At a Senate Homeland Security Committee hearing on Tuesday, Sen. Josh Hawley (R-MO) spoke to Nick Schroeder, a field adjuster deployed by Allstate through Pilot Catastrophe Services, to survey damage.
Category
🗞
NewsTranscript
00:00Thank you very much, Mr. Vettel. Thanks to all of the witnesses. We'll now have some rounds of questioning. I will start and let me start with you, Ms. Miguel. So at September 27th, 2024, Hurricane Helene hits, hits Georgia, hits your home, causing very significant damage. I think we've got a picture of some of the damage here. Let's have a look. Does this look pretty familiar to you? It does. It looks pretty severe. I mean, that's a massive tree right there in the front part of your home.
00:30And you're an all-state policyholder. Is that correct? Correct. And all-state sends out an adjuster. You said pretty quickly just a moment ago. Is that correct? About three weeks after. Oh, well, that's not very quick. Okay. Three weeks after. All right. And you were told at the time in this first inspection verbally that the adjuster agreed with you this was very severe damage. Is that fair to say? Correct. I think we maybe have a second picture. Let's look at another view of this just to give a real impression. Here's a breezeway that looks to be nearly completely destroyed.
00:59You can see some of that roof damage quite extensive that you were talking about in your testimony. All of this looks familiar to you, I'm sure. Yes. Now, after this first adjuster agrees with you that, yes, there's very significant damage, what did all-state, when they finally came back with an actual assessment, a real number, what was that number again?
01:19$46,000. $46,000.
01:21So you went to considerable expense on your own.
01:24You hired your own independent adjuster to come back out and do all of this over again.
01:29And that person, looking at all of this evidence, that person found that the damage was in the neighborhood of what?
01:35I'm sorry. Can you repeat the question?
01:36Yeah. Your independent adjuster, how much did that person estimate the damage was?
01:41$497,000.
01:44$497,000.
01:46All-state offered you $40,000, basically.
01:51Correct.
01:52And you're still waiting for this process to be resolved all this time later.
01:56Is that right?
01:57That's right.
01:58Let me just ask you now, Mr. Schroeder, because you were that first adjuster who worked for All-State who came out to look at this home.
02:06You were a field adjuster deployed for All-State through pilot catastrophe.
02:11Is that correct?
02:12Yeah, that's correct.
02:13And you were the first one to inspect Ms. Miguel's home after the hurricane.
02:17Is that right?
02:18Yeah.
02:19And you went in person, I think.
02:20Is that correct?
02:21Yes.
02:22And you spent several hours, Ms. Miguel said in her testimony a moment ago, you spent several hours doing a very thorough inspection.
02:28Is that your memory also?
02:30Yeah, that's correct.
02:31And how serious would you say the damage was in your own personal recollection?
02:35Extremely, probably the most serious that I saw on this deployment.
02:39Wow, the most serious that you saw on the deployment, which makes sense given these photos.
02:44So you start, if I understand correctly, you start to prepare an estimate for a full replacement of this breezeway right here.
02:50Does that sound right?
02:52Yeah, that's correct.
02:52But then you were instructed, you were told by the higher-ups, no, no, no, no, no, we're not going to do a full replacement of the breezeway.
02:59So only do an assessment for a partial replacement of the breezeway.
03:02Is that correct?
03:03Yes, that's correct.
03:04Okay, so then you start working on that, and you're working to get as big of a damage claim as you can for Ms. Miguel in line with the facts after you've already been told, no, we're not going to do the full thing.
03:15And then before you can even complete your work, you're taken off the case.
03:19Is that right?
03:20Yes.
03:20Why do you think that happened?
03:24I was told it was due to time I was taking too long, but I don't believe that is the case.
03:33I think that Allstate saw from this and my recently prior estimates of being very thorough and complete and going back and forth with reviewers on coverage that it was going to be a higher estimate, and it would be more cost-effective to reassign it to an adjuster that would listen better.
03:58Yeah, an adjuster who would lowball the policyholder, really.
04:03I mean, that's what we're talking about.
04:04You're removed from the case.
04:06It took three weeks to send you out to begin with, and then all of a sudden, boom, you're removed once it looks like you're actually going to do some justice for Ms. Miguel.
04:14Let me just ask you more broadly, Mr. Schroeder, have you ever been told to change estimates to reduce payouts?
04:20Yeah, frequently.
04:21And when you've pushed back on this, if you've ever said no, what happens then?
04:28If I say no, then the claims typically get reassigned due to, they say, either lack of compliance or other reasons, like I'm taking too long.
04:42In your experience, was this kind of thing a one-off thing, or was this a pattern?
04:47This was definitely a pattern.
04:49Is it fair to say, then, that Allstate's priority, in your experience, was not getting the best possible award for their clients?
04:58It was in protecting their bottom line?
05:01Certainly in protecting their bottom line, yeah.
05:04Mr. Milliken, let me just come to you, because you were then another adjuster in this same case sent out to look at Ms. Miguel's property.
05:12You worked as a field adjuster for Allstate through pilot catastrophe for about eight years.
05:17Do I have that right?
05:18At least eight years, yes.
05:19Yeah.
05:20In that time, you have personally inspected hundreds of properties damaged after storms and disasters.
05:26Is that fair to say?
05:27Thousands.
05:28Thousands.
05:29And you're trained to determine the extent and cause of the damage and how much it costs to repair it.
05:34Is that fair to say?
05:35Yes, sir.
05:36All right.
05:36So let me just ask you about Ms. Miguel's claim.
05:40You were assigned to re-inspect her home.
05:43Is that right?
05:43Yes, sir.
05:44And you testified earlier that you went about that diligently.
05:48You could see that there was very extensive damage.
05:51That was your initial impression.
05:52Is that fair to say?
05:53Yes, sir.
05:53And you reviewed all of the reports.
05:55There was an engineer's report by this time.
05:57There was the public adjuster's report.
05:59You reviewed all of those things diligently.
06:01Is that fair to say?
06:02Yes, sir.
06:02When you submitted your report to Allstate recommending several hundred thousand dollars worth of payments to Ms. Miguel and her husband, what happened then?
06:14It was my estimate was rejected and I was advised to alter it to a lower figure.
06:22So you were told to alter the estimate and to alter your findings as well?
06:29I was told to alter my estimate.
06:35I don't know that the findings was told to be altered.
06:37Were the alterations that you were told to make, were those consistent with your own review of the property and your own assessment of the damage?
06:48No, sir.
06:49Did you write that up in a detailed estimate, what you were told to do?
06:54I did, yes, sir.
06:56And Allstate then, they send that estimate ultimately to the property owner, is that correct?
07:03I'm obligated to send the estimate to the policyholder.
07:06And does there any record anywhere the policyholder would ever know that your initial findings, your recommendations were rejected and somebody told you to come in and alter them?
07:15No, sir.
07:16Let me just ask you more broadly.
07:18Have you ever been told in other cases with Allstate to alter or delete your findings?
07:25Absolutely.
07:26In fact, you testified just a second ago, I think, that you were frequently asked to alter factual findings, delete material, and sometimes include items that were false.
07:34Did I hear you correctly when you said that?
07:36Yes, sir.
07:36In the overwhelming majority of cases where you were asked to do something like this, did that cause the estimate to the policyholder to go up or to go down?
07:45To go down.
07:46What is your assessment of what Allstate's ultimate goal here is?
07:51Is it to pay out the policy according to the terms of the policy to the best extent they can?
07:57Or is it to protect their bottom line and to use you and your report as necessary to meet that end, to make sure they make as much money as possible?
08:06A hundred percent to use me to enable them to make as much money as possible.
08:12And you would say that this is a pattern.
08:14This isn't just something that happened one time like in Ms. Miguel's case.
08:17You've been doing this for a long time, and you've observed this to be a pattern with Allstate and in the industry.
08:22I have, yes, sir.
08:24Thank you for your testimony.
08:26Senator Kim.