In the early 1960s, his firm was a member of National Institute of Rug Cleaning (NIRC). He gave a presentation at a NIRC event in Florida explaining that water damage might be lucrative and was almost hooted off the stage. NIRC members were “fat cat rug plant owners” who often took month long cruises after the NIRC convention. Martin fought for a seat at the NIRC table for restoration.
People throughout the US were doing fire restoration work but didn’t have a mechanism for meeting and communicating. He started the National Institute of Fire Restoration (NIFR). He couldn’t run both a service business and an association so he turned it over to Bob Coleman who was also running NIRC. Bob changed NIRC’s name to Association of Indoor Décor Specialists (AIDS) and instituted a divisional structure; of which the NIFR was a division. Martin started teaching classes for AIDS. On-location carpet cleaning was growing, plant cleaning was declining. Due to unfortunate acronym AIDS, the association changed its name to ASCR.
As the one constant, Martin tagged along with NIFR at every stage. As part of ASCR, NIFR had to fight for the ability to spend the association money they generated.
Restoration was becoming better known through a large influx of carpet cleaners claiming to be restorers. Experienced restorers wanted to distinguish themselves from wannabees. To be meaningful, the program needed to be as difficult as possible. From the outset, the CR program was designed to be small and be exclusive. The common thread among CR’s was, the program was more difficult than we ever thought it would be, don’t make it any easier.
Legendary work products
“Emergency Tips”- provides emergency recommendations for dealing with insured perils to property owners and occupants.
“Home Owners Bill of Rights”- Property owners don’t understand the significant rights paid for when they purchase property insurance coverage. They don’t know they must promptly act to minimize the claim and limit further damage.
- Nowhere in the insurance policy did the words “competitive bid” or “lowest price appear”.
Due to the recession and high unemployment in the 1970s insurance companies offered cash settlements to property owners to settle claims. While the lump sum payment sounded good to the unknowing; these payments were lower than the amounts needed to have the repairs professionally performed. Due to dependence upon insurance companies for claims repair work, ASCR members were fearful of retribution by insurance companies and the document was retracted. The document was rewritten in softer language and in a question and answer format as “After the Disaster, first 24 hours”.
Guidelines for Fire & Smoke Damage Repair?
Martin credits Barry Swidler; for asking him if standards from another industry could be done for disaster repair? The guidelines are focused on the three parties: property owner, insurance company and repair contractor. Bringing standards into play that are verifiable. Marty never felt that precise procedures were needed for everything and that procedures should be left un-ended. Martin drafted the first version which was sent out for peer review prior to publication, the second edition was published several years later in 2007.(A British version was also published.)
10% and 10%
According to Marty, 10% overhead & 10% profit has been utilized in the insurance repair industry as far back as the 1960s. The 10 & 10 is financial consideration for the coordination of trades and subcontractors work on the project.
According to Marty, no law says that it must be there, it’s just there.10 & 10 works well on a $5M dollar project not on a $5K project. 10 & 10 when added to the contractor’s unit costing was used to obtain a normal profit not extract an extraordinary profit. In the remodeling business work costing $100 was sold for $150. Restorers are at a disadvantage when presenting their billing in the insurance companies format with pricing based upon the insurance industry’s computerized cost data base; an artificial standard with no wiggle room. An ASCR white paper titled “Cost Accounting Issues for Damage Repair” demonstrated that the average restoration contractor’s overhead is 26%, guaranteeing the contractor will lose money on every job.
Insurance regulation has always been a state matter. Insurance companies have an exception permitting them to act in restraint of trade.
Insurance companies formerly lost money on underwriting and made money on their investments. Insurance companies have learned if they squeeze hard enough they can obtain an underwriting profit.
What are the most common technical questions?
- We had a spill or an event, should I use ozone? The first resort is not to apply ozone and as follow up explain why the use of ozone isn’t a good idea.
- Common perils occurring in uncommon places, water damage in a hospital near a CT scanner, etc.
- Financial questions, how to collect money from an adjuster or client who balks at paying the bill.
Which is the greater health concern: mold, sewage or soot?
Sewage can harm you quickly, mold can harm you slowly, fire residues can harm you over the long term.
He doesn’t like the over acknowledgement of fire residues as being, and/or making them more complex than they are or need to be. Treating smoke residue as a toxic hazard has never been established, the contrary has been established.
What about insurance company line item for maid service?
Use of the term “maid service” indicates how little the insurance industry understands restoration. Maid service is unskilled labor, it’s like inviting a butcher to perform heart surgery, devaluing the service.
Pete Consigli- standardized forms (as used by American Institute of Architects) are an industry need due to maturing of the industry.
Dieter Weyel– on fire and smoke residues- nothing burnt is good for you or the human body. Both ozone and nitroglycerine should be handled very carefully.
Martin King award named after you while your living: uneasy feeling that somebody made a big mistake, nice to be appreciated, thought I was being faided out. Cited a Woody Allen quote: “rather than live on in the hearts and minds of my fellow man, I would rather live on in my apartment.”
4 Important Takeaways from Marty:
- Business educational growth is needed. Contractors need to become more businesslike, understand contracts and operate in a more formal and documentable manner than in the past.
- Polarized claims process isn’t good for the policyholder.
- Contractors good judgement must be their home base.
- Water damage, dry as quickly as possible with over-sized equipment, don’t worry about the fine details (vapor pressure, etc.) and then put things back together. Insufficient drying equipment is a false economy, liable to show up as costly problems later.
Z-Man signing off