Managed Middle: The IA Industry’s Opportunity for Relevance

“The issue I have is not just with SCA, but with all IA’s, my issue is supplement handling. The size of the size and number of supplements.”

This is the feedback coming from insurance carriers and vendor managers in my daily conversations with them. What is the client really saying when they say, ‘their issue is IA supplement handling’? What these clients are communicating is that ‘their issue is with the IA’s ability to manage and control the repair process.’

This common feedback scares the heck out of me as an IA…. and should scare you too! This feedback and critique of the IA industry should be seen by all of us as a “call for urgent action.”

In these next paragraphs, I will explain why this criticism is such a massive threat to the modern IA industry.

SCA Appraisal Company has been in business since 1979 and has been adapting to technology changes from day one. Historically, SCA has done a good job finding growth and advantage with each era’s technological gains for the last 4 decades.

In the last 5 years, Photo Estimating has found traction and permanence in our industry. The Photo Estimating and Desk Appraisal practices have more deeply commoditized and streamlined the minor/outer panel damage estimates and the obvious total loss estimating, conditioning and optioning.

In terms of available assignments, field IA’s have decreasing access to the 35% of estimates that are light/exterior panel inspections, and the 25% of Total Losses where IAA and Copart are providing detailed photos upon vehicle pick up or check-in. This will not change – this is the new normal.

Let’s break down these numbers:

  • 35% of auto claims are light/exterior panel inspections – Photo Estimating Candidates
  • 40% of auto claims are repairable and will likely require a tear down – Repairable Middle
  • 25% of auto claims are not repairable – Total Losses

Breakdown in Auto Claim Percentages

What does this mean to the IA who provides field services? It means that there is 40% of claims that IA’s still are given the opportunity to handle. This is where we as IA’s and IA firms must excel. I call that remaining 40% the “Managed Middle.”

What is the “Managed Middle”?

It is the 40% of auto claims that have damages that can only be seen after tear down where we IA’s, experts in the field, are needed most. The auto claims that are repaired demand that the IA control the repair process by keeping repairers accountable, visible, and honest.  These claims require the appraiser to collaborate heavily between the IA and the insurance carrier, while keeping all other parties informed.

It is these 40% of auto claims that truly require the IA to be an expert at what they do.

Here is my contention, if the auto IA industry is not capable of increasing value in the ‘Managed Middle,’ then the value and relevance of the IA’s in the auto claims industry will continue to diminish.

“If the IA is not capable of increasing value in the, ‘managed middle,’ then the value and relevance of the IA’s will continue to diminish” – Tim Davis Jr.

Adversely, mastering the ‘managed middle’ is where the IA industry will grow in relevance, increase in billing, and bring new value to the carriers and vehicle owners we serve.

“Mastering the, ‘managed middle,’ is where the IA industry will grow in relevance, increase in billing, and bring new value to the carriers and vehicle owners we serve” – Tim Davis Jr.

Supplements and the managed middle are where IA’s bring strategic value to the auto claims industry. Focus on bringing value to the managed middle and you see your business, your relevance, and our IA industry continue to grow.


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