Loss adjustment
The assignment given by an insurer to a technician to establish the cause, circumstances and amount of a loss, with no adjudicative force.
The 2022 drought in France: several thousand towns recognized as natural catastrophes, a clay shrink-swell bill estimated at about 3.5 billion euros by the Caisse centrale de réassurance, and for every house a geotechnical survey, with boreholes and crack monitoring over several seasons. Settlements take years. Loss adjustment is the assignment by which an insurer asks a technician to say what happened, whether it is covered and what it costs. The adjuster is appointed and paid by the insurer; the report does not bind the policyholder, and a court seized later is bound neither by its conclusions nor by its figures. Many claimants take it for a decision when it is only one piece of the file. The report also sets the reserve booked on the balance sheet, and assessments that run optimistic come back years later as adverse reserve development.
The 2022 drought, declared a natural catastrophe for several thousand French municipalities, produced a soil shrinkage and swelling loss estimated at about 3.5 billion euros by France's state reinsurer, the Caisse centrale de réassurance, after revision (over 3 billion at first count), a record for that peril. Every file calls for an individual geotechnical survey, with boreholes and crack monitoring across several seasons. That is why settlement times are counted in years rather than months.
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