While this may be slightly more obscure than some of the other Article topics, it is definitely worth covering as this small oversight can cost Your Company exactly what we are trying to save you–time. So, when will you need to include a cover letter for your estimates? First, we need to explain exactly what it is that we are talking about.
ALL loss draft departments, from the large ones like JP Morgan Chase, Wells Fargo, Bank of America, Citi Morgage, Ocwen and US Bank, to the smaller ones like Green Tree, Midland Mortgage or Flagstar Bank–ALL require an Adjuster’s Estimate (which can also be called Adjuster’s Report, Contractor’s Bid or Insurance Estimate). Again, ALL mortgage companies you will ever need an endorsement from will require you to have an insurance Adjuster’s Estimate, and most even require it for non-monitored claims.
Here is the problem: insurance adjusters don’t write very many estimates anymore. Your Company writes it for them and they approve, adjust or deny the claim based off of your estimate. So why is that an issue for getting your claim check endorsed? Because technically all the mortgage companies need/prefer to have the estimates written by the insurance company who is covering the claim.
Before we get back to the original question there is one more thing to clarify: what exactly is a cover letter for an Adjuster’s Report? A cover letter is a single page document written by the coinciding insurance company that simply reads, for example, “State Farm has based our claim off of Your Company’s estimate.” Passable cover letters are sometimes included with the claim check so use those whenever possible! If not, simply call the adjuster and request “a letter that states you based the claim off of our estimate” and they will usually know what you are talking about.
Finally, back to the original question–Cover letters for Adjuster’s Estimates: When Do I Need One? The answer is that you will most likely need one WHENEVER THE ESTIMATE IS NOT ON INSURANCE LETTERHEAD. So any estimate that Your Company writes, you will need a cover letter stating that the estimate is based off of Your Company’s estimate. There may be times where the estimate will slide through without a cover–but the hold up is not worth the risk. Remember, having your check returned will always cost you a couple weeks of not getting paid! And 99% of the time the mortgage companies will not let you know! You will simply find out when you get your unendorsed check back. So stay ahead of the curve and count on getting a cover letter for any estimate that is not on insurance letter head.
Now go and get Your Money Faster!