Larry, in general, we choose option 2 and option 1. We generally don’t start work until the “base claim” pricing has been settled on. It is beyond stupid to go ahead and do the work expecting to get paid several thousands of dollars extra for line items left off, O&P, etc… That needs to be covered, per your option 2, before work begins. You lose pretty much all your leverage once the work is complete. Since the permit fee often isn’t known until the job amount is finalized (permit fee is variable calculated based upon the job $ amount), we most often include this fee in our final invoice. We may have had a slight over run (couple of bundles) of shingles which we will include. If our field people are doing their jobs right, if the over run is more than a couple of bundles, they are to halt work until formal approval has been gained from the Desk Adjuster. It is always possible there were some other minor items that were discovered during the build process that require pictures to have been taken in order to get the supplement approved. If it is more than a few hundred dollars, again, our operating procedure is to halt work until the additional work has been approved formerly by the Field or Desk Adjuster.
I don’t really have a problem with this process to a certain extent. There is no doubt in my mind the Insurance Companies have been swindled out of hundreds of millions of dollars by Contractors submitting fraudulent charges. I’m not going to accept the logic of “well, they’re screwing HO’s and Contractors out of billions of dollars”. Two wrongs don’t make a right. Contractors need to be business men and understand there is a process. Follow the process and things generally work out as they’re supposed to. You may not like or agree with the process but until that process changes, it needs to be followed. When you consider the P&C Insurance Companies, they’re Fortune 500 multi-billion dollar bureaucracies that can’t operate their businesses the same way a $2 million dollar per year Contractor does. The $2 million dollar per yer contractor needs to understand how to successfully work with these large entities. The tail isn’t going to wag the dog, it is what it is.