ARI SHAPIRO, HOST:
More than 82,000 victims of Hurricane Harvey have so far filed claims with the National Flood Insurance Program. This does not include any Irma victims. The government's flood program is managed by hundreds of for-profit companies. Charles Lane of member station WSHU reports that this has created a business model that favors speed over accuracy, possibly hurting homeowners and taxpayers in the process.
CHARLES LANE, BYLINE: In a gutted house in Bellaire, Texas, Sean Westerling and his helper measure everything - closets, doorways, windows.
SEAN WESTERLING: You need to get the serial number off this freezer.
LANE: FEMA wants serial numbers to make sure taxpayers didn't already pay for appliances in the last storm. There are lots of details like this.
WESTERLING: If you don't watch what you're doing, if you don't remember to get your windows, you don't remember to get your doors, well, not only are you going to pay for that drywall and that window, but you're going to forget about the door trim and the door.
LANE: It's a meticulous process of essentially fact-checking what was actually damaged. It takes Westerling and his helper more than two hours to scope each house.
WESTERLING: I've got to have a cigarette.
LANE: For this one he figures he'll earn $1,600. And the more houses he adjusts, the more money he makes. Westerling says this causes most adjusters to work too fast.
WESTERLING: You want to make sure you see everything because I don't want to write something and then they have to come back with a supplement. I mean, that's what's going on up there on Hurricane Sandy.
LANE: After Sandy hit New York and New Jersey in 2012, about 15 percent of policyholders complained about being short-changed. Most adjusters I interviewed refused to be recorded. Westerling was an exception. And so was James Gardner.
JAMES GARDNER: Now, you can see how personal this is. I'm in every room of their house. I'm in every closet of their house. I am in their personal space.
LANE: Gardner has a lot of compassion for his customers, but he works much faster than Westerling.
GARDNER: A 74-inch waterline.
LANE: In briefings, FEMA advises adjusters to spend two to three hours per house. Gardner gets this one done in just under 45 minutes.
What's that sound?
GARDNER: That's the pictures uploading.
LANE: You submitted it?
GARDNER: Yeah, it's sent.
LANE: He didn't measure or count the windows, and he didn't count the number of outlets. He didn't get the serial numbers for the appliances. And he would've missed an entire bedroom in the back if the owner, Maria Jimas, didn't point it out to him.
MARIA JIMAS: He don't ask. We need to tell him to.
LANE: And he didn't measure the laundry room?
JIMAS: No. No, he didn't measure the laundry room.
LANE: Back at his truck, I ask Gardner about the economics of flood adjusting.
Don't you want to try to get as many claims on your desk as possible?
GARDNER: Absolutely, absolutely.
LANE: Most adjusting companies assign claims in stacks, so adjusters can make more money by inspecting fast so they can get another stack.
GARDNER: You definitely wanted to get as many claims as you could on those because you don't know when they're going to stop.
LANE: For large storms like Harvey, Gardner says he can handle upwards of 150 claims. Mark Buntyn says that's possible but hard. He's contracted by FEMA to train new adjusters. He says, yes, the business model does pressure adjusters to go fast. But...
MARK BUNTYN: Individual companies are not going to give an adjuster too many claims generally. But some adjusters, just like any other people, are unscrupulous and they get claims from another company. And then that's when trouble happens.
LANE: After Sandy, FEMA implemented a new real-time quality control process to make sure each adjuster will get at least one claim reviewed during the storm. The agency hopes to weed out bad adjusters before they process too many claims. For NPR News, I'm Charles Lane.
SHAPIRO: And that story was reported with help from member station WNYC.
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