Category: arizona insurance resources

State Farm’s $1.4B Claim Savings: What Homeowners Must Know

State Farm’s $1.4 Billion in Claim “Savings”: Why Homeowners Should Pay Attention

A case out of Oklahoma should get the attention of homeowners everywhere, including here in Arizona.

Recently unsealed court documents show that State Farm calculated approximately $1.4 billion in claim-payment savings during the first full year of a program involving wind and hail claims.

The documents are part of lawsuits accusing State Farm of changing its claim-handling process to reduce payouts. State Farm disputes those claims, and the case is still being litigated. The court has not determined that the $1.4 billion represents money that should have been paid to policyholders.

But the documents raise a question every homeowner should be asking:

When an insurance company “saves” money on claims, how are those savings being achieved?

According to the court documents, State Farm calculated that reducing the roof replacement approval rate by just one percentage point would save the company approximately $78.8 million annually.

One percentage point.

That number shows the financial impact claim-handling decisions can have for an insurance company. For an individual policyholder, a repair-versus-replace decision, an omitted item, or a coverage determination can change a claim by thousands of dollars.

When those decisions are applied across thousands of claims, the financial impact adds up quickly.

Your Premium Is Only Part of the Story

For Arizona homeowners already facing higher premiums, deductibles, and changes in coverage, this case is another reminder to look beyond what you’re paying and understand what your policy actually covers. Don’t judge your insurance by the premium alone.

You can pay a higher premium this year while having a higher deductible or less coverage than you had last year.

Changes can include:

  • Higher deductibles
  • Separate wind or hail deductibles
  • Changes to roof coverage
  • New exclusions or limitations
  • Changes to replacement cost coverage
  • More restrictive policy language

Price matters when choosing insurance, but it shouldn’t be the only factor.

A lower premium isn’t necessarily a better deal if a difference in coverage leaves you responsible for thousands of dollars after a loss.

The Insurance Company’s Estimate Is Not Automatically What Your Claim Is Worth

An insurance estimate is based on the scope of work included.

Change the scope, and you change the claim amount.

If damaged materials or necessary repairs are left out, the estimate is lower. If damaged property is considered repairable instead of replaceable, the estimate is lower. If the insurance company determines the damage is wear and tear rather than covered storm damage, it may not pay for it at all.

An estimate can be mathematically correct and still be too low if the scope of work is incomplete.

What Should Homeowners Do?

When your renewal arrives, keep last year’s policy nearby and compare the declarations page, deductibles, and endorsements. Don’t assume the coverage stayed the same because you stayed with the same insurance company.

If something changed and you don’t understand it, ask your insurance agent to explain it in writing.

If you have a significant property loss, understand who represents whom.

The insurance company’s adjuster represents the insurance company. A licensed public adjuster represents you, the policyholder.

At AJR Public Adjusters, we prefer to become involved at the beginning of a claim. This lets us review your policy, document the full extent of the damage, and develop and present the scope of loss before key claim decisions are made.

The Bottom Line

The State Farm case gives homeowners a look at something they rarely see: the financial impact that claim-handling decisions can have when applied across thousands of claims.

The $1.4 billion figure is what made headlines. For homeowners, the bigger lesson is what happens one claim at a time.

Know what your policy covers. Know what changed at renewal. And when you have a loss, make sure the full scope of your damage is being considered.

Because what you pay for insurance matters. What happens when you need to use it matters more.

AJR Public Adjusters
We represent the policyholder, not the insurance company.
602-795-5227
publicadjusteraz.com

About the Author

Stacy K. Horowitz is co-owner and manager of AJR Public Adjusters, an Arizona public adjusting firm serving homeowners and business owners with property insurance claims. Stacy writes about insurance claims to help policyholders better understand the process, their coverage, and the importance of having someone representing their interests when dealing with an insurance company.

Image Disclosure: The image used in this article was AI-generated for illustrative purposes and does not depict a specific State Farm office or location involved in the matters discussed.

First 48 Hours After Property Damage: Essential Steps

What to Do in the First 48 Hours After Property Damage

When something goes wrong in your home, a leak, fire, storm, or sudden water damage, the first two days matter more than most people realize.

What you do right away can affect your entire insurance claim.

Here’s a simple checklist.

1. Make it safe first

If there’s standing water, exposed wiring, or structural damage, focus on safety. Shut off water or power if needed. If the home isn’t safe, don’t stay inside.

2. Take photos and video before cleanup

Grab your phone and document everything.

Wide shots of rooms.

Close-ups of damage.

Damaged furniture, flooring, cabinets, walls, ceilings.

Do this before anything gets moved or dried out. Once it’s gone, it’s hard to prove.

3. Don’t throw damaged items away

Even if something looks ruined, keep it until your claim is documented. Insurance companies often want proof. Tossing items too early can cost you money.

4. Start a basic list of damaged items

You don’t need perfection. Just start writing things down. Furniture. Clothing. Kitchen items. Electronics. Every little thing adds up.

Most homeowners underestimate contents losses by thousands.

5. Avoid hiring contractors too fast

Some contractors push hard right after a loss. Take your time. Get estimates. Don’t sign contracts that assign your insurance benefits unless you fully understand what that means.

6. Know who your adjuster works for

The insurance adjuster works for the insurance company.

A public adjuster works for you.

That’s where AJR Public Adjusters comes in. Our job is to document your damage, prepare your claim properly, and negotiate so you’re paid what your policy allows, not just what the carrier offers.

7. Set up your claim for success

These steps help protect your claim, but the best way to make sure nothing is missed is to hire a public adjuster right away. A good public adjuster handles the documentation, values your damage properly, and deals directly with the insurance company so you don’t have to.

Before hiring anyone, take a few minutes to research. Look at references and client testimonials. Check their standing with the Better Business Bureau. It’s one of the easiest ways to see how a company treats people and whether they follow through.

AJR Public Adjusters works only for policyholders. We make sure your loss is fully documented and your claim reflects what your policy allows, not just what’s offered at the start.

Getting help early can prevent costly mistakes and protect thousands of dollars most homeowners never realize they’re leaving on the table.

Monsoons, Microbursts, kitchen leaks, it adds up fast. Make sure your settlement does too. Valley homeowners deserve full settlements not quick checks. Don’t leave money behind.

CALL AJR FIRST – 602-795-5227

Public Adjuster Insights: How Hiring a Public Adjuster Can Maximize Your Insurance Claim

Public adjuster insights to start your week

Over the years, we have received many questions about public adjusters, and people are surprised they have never heard of this industry. Sometimes, they learn a little too late about the opportunity that exists when you hire a public adjuster.

Alright, let’s break this down from the very basics. Imagine something bad happens to your home or business—maybe a fire, a flood, or a storm. You’ve probably got insurance to help cover the costs of the damage, right? But when it’s time to file a claim and get the money back, it’s not always as easy as you think.

How can a public adjuster help with property damage? A public adjuster is a professional who helps you, the policyholder, with your insurance claim. Their main job is ensuring you get the full payout you’re entitled to, which is a bit more complicated than just asking for the money.

Here’s a simple way to look at it:

  1. You file a claim: Something happens to your property, and you contact your insurance company.
  2. Insurance assesses the damage: The insurance company will send someone (called an adjuster) to evaluate the damage and estimate how much it’s worth. But here’s the thing—the insurance company’s adjuster works for the insurance company, not for you.
  3. Where a public adjuster comes in: You can hire a public adjuster. They’ll work only for you (not the insurance company). They come in, look at the damage, and make sure the insurance company offers a fair payout based on your policy.

Think of a public adjuster like a guide who knows how to navigate the complicated world of insurance. They’ll do everything from reviewing your policy to dealing with the insurance company directly, all to make sure you don’t get shortchanged. In exchange, they typically take a small percentage of the claim amount as payment, but only if you actually get paid.

In short, the benefits of hiring a public adjuster are they help level the playing field between you and the insurance company, so you don’t have to go through it alone. They’re there to ensure you’re treated fairly, get the compensation you deserve, and reduce the stress of dealing with insurance claims. Does that help clear things up?

What to do after property damage in Arizona: Learn how a local and trusted public adjuster in Arizona can help you navigate insurance claims and maximize your payout. With over 35 years of experience, Call AJR Public Adjusters first. As Arizona home insurance experts with 35+ years of experience and an A+ BBB rating, we are onyour side when it matters most.