By Jeff Gelles - Inquirer Business Columnist

Hurricane-force winds walloped the Jersey Shore that Saturday in mid-March as a nor'easter blew through. Eighty miles inland, Larry Collins' part of Upper Bucks County didn't fare much better, taking torrential rains and gusts near 55 m.p.h.

Collins worried as windows rattled and shingles blew off the house he shares with his 83-year-old mother, Minnie Smith.

Smith was terrified by the storm's fury. Collins was concerned about the damage. One thing neither worried about was the financial effect, even after Collins ventured outside and found rain gutters dangling, the front deck damaged, and an awning partly collapsed.Collins and Smith were protected by their homeowners' policy from State Farm, the company with the "good neighbor" slogan.

But six weeks later - with the awning, deck, and other damage still unfixed - they weren't quite so sure.

For much of that time, Collins and his mother have been at an impasse with State Farm. Their contractor - suggested by State Farm's agent - estimated repair costs of about $12,500. State Farm's adjuster, who visited two weeks after the damaging storm, put the damages at less than half that amount. He cut a check on the spot for $4,132 "and told me several times to get that right in the bank," Collins recalls.

I'd like to report that this case had a happy ending, and that may be where it's heading.

I contacted State Farm spokesman Dave Phillips last week, and within a day Collins got a call from an adjuster who said he was reassessing the claim. The adjuster even gave a last name and phone number - the first time that's happened in half a dozen calls, Collins says.

Phillips told me he couldn't talk specifics, but said the company was looking into the case.

"Our main intention right now is to get the issue resolved," Phillips said Friday. "Our practice at State Farm is to deliver and to pay the right amount - to get a claim resolved and to make sure our policyholder comes first."

I hope that's the outcome. But Collins contacted me in part because he saw last week's column about a new book on the insurance industry and its author Jay M. Feinman, a law professor at Rutgers University-Camden.

Collins asked a reasonable question: Was his case an example of the claims-practices trend identified by Feinman and other industry critics - a trend Feinman summed up in his book's title, Delay, Deny, Defend?

Those critics say that insurers, just like policyholders, face a "moral hazard" - a term referring to the potentially reckless behavior of those protected from its full consequences by insurance.

The moral hazard facing insurers is even more straightforward, Feinman says, and also a matter of incentives: that a dollar saved in claims is a dollar made in profits.

Insurance has a long, venerable history, punctuated by some disturbing episodes. Feinman believes that one has been under way since the 1990s, when Wall Street's press for higher profits led some insurers to revamp their practices at the urging of consultants such as McKinsey & Co.

Essentially, Feinman says the consultants urged insurers to overlook their own moral hazard and turn their claims units into a profit center. He says the result - also fostered by the use of complex computer models to estimate repair costs - is that some insurers systematically lowball claims.

As you'd expect, the large insurers drawing most such criticism, such as Allstate and State Farm, have strenuously denied the accusations. State Farm says it followed key recommendations from McKinsey & Co. only "for a short period of time in the 1990s as a way to go after insurance fraud."

Feinman says there's too little information to say whether State Farm's seemingly lowball offer to Collins or the delays he's faced since are part of larger trends or isolated incidents.

He says a second estimate would have helped, even if Collins acted reasonably in assuming it was unnecessary because he'd hired a contractor recommended by a State Farm agent.

I should note that Collins' contractor, Alex Shelmet, says he was offended by the State Farm adjuster, but calls the experience unusual.

"I've never been questioned like this by an adjuster," says Shelmet, owner of AJ's Home Remodeling & Repairs, of Chalfont. "My prices are very well in line."

So what does Feinman recommend?

First, he says consumers should be better shoppers. Don't just focus on price. Look for whatever comparative data you can find on claims practices and customer satisfaction - and urge your state to make more information available on policyholders' complaints.

Second, recognize there are variations in policies, such as whether a policy covers damage if a sump pump fails or an oil tank leaks. Get an agent who can explain the gaps, and ask if riders are available to cover risks that worry you.

Finally, if bad luck strikes, recognize that slogans like "good neighbor," "good hands," and "on your side" are just slogans, just like that Geico gecko is just a darned cute animation.

"When you have a claim, the insurance company isn't your enemy, but the insurance company isn't your friend, either," Feinman says. "You don't have to assume that what they tell you is accurate with respect to your coverage or how much your claim is worth."

Feinman advises consumers to document damages, familiarize themselves with special rules covering emergency repairs, and be assertive about their rights.

For large claims or complex situations, Feinman also recommends that policyholders get professional help from an experienced lawyer or public adjuster.

Ultimately, Feinman says, state regulators need to work harder to make the market more transparent and help consumers fight bad decisions because moral hazard definitely cuts both ways.

The owner of Anthony and Cleopatra's Catering Hall in New Jersey, submitted a Wind/Rain claim to his insurance company. The insurance company was quick to offer to replace the entire roof and allow for some repairs to the inside of the building. The total settlement was just over $13,000.00. The roof replacement took up most of this settlement. The owner realized that he had to do more repairs than what the insurance company offered, since there was still a musty smell in the building. Most of this catering halls business was weddings. The owner, who owned the building free and clear, was about to take out a mortgage to make the repairs.

A few months later, Brad Johnson, currently a Regional Manager in Ohio, attended a banquet. During the banquet, Brad noticed water damage to the ceiling tiles. He spoke with the owner who told him that he felt the insurance company had paid more than he had expected. The owner agreed to allow the claim to be signed up, since Metro worked on a percentage of the settlement over and above the original settlement. The insured felt as though he had nothing to lose and welcomed the opportunity to have his claim re-opened. Dan Young, the Metro assigned adjuster, was able to successfully re-open the claim. In addition to the original offer of $13,000.00, Dan was able to convince the insurance company to agree to pay an additional $40,000.00. Now the property owner could replace all of the musty smelling carpet as well as replace all of the mismatched ceiling tiles that the insurance company thought was no big deal.

The best news of all was that a few months later, Anthony and Cleopatra's Catering Hall was named the best place in South Jersey to hold a wedding. Thanks to Brad's keen eyes, the owner of the catering hall was able to restore his catering hall the way it should have been.

By MICHAEL W. FREEMAN

FOUR CORNERS | When three hurricanes struck Central Florida in the summer of 2004, causing widespread damage to homes and businesses, there were plenty of stories from angry owners of homes and businesses about lingering battles with their insurance companies over unsettled claims.

There were complaints that insurance claims adjusters, sent out by the insurance agencies to investigate damage claims, too often were simply trying to help the insurance companies avoid paying the claims - or to try to pay out as little as possible.

Adriana Velez, who works in the insurance industry as a claims adjuster, has heard those complaints numerous times. She said the solution for homeowners is simple: hire someone like her to work for them as a public adjuster.

Velez operates Insurance Claims Central Florida LLC, an Orlando-based firm that handles residential and commercial claims. The difference, she said, is that she works as a public adjuster - an insurance claims advocate working for the policyholder, not the insurance company. Her side, she says, "helps level the playing field" in fights over claims.

Public adjusters, she said, are licensed by the state and have the same training as claims adjusters working for the insurance companies. Public adjusters, she said, use their experience to protect policyholders, to negotiate settlements and to push for higher amounts than what the insurance companies may initially offer.

It's a new field, she said, but a growing one.

"This area is very virgin," Velez said. "Not many people know about this."

Velez recently spoke during a meeting of the Four Corners Business Council, a group of business owners who work in fields related to real estate, who meet once per month at USA Vacation Homes at Four Corners' Polo Park subdivision. Velez was invited to the meeting by one of the regular members, Kevin Delaney, owner of Delaney Insurance Group on U.S. 27 in Four Corners.

"What typically happens during a claims process is independent adjusters work on behalf of the insurance companies," Delaney said. "The insurance companies spend a lot of money on these agents, but typically they don't invest a lot in overhead. So they hire independent contractors. The independent adjuster works for the client."

Public adjusters offer a way to balance the scale, Delaney said.

"When you have a public adjuster, that person is committed to your needs," he said. "It's a voice for the insured."

Velez said public adjusters can be used for damage claims related to fires, hurricanes, leaking roofs, sinkholes, cracked tiles, tornadoes, water damage, smoke damage, vandalism, theft, flooding - virtually any and all physical-damage claims on residential and commercial properties.