💔 Are You OK? The Silent Burden of Property Insurance Claims

"Eventually, we lose a certain spark of optimism, humor and hope. We tire. We aren’t sick, but we aren’t ourselves."

⚠️ Trigger warning:

  1. Death, suicide, and violence are mentioned in brief detail, in relation to property insurance claims

  2. Images of heavily-damaged homes and personal property

Table of Contents:

An Introduction

“We feel the feelings of our clients. We experience their fears. We dream their dreams. Eventually, we lose a certain spark of optimism, humor and hope. We tire. We aren’t sick, but we aren’t ourselves.” – C. Figley, 1995

"I wasn't prepared for that."

I routinely see a certain level of property loss and destruction in my work as a public insurance adjuster, and in my volunteering for policyholder advocacy. Thankfully, I have formal training in compassion management, from my time in non-profit crisis outreach.

If you regularly read or watch the news, you'll likely have seen hundreds of disaster photos like this over the years:

Photo of a home damaged by a hurricane.
© Photo by Doug Quinn. Hurricane damage in Louisiana, 2021

But you may not have seen one quite like this. Even with my years of formal training, experience, and exposure to extreme situations and emotional losses, nothing prepared me for this photo.

Look at the picture again, focusing on the left of the home.

You may not have noticed this before, but there is a gentleman standing in the corner. Doug Quinn, director of the United Survivor Disaster Relief, and the American Policyholder Association, took this photo while on deployment for disaster victim outreach with long-time partner and fellow disaster victim and policyholder advocate, Heather Shapter, in late 2021:

"Took this picture down the bayou. House is elevated for a flood, but that doesn’t help for wind. Two walls and all their belongs are gone. We saw many houses like this, some even worse. I didn’t realize until looking at the picture last night that there was an actual person in the house standing on the left side. I don’t notice him because he was frozen in place. This elderly man is probably in shock. Looking at what’s left of his house & belongings, trying to grasp what happened & how does he possibly move forward from here? I know this feeling well, I’ve been there. But it’s different for seniors… Young people can lose everything & shrug it off knowing that they have the rest of their life to get it all back again. What do you do when you’re 70 & don’t have decades of income producing years ahead of you to recover? What do you do when everything you’ve spent your life accumulating vanishes in the wind…your pictures, sentimental keepsakes, family heirlooms? All gone."

Imagine how this could affect you if you were exposed to this, regularly, and weren't even aware of the possible psychological effects? Even if you are not a first party property insurance professional, you likely have experienced something similar, just having gone through the tumultuous, worldwide events of the last three years, triggered by COVID-19.

If you are not familiar with the property insurance industry, here are just a few examples of common losses and stressors that insurance adjusters, contractors, and other professionals may encounter:

  • It is common in large or catastrophic residential fire losses for beloved family pets to perish, and in some cases, there is loss of human life. In the case of pets that didn’t make it out with the family, you will almost always see the outline of the family's pet (usually a dog or cat) on the floor or carpet. Individuals that are 85 and older are at most risk of fire death, and are the most common demographic of fire death victims that I’ve seen in my work, although I have encountered fire deaths involving small children.

  • Biohazard cleanup and mitigation of, or loss documentation and adjusting property damage claims in relation to, natural death, suicide, or other violence that ends in loss of life for humans and animals. Further details of which, I will spare you of.

  • Insurance company staff and independent adjusters may experience an overload of assigned claims and policyholder clients. The claims department is a service department. While a positive claim experience can certainly attribute to policyholder retention and referrals, it does not directly make an insurance company any money. Before the COVID-19 pandemic, insurers were looking to modernize their claims processes to save on operating costs through automation and digitization, and many large insurers were laying off employees. As insurance companies look to further digitize the claims process by utilizing Artificial Intelligence (AI) within the claims process, and focus on Business Process Outsourcing (BPO) to reduce claim servicing costs, this will inevitably lead to less humans being involved in the claims process. This means that disputes or claim issues that are required to be escalated past automation and AI will likely be placed on a relatively few individuals' shoulders.

  • Insurance claim dispute resolution and legal proceedings. By its nature, dispute resolution can be negative or combative. Negativity bias and other affects of repeated exposure to negative environments can coexist with, and contribute to, compassion fatigue. Public adjusters and contractors come in contact with large numbers of policyholders that often do not have the knowledge or the ability to effectively advocate for themselves within an insurance claim. This burden is then transferred by proxy to the professionals working for the policyholder. Insurance company adjusters can also bear this burden, as well as attorneys.

  • Severe injury or death for professionals on hazardous loss sites, most commonly falling through, or off, roofs. Inspecting damaged structures for claims can be dangerous work. At least a few times each year, I see charitable campaigns on social media and networking sites for adjusters and restoration contractors that have fallen off/through a roof. In these cases, it's typically to pay for health care expenses if they have been severely or gravely injured (and at times permanently disabled in some way). Sometimes, it may be for funeral expenses. Often a spouse and children are pictured in the social media posts. This tragic scenario happens more often than the general public may be aware of. When I am on loss inspections with insurance company adjusters and restoration contractors, we all take great care to look out each other for safety considerations. We are careful to make sure that conditions are safe before climbing roofs or entering unstable structures.

Insurance professionals are face to face with many types of property losses, every day. However, many do not realize that they are also exposed to emotional losses, vicariously. Now that we've covered a few scenarios of where, when, and who Compassion Fatigue might affect in the first party property claim industry, we will take a look at the definition and symptoms of Compassion Fatigue.

The Basics of Compassion Fatigue

The American Institute of Stress explains compassion fatigue in detail:

Compassion Fatigue

Also called “vicarious traumatization” or secondary traumatization (Figley, 1995). The emotional residue or strain of exposure to working with those suffering from the consequences of traumatic events. It differs from burn-out, but can co-exist. Compassion Fatigue can occur due to exposure on one case or can be due to a “cumulative” level of trauma.

Dr. Charles Ray Figley, founder of the Tulane University Traumatology Institute, coined the term "compassion fatigue" during his research into trauma in the 1980s. Compassion fatigue has been documented among social workers, first responders such as firefighters, law enforcement, and paramedics/EMTs, caregivers, disaster victims, and more.

According to Dr. Figley, "The most insidious aspect of compassion fatigue is that it attacks the very core of what brings helpers into this work: their empathy and compassion for others."

Symptoms of Compassion Fatigue:

  • Affects many dimensions of your well-being

  • Nervous system arousal (Sleep disturbance)

  • Emotional intensity increases

  • Cognitive ability decreases

  • Behavior and judgment impaired

  • Isolation and loss of morale

  • Depression and PTSD (potentiate)

  • Loss of self-worth and emotional modulation

  • Identity, worldview, and spirituality impacted

  • Beliefs and psychological needs-safety, trust, esteem, intimacy, and control

  • Loss of hope and meaning=existential despair

  • Anger toward perpetrators or causal events

The American Bar Association has recognized compassion fatigue as affecting those working in the legal field, resulting in symptoms such as substance abuse as a coping mechanism.

A screenshot of a section of an article explaining how Compassion Fatigue affects lawyers.
© American Bar Association, americanbar.org

This is mirrored by a study completed in 2016, titled "The Prevalence of Substance Use and Other Mental Health Concerns Among American Attorneys".

Considering the vicarious nature of compassion fatigue, it is (in my unscholarly, lay opinion) of paramount importance for individuals that may be affected by this to treat this if it occurs, in order to attempt to avoid it affecting those closest to them. This excerpt from the book Treating Compassion Fatigue (Routledge Psychosocial Stress Series) by Dr. Figley, explains my sentiments:

"A recent book focused on both the secondary traumatic stress and burnout found among modern families (Figley, 1997). Among the conclusions were these: that families both breed and destroy stress among their members and that PTSD spreads in families like a virus unless they have ways to cope."

The Professionals Weigh In

Curious to see if other professionals in my industry had experienced and/or recognized the prevalence of this in our work, I decided to ask a handful of them about their thoughts on the subject.

I had the great pleasure of meeting with Bill Wilson of InsuranceCommentary.com, and author of When Words Collide via video conference last week. After I asked him about this topic, he gave a brief and thoughtful pause, and started with this:

"We often don't understand the emotional impact of claims." - Bill Wilson

Bill emphasized that property insurance and claims are serious business. He highlighted how the humor often used in insurance company adverts is in stark contrast to the momentous function of property insurance: people losing what matters to them the most, and helping them to financially recover from it, to some extent.

Three people presenting a live video podcast.
© Listen to This Bull Podcast, 2/8/22. A member of the audience agrees: "Compassion fatigue is REAL!"

During my most recent podcast guest appearance, similar sentiments were echoed by the podcast's guests, as well as the hosts, Remington Huggins, Esq. of Huggins Law Firm, and Mathew Mulholland of the National Claims Institute.

"People get burnt out in this job pretty easily, [...] after a major event or something catastrophic [...]. Just being told no over, and over again has an effect on your psyche." - Mathew Mulholland

I interviewed other property insurance professionals about their thoughts on the matter, in depth:

A portrait of a woman.

Angela Henderson, CLMP, Public Insurance Adjuster and past Independent Adjuster, The Green PA, Ohio

What do you think contributes to compassion fatigue being so common in our industry?

When you're an independent adjuster, you're typically passionate about what you do and the difference you can make in your work to motivates you. When you received a giant batch of assignments related to a recent catastrophe like a hurricane or tornado, you're ready for the challenge. As an independent adjuster, you see a lot of information online about damages that occur and policyholders that are struggling through their disaster recovery. As a result, when when those claims get assigned to you (especially a fresh batch from the start of the recovery efforts) we are excited to arrive to the staging location and very motivated to be of assistance.

As to why it's common for there to be fatigue in the industry, I don't blame the policyholders or the claims. The amount of micromanagement that adjusters experience from independent staffing firms or directly from carriers is herculean! When a claim is being handled by an independent adjuster, there is often an internal person at the staffing firm that reviews your evaluations before they can be submitted to the insurance company. Many of the independent adjusters I have known have had their claim evaluations from the field pushed back two to three times for revisions based on claims handling guidelines, before their file reviewers will approve them.

Concerningly, the file reviewer is usually a gig (temporary) hire and may not even have any prior experience in the insurance industry, or with property insurance claims. They look at a checklist and confirm whether or not your submission matches the carrier's estimating guidelines. The guidelines are global and not necessarily specific to any of the realities that we field adjusters would encounter for each loss. And, because the file reviewer may also not have the specialized field and professional experience needed to look at the photos and accept the judgment call from the field inspector, you can wind up with emotional fatigue; not for the policyholder but for the process of getting your claims accepted and your fee bills paid.

Independent adjusters must pay out of pocket for the cost of housing, food, gas, and other necessities, and this is often in areas that have become expensive because of widespread damage caused by a natural disaster. When you are required to submit the same paperwork multiple times being asked to tweak the recommendations even after you have provided your most complete feedback, it can be very frustrating.

What tips do you have on avoiding, managing, and recovering from compassion fatigue?

A portrait of a man.

Doug Quinn, Non-Profit Policyholder Advocate, United Survivors Disaster Relief and American Policyholder Association, New Jersey

What do you think contributes to compassion fatigue being so common in our industry?

There is a natural tendency among those of us who regularly deal with policyholders in a time of loss to become desensitized. When operating in an environment of trauma & loss are part of ones everyday normal, it is difficult to absorb the full depth of suffering felt by victims who are facing it for the first time.

I am The executive director of a nonprofit consumer protection organization; the American Policyholder Association which defends consumers from fraud perpetrated by insurance companies as well as the adjusters and engineers that they hire. I am also the CEO of United Survivors Disaster Relief which focuses on addressing the needs of victims of crisis & trauma in under-resourced areas.

As the survivor of natural disaster & insurer fraud myself, I am perhaps not as susceptible to the same levels of compassion fatigue that others may experience, however it is an issue I have struggled with. Specific symptoms I have experienced are vacillation between oversensitivity and feeling numb/desensitized, trivialization of non-crisis related day-to-day issues, feeling a lack of connection with non-work peers (I hate smalltalk & sometimes resent the naïveté of those around me), and a burning drive to overwork.

What tips do you have on avoiding, managing, and recovering from compassion fatigue?

A portrait of a woman.

Olivia Marraccino, Contents Specialist and Public Insurance Adjuster in training, Digitory Claims, New Jersey

What do you think contributes to compassion fatigue being so common in our industry?

Personally, having the opportunity of being a part of the recovery process serves as a reminder

that things can always be worse, and that even through difficult times, you can remind the home

owners that although what they went through is traumatic, it can result in a positive outcome. As