Special Allocated Loss Adjustment Expenses Overview
Loss Adjusting Expenses (LAE) are normally reimbursed to a Write Your Own (WYO) company and the National Flood Insurance Program (NFIP) Direct Servicing Agent based on the NFIP’s Fee Schedule.
In some cases, a WYO company may experience extraordinary costs in the handling of a claim. When justified, FEMA will reimburse these costs separately as a Special Allocated Loss Adjustment Expense (SALAE).
The Four Types of SALAE
A SALAE is defined as any incurred loss adjustment expense related to a claim that isn’t covered by the standard Adjuster Fee Schedule.
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Type 1 – Expert Expense (Categories: Engineer, Surveyor, CPA, Salvor, etc.) incurred to adjust a specific claim.
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Type 2 – Adjuster Expense, in excess of the applicable NFIP Adjuster Fee Schedule. It is used to establish coverage on a specific claim or to otherwise facilitate the adjustment.
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Type 3 – Litigation Expense incurred to defend a suit within the scope of the Financial Assistance/Subsidy Arrangement (Appendix A Part 62) (Arrangement) brought against the Company on a claim under a WYO policy.
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Type 4 – Cost of Appraisal under the Standard Flood Insurance Policy (SFIP) Appraisal Clause, or cost of examination under oath.
SALAE FAQs
Write Your Own (WYO) Companies, the NFIP Direct Servicing Agent and Vendors should submit requests through PIVOT, FEMA’s system of record.
For technical support, contact fema-nfippivotsupport@fema.dhs.gov.
FEMA will review the request and provide an electronic response. Please ensure the SALAE request form contains all required information to facilitate a timely response.
For guidance on the SALAE processes, refer to the Claims Manual - Section 6 Special Allocated Loss Adjustment Expense (SALAE) Processes
Yes, FEMA approval is required for all SALAE types, regardless of dollar amount.