Annissa Coy
Owner, Mobile Clean Systems
Topic: Contents Restoration
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
There was little conversation 10 years ago about contents in the restoration world. Restoration contractors for the most part viewed the contents part of the claim as an inconvenience and not important really. Adjusters did not like dealing with this side of the loss because they knew nothing about it and it was where most of their headaches came from.
2. How large or small a role did government regulation take in that area?
None really, unless you were dealing with mold.
3. Were there actively used industry standards? Or best practices?
There were virtually no industry standards or practices to speak of when dealing with contents 10 years ago. In fact there really was not training being offered for companies that wanted to get into contents cleaning.
4. What were some of the most popular or innovative tools at that time?
Ultrasonic machines.
5. How large a role did associations have in the industry?
The only real association back then that seemed to have a big presence was IICRC, and their reputation was not great.
Over the last decade ….
1. What has been the biggest change you have seen?
Awareness of just how important contents restoration is to the overall success of the job. Most people really don't care that much about walls and roofing material. What matters most are the things inside the house that make up their life experiences and memories.
2. What natural disaster impacted the industry the most?
Katrina really woke the industry up on so many levels. Not only did a lot of companies re-evaluate how they mobilize and respond to a CAT loss (i.e. billing practices, system and paperwork), but we found ourselves in the industry realizing that proper PPE and job site safety is not just a good idea, it was critical to the health of our team.
3. Were there any other major events inside or outside of the industry that changed how restorers work?
When the financial collapse happened in the building industry, we saw a huge influx of construction companies jumping into restoration as a way to save themselves from bankruptcy. This put a lot of new restoration contractors out there that thought they could do restoration work because they knew how to build a house. This caused a decline in quality in my region in a big way and created a huge need for good training classes in the industry especially when it came to contents and structure cleaning.
We also saw insurance companies really take a beating in Katrina. This caused a ripple effect in the industry as insurance companies put a lot more pressure on adjusters to be more fiscally driven. We saw more and more adjusters that just didn't want to deal with the cleaning of contents at all so we saw an increased pressure for homeowners to just take a cash out payment and move on.
4. What big changes in technology did you witness … from tools to software?
In 2009, hydroxyl really started getting noticed in the industry and has been a big addition when it comes to odor removal. There has been tremendous change as far as software goes but I feel like we can do so much better in this arena. We now have photo inventory and destroyed items software that works in conjunction with billing the job. However, most are cumbersome and clunky.
5. How has the landscape of working with insurance companies changed?
Ten years ago you could get away with the fake it till you make it mentally when it came to just jumping into restoration work and figuring it out as you go. Not today. Adjusters and homeowners are too savvy for that. Adjusters go to regular training in our industry and are learning what we a restorers are learning. With Google, homeowners can tell in a hot second if you are on your game or know what you are talking about. Also after Katrina there was a huge amount of scammers that took advantage of not only homeowners but of insurance companies as well. This made the insurance companies change their policies when it came to putting contractor names on checks and pretty much put a stop to paying a restoration contractor directly for work that was done.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
The use of technology. Technology can definitely improve productivity and streamline the process of handling contents. The challenge I feel will be to make to that the process does not get dehumanized.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
Training and education resources.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
There are more desk adjusters today than in-field. Insurance companies are cutting staff to increase their bottom line profit and driving to a loss to look at a claim takes a lot of time and more staff. This is a bad idea, in my opinion. With adjusters not physically looking at losses and relying only on pictures, this has caused a problem with invoices getting paid because it’s hard to understand the scope of a job from just a photo.
4. Where is the biggest need in the restoration industry?
Hands down training! Not just any training, but good practical training that works in the real world not just textbook learning.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
Do not put limits on what is possible. You don't have to do things the way they have always been done just because that’s the way they have been done for years. And never, ever forget to be kind and show immense compassion.
2. Do you anticipate more government regulation or less in the next decade?
The government typically reacts to our industry instead of being proactive. For instance, when a huge loss like Sandy or Katrina hits an area then government in that local impacted area reacts with new rules and regulations imposed on us.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- I think insurance companies will continue to cut costs by standardizing fees by using programs and contracts of agreements to settle for less if you will. This is going to cause restoration companies to have to become even more efficient to remain profitable. There are some real dangers here. Becoming more efficient cannot be done at the sacrifice of quality and customer care.
- Contents is still kind of the wild west of the industry if you will and I hope to see industry protocols and standard procedures get put in place to create a baseline for cleaning operations.
- Insurance companies trying to put limits on contents value verses restoration.
4. What do you see the biggest NEED for in the next decade?
Higher quality training programs that are not theory but real applications that students can use in their job or business right away.
About Annissa: Annissa Coy is a well-trained and highly skilled professional in the cleaning and restoration industry and the co-creator of Firehouse Education and Mobile Cleaning Systems. She was also the winner of R&R’s inaugural Recognizing Women in Restoration award in 2017. Be sure to check out Annissa’s weekly videos on www.randrmagonline.com! Have a question for Annissa? E-mail her at Annissa@firehouseeducation.com.
Ed Cross
“The Restoration Lawyer”
President, Cross & Associates
Topic: Liability & Laws
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
On the liability side, word had gotten out about Gorman v. Crenshaw Lumber, a construction defect case in which a family received a $22.6 million combined settlement from seven defendants who allegedly built a custom home in Manhattan Beach with moldy lumber. The family complained of chronic respiratory problems, sinus infections and fatigue. But the lion’s share of the recovery was for the alleged brain damage to the 5-year-old son who could not talk and was still in diapers. It was the largest known out-of-court settlement for a single family mold case in the United States at the time. It came at a point when mold litigation had started to decrease and the media frenzy about mold had subsided. It re-energized fears of major liability exposure arising from mold.
Adding to the pressure faced by restoration contractors, contracts based on a “time and materials” pricing structure had just been declared illegal for residential work in the state of California. Contractors were reeling from sweeping legislative changes that imposed dozens of new mandatory contract provisions, many of which carried criminal penalties. Virtually every California contractor was ignorant of––and instantly in violation of––these provisions. Most notably for the restoration industry, the “exact final price” of the work, stated in dollars and cents, had to be in writing, signed by the customer before any residential work, including emergency service, could begin. The new law forbade the request or collection of deposits or advances in excess of 10 percent of the total contract price or $1,000, whichever is less. The customer was entitled to a “completely filled-in” copy of the agreement, signed by both the contractor and the customer. All of this remains the law today. While many companies are now in compliance, many well-established companies with clean disciplinary records are totally unaware that they are in violation of these complex laws. Laws tend to move from West to East, and other states have followed suit with stringent contracting requirements, and I suspect that major players in the industry face a high level of exposure today.
2. How large or small a role did government regulation take in that area?
The shockwave felt by the restoration industry was the direct result of government regulation. The regulation was in response to public outcry about unscrupulous tactics by contractors, particularly “bait and switch” schemes. Pro-consumer legislators came to the rescue of homeowners who suffered cases of “sticker shock” when contractors spiked the price of work after the owner had fully committed to those contractors.
3. Were there actively used industry standards? Or best practices?
The IICRC standards were (and are) the most authoritative source for preferred methodologies of water damage restoration and mold remediation. They offer many statements as descriptions of the industry “standard of care.” Although they are not law and are not binding on any court, it is likely that most courts will probably accept them as the legal standards of care. The test is whether the practice or method is common among reasonably prudent members of the trade who are recognized as qualified and competent. If that question is answered in the affirmative, then the practice or method is the legal standard of care.
Over the last decade ….
1. What has been the biggest change you have seen?
Successful companies do not have the same needs the industry had 10-15 years ago, when the industry was more adolescent and lacked leadership. There is still a leadership issue, but millennials are bringing fresh thought to the table, and leadership is growing within the rank and file of the industry.
2. Were there any other major events inside or outside of the industry that changed how restorers work?
Major portions of insurance industry profits come from investments and when the investments decline, the companies look for new ways to make up the difference. The economic crash of 2008 affected every sector of business, including the insurance industry. It is believed to have motivated many carriers to modify their property claims adjustment practices and lower prices they would allow for certain work in order to minimize claims costs.
Today …
1. How has working with insurance carriers and TPA’s changed from 10 years ago?
The relationship between the TPA industry and the restoration industry has decayed. The TPAs feel emboldened and many restorers feel abused. Some get caught in the trap of trying to fight a system that is well-entrenched, rather than trying to find ways to use the system correctly. The insurance industry has a right to expect efficiencies and many restorers are doing little to acclimate to shifting trends and fine-tune their operations to economize and become more efficient.
2. Where is the biggest need in the restoration industry?
The restoration industry needs to coalesce and pool resources to engage lobbyists to push for regulatory reforms, particularly for residential emergency service work. We learned from the ThermaPure experience that restoration companies were reluctant to contribute funds to address a threat that had not yet been made directly against the companies in the form of a lawsuit. The result was a lack of coordinated effort and little economy of scale. Many suffered from the lack of unity.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
The next generation of industry leaders needs to understand that important laws change fairly frequently. There needs to be an emphasis on training and education. The leaders of tomorrow are those who are well abreast of new legal developments as they arise.
2. Do you anticipate more government regulation or less in the next decade?
I definitely anticipate more anti-contractor regulation in the next decade, particularly in the liberal or pro-consumer states, like California. Consumers and trial lawyers will benefit and contractors will suffer if they are not vigilant and creative.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
First, once they find better footing, third party administrators will likely become more active on residential claims. Second, plumbing companies have a distinct advantage in acquiring viable leads for emergency mitigation work, and some have opened restoration divisions. The plumbing industry will slowly emerge as a significant force in the emergency water damage mitigation market. Third, the frequency of citations against restorer’s contractor’s licenses will increase, and some will be revoked permanently.
4. What do you see the biggest NEED for in the next decade?
The industry needs to adapt to changes in the business environment, looking at the world for what it is––not just what it wants the world to be. Taking realistic stock of a company’s weaknesses and objectively identifying areas for potential improvement is critical not just to growth, but to survival. Each company needs a strong captain of the ship, and many companies would benefit from a more collaborative approach with adjusters, TPAs and insureds.
About Edward: “The Restoration Lawyer” Edward H. Cross is president of Law Offices of Edward H. Cross & Associates, PC; www.edcross.com. He can be reached at (760) 773-4002 or by email to ehc@edcross.com. Disclaimer: this article is intended to provide general information and is not intended to be specific legal advice. It does not create an attorney-client relationship. Every legal case is different and the reader is advised to consult a licensed attorney regarding the particular circumstances of a given case.
Gordy Powell
Founder, GeorgiaClean.com
President, BioPTO.org
Topic: Forensic Restoration
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
A level playing field. News articles drummed up interest about trauma scene cleanup, inspiring many to try it without property training and raised concerns about uneducated work and cross-contamination.
2. How large or small a role did government regulation take in that area?
All we had was OSHA 29 CFR 1910.1030 for blood borne pathogen training. Only a handful of states like California, Louisiana, New Jersey and Florida would create permitting of companies, but that would only oversee the handling of the regulated trauma waste (formally known as biohazardous waste).
3. Were there actively used industry standards? Or best practices?
Not anything official; the American Bio Recovery Association (ABRA) started a standard of care for the industry.
4. What were some of the most popular or innovative tools at that time?
Ozone and hydroxyl technology.
5. How large a role did associations have in the industry? (such as RIA, IICRC, and even local chapters of other associations).
Again, just ABRA. It too had its growing pains , trying to keep ahead of a new and growing industry. Back in September of 2009, a meeting took place in Orlando, Fla., where the leaders of the IICRC and ABRA came to the same table and talks were initiated to create a standard of care in the trauma scene cleaning industry, later to become the S540. The IICRC and RIA would take a serious look at trauma clean up and would offer education classes at annual conferences.
Over the last decade ….
1. What has been the biggest change you have seen?
Ten years ago, you would see the big-name companies take on the trauma scene clean up service in-house. As time moved on, and we all know how employees are like a revolving door in the restoration industry, it became incumbent for companies to retrain and train technicians and to keep supplies around for the random trauma cleanup call. So, what has evolved over the years is the big box companies have developed relationships with the properly trained, insured and educated trauma scene cleanup firms to take on these services for them. Some trauma cleaning firms claim that these newly built relationships can count as much as 30 percent of their business model.
2. What natural disaster impacted the industry the most?
While not a natural disaster per se, the anthrax incident took place in New York in the NBC offices, Hart Senate Building in Washington and the AMI tabloid publishing building in Florida, the forensic restoration industry took a front seat as who to turn to for answers on how to remediate such a threat. If it were not for pioneers like the late Ron Gospodarski of Bio Recovery Inc. out of New York City, who spearheaded education on the unique cleaning practices out of his New York office, we might not be where we are at today. Joan Dougherty of AA Trauma Services in Florida worked closely with Ron to develop remediation protocols. Because of how the anthrax threat was handled, we have protocols and contingency plans for the clean up after terrorist threats in place today.
3. What big changes in technology did you witness … from tools to software?
The biggest changes I have witnessed are the use of peroxides and thermo-technology. When properly educated on usage, certain disinfectants and cleaners can cut down on manpower hours. When delivered as a foam for hang and dwell time, it can be used as a cleaner, a disinfectant and an odor eliminator. Thermo-technology has proven its worth in not only odor removal from a decomposition, but when you know how to use it properly to off-gas it can remediate teargas from a structure. Ten years ago, a teargas-affected property would take weeks to remediate. When properly using thermos-technology, you can remove the teargas in a few days from a structure.
4. How has the landscape of working with insurance companies changed?
There are still adjusters who seek out the advice of a senior adjuster in extreme cases. Software such as Xactimate is still in the dark when listing industry standard rates on line item recommendations for pricing and some programs still do not list trauma services at all. Adjusters are still gun shy many times because there are those companies out there that try to retire off one invoice and take advantage of the carriers as well as the insured. I saw one company’s invoice charging $172,000 to clean and remove a hot tub from a decomposition.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
States like Georgia are now setting regulations on the trauma scene clean up industry. Simple regulations are in place to make sure there are background checks and proper insurance policies in place before a homeowner or family allow a contractor to blindly enter their home.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
A standard of care. With tools such as the S540 and the RIA Guidelines for the Professional Forensic Restoration Operator in print, there is now structure and substance in place for the trauma scene clean up industry to follow.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
There is less of a shock and awe factor when a claim is presented, but there is still a constant education of the trauma scene cleanup industry and its services to the adjuster and TPA’s.
4. Where is the biggest need in the restoration industry?
Individual state regulations.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
Never assume that you have seen it all. The phone will ring with a new and unique problem to solve.
2. Do you anticipate more government regulation or less in the next decade?
Yes, I see more government involvement. I believe you will see more states adopt what Georgia has in place sooner than later. A copy of what Georgia has created in HB 149 can be viewed at BioPTO.org.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- Regulations by state.
- Firms working with State Emergency Departments on contingency plans in place on the remediation of the aftermath of a potential suicide bomber and other terrorist events.
- More of a trend of the big box fire, water and mold firms outsourcing to qualified trauma cleanup companies.
4. What do you see the biggest NEED for in the next decade?
Many contingency plans for hotels, manufacturing facilities, government facilities, and so on are very well written, but they are missing the last chapter. Who is going to properly clean and remediate a scene after a mass casualty or traumatic event such as a Pulse Night Club. You simply cannot just take a firehose and wash the remains down the storm drain.
About Gordy: Gordy Powell entered the victim service industry/crime, trauma & death scene clean up in June of 1996. Today, he operates Georgia Clean with Doug Cunningham, a former FBI agent, and helped create the Bio Professional Trade organization to develop regulation in the bio recovery industry in Georgia. He has also served as VP of ABRA, and on the association’s board of directors.
Lisa Lavender
COO, Berks Fire Water Restorations
COO, Restoration Technical Institute
Topic: Training & Operations
10 years ago ….
1. Were there actively used industry standards? Or best practices?
There were standards and best practices; however, they were not as widely practiced and acknowledged.
2. How large a role did associations have in the industry?
Many industries will tell you that professional associations have diminished in participation and presence over the last 10 years. Local organizations, like claims associations, were more prevalent. The IICRC is an example of an organization that is not an association but rather a certifying body. It seems that credentialing and certifications have taken on a stronger presence today than ten years ago as the industry matures.
Over the last decade ….
1. What has been the biggest change you have seen?
Although equipment and products have evolved, I think one of the most impactful is the development of a wide variety of software that is specifically designed to serve our industry. Software and applications have had a direct impact on many parts of our industry: Estimating, communications, contents, moisture mapping, and general operations, to name a few. Advancing technology has changed the expectations of those we serve, changed the necessary skill set of restorers, and has changed the way we operate.
2. What natural disaster impacted the industry the most?
Hurricane Sandy has had a significant impact on the industry. This natural disaster brought the industry to the headlines of America. It brought to light, for many who may have never known what a restorer is, that we can truly be heroes during and after the devastation that a natural disaster can cause. It gave attention to the training, skills, and qualifications necessary to be a restoration professional. The activities during and after Sandy have led to new legislation and barriers to entry for our market. The legislation that was created post-Sandy has been somewhat regional but I believe it will lead to legislation across the country for years to come.
3. Were there any other major events inside or outside of the industry that changed how restorers work?
As society has become more litigious, I think restorers are more concerned about waivers, contracts and documentation as a means to protect themselves from the on-going perceived threat of litigation as a result of our work.
4. What big changes in technology did you witness … from tools to software?
Tools have become more effective and efficient using less energy than ever before. Products are evolving and developing to where “green and botanical” have become part of our everyday language. Restorers look for green and safe products and consumers expect it. There is an app or software that is either demanded, or is available, as an option for nearly every function and every problem encountered by a restorer.
5. How has the landscape of working with insurance companies changed?
Third Party Administrators have become an important part of the landscape and impact relationships with insurance carriers. The exact nature of the changes is dependent on a restoration company’s operating model and approach. Specifics are impacted based on the marketplace, culture, and a variety of other factors. Relationships built on mutual respect and trust with the sole objective of customer satisfaction has not changed; it is more the “how” that has changed.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
In addition to technology and TPAs, I think we must look at the dramatic changes in consumer behavior and consider how we fit both today and tomorrow. Phone book ads are an example of a rapidly evolving change in how a customer connects with us and chooses to engage a restorer. Another example is online reviews; this evolution has an increasing impact on consumer behavior.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
Information. There is such a wealth of information and knowledge readily available and accessible that there is rarely a time or a situation that a resourceful restorer can’t resolve or find potential solutions.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
TPAs are a bigger part of the landscape in general. One of the biggest changes for the positive is that there is a better understanding of our industries standards of care from both carriers and TPAs. This allows for opportunities for improved communications and better results. As an example, today a conversation with an adjuster may reference the category and class of a water loss.
4. Where is the biggest need in the restoration industry?
Entry level labor that has potential to be developed. Most restoration companies I know will invest in people with the right attitude. The entry level/new restorers of today will be the industry leaders tomorrow; their recruitment, training and development is critical to the industry’s future.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
Change is inevitable. Your ability to anticipate and adapt to change will be critical to success. Have strong core values and sense a purpose that will guide you and your organization through times of change for years to come.
2. Do you anticipate more government regulation or less in the next decade?
This is very difficult to determine as the matter is largely influenced by political forces. I anticipate more government regulation in the next decade for a variety of reasons:
- Publicity of science and research will bring attention to the industry and related health and safety issues associated with restoration.
- Lawsuits will continue to draw attention.
- Consumer protection from a largely unregulated industry.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- Consumer behavior and expectations
- Technology
- More barriers to entering the industry
4. What do you see the biggest NEED for in the next decade?
Restoration companies will need to continue to develop management skills in operating their businesses. The evolution of the industry will include seeing a need for business leadership in running an increasingly more complex business model. Technical capabilities will complement a professionally-managed business operation.
About Lisa: Lisa Lavender holds her IICRC Master designation in Water, Fire and Textile Restoration. She is a Lead Trainer, Chief Operating Officer and Co-owner of the Restoration Technical Institute, Reading, PA, a restoration/insurance industry training center and Berks, Fire, Water Restorations, Inc., Reading, PA, a full service restoration and reconstruction company for more than 14 years. You can reach her at lisa@restorationtechnicalinstitute.com.
Ken Larsen
CR, WLS, CMP, CSDS
Industry Consultant
Topic: Structural Drying
10 years ago ….
1. What was the biggest topic of conversation?
In the context of my four decades in the industry, “10 years ago” seems so recent. In 2007, Applied Structural Drying courses (ASD) were pretty much winding down in popularity. The rise of the Third Party Administrator (TPA) model was in full gear. At the time, contractors were confused and conflicted in their understanding of how the TPA was going to become a part of their daily business. On one hand, the opportunity to be assigned insurance claims without intense marketing made the decision to participate appear to be a no-brainer.
On the other hand, the necessity to agree to deliver substandard workmanship, price concessions, revenue caps, and most egregiously… a willingness to allow inexperienced “reviewers” (aka. non-insurance representatives) to debate and even dictate the competent contractor’s processes and billing called the contractor’s decision to participate into question.
These programs have established a pretty amazing result. They have both cultured and rewarded a demographic of restorers who, 10 years ago, would have been identified as a nothing more than a “second rate restorer;” those who perform services known to be sub-standard and/or misrepresent the services actually performed on the project.
Additionally, they diminished the industry’s credibility through agreements with the TPA to forfeit fair compensation for the justifiable services performed.
2. Were there actively used industry standards? Or best practices?
In 2007, the S500 Standard and Reference Guide to Professional Water Damage Restoration had just been released. It had some serious issues that took far too long to correct. In fact, it took 10 years for the next edition to be released – and it has finally corrected many of the issues introduced in the 2006 version. The 2006 issues corrected in the 2015 edition included removal of a “connection” between the ANSI Standard and the non-ANSI Reference Guide. This means that the white pages are nothing more than some friendly advice… a casual suggestion; but NOT a component of the accepted “standard of care” to be followed. There is also a notorious absence of any reference to “In-Place Drying” in the new standard. This is a very important change since the process lacked attention to the safe and responsible restoration of the structure with an attention toward safety and skilled use of tools.
3. What were some of the most popular or innovative tools at that time?
I think there is far too much emphasis on tools in our industry. Too many restorers have been indoctrinated with the idea that they must merely install “x” quantity of equipment, installed in “y” fashion, and that will result in a meter that stops beeping when you put it on the wet material. Tools do NOT dry structures. It is the technician’s skilled use of their tools that produces the desired results!
4. How large a role did associations have in the industry?
Our industry has one dominant trade association where true industry leaders regularly network and fiercely support our industry’s growth: RIA
Over the last decade ….
1. What has been the biggest change you have seen?
The rise of the TPA has devastated our industry. Substandard performance on projects or non-compensated services resulting in an insurance claim shortfall are now commonplace as a result of adherence to the program stipulations. These TPA programs insist upon adherence to drying documentation programs that impose penalties or trigger alarms when equipment formulas are violated.
2. What natural disaster impacted the industry the most?
Katrina (2005). Insurance companies changed the way they treated contractors from that day forward. If they had a skeptical view of contractors before Katrina… it was inflated to flat-out distrust after Katrina.
3. Were there any other major events inside or outside of the industry that changed how restorers work?
The ThermaPure Lawsuit era was a very troublesome time for the restoration industry. Thank goodness for the RIA being there for our industry to produce a settlement on behalf of the industry. We must support our industry’s association (RIA) for the other legal matters that are rearing their litigious heads.
4. What big changes in technology did you witness … from tools to software?
There is more sophisticated software for our industry. That can be a two edged sword for some, but generally speaking – good software can be very good for a restoration company.
5. How has the landscape of working with insurance companies changed?
Peter Crosa (President of the NAIIA) described this situation best when he declares to restoration professionals, “Insurance companies will never be your “partner.” By necessity, the relationship is adversarial since the money paid to the contractor is subtracted from the insurance company’s profit.” As such, it’s time to start battling for fair settlement practices.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
I believe there is a very good chance that highly qualified independent restoration experts will be used on restoration projects from the start to the end of the restoration project. This will negate the unfair and incompetent demands from those who would debate the contractor’s processes.
2. How has working with insurance carriers and TPA’s changed from 10 years ago?
It is more unreasonable, inflexible and incompetent. The programs have ignored the contractor’s promise to deliver quality work according to a standard of care. This results in a compromised customer experience and possibly a failure to fulfill the indemnification promise within the insurance policy.
3. Where is the biggest need in the restoration industry?
The biggest need in the restoration industry is the contractor’s courage to “grow a spine.” Stand up to the demands from uneducated reviewers who demand your forfeit of perfectly justifiable charges and who demand you deliver substandard product.
Tough words and they are hard to swallow. But few would argue its accuracy.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
- Don’t succumb to the temptation to participate in program work. It looks so easy and harmless until your own principles and values are compromised due to the demands of the TPA.
- Be a “first rate restoration expert” who creatively develops a company reputation and brand that they can take pride in knowing their customers are enthusiastic cheerleaders who do their marketing on their behalf.
2. What do you anticipate will be the three biggest industry changes in the next 10 years?
The rise of the Registered Third Party Evaluator™… and the decline of the Third Party Administrator. I believe contractors will learn it is important to read the program “rules” before signing them to be sure they can live with the stipulations. If it is not in the rules – then the contractor can reject all other ideas echoed by the “reviewer.” I believe contractors will learn that TPAs are rarely (if ever) permitted to speak on behalf of the insurance carrier, so their “recommendations” can be addressed with a simple answer: “In the absence of legitimate evidence to support your statements, we fully reject your recommendation.”
3. What do you see the biggest NEED for in the next decade?
The TPA business models… needs to be retired.
About Ken: Ken Larsen, CR, WLS, CMP CSDS has been in the restoration industry since 1978. He holds RIA, ACAC and IICRC advanced designations. The recipient of the 32nd RIA Martin L. King Award for his many contributions and sincere dedication to the Restoration Industry, Ken is currently an IICRC Approved instructor of WRT, ASD and CDS certificate courses and an RIA instructor of the restoration industry’s advanced certification credentials. He is also a Registered Third Party Evaluator™ (RTPE). ken@drystandard.org .
David Dybdahl
Owner, American Risk Management
Resources Network (ARMR Network)
Topic: Risk Management
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
Ten years ago, the insurance industry was in the middle of solving a “toxic mold” problem.
All the insurance companies followed suit by either excluding of severely sub-limiting losses involving a speck of any type or amount of mold or bacteria. All those insurance limitations are still in effect today. Almost all property owners and 80 percent of restorers are woefully, inadequately insured today.
2. How large or small a role did government regulation take in that area?
The EPA did very little to create a meaningful mold clean up standard. Insurance commissioners in every state allowed the insurance exclusions to go through the regulatory approval process.
3. Were there actively used industry standards? Or best practices?
The IICRC stepped in to fill the void with the development IICRC S520 Professional Mold Remediation Standard and Guidelines. The document is under its 4th edition edits today.
4. What were some of the most popular or innovative tools at that time?
In the insurance business, package insurance policies were introduced with specific coverage for job sites involving mold or bacteria, which by default included Category 3 water job sites. These policy forms, which combine General Liability/Contractors Environmental Liability and Professional Liability, were originally created for use by nuclear weapons manufacturing facility clean up contractors working for the US Department of Energy. The specially modified versions of these liability insurance packages are still the only insurance design that actually works for a restoration firm today. The only reason four out of five firms do not have one of these policies in place 10 years later is there is no place for insurance agents to learn about nuclear bomb plant clean-up contractor insurance coverages. By default, the insurance agents naively sell insurance policies with material gaps in coverage to restoration firms. Today, the customized insurance may actually cost less than the policies containing the design flaws.
5. How large a role did associations have in the industry?
The IICRC S520 and S500 played a key role in the development of the specialized insurance packages for restorers. The best quality insurance policies for restorers specifically references the IICRC standards as a base line for the clean-up of water, mold and bacteria.
Over the last decade ….
1. What has been the biggest change you have seen?
The growth of the direct repair networks. With more dots on the map and lower operating costs for master service agreements than franchise operations, the networks have grown much faster than the insurance companies they serve.
2. What natural disaster impacted the industry the most?
Hurricanes and superstorms drive a lot of work. More hail damage from climate change is a bigger deal than most folks realize.
3. Were there any other major events inside or outside of the industry that changed how restorers work?
There are constant innovations in tools and methodology that make the work more efficient.
4. What big changes in technology did you witness … from tools to software?
There are some relatively new products that appear to neutralize mold in place.
5. How has the landscape of working with insurance companies changed?
Insurance companies are stressed by increasing claims from weather events. They are looking for efficiencies. In the internet age, they are also keenly aware of the customer’s claims experience effecting their ability to sell more insurance policies. the factors are driving the growth of the direct repair networks.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
In the master service agreement arena, there is a showdown taking place between the franchisors and the direct repair contractor networks. A franchisee sourcing work through a network has very thin profit margin. Franchisors provide great value to new operations, but their relative value in master service agreement awards is being challenged.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
Advancements in the efficacy of mold control chemicals.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
The networks are 20 times larger than they were 10 years ago.
4. Where is the biggest need in the restoration industry?
Training and maintaining skilled technicians.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
The restoration business is a great place to be. Prepare succession plans for the business. Climate change is creating more intense weather events, all of that spells increasing work for restorers over the next 100 years. Anticipate and be prepared for change. The growth of the direct repair networks has been extremely fast when compared to the underlying growth rate of the insurance companies.
2. Do you anticipate more government regulation or less in the next decade?
Fewer regulations, especially with the Trump administration defending the regulatory process across the board.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- More intense weather events.
- The growth of direct repair networks.
- More master drying service agreements with commercial property owners.
4. What do you see the biggest NEED for in the next decade?
Mold and bacteria exclusions have been in insurance policies for 10 years. The effects of these exclusions can be very onerous for the policy holders. However, the insurance companies never trained their claim’s adjusters how the 10-year-old exclusions actually operate. Therefore, a lot of claims involving a speck of mold or bacteria are being paid that technically are not covered claims under the policies. That is a good situation for policy holders and the contractors working the projects. The problem is that big claims are denied based upon the mold and bacteria exclusions. The needed insurance to cover these technically uncovered loss events has been available for 10 years now. But no one trained the insurance agents on how to use these products either. Insurance buyers are needlessly uninsured for losses related to mold and bacteria.
About David: David Dybdahl, CPCU, is the president of American Risk Management Resources Network, LLC. a wholesale insurance broker specializing in the design and sale of customized insurance packages for the cleaning and restoration contracting business. His insurance products are sold through local insurance agents in every state. He can be reached at dybdahl@armr.net or 608-836-9567.
Les Cunningham
President & CEO,
Business Networks
Topic: Restoration Industry as a Whole
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
Companies were continuing to try to address and respond to the multiple hurricanes that were happening in in the US. Then the mother of all hurricanes hit New Orleans. The disruption of everything threw the industry into an arena they had never had to function in before.
2. How large or small a role did government regulation take in that area?
It depended on which state the company was working in. Some states were more aggressive than others as to what hoops the companies had to jump through in order to do business in their state.
3. Were there actively used industry standards?
RIA & IICRC were trying to educate the contractors as to what they should be doing in their production efforts, standards and best practices.
4. What were some of the most popular or innovative tools at that time?
GPS became a necessary tool for all types of functions going on in the area. Contractors were bringing their own living quarters, kitchens and bathroom facilities to their working sites. Along with generators and other essentials in order to live and function in business efforts. Permanent housing facilities were at an absolute premium. One contractor signed a one year contract to rent housing with electricity, air conditioning and internet for $1,000,000.
5. How large a role did associations have in the industry?
They were all trying to help as best they could, but the disaster stretched all the limits of previous disasters.
Over the last decade ….
1. What has been the biggest change you have seen?
The move to contractors realizing that they need to be a profitable business.
2. What natural disaster impacted the industry the most?
Hurricane Katrina
3. Were there any other major events inside or outside of the industry that changed how restorers work?
The emergence of Third Party Administrators.
4. What big changes in technology did you witness … from tools to software?
The move to contractors realizing the need for software that connected with each other, I.e. a CRM connecting to an estimating system that connected to an accounting system.
5. How has the landscape of working with insurance companies changed?
The insurance company has increasingly removed themselves from contact with both the policy holders and contractors by placing TPA’s (Third Party Administrators) between themselves and both Policy Holders and Contractors.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
Some insurance companies being unwilling to pay overhead and profit.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
Software to run their companies with.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
The insurance companies are trying different ways to utilize TPA’s to cut costs in their changing business arena. (i.e. Policy Holders buying cheaper policies on the internet without using the broker, agent network.)
4. Where is the biggest need in the restoration industry?
Better utilization of existing employees AND going outside of the industry to find new future employees.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
The insurance industry continues to mature and all participants need to provide the serviced needed by all parts of the industry that they can perform profitably.
2. Do you anticipate more government regulation or less in the next decade?
It depends on the amount of both perceived and actual abuses occurring within the industry.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- Continued consolidation of industry players.
- Continued need for trained employees.
- The need to control all business expenses.
4. What do you see the biggest NEED for in the next decade?
The realization of the owner that they need to be running a business, not a feel good practice of what they think the industry needs.
About Les: Les Cunningham, CGC, CR, CCR, CGRa, is a highly-respected industry consultant and author of Accountability through Transparency. He can be contacted at 800-525-1009, ext. 14 or by e-mail at Les@BusinessNetworks.com.
Kent Rawhouser
President, A&J Specialty Services
Topic: Restoration Business Ownership
10 years ago ….
1. What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
There were two things:
- What is the best way to dry? LGR, desiccant, heat, etc.
- How do you get into commercial mitigation work?
2. How large or small a role did government regulation take in that area?
Very little.
3. Were there actively used industry standards? Or best practices?
Yes, the S500, New York City Guidelines, EPA Mold in Schools and Commercial Buildings, S520…
4. What were some of the most popular or innovative tools at that time?
Extreme Extractor, Injectidry, Infra-Red heat lamps, P tape.
5. How large a role did associations have in the industry?
Associations were shaping the direction of the industry by making people aware of challenges and bringing interested parties together to discuss them. IAQA local chapters did a great service to connect contractors and consultants on the local level.
Over the last decade ….
1. What has been the biggest change you have seen?
TPAs have tried and are controlling the residential market and taking it in a bad direction. The importance of working with commercial clients.
2. What natural disaster impacted the industry the most?
The Polar Vortex.
3. Were there any other major events inside or outside of the industry that changed how restorers work?
The onset of franchises going after large insurance providers and their ability to make a small individual franchisee look bigger than they really are in the eyes of the consumer. For the independent, it created the need to be part of something larger to compete.
4. What big changes in technology did you witness … from tools to software?
IR cameras came down in price and up in quality. Now every contractor could have one and even more technicians could have one individually in the field. The quality and versatility of moisture meters and thermos-hygrometers also improved. Better quality at a lower price.
5. How has the landscape of working with insurance companies changed?
For us, we are moving in directions that limit the need to depend on insurance work. Sure, most losses have an insurance component, we are choosing to have the client directing the project and approving the pricing vs. the insurance company.
Today …
1. What is one area where you see major changes evolving and brewing in the industry?
The biohazard and health care segments.
2. What is the #1 tool restorers have today that they didn’t have 10 years ago?
Social Media.
3. How has working with insurance carriers and TPA’s changed from 10 years ago?
The TPAs are much more difficult and demanding to work with, which caused us to leave all programs except one. Insurance carriers are trying to have the contractor do more and more of what was adjuster work. There are insurance companies who do put the insured first – they are just harder to find.
4. Where is the biggest need in the restoration industry?
Labor and the coming increase in labor costs because we will have fewer people to do the work.
Looking Ahead…
1. What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
To relax and hear the challenge out, don’t be in a hurry to make decisions. Also, take advantage of the wisdom that is in our industry now; they can help you to not make the same mistakes we did.
2. Do you anticipate more government regulation or less in the next decade?
The nature of government is to get more involved either by regulation or taxes.
3. What do you anticipate will be the three biggest industry changes in the next 10 years?
- We need to work as an industry of professionals and stop beating each other up and cutting prices.
- The contractor needs to take control of his product. We need to stop doing our work for a price and start pricing our work for doing it right.
- TPAs need to be removed or have their powers greatly reversed.
4. What do you see the biggest NEED for in the next decade?
Labor. The different segments of the industry need to come together. The industry is fragmenting because we choose not to get along. “If” we have the same goals, to serve the restoration contractor and serve the client, we need to set our egos aside and really work together. A simple example is the continued downward trend of what is paid for our services. Another example is the endless number of conference/tradeshows we have. Just imagine if there was ‘a’ single industry conference/tradeshow where we could go and really learn new stuff and show unity for the industry.
About Kent: Kent is the founder and owner of A & J Specialty Services, Inc., DKI located in De Forest, Wisconsin. Founded in 1984, A & J is the leading disaster response company in the area specializing in water, sewage, mold, fire and smoke damage mitigation, trauma/bio hazard clean up and specialty services.
Michael Pinto
President, Wonder Makers Environmental
Topic: Mold Remediation
10 years ago ….
1) What was the biggest topic of conversation and debate in your section of the industry/your area of expertise?
How dangerous is mold?
2) How large or small a role did government regulation take in that area?
Minor
3) Were there actively used industry standards? Or best practices?
Yes
4) What were some of the most popular or innovative tools at that time?
Small-sized negative air machines.
5) How large a role did associations have in the industry?
It certainly was moderate in that they promoted the use of best practices and organized much of the training.
Over the last decade ….
1) What has been the biggest change you have seen?
Segregation of the industry into the top 20 percent who really understand mold remediation and follow the standard of care, 60 percent that are marginal performers, and 20 percent in the industry that are a danger to their clients and the industry as a whole.
2) What natural disaster impacted the industry the most?
Superstorm Sandy led to some re-thinking of the standard protocols for cleaning up after flooding; especially in a manner that reduces mold.
3) Were there any other major events inside or outside of the industry that changed how restorers work?
The continuing investigation into the types of symptoms caused by mold exposure and the mechanisms that explain how mold affects individuals. This is in conjunction with the growing recognition that there is a smaller subset of mold exposed individuals that can suffer ill health effects much more damaging than “normal occupants”.
4) What big changes in technology did you witness … from tools to software?
There has been lots of improvement in equipment and chemicals including mold stain removers, microfiber cloths and now disposable microfiber cloths, ATP meters, hood style powered air respirators, air fogging equipment for dust control.
5) How has the landscape of working with insurance companies changed?
Some representatives of the insurance industry understand more about the standard of care and expect contractors to follow it. But, just like contractors, some representatives of the insurance industry only have a surface understanding of the industry standard of care and try and push it too far to justify unreasonable cost reductions.
Today …
1) What is one area where you see major changes evolving and brewing in the industry?
Forensic restoration, mold remediation for sensitized individuals, continued debate about whether mycotoxins are being properly addressed during standard mold remediation, continued migration of tools and equipment from other industries to different types of restoration projects -- sometimes with very positive results and other times with real problems.
2) What is the #1 tool restorers have today that they didn’t have 10 years ago?
Easier and faster access to the Internet. Many people do not remember that it was only 15 or 16 years ago that easy Internet access became generally available.
3) How has working with insurance carriers and TPA’s changed from 10 years ago?
Electronic reporting of data emphasizes speed over thoughtful processing of claims.
4) Where is the biggest need in the restoration industry?
Finding project managers that can balance physical labor with the skills of electronic documentation and reporting.
Looking Ahead…
1) What would you tell the next generation of restoration industry leaders based on what you’ve learned and seen in your time, so far, in the industry?
The world will always need individuals who can see beyond their specific niche. Although restoration professionals need to keep up with everything that is going on in their specific industry, they also have to spend some time looking at other areas to see how some of their processes and technology could be incorporated into our own.
2) Do you anticipate more government regulation or less in the next decade?
At some point, government regulations reach a point of diminishing return. I believe that we are already there and that a backlash is underway. It will be especially interesting to see if the push to certify/license different aspects of the restoration industry (mold, forensics, disaster response, etc.) continues to gain momentum.
3) What do you anticipate will be the three biggest industry changes in the next 10 years?
1. Continued innovation and sharing of ideas/equipment across industry lines.
2. Better appreciation of the hazards from microscopic contaminants in all areas of restoration work and the move toward "universal precautions" in regards to PPE for restoration work just as it is recognized and enforced for blood borne pathogens. (Remember when dental hygienists did not aware surgical mask and eye shields when they were cleaning teeth?)
3. Professionalization of forensic restoration activities related to crime and trauma scene, hoarders, animal contamination, illicit drug labs, etc.
4) What do you see the biggest NEED for in the next decade?
Individuals who know how to manage projects and data/documentation efficiently.
About Michael: Michael A. Pinto is chief executive officer of Wonder Makers Environmental, Inc., a manufacturing and environmental consulting firm that specializes in identification and control of asbestos, lead, IAQ, mold, industrial hygiene, and chemical problems. Mr. Pinto is the author of over 220 published articles and several books including, Fungal Contamination: A Comprehensive Guide for Remediation. In addition to being a frequent speaker at industry events, Michael has been honored with such prestigious awards as the Golden Quill, Martin L. King Award, the Phoenix Award for Innovative Restoration from the Restoration Industry Association, and the President’s Award from the Environmental Information Association. He is a past board member of the Indoor Air Quality Association (IAQA) and currently serves on the boards of both the Cleaning Industry Research Institute (CIRI) and the Restoration Industry Association (RIA) where he chairs the Environmental Health and Safety Council. Michael can be reached at 269-382-4154 or map@wondermakers.com.
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