Construction projects face numerous risks, from weather delays and material defects to workplace accidents and structural failures. Few professionals understand these risks as intimately as an insurance adjuster who sees the aftermath of construction claims every day. Josh Zoller, an experienced insurance adjuster featured on the Fine Homebuilding ProTalk podcast, brings a unique perspective to risk management in the built environment. His work involves investigating claims, assessing damage, and determining what went wrong and how it could have been prevented. This article draws on Zollers experience to help builders, contractors, and homeowners reduce risk on their projects while building more resilient structures.
Building code compliance serves as the baseline for risk reduction, but going beyond the minimum requirements often pays dividends when it comes to avoiding claims. Understanding how an insurance adjuster evaluates a property can transform the way you approach everything from foundation choices to finish work.
How Insurance Adjusters Evaluate Construction Claims
When an insurance adjuster like Josh Zoller arrives at a property, they look for a chain of causation. Something caused the damage, and the adjuster must determine whether that cause is covered under the policy, whether it resulted from poor construction practices, or whether it stems from a maintenance issue. This investigative lens is invaluable for builders who want to understand what holds up over time.
The Adjusters Perspective on Common Claims
Zoller notes that water damage accounts for the largest category of construction-related insurance claims. From leaking roofs to failed waterproofing systems, water intrusion is the most common reason homeowners file claims after a construction project. The adjuster looks at several factors:
- Was the water intrusion caused by improper installation or a material defect?
- Did the damage occur gradually over time, indicating a maintenance issue?
- Was the work performed to current code standards at the time of construction?
- Are there signs of pre-existing conditions that should have been addressed?
These questions determine not only whether a claim is paid but also whether the builder bears liability. Zoller emphasizes that proper documentation throughout construction is the best defense against disputed claims. Photographs of each stage, material receipts, and signed approval documents create an evidence trail that protects everyone involved.
What Builders Can Learn from Claim Patterns
Insurance adjusters see patterns across thousands of claims. Zoller reports that certain issues recur with striking frequency: improper flashing around windows and doors, inadequate grading that directs water toward foundations, and poor ventilation in attic and crawl spaces that leads to moisture accumulation and mold growth.
Builders who study these patterns can adjust their practices proactively. Using self-adhered flashing tape at all window and door penetrations rather than relying solely on caulking dramatically reduces the risk of water intrusion claims. Ensuring final grading slopes away from the foundation at a minimum of 1/4 inch per foot over a 10-foot distance can prevent basement and crawl space moisture issues.
Building Envelope and Moisture Management
The building envelope is the primary barrier between interior living spaces and the elements. Zollers adjusting experience has shown that envelope failures cause some of the most expensive claims in residential construction. When water penetrates the building envelope, it can lead to rot, mold, structural damage, and compromised indoor air quality.
Critical Details in the Building Envelope
Window and Door Flashing. Zoller identifies improperly flashed windows and doors as the top source of water intrusion claims in new construction. Each penetration through the weather-resistant barrier creates an opportunity for water ingress. The industry best practice involves a layered approach: building paper or house wrap lapped shingle-fashion over flashing at the sill, with self-adhered flexible flashing tape at jambs and head.
Roof-to-Wall Intersections. Where roof planes meet vertical walls, the potential for leaks multiplies. Step flashing that is properly integrated with siding and counter-flashing is essential. Zoller notes that many adjusters can identify a failure point simply by looking at how step flashing was installed or whether kick-out flashing was used at the base of the roof-to-wall intersection.
Foundation Waterproofing. Below-grade waterproofing is another area where cutting corners leads to expensive claims. Zoller recommends going beyond minimum code requirements, especially in areas with high water tables or expansive soils. The cost of an extra protection layer during construction is negligible compared to excavating and repairing a failed foundation wall after the fact.
A Comparative Look at Moisture Protection Approaches
| Envelope Area | Minimum Code Requirement | Risk-Reducing Best Practice | Common Claim Cause |
|---|---|---|---|
| Window flashing | Caulking or simple drip cap | Self-adhered flexible flashing tape at all four sides | Missing or improperly lapped sill flashing |
| Roof step flashing | Step flashing every course | Step flashing + kick-out flashing at base + ice and water shield underlayment | No kick-out flashing directing water away from wall |
| Foundation waterproofing | Dampproofing coating | Dimpled drainage board + waterproofing membrane + perimeter drain tile | Inadequate drainage leading to hydrostatic pressure |
| Crawl space ventilation | 1 sq ft vent per 150 sq ft | Encapsulated crawl space with vapor barrier and conditioned air supply | Moisture accumulation and mold growth |
Builders who adopt these practices reduce their exposure to claims while building a reputation for quality that can command premium pricing.
Site Considerations and Foundation Risk
The conditions beneath a building are just as important as the structure itself. Zollers adjusting career has shown that many expensive claims originate from site-related issues that were either not identified during pre-construction or were underestimated.
Understanding Soil Risks
Expansive clay soils cause more foundation damage claims than any other site condition. These soils swell when wet and shrink when dry, exerting tremendous pressure on foundation walls and slabs. Zoller notes that adjusters frequently see foundation cracks, uneven floors, and sticking doors and windows in homes built on expansive soils without proper mitigation.
Expansive clay soils require specific mitigation strategies including proper compaction, controlled fill placement, and foundation designs that accommodate soil movement. Deep foundations extending below the active zone of soil movement, such as drilled piers or caissons, can protect structures from the worst effects.
Grading and Drainage
Site grading is one of the most cost-effective risk reduction measures available to builders. Proper grading directs surface water away from the foundation and prevents ponding against basement walls. Zoller points out that many adjusters can spot grading problems immediately by observing where water flows during a rain event.
- Finish grade should slope away from the foundation at a minimum 5% slope for the first 10 feet
- Gutters and downspouts should discharge water at least 5 feet from the foundation
- French drains or swales may be necessary on lots with poor natural drainage
- Surface water should never be directed toward neighboring properties
Weather and Construction Planning
Weather is a constant variable in construction. Builders who plan for weather-related contingencies reduce their risk of schedule-driven errors. Zoller has seen claims where rushed work during inclement weather led to improper installation of weather barriers and inadequate concrete curing. Building realistic weather buffers into schedules and having contingency plans for protecting exposed work during rain events is essential risk management.
Documentation, Communication, and Contractor Liability
The final pillar of construction risk management involves paperwork and communication practices that protect builders when things go wrong. Zoller emphasizes that many adjusters make liability determinations based as much on documentation as on physical evidence at the job site.
Building a Paper Trail That Protects You
An insurance adjuster evaluating a claim looks for evidence that the builder followed accepted industry practices. The following documentation practices create a defensible record:
- Daily logs recording weather conditions, crew size, tasks completed, and unusual observations
- Photo documentation of each construction phase, particularly concealed work before it is covered
- Material receipts and specifications showing that specified materials were used as designed
- Subcontractor agreements that clearly define scope of work and insurance requirements
- Change order documentation signed by the homeowner for any deviation from the original contract
- Inspection reports from third-party inspectors or building officials
Zoller notes that builders who maintain thorough documentation are far less likely to face disputed liability, even when a legitimate defect occurs. The documentation demonstrates good faith and professional practice.
Insurance Coverage for Builders
Beyond building practices, every builder needs appropriate insurance coverage. General liability insurance protects against third-party claims for property damage or bodily injury. Builder’s risk insurance covers structures under construction. Equipment insurance protects valuable construction tools and machinery essential to completing projects on time. Zoller recommends an annual insurance review with a broker who understands construction. Coverage needs change as a business grows or takes on different project types.
Building Codes and Standards
Building codes establish minimum safety standards, but Zollers experience shows that code compliance alone does not guarantee a claim-free project. Codes establish floor-level requirements, while best practices and manufacturers installation instructions often exceed code minimums. Understanding building codes and standards and following them diligently is the foundation of construction risk management.
Zoller encourages builders to view codes as a starting point rather than a ceiling. When manufacturers specify installation methods that exceed code requirements, following those specifications provides additional protection against claims. When a builder can demonstrate work exceeded code requirements, adjusters and juries take notice.
Josh Zollers unique position at the intersection of construction and insurance gives him insights that few other professionals possess. He sees the immediate failures and the human and financial toll they exact. The most successful builders invest in ongoing education, maintain meticulous records, build relationships with qualified subcontractors, and view insurance as a safety net for the unexpected rather than a backstop for poor work. By adopting an adjusters perspective during planning and construction, builders can identify potential claim sources before they become problems.