Managing Claims Best Practices The key to preventing and managing claims for your home building business.

LONG LIVE HAPPY HOMES®

By: Alison ShortExecutive Vice President of New Home Division2-10 Home Buyers Warranty®

Why managing claims is important

• Customer satisfaction

• Reputation

• Arbitration

4Reduces your risk of going to court

• Saves money

4Court costs and lawyer fees can get expensive

• Put focus back on fixing the issue and avoids escalation

of disputes

Stop them before they happen

#1 Quality control

#2 Have a process in place

#1 Quality Control

When hiring design professionals, consider the following:• Expertise in residential construction

• Check references

• Interview – does their working style match yours?

• Look at other jobs they’ve worked on

• Tell them what you expect

• Listen to their recommendations

Land Planner/Civil Engineer

Architect

Geotechnical Engineer

Structural Engineer

#1 Quality Control

When hiring a Land Planner/Civil Engineer, consider the following:

• Must understand issues that impact the project

• Must be familiar with all land use, wetland

and environmental laws

• May assist with feasibility studies

• May be required to complete environmental impact studies

• May assist in rezoning, as necessary

#1 Quality Control

When hiring an Architect, consider the following:• Make sure they understand your needs and expectations

• Explore different solutions during conceptional design stage

• Select the most promising concepts to develop

• Must be buildable (i.e. Translate well from blueprint to

actual construction) and cost-effective

• Construction drawings should include detailed floor plans and

elevations (with notes), specifications, framing and electrical plans

• Review plans with mechanical trades prior to construction release

#1 Quality Control

When hiring a Geotechnical Engineer, consider the following:

• Oversees placement of all fill soils used to support foundation elements

• Performs soil testing on lots with fill or suspected fill soils

• Critical in areas where expansive, active or other unstable

soil conditions exist

• Determines boring depths and spacing

• Provides sufficient detail and recommendations for the structural engineer

• Builder should retain documentation of all work performed

#1 Quality Control

When hiring a Structural Engineer, consider the following:• Responsible for foundation design in areas with expansive, active or

other unstable soil conditions

• Designs all post-tensioned slabs-on-ground, pier and grade beam and

deep pile foundations

• Inspects critical phases of construction, such as engineered foundation

pre-pour or pile driving operations

• Prepares detailed structural plans for multi-family or complex structures

• Engineers shear walls to withstand seismic and wind loads

• Understands budget constraints, including costs of materials and labor

to complete project

#2 Have processes in place

CONSISTENT CLAIMS HANDLING

Handle each claim the same way to avoid a homeowner

claiming the builder was biased. For example, repairing

one homeowner’s defect, but not repairing another

homeowner’s issue who has the same defect.

#2 Have processes in place

SET EXPECTATIONS WITH HOME BUYERSIt’s also important to let your buyers know the ins and outs

of their new home, post-build. If something goes wrong or

they have concerns, who should they call? How do they

submit a formal complaint?

Proactive communication

Be open and actively listen to the homeowner’s complaints

Be considerate to the homeowner by maintaining goodwill and building trust

Convey information in terms the homeowner will understand

Learn about the products 2-10 Home Buyers Warranty® offers, visit 2-10.com.

LONG LIVE HAPPY HOMES®