Damage Consulting and Contracting

John DiMenno, CR, CMRS, CMP,  VP of Operations and Director, J. S. Held, Pittsburgh  Construction Consulting provided an overview discussion of this segment of the building failures industry.  His talk to the AE 537 Class at Penn State was a part of the Visiting Practitioner Lecture Series for 2016.  Mr. DiMenno was assisted in this talk by Mark Cantalamessa, Senor VP, Business Development.

Mr. DiMenno’s talk centered on the process of how insurance losses are assessed, monitored and finalized.  In addition, he discussed how firm’s such as J. S. Held assemble teams of engineers and other specialists  (internal and/or external) to address complicated and extensive losses such as major fires, wind storms and floods.  J. S. Held provides consulting services on a national basis for all types construction including commercial, industrial, high rise, special structures, governmental, residential and infrastructure.  Their extensive institutional commercial and residential experience has been accepted by the courts as expert testimony.

Some representative examples of the services they offer are:

  • Detailed repair cost estimates
  • Building replacement cost analysis
  • Cause of loss determination
  • Engineering analysis
  • Code compliance and requirements
  • American Disabilities Act compliance and evaluation
  • Structural steel evaluation
  • Building foundation evaluation
  • HVAC system testing and evaluation
  • Electrical system testing and evaluation
  • Vibration damage from blasting
  • Code compliance and upgrading
  • Construction defects
  • Commercial and Residential roofing and roof systems (flat, sloped & steeples)
  • Retaining wall evaluation
  • Parking garage structural evaluation
  • Elevators and material handling systems
  • Hail damage evaluation
  • Mold and environmental damage assessment
  • Clerk of the works and emergency service monitoring and evaluation

More  information can be found on  the J. S. Held Website.  Additional information on disaster response and remediation can be found on the sites of some of the industry organizations involved in this type of work including the International Restoration Institute.

Additional information to help jump start the discussion on this topic can be found in the article “Consulting to Insurance Companies” published in the November 2008 issue of STRUCTURE magazine.  Although J S Held is not an insurance company, much of their work relates to the insurance industry and the role of the structural or architectural engineer is similar regardless of the exact nature of the client.

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59 Responses to “Damage Consulting and Contracting”

  1. Shubham
    November 1, 2016 at 8:18 am #

    The STRUCTURAL magazine provided by professor, adds up to the presentation of Mr. DiMenno, enlightening the very specifics from the point of a Forensics Engineer, when involved with a insurance company.

    Few important points to highlight are code requirement, determining coverage.

    When structural damage occurs, it is generally required that all structurally deficient items discovered or included in the repair process be brought to the minimum standards of the current building code.

    A structural engineer who is evaluating a claim is highly cautioned not to guess at, comment on, or speculate with respect to insurance coverage. The best practice is to completely avoid commenting on coverage. I believe the main objective behind this is, the engineer should believe in claim calculations from raw and not the abstract idea.

    Moreover, the scope for such scenario (involving insurance companies) is not more or less the same as for a routine failure scope.

    Also, the three misconceptions are quite interesting and deserve a minute of the client (both, the insurance company and the insured) to ponder upon.

  2. Joshua Z
    October 31, 2016 at 10:08 pm #

    I was reading the article in STRUCTURAL magazine and wanted to share a few things that I found interesting. Earlier I asked about the scope the of the engineer with respect to the insurance company, and if the insurance company has jurisdiction over what the engineer investigates. Thanks to Professor Parfitt and the article, I have a better idea of how it works, in addition to what the engineer that is investigating should be looking for, and what questions the insurer might ask. For example, the insurer may want to know the extent of the damage, how the damage occurred, who might have caused it, as well as the existing conditions and what the might be required in order to fix the damage. I also found the section on subrogation to be very interesting. Specifically, I didn’t know how much responsibility the engineer leading the investigation had. The investigating engineer is required to keep a “higher level of documentation” in order to ensure that the insurance company can support the ability to subrogate, as well as understand that all suggestions that are made with regards to repairs will be questioned and opposed.

    It’s interesting to learn about the legal side of engineering forensics.

  3. Alec B
    October 31, 2016 at 12:43 pm #

    To wrap-up the idea of assessing damages while segueing into a related topic of serving as an expert witness, attached is a link to a chapter of a Forensic Engineering textbook I found online through Penn State’s online library database. Please be aware that you may need to enter your PSU e-mail and password in order to access the online textbook chapter. If you are unable to access the link, e-mail me at ajb6056@psu.edu, and I would be happy to send the PDF version.

    The chapter of the textbook specifically focuses on serving as an expert witness. I’d recommend skimming the first few pages that provide simple background information on the legal/court process in general. Page 759 begins the information pertaining to expert witnesses. The textbook chapter does a great job presenting information related to several different roles an expert witness may take on in the process while also illustrating some of the expert witnesses’ responsibilities associated with each role. At the very end of the chapter, the textbook summarizes some “tips” for serving as an expert witness that may be worth making yourself aware of!

    http://www.crcnetbase.com.ezaccess.libraries.psu.edu/doi/pdfplus/10.1201/b14052-24

    • Yamile R
      November 1, 2016 at 12:24 am #

      Alec:
      Thank you. This is a good reference.
      The tips for serving as an Expert Witness are very good suggestions. The most important one in my opinion is to “Know the facts of the case inside and out” It is very important to do the homework and be prepare to answer any question from the case. If a professional is serving as a witness and it is not familiar with the case, it could be seen as an untrustworthy source.

    • Brendan B
      November 1, 2016 at 12:55 am #

      Alec,

      The article you shared does a great job explaining the litigation process, and how complex it can truly be. The example about the homeowner alleging there was mold growth in their home due to the general contractor improperly sealing a door frame illustrates how all possible causes of mold growth must be considered before deciding improper installation was the cause. As the article points out, a faulty sealant from the hardware store could also be a cause of the mold growth.

      What I found most interesting form this article is the section on what an expert witness is. It certainly makes sense that someone with a technical background will help explain the case to the jury to help them fully understand the situation. Becoming an expert witness seems like a great field for someone that has been in the industry for a number of years and would like to offer assistance in the litigation process.

  4. Mehrzad
    October 30, 2016 at 7:21 pm #

    As explained in the article below, forensic structural engineers are oftentimes hired and relied on by insurance companies as one of the first parties present on site for prevention of evidence spoliation and to take on identification of PIPs (potentially interested parties). These PIPs may include manufacturers of products, construction companies and design professionals of the structure under investigation who are sent Notice of Claim letters by the insurance company. This is why through observation and full documentation by the forensic engineers is necessary in order to minimize the allowance room for false claims by the owners or other trades involved.

    http://ascelibrary.org/doi/abs/10.1061/9780784412640.039

    • mkev
      October 31, 2016 at 10:59 am #

      Nice reference article Mehrzad. Everyone should read it! Some of those concepts will be discussed in more detail near the end of the semester when we have a guest speaker who will comment on the Role of the Expert and Expert Witness along with some mini case studies.

    • Di W
      October 31, 2016 at 3:04 pm #

      Mehrzad,
      It is a very good reference article. It specifies two legal doctrines that have had the most significant effect on the jobs and duties of forensic structural engineers, Daubert Standard and Spoliation of Evidence.
      If anyone could not get access to the article above, you can use the following URL:
      http://yostbaill.com/wp-content/uploads/2015/01/DJT-final-paper.pdf

  5. Brendan B
    October 27, 2016 at 6:41 pm #

    Throughout the semester, we have discussed reasons why buildings fail, what constitutes as a “building failures”, several different building enclosures, and the effect time can have on these enclosures if not properly maintained. However, we have not discussed the litigation and consulting process in great detail which made Mr. DiMenno’s presentation very informative. Both John and the “Consulting to Insurance Companies” article stressed the importance of the structural engineer approaching a claim as an advocate of their own opinions and remaining objective with their findings. Although the most important part of an insurance claim is making sure the site is safe and that human life is not at further risk, structural engineers have to be wary about the scope of their findings and making sure themselves, the insurance company, and the insured stay out of further legal trouble. The turn around time is already long enough, and providing over-conservative or biased reports will only drag out this process.

    A question I have is how do insurance companies determine if the structural engineer was over-conservative with their estimate? And how do you prove if the engineer intentionally was over-conservative?

    • mkev
      October 31, 2016 at 10:54 am #

      Brendan,
      Good question. There is a system of checks and balances. Most often there is at least one other engineer on the project. Perhaps one for the owner and one for the insurance company. Or, in a litigation related issue, the contractor and/or subcontractors are also involved. Bottom line, a number of engineers and /or experienced construction professionals and adjusters are looking at the claim and that helps to keep things reasonable most of the time.

    • Prateek Srivastava
      October 31, 2016 at 5:43 pm #

      I have a similar question as how the insurance companies get to know that structural engineer is doing the right thing.

      Though, they have hired other structural engineers but are there any guidelines defined as to cross-reference if the engineer is doing the right thing and he is not being biased/over-conservative.

      • Joe H
        November 1, 2016 at 12:10 am #

        I’ve heard from multiple professors and seen in my classes that you could give 5 engineers the same problem and get 5 different solutions. These could be based on their experience level, their education, the company they worked for, or a variety of other factors. I think as engineers it makes it extremely important to carefully document the decisions and calculations that we make. This way, they can facilitate a discussion and allow for clear understanding between two or more parties that were not present while the design was being made. While other engineers may have different opinions, careful documentation can be a huge factor in the letgitamcy and analysis of an engineers work

    • Ommar E
      October 31, 2016 at 11:06 pm #

      When it comes to giving accurate estimates i find experience play a major role. Mr. John DiMenno is a good example of the type of hands on experience that become invaluable in giving estimate in the field. As Professor Parfitt mentioned that since Mr. DiMenno started working in the field as a carpenter and led his way up equipped him with the ability to give excellent estimates and on the spot. So, I believe there is no alternative to proper training and getting enough experience before starting giving assessments. by doing so it saves owners and insurance companies a lot of time and resources.

  6. YusufA
    October 27, 2016 at 8:43 am #

    The presentation by Mr John Dimenno has exposed me to the role of an engineer in the insurance industry. I would usually believe that an insured damaged building would be estimated and insured but little did I know that this involves the brilliant work of structural engineers until now.

    Reading the STRUCTURE article at the same time has made some points clear to me. The role of a structural engineer in a disaster or damage becomes very important especially since both the insurance company and the insurer are the client and at the same time not the client in order not to be biased in judgment calls. This means an engineer needs to be cautious and professional in his acts and base all reports on the findings, analysis and recommendations. This point was also highlighted by Mr Dimenno in the lecture when he mentioned that JS HELD are most well known for making good unbiased judgment calls in the industry during the lecture.

    I have also learnt that a clear and concise scope of a job should be known by an engineer prior to the start of work as this would have an effect on the kind and extent of work to be done especially in a SUBROGATION case. This however does not mean that an engineer should only focus on the damaged area and not be aware of potential risks which should also be reported for further preventive action to be taken.

    • mkev
      October 31, 2016 at 10:11 am #

      Good point. I made a similar comment earlier.

  7. Shane M
    October 27, 2016 at 12:14 am #

    This presentation was very enlightening to hear. It was nice to gain more knowledge about the insurance side of the building failures investigations. I worked at a design and forensics firm this past summer and I was able to get my hands on a few of their investigations. Just like JS Held we worked with the insurance companies to assess the damages for a few single family homes. The interesting thing is, that they were both vehicle impacts to the structure. We would go to the site with a representative from the insurance provider to give them guidance during their own assessment. Our main goal was to provide the owner and insurer with the information they needed in order to put together a repair estimate. We would point out what needed to be fixed to make the structure safe, instead of letting any contractor come in and do more work than was needed. It was a very interesting side of my job and it really got me interested in forensics in general. JS Held is obviously operating on a much bigger scale. For the 9/11 investigation, I am curious about how many people were involved on JS Held’s end. Also, for sensitive events such as 9/11 I wonder if the insurance company was willing to provide extra help on the costs.

    • Joshua Z
      October 27, 2016 at 1:37 am #

      Shane,

      It’s interesting to see an example of the relationship between engineer and insurer. I am curious, did you only have to answer questions and provide information that the insurer asked for, or were you required to have broader knowledge of the accident that occurred and the impact it had on the structure? That is, as Rebecca mentioned earlier, did the insurer determine the scope of your inspection, or did you perform your inspection and then answer the questions as required?

      • mkev
        October 31, 2016 at 10:09 am #

        Josh,
        Usually you determine the scope because you often only get one shot at this. I usually inspect the entire facility (within reason depending on size) especially in residential cases so that if any additional damage claims are made you have all the backup information. In other-words, sometimes it is just as important to note what is NOT damaged in addition to what IS damaged.

    • mkev
      October 31, 2016 at 10:06 am #

      Shane,
      Funny how those vehicles keep hitting houses. I have investigated several in my career. Another common one is construction vehicles damaging adjacent properties during construction operations.

  8. Ommar E
    October 27, 2016 at 12:09 am #

    Expertise possessed by companies like J. S. Held are called for by insurance companies to better assess the losses incurred in failure cases. Mr. John DiMenno and the author of the article have made it clear that the objective of an expert advice/assessment and position is not to take sides or pick winners and loser but rather rendering a professional, supportable and well-reasoned opinions and findings. These expertise becomes in even higher demand when the stakes are high and billions of dollars are involved and parties to a failure case are multiple entities and might even be from different countries and the effects of the failures spans regions and communities. One such case with all of the above is the Deepwater Horizon oil spill (also referred to as the BP oil spill, the BP oil disaster, the Gulf of Mexico oil spill) which is considered the largest accidental marine oil spill in the history of the petroleum industry. Navigating such murky waters of that kind of failures is difficult if not impossible for insurance companies without the know-how and judgments of experts in the field which in this case extends to many areas.

    Here are some excerpts from the experts reports for that case:

    “On 23 March 2011, BOEMRE (former MMS) and the USCG published a forensic examination report on the blowout preventer, prepared by Det Norske Veritas.The report concluded that the primary cause of failure was that the blind shear rams failed to fully close and seal due to a portion of drill pipe buckling between the shearing blocks.”
    “The US government report issued in September 2011 stated that, although the events leading to the sinking of Deepwater Horizon were set into motion by the failure to prevent a well blowout, the investigation revealed numerous systems deficiencies, and acts and omissions by Transocean and its Deepwater Horizon crew, that had an adverse impact on the ability to prevent or limit the magnitude of the disaster. The report also states that a central cause of the blowout was failure of a cement barrier allowing hydrocarbons to flow up the wellbore, through the riser and onto the rig, resulting in the blowout.

    https://en.wikipedia.org/wiki/DNV_GL

    • mkev
      October 31, 2016 at 9:57 am #

      Good points Ommar. And, it is not uncommon for experts to come to different conclusions using the same data. We studied a case like that at the beginning of the semester. Anyone remember which one?

      • ErikS
        October 31, 2016 at 3:33 pm #

        Hartford Civic Center – LZA (Harford’s panels’ consultant) believed inadequate bracing of the top chord was the initial cause (as well as inadequate QC and inspections); Loomis and Loomis believed torsional buckling of the compression members and overloaded truss members were the main cause of the failure; and Hannsrarl Bandal (architect’s insurance company) believed fault welds connecting the scoreboard to the roof was the cause of the failure. Apparently Fraioli, Blum, and Yessleman, Engineers (FB&Y) (Engineer of Record) also disagreed with LZA though I have not been able to track down their account. Essentially, it was also believed over-reliance on computer analysis software (at the time) may have led to a false sense of security in that not all modes of failure were included in the analysis.

      • YusufA
        October 31, 2016 at 3:40 pm #

        I believe this was the L’Ambiance Plaza building, in Bridgeport, Connecticut which was constructed using the Lift-Slab method with 5 different expert failure theories over the years and no confirmed cause of failure till date. The case was quickly settled out of court to end all investigations and this gave no report of the exact cause of collapse.

        The link on Failures wiki is as shown below.
        http://failures.wikispaces.com/L%27Ambiance+Plaza

        I think this adds to how important the role of an engineer in an insurance claim is to make all parties realize the possible fault location and agree on settlement terms.
        Was this the reason for the quick settlement?

  9. Prateek Srivastava
    October 26, 2016 at 11:55 pm #

    As a forensic structural engineer, it requires a sound knowledge of the technical concepts involved as they come handy when looking for causes of damage.

    As mentioned in the Structural magazine, the structural engineer need to define his/her duties and need to clarify them with the structure owner and the insurance company, so that he/she can efficaciously perform the duties involved.

    The structural engineer has to be very objective while providing his/her final report. He/she should listen to their own conscience and take decisions accordingly. Sometimes, less experienced engineers get influenced by perceptions of the owner or the insurance company which should not happen.

    The engineer should take decisions considering if the building is very old what building codes and practices were prevalent at the time of construction.

    The sole purpose of a structural engineer at the failure site is to provide the cause of damage and which all parts of the structure were damaged from before and are going to be damaged in near future, just to get a clear picture about the structure in consideration.

    The structural engineer should not act as an advocate to either parties as it is a misconception.

    These aforementioned points are some of the good ones which i got to know and are essential to know for any practicing structural engineer.

    • mkev
      October 31, 2016 at 9:53 am #

      Good points Prateek. Keep in mind that the engineer also may be involved in recommending temporary support or protection from he weather, determining what parts can be reused structurally and advice on economic items related to his or her expertise.

      • Prateek Srivastava
        October 31, 2016 at 5:36 pm #

        Thank you for replying Professor.

        I totally agree with your points, a structural engineer need to provide the remedies as well to the client. The remedies can differ according to the needs of the client, i.e., the amount of money they wish to invest, the importance of structure in terms of usability etc.

  10. Ishan Uppal
    October 26, 2016 at 11:04 pm #

    Another informative talk by an industry expert. Thank you Mr DiMenno.

    As a structural engineer hired by an Insurance company, I always thought the engineer would report in such a way as would be beneficial to the Insurance company. But Mr DiMenno’s first hand experience of the Insurance industry and the Structural magazine article laid to rest my doubts.

    The case studies presented by Mr DiMenno once again saw the extent of damage water does to a structure. Seems like water is the most critical element for any structure.

    Something in the talk that I found interesting was that Mr DiMenno mentioned that the WTC building was valued at $5 Bn and he then mentioned that they insurance company paid Mr Silverstein an amount of $3.5 Bn. Why so? Did Mr Silverstein not insure the building for the entire value it was worth?

    • mkev
      October 31, 2016 at 9:51 am #

      Ishan,
      I don’t have the specifics on that part of the WTC project. There are legitimate reasons why that could happen. Although it doesn’t apply to the WTC, sometimes a building has a certain value but the entire building is not damaged. A fire may burn the upper floor of a house but the lower level and /or foundations may not need replaced so overall value and replacement / repair costs can be different. And yes, policy issues can play into that such as the question of one vs. two events with WTC.

      • ErikS
        November 1, 2016 at 8:18 am #

        While not the same it may be similar to the Katrina Hurricane insurance claims. I was not directly involved with the Katrina Hurricane insurance claim projects but my previous company was. Many of the investigations included determining if the house or other property was damaged due to wind or flood. This is important for the insurer to know for those insured who only had one coverage or the other. The investigation included observing damage to the remaining portions of the house (or lack thereof in many cases – house that is…many were removed completely from their foundations) or examining damage to objects around the property (e.g., trees, adjacent structures). They were looking for evidence of water levels to determine at what level the flood waters rose at the property. Reviewing local wind reports, if available, to determine the speed and direction of the wind, and they used this information to provide evidence to the insurance companies to determine whether the claims would be paid out or not depending on the insurance policy coverages. There may be something in the policies on the WTC that were not triggered due to the impacts (north and south), collapses (north and south) or many other factors we are not aware of. Insurance policies are tricky – look at your own car insurance (or rental or home) some time and see if you can understand it and know what you are and are not liable for or covered for.

      • Ishan Uppal
        November 1, 2016 at 8:53 am #

        Thank you for the reply. Yes I remember you explained in class the one event vs two events by giving the example of the Katrina flood. So it makes sense that WTC building did not get the $5 billion it was worth.

  11. Yingzhe You
    October 26, 2016 at 10:40 pm #

    I really enjoyed Mr. DiMenno’s speech as well as the article from the STRUCTURE magazine. My favorite sentences from the article is “The investigating engineer’s work, opinions, and findings should be impartial.” And “Be an advocate of only your own opinions”. We always have the prejudice that the structural engineers are hired to work to minimize the client’s cost, but what should be done by the engineers is to find the evidence the can lead to the actual cause and finally get the fair answer for all parties.

    • mkev
      October 31, 2016 at 9:47 am #

      Yingzhe,
      You can actually do both in some cases. For example, you should determine the cause etc. But you may also be able to recommend a creative repair solution acceptable to everyone that will save costs or you often can provide direction on temporary stabilization that will ultimately reduce costs for everyone by saving a part of the structure.

  12. MichaelB
    October 26, 2016 at 10:36 pm #

    It was nice to hear about a different aspect of forensic engineering with the presentation by Mr. DiMenno. Whenever I see a building failure in the news I just assume that the building will be fixed or reconstructed but it is not as simple as that due to the complexities of insurance policies.

    This was especially evident in the case of the ice arena. Because the owner had a very limited insurance policy and his personal wealth invested in the property, the building could not be returned to its prior condition before the collapse. In situations like his it is very important to have intelligent advisors to recommend the best course of action with limited funds.

    I am curious if limited funds was the only reason that the free standing rectangular structure was chosen over ordering new arches from the original manufacturer.

    • ErikS
      October 26, 2016 at 11:37 pm #

      Michael, I believe the pre-engineered metal building was selected for cost reasons, as you mentioned, but also lead time for getting the new laminated arches re-fabricated by Weyerhaeuser, and likely for other reasons. Based on the timeline of the owner to get the facility operational again he was unable to wait for the arches to be replaced and could not afford to expedite their fabrication so the pre-fabricated building was utilized as a stop-gap. I wonder if his intention is the pre-fabricated building is a temporary fix and will replace them with a more elegant structure as funds/timing allows…like Penn State planned for our AE department with the Engineering Units… 

      • mkev
        October 31, 2016 at 9:45 am #

        You are correct Erik. Schedule was a driving issue since it impacted the revenue generation side for the owner.

      • MichaelB
        October 31, 2016 at 6:38 pm #

        Erik, good point. As Professor Parfitt mentioned in class and in his comment, the schedule was very important. I would like to think that the owner has thought about ordering new arches to restore the building to its original state.

        I have a feeling this will not come to fruition though if the prefabricated steel building holds up. Looking at pictures of the exterior after the fix was put in place, it actually looks pretty fitting with the slanted roof. I do wonder if the owner could adjust his insurance policy and if he could whether the building would be valued less because of the steel structure.

  13. Rebecca M
    October 26, 2016 at 7:26 pm #

    Tuesday’s discussion by Mr. DiMenno and Mr. Cantalamessa was a great segue from the building failure investigation and design repair to the damage consulting process. Rather than only investigating the site to find the cause of failure, experts in this situation determine the repair scope for the project and work with insurance companies to determine repair cost. I hadn’t before realized the extents and limitations of insurance policies in regards to building failures. One question about the insurance side of things would be who is responsible for structure damage in the event of vandalism or something that wasn’t a natural disaster? Is it a company like J.S. Held’s responsibility to figure that out or does it shift to the insurance agency?
    Also, during a damage consultants site evaluation for repair scope and cost, how often does that inspection result in finding building damage that did not directly result from the disaster and if it does happen, is that information also conveyed to the owner at some point in a report? I would think that insurance and damage consultant companies only inspect the damaged areas and make safe anything else they saw fit rather than inspect the building for other signs of failures.

    • ErikS
      October 26, 2016 at 11:35 pm #

      Rebecca, based on my experience and reading the STRUCTURE article the consulting engineer is not responsible for interpreting the insurance policy. It is the engineer’s responsibility to determine the cause of the damage, develop repairs for the damage, and provide a cost estimate for the repairs (or replacement) and it is the insurance company’s responsibility for determining whether it is covered by the policy or not due to a natural disaster or vandalism. And if the vandalism followed a natural disaster an additional claim may be justified to be paid out, such as was the case at Rostraver with the vandalism of the mechanical equipment following the snow collapse.

      Regarding discovery of additional damage during an investigation, it depends on the agreement with the insurance company but generally the engineer is obligated to disclose damage observed, or at least conditions the engineer believes to be unsafe, (Professor Parfitt please correct me if I am wrong). As mentioned in the STRUCTURE article the insurance company may discuss expectations and direct the engineer up front to only evaluate a certain area of the building, so if something additional is noted within that area but is obvious that is was not directly related to the primary event, the engineer may be requested to make the disclosure under a separate cover. And as has been discussed numerous times, a good engineer does not wear blinders and when observing, assessing, or investigating a building failure they may observe deficiencies or damage elsewhere and this should be documented one way or another.

      • mkev
        October 31, 2016 at 9:40 am #

        Yes, the duty of a structural engineer is public safety first and foremost. There is a chain of command. You can tell your client (insurance company for instance) that you have discovered an unsafe condition (or you have discovered that the owner is continuing to use parts of the facility that are deemed unsafe). They most often ask for a letter in those circumstances which they then forward on to the insured. In extremely urgent cases, they may instruct you to tell the owner in person, usually to be followed by a letter for the record.

        This works 99% of the time. I was involved in one situation where the owner ignored the recommendation and additional steps had to be taken. We can discuss this in class as it is too complicated for a simple post.

      • Rebecca M
        October 31, 2016 at 8:59 pm #

        Also, reading further into the STRUCTURE magazine article, in the event of damages from a third party, the insurance company becomes involved in subrogation or “paying for the insured’s damages and legally seeking reimbursement from a third party that is at fault.” With this issue, in cases like the mentioned Rostraver, extra measures need to be taken by the investigating structural engineer such as creating a higher level of documentation on the project and damages, being more aware that repair recommendations will be scrutinized, and determining whether or not the insurance company wants the engineer to be a forensic expert witness. It was also illustrated that the process of investigating sites as insurance consultants, as with all things, deals with the major responsibilities of being an engineer such as to uphold the code of ethics, be impartial, and be thorough in the evaluation and documentation.

  14. Di W
    October 26, 2016 at 4:53 pm #

    Mr. John DiMenno did a very good speech on consulting to insurance company. He showed me a new field that an engineer can work in. I think the biggest challenge for an consulting company would be how they could keep a balance between the insurance company and the insured. Both the insurance company and the insured are the clients, in the sense that an engineer must be aware of both party’s needs. If the engineer cannot be an advocate of either, the insurance company and the insured will not be the clients.
    The article also enlightens me what an engineer should consider if the building codes changes.

    • mkev
      October 31, 2016 at 9:33 am #

      Di,
      Yes, it helps to know both sides of any claim but your duty is to your client. Not a duty to advocate but often you must maintain confidentiality of information. An attorney can be an advocate. The balance of power so to speak is that the owner is still permitted to hire their own engineer or expert for advice etc.

  15. Joe H
    October 26, 2016 at 12:41 pm #

    As John was going through the presentation, I kept waiting and waiting for an answer to the question that I had on my mind for a while: what is the goal of JS Held in the role they play? And John did answer this in that their goal is to come up with the most accurate estimate of the damages and repairs that they can. They have high integrity in that they do not work for the benefit of any one party, but rather to provide the most complete work from their position, and this was well explained in the 9/11 example provided by Mark.

    My follow question to that is how much does JS Held or other similar companies know about the specific insurance policies held by the owners upon beginning an investigation? Do they need to know how much coverage the owner have so they only have to focus on certain areas of investigation? Or does JS Held conduct their investigations as bias-free as possible knowing what is covered until after their investigation?

    • Shubham
      October 27, 2016 at 8:30 am #

      Logically, I would not work on something that is not going to get repaired by the insurance company. So, the investigator may be informed by the insurance company about the scope, to reduce the billable hours.

      That being said, strategically, the investigator will carry out superficial investigation on those aspects (not insured) if they govern/ are related to the repair of insured damages.

      Moreover, while you are working for the insurance company, you can also be a consultant to the owner and investigate other damages.

      • mkev
        October 31, 2016 at 9:30 am #

        Shubham,
        Normally you can not work for both as that would be a conflict of interest, at least on the same claim. There are some exceptions whereby the insurance company may release you to help the owner in some way but that is not the norm.

    • mkev
      October 31, 2016 at 9:27 am #

      Joe,
      If you take as your goal to find the cost to restore the facility to the condition one minute before the accident event, you don’t need to know the policy. That said, that full cost is not necessarily what the insured is due depending on the policy type and limitations etc. But, that is always calculated as a base case no matter what so that part can be done without a policy. In some cases, the insurance company may ask the Consultant (J S Held or others) to help them determine special categories of costs so that the adjuster or insurance company can determine the final payments due. Code upgrades is one example. J S Held may compute those costs separately at the request of the insurance company because it is in the policy but even that can be done without knowing the specifics of the policy wording.

  16. Mehrzad
    October 25, 2016 at 11:20 pm #

    One important aspect of the job of a forensic engineer as an expert witness is to be unbiased and not comment based on the favor of his/her recruiter (the insurance company, attorney) and, as mentioned in the Structures magazine article, not be too conservative in not recommending rehabilitation or replacement of non-performing elements of the structure, if needed. Inexperienced forensic engineers may wrongfully comment in sole favor of the claimer reinforcing the misconception of the deep pockets and willingness to pay of the insurance companies. This balanced and neutral perspective required in generating a representing report of the actual occurrence by ethical/reliable forensic engineers leads to their decline of a prompt comment sometimes asked by insurer until further investigation of the causes and recommendations is performed. Due to the same reason, most states’ courts (with some exceptions like Missory, Texas, New Jersey) grant immunity to the expert witnesses.

    • mkev
      October 31, 2016 at 9:23 am #

      Mehrzad,
      Reasonable expression of ‘Opinions” usually keeps the expert witness out of the way of follow on litigation. In the event that poor or incompetent advice or options are provided and the insurance company makes a decision on that the insurance company can sometimes be sued for a “bad faith claim”. Such cases are unusual but not completely rare.

  17. philr
    October 25, 2016 at 7:56 pm #

    I was especially taken by the high proportion of losses that have something to do with water. In the forensic world the “water” issue keeps coming up. I have to say, that I am beginning to feel that engineering curriculums probably should have more coursework dedicated to the impacts of water…from mold, to wood rot, to corrosion, to vapor issues in envelopes, to roof leaks, etc. It seems to be a persistent issue.

    • mkev
      October 31, 2016 at 9:17 am #

      Good point Phil. Water in all its forms causes a lot of our building performance headaches.

    • Yingzhe You
      October 31, 2016 at 10:35 pm #

      Phil,

      I agree with you. We definitely need that kind of knowledge or case studies.

      I have read some reports about the damage of buildings under hurricane. The water intrusion is really a big problem. The instant damage including damages of the furniture and carpet is really easy to tell and easy to repair too. But the long term damage such as water penetration into the wall is usually hard to find and with the time passing by, deterioration\mold\corrosion may happen. The walls are more expensive to fix compared to the instant loss due to the water intrusion. And I’ve got a question,do we need to determine whether the envelope is damaged or not after certain cases (hurricane, flood, etc) even though it seems to be in good condition?

  18. Alec B
    October 25, 2016 at 6:02 pm #

    Mr. DiMenno’s talk this morning, tied in with the Structural magazine article, helped to clear up common misconceptions that I had prior to learning about construction consulting/consulting to insurance companies. The Structural magazine article summarizes three of the most common misconceptions about consulting to insurance companies:

    1) “The structural engineer is retained to minimize the insurance company’s claim payment.”
    2) “The insurance company can afford an over-conservative repair designs.”
    3) “The insurance company is engaging a structural engineer to act as their advocate and provide a failure analysis or cause of loss opinion supporting an exclusion or limitation in the insurance contract.”

    To best summarize the article and the main takeaway of Mr. DiMenno’s talk: the consulting structural engineer(s) are brought into the equation to utilize their expertise and knowledge to help attain a fair, justified, and supported outcome for all parties involved.

    I related a lot to this morning’s presentation since I have a lot of exposure to the insurance side of things in the auto body repair business. A lot of comparisons can be made between the two industries. I know in the auto body repair business, it isn’t uncommon for an estimator to miss some damage in need of repair. A lot of times, unforeseen things don’t come up until the repair starts to take place (even though the estimator does his/her best to “cover all bases”). Because of this, supplements are filed to the insurance companies as a way to cover the damage that wasn’t initially included in the estimate. I assume similar things happen in the construction industry. How often are supplements filed to insurance companies for things missed in an initial estimate for repairs? What percentage of the time are they actually accepted and paid for by the insurance company?

    Another question: do insurance companies follow-up with the repairs to make sure what they covered is what is actually repaired or do the insurance companies just pay out what is covered and move on, trusting the contractors with repairing the covered damage from this point forward?

    • mkev
      October 31, 2016 at 9:15 am #

      Alec,
      If you are well over the limits of the policy, they usually just pay and let the owner decide what to do. If under the policy limit, they do monitor the construction and repair. Just like in regular construction, hidden items can be claimed later and added to the claim….say foundation damage that could not be determined until some form of reconstruction takes place. That said, they monitor to make sure the additional claims are fair and reasonable etc.

  19. Yamile R
    October 25, 2016 at 3:29 pm #

    Today’s lecture was interesting, especially JS Held works with appraising and estimating the restoration of a building under failure, and not only investigating the cause; so they go in hand with the other companies we have listened to.

    Regarding the estimation of building collapses and significant failures, I wonder how they get to a final estimation of reconstruction if they are lacking information due to destruction of the building. So if it is not possible to reproduce the exact layout, height and material of a building that it burned down, is it enough an estimate for the insurance companies and owners? How do they manage this situation?

    • Ishan Uppal
      October 26, 2016 at 11:08 pm #

      Hey Yamile,

      I’m sure they refer to the building plans and specifications for the information required to estimate the extent of damage. Much like we are doing with our project.

    • mkev
      October 31, 2016 at 9:11 am #

      Yamile,
      Unless you get a complete burn of all material throughout, there are usually enough clues to get overall dimensional information. From there you have to piece it back together using whatever you have including interviews with the owner and occupants. Keep in mind that if you underestimate a small amount on one space you likely overestimate the next room since overall dimensions can be obtained. Today, you have Google earth and software like that to help you visualize what the facility looked like prior to the accident.

  20. Yemi O
    October 25, 2016 at 12:21 pm #

    Very enjoyable lecture by Mr. John DiMenno. What really struck me in today’s lecture was the manufacturing plant that had the “Galbestos” roofing material.How is the approach in considering buildings that have a failed? Is every detail known and information about the building and its failure collected prior to the site visit?

    I say this because, with regards to asbestos and knowing how harmful it is, it can be very hazardous to be walking around investigating a building that is crawling with it, just to find out about it later on.

    Furthermore, and if I heard correctly, John spoke about how they can only fix what was insured. Are there ways to go around this in a scenario that demands otherwise?

    • Shubham
      October 27, 2016 at 8:17 am #

      Hey Yemi, I believe the investigators do consider their safety before entering the premise. This information can be provided by the owner or they’ll need to find it out on their own background check.

      Answering the second question, the insurance company won’t fix directly anything that is not covered. But, if if it depends on something that is insured, then you got a way to atleast get partially paid for that damage and cut down personal expense.

    • mkev
      October 31, 2016 at 9:08 am #

      Yemi,
      Actually, most of the information comes from the site visit and /or meetings with the owner. Drawings are not often available and even when they are, many buildings are modified or renovated over the years.

      Asbestos is a tricky one. We often discover it or suspect it during one of the early visits. This one was a little different but based on the age of the building there are typical areas to check such as floor tile, pipe insulation etc. Demolition work in those areas are avoided until abatement. Many times the asbestos is in the material and isn’t a huge danger unless it is being released into the air through some form of demolition or investigation using heavy equipment but your point is well taken.

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