Homeowners

June 29, 2011 TAGS: , , ,

Collaboration with homeowners following a personal-property loss can pay dividends in a wide range of ways. Homeowners who work closely with adjusters or estimators when documenting contents items are more likely to agree with the results, are more satisfied with the service, and are less likely to dispute the estimate. They can also help reduce claims handling time.

But until now, collaboration has been very hard to make work.

Over the years there have been many programs and many variations of forms and training designed to harness the power of the homeowner’s built-in knowledge of his or her own things. The problem is that the homeowner usually has a job, is dealing with disrupted personal and family schedules, and is often working on difficult issues related to the loss in addition to the personal property inventory. The process is also psychologically challenging for many homeowners. Just scheduling a time for the estimator and homeowner to meet is often difficult and days may be wasted scheduling and rescheduling meetings that are often hurried and unproductive. Many estimators feel they just can’t wait and they end up completing the work themselves.

There are no easy answers and, if unaided, some homeowners will not have the inclination, time, or ability to help compile an accurate inventory. However, with the right tools, it is possible for homeowners to be an invaluable resource for documenting personal property claims.

The secret is to make the process for the homeowner easy, intuitive, helpful, and always available. Our XactContents team has done exactly that with the new Contents Collaboration tool. Contents Collaboration is a secure website where homeowners can enter their personal property items, communicate about the claim, and collaborate with the adjuster or estimator. The estimator simply sends them an email with a login. Access to the secure site is available anytime and communication is centralized and convenient. The best part is that XactContents does most of the hard work. For example, finding the items and checking their prices with major national retailers. It even suggest items of like kind and quality for discontinued products and can help track down hard-to-document items such as antiques and jewelry.

Most homeowners want to help and are committed to fulfill their responsibilities after a claim. Contents Collaboration is one way to help them do that in a way that is much easier and works with their schedule. The result is happier customers and lower claims handling costs.

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The 2011 Hurricane Season

June 10, 2011 TAGS: , ,

Some people are surprised to hear that the 2010 hurricane season was one of the most active on record with 19 named storms. This tied it with 1887 and 1995 for the third most reported storms. Twelve of the 2010 storms became hurricanes, but none reached landfall in the United States. The result was a very welcome inactive storm season for property insurers.

Hurricane forecasts for each of those five seasons were about the same as the forecasts for this one. NOAA predicts “an above normal hurricane season” in 2011, and researchers from Colorado State University’s Tropical Meteorology Project agree with a forecast of one storm above average. NOAA thinks we will see three to six storms that are Category 3 or higher, and Colorado State predicts five. The average is four major hurricanes that are Category 3 or higher each year.

As U.S. property insurers are absorbing the costs of a devastating beginning to the 2011 tornado season, the hope is that hurricane forecasters come up short at least one more year.

Since the last major hurricanes made landfall in 2005, Xactware has been busy developing many new products that will help property professionals be even more efficient and effective when they do have to handle the aftermath of another major catastrophe. This includes faster computing, new mobile options, and improved Sketch estimating including the new Aerial Sketch feature that is helping estimators quickly provide roof estimates, even when roofs and buildings have been destroyed.

We’ll be discussing some of these features and other important topics in the industry in our new series of Xactware Webcasts, which will broadcast on the third Wednesday of each month at 2:00 p.m. MT. These webcasts are designed to be short and to the point, and they are required to be 18 minutes or less. Our first webcast in the series was on Aerial Sketch is now available for on-demand viewing at http://www.xactware.com/resources/webcasts/on-demand.

If you have a moment, check it out. You can also sign up for other upcoming live webcasts.

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The Unfolding Severe Weather Catastrophe of 2011

May 25, 2011 TAGS: , , ,

On April 27, 2011 a tornado swept through La Grange, GA damaging many homes and businesses. Judith Grafe/FEMA Photo

The cumulative total of the 2011 tornadoes and severe weather from April and May in the United States has added up to be a major catastrophe with no sure end in sight. On May 9, 2011, our sister company, AIR Worldwide, calculated insured losses for the week of April 22-28 to be between $3.7 billion and $5.5 billion. That week 475 tornadoes were reported, including two F-4 tornadoes (with wind gusts of 166 to 200 mph) on the ground at the same time. That seemingly remarkable week has been followed by the deadliest tornado to touch down since 1947 that destroyed or damaged nearly 75 percent of the city of Joplin, Missouri, and took at least 125 lives, with many still unaccounted for.

The destructive storms are continuing with many new tornado outbreaks being reported since the Joplin tornado, including today.

The response of the property insurance industry has been excellent. Professionals have been working through rain, wind, and the threat of more severe weather. Their efforts can be measured by the volume of claims flowing through our servers.

As I noted in a previous post, the volume of claims through our XactAnalysis system continues to be high as professionals quickly respond to each new disaster. In April, for example, XactAnalysis processed more than 694,000 claims assignments. That is a 41.9 percent increase over assignment volume in March 2011.

The wide-ranging severe storm damage in the Midwest comes on the heels of the devastation in Japan from the early spring earthquake and tsunami and amidst unstable fuel prices. Added to that is the knowledge that tornado season is still young and the hurricane season has not yet begun. To keep current with rapidly changing conditions, Xactware has collected and analyzed more than 35,000 direct survey responses from retail vendors and 30,000 direct survey responses from trade contractors in the last three months. Updates that reflect the latest research are posted each month in the United States and Canada.

The hard work of recovery is just beginning. Our hearts and thoughts go out to the many victims and our support and best efforts go out to the quality professionals who help so many people put their lives back together again.

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