What are the biggest challenges facing restoration claims? How is technology helping to address these issus? And finally, what effect is consolidation having on the industry?
What are some of the latest technology trends in restoration, and how does technology separate the best from the rest?
SUSAN KUCHTA, PRISM SPECIALTIES: The overall market trend toward more desk adjusters has been in motion for some time, but the pandemic has heightened it. This has driven the need for everyone in the supply chain of the claims process to integrate into the technology platforms of carriers and their third-party administrators. In our specialty contents restoration process, we had been moving in this direction already by focusing our technology improvements on the ability to communicate details to the adjuster more quickly and in the moment. We add photos and detailed descriptions to our estimates to enable transparent and speedy decisions. We implemented API connectivity from our job-tracking software with the carrier so the information can be accessed by the adjuster in real time. The adjusters and their vendor teams appreciate the ability to make decisions easily and effectively without having to be on site.
SCOTT MABIE, AREPA: For the most part, the science and technology associated with equipment decontamination has not changed much over the last several years. Different processes and cleaning systems have been introduced in the industry, but due to limited added benefit and concerns over long-term effects of these processes, companies such as AREPA continue to stand behind “tried and true” techniques that use heat, water, or extreme cold temperatures to remove contaminants. Our advice to equipment owners and stakeholders is to not be swayed by some of the latest technology restoration trends.
What has been the impact of the consolidation trend in the restoration business? Has it stifled competition, or has it allowed the best companies to compete more effectively?
SCOTT MABIE, AREPA: Consolidation has made the market more competitive, as there are fewer options for equipment owners and other involved parties to choose from. At the same time, the growing competition in the restoration industry has paved the way for the strongest companies to compete more effectively. To stand out, AREPA has remained focused on providing exceptional customer experience and service, from customized solutions that minimize business interruption to 24/7/365 response, since disaster never strikes when you are ready.
SUSAN KUCHTA, PRISM SPECIALTIES: Consolidation is simply the result of a maturing market. Insurance companies’ adoption of more technology that allows for data-driven decisions may add fuel to the consolidation. In economic theory, the best companies will survive and will likely expand services. This can cause a loss to the market of customization. Over time, the market may not be able to provide the customized attention, services, or high levels of quality that the carriers and their insureds need and want. For example, many mitigation contractors are adding contents restoration to their services thereby increasing competition, among these contractors but also with contents restoration companies. This increased competition heightens the difference between the players and highlights the services that really need expertise in the areas like high end appliances, fine art and document restoration and digitization. As with most market transformations, competition increases in some areas and decreases in others.
When you look ahead to the next five years, what are some of the biggest opportunities and challenges you see for the restoration business?
SUSAN KUCHTA, PRISM SPECIALTIES: Technology integration and the predicted increase in catastrophic weather events will be the source of most challenges and opportunities for everyone. Technology that has already been integrated into the claims process can be leveraged to increase efficiency and flow. To the extent that technology is changing within a company and not yet integrated, it will cause frustration to those managing more and more complex claims. The increase in storms will reduce the response of restoration companies to restore to normal as quickly as companies reach their service capacities more quickly. The consolidation of the restoration market may be able to help, as local companies can more readily call on partners from around the country to support their losses and increase capacity. In the area of specialty restoration, having the ability to address several specialty categories will be critical. The key areas are textiles; documents and digitization; electronics and appliances; and art and collectibles.
SCOTT MABIE, AREPA: As the demand for a sustainable future increase, so does the opportunity to implement sustainable practices in the restoration industry. In doing so, we can increase recovery and restoration in order to decrease waste and material usage in the industry.
While technology is constantly becoming more advanced and complex, this creates a positive challenge for the restoration industry, which allows for the evolution of reconditioning measures, increased production, and innovative solutions that are also sustainable and forward-thinking.
What has been the biggest change in the business over the last decade?
SCOTT MABIE, AREPA: In the past, companies had the tendency to run equipment until failure. Supply-chain issues have recently impacted the availability of parts and new equipment lead times. This has forced equipment owners to focus on preventive maintenance so they can avoid downtime before it occurs. Preventive maintenance measures help ensure that vital equipment stays running at full capacity, which increases productivity, reliability, and the overall life of the equipment. With the current shortage of labor, equipment owners are outsourcing to restoration companies, like AREPA, to provide confidence in their equipment.
SUSAN KUCHTA, PRISM SPECIALTIES: As business owners and consumers, everything we buy and own has become more technical, complicated, and expensive. These are the things we ask our insurance companies to insure. This has also resulted in the need for more experts in key areas.
When a loss occurs, the carrier must make hundreds of restore-versus-replace decisions on behalf of the insured. Consider the following scenarios.
• A dental office that has not yet converted patient files from paper to digital.
• A homeowner who collects fine art or high-value memorabilia.
• A custom kitchen with commercial-grade appliances.
• A hotel fire involving bedding, linens, kitchens, computers, and more.
Fewer, larger companies will handle more of the losses, and having specialists and experts where needed will be critical.
Susan Kuchta is vice president, sales and strategy, for Prism Specialties. susan.kuchta@prismspecialties.com
Scott Mabie is managing director – North America at AREPA. scott.mabie@arepa.com