Proof Over Promises: Ethics, Certifications, Documentation &
the Future of Restoration

Alright. Well, I think we can get it underway. Welcome, everyone. I appreciate you joining us for this, Proof Over Promises webinar. I’m fortunate to have, Vince Scarfo with me from the RIA. He is the Director of Advocacy and Government Affairs for the RIA industry. And you’re fortunate to have him as your advocate, I can tell you, with a really good depth of understanding having worked with Fortune fifty organizations with deep resources who are used to advocating government agencies to now be representing the RIA is a huge win. But, Vince, maybe we can start off by asking, why do you care so much about the restoration industry? Well, good afternoon, everyone, and thanks for joining us. Paul and Encircle team, thanks for having me. Listen. I I I I think that’s an easy, I think for all of us, I think for every restorer, that’s an easy answer. Right? And it’s because we’re in the people business. And whether it’s your childhood upbringing, whether it’s the companies you worked for, I I was blessed to work for three Fortune fifty companies that were other than other than GE that did manufacture things, we were we were all service companies, and we were all in the people business. And I have found over my six years in restoration that the people in this industry are phenomenal, always willing to help, always willing to share, just great people. And that’s what excites me every day about the work I get to do and the people I get to work with. Thanks for asking. And I oh, man. You and I have the exact same perspective. In fact, my young daughters and young daughters, they’re they’re 29 and 28, and they work for Encircle. And what the reason why they work for Encircle, they love the customers we serve. Thousands of restorers, and they’re all just awesome people. So great. For decades, the restoration industry has run based on, you know, trust, a handshake, you know, reputation. But now carriers and policyholders and regulators want irrefutable proof. And that’s really the challenge here, and that’s what we’re talking about, in regards to proof over promises. Your word used to be able to get you by. But today, the standard of proof is growing much, much higher, and AI is changing that. We’ll be talking about that in greater detail because it has implications for all of our businesses, and we need to step up. If we do, we help Vince in his advocacy work to support this industry, which is a professional group. So over the next hour, we’ll cover off, you know, adherence to ethics, training, creating complete documentation that backs up your, your skills, backs up why you’re doing what you’re doing, and, of course, helps you become advocates as well to ensure that this professional industry is treated the way it deserves to be treated. Vince, this is a a a pitch for the RIA. Whether you agree with all of the elements of the RIA or not, it’s important that you come together as one voice and one mind to drive this industry forward. You’ve got IICRC standards. Those standards need to be applied across the boards no matter who’s reviewing the file, and you need to be trained on it, and there needs to be consistency. And that’s what some of the things the RIA can do. But our world is changing faster than, you know, faster than we can keep pace with. AI is one of those things driving it, but, also, there’s just a massive change across every industry globally, and trust is in short supply. Mistrust is everywhere. You see that on social media, with government, government relations, in just about every industry. How can you overcome it? So, Vince, let me throw it over to you. Talk to us about the reality shift in the industry. Yeah. So I’m I’ve been very blessed to, in in over the last couple years to get to know a lot of restorers. The RIA, conference every year gives me the ability to interact with thousands of restorers. But but, the work that I’ve done over the years, not only have I been able to meet a lot of local folks, but a lot of lot of folks across the country. And those that I was on a call yesterday with a gentleman who owns a company in New Jersey. He’s third generation. And when he talks about what his grandfather used to do and what his parents used to do in restoration, where they could build a relationship with folks locally, and that was basically good enough. Like, if he if he did if he executed properly and communicated properly, they trusted they trusted him. They trusted his company. They trusted what he what they said they were gonna do. Well, unfortunately, as as all the listeners and viewers know, this is a easy inter industry to get into. Right? You and I, this afternoon, could go to a big box store and buy a few D Hughes and buy a few fans, and we could be in the restoration business. That, in my opinion, has been problematic because they don’t they’re not always trained the way we’re trained, and they’re and they may not follow ethical procedures the way we’ve trained. So even though I may go to a business or a local homeowner and they trust me in that ten minutes, fifteen minute interaction that we had with each other, there’s a whole ecosystem that’s engaged in what we do that is based now on proof. And you’ve gotta be able to document everything that you’re doing. You still have to communicate properly. You have to operate with ethics. And then on top of that, you better dag on be trained in in the work that you’re doing, doing the work on. Yeah. I couldn’t agree more. I’d there we go. Yeah. So so this sort of stamp of approval. Right? The stamp of approval to me means this. In many states now, they are starting they are starting to regulate our industry. So in my own state, for example, they’re now asking restores to be part of, home improvement. So they they set little guardrails. But whether we’re working for a TPA or you’re working under an MSA or an SLA, there are there are qualifications that you have to have. Right? And then the expectation is that you you operate in an ethical manner. Well, I also think that there was a day that I could walk in and people and I could tell people I was ethical. And if I’m a if I’m a if if they perceive that I’m a worthy enough guy, they just trust me. Not any longer. That’s why RIA has created this code of ethics that we have a mantra by which to agree upon that as RIA members, we’re we’re gonna follow this this, this strategy, this philosophy, this way of doing business. And, and that’s what we can go tell folks, what we’re doing as as they’re as they’re trying to make decisions on what restoration companies to use out there. Standards based. Whether you are taking the IICRC training or you’re taking RIA’s training, everything now is based on standards and based on training, and this is a science business. This isn’t, hey. My granddad taught taught me how to do it this way. My dad taught me how to do it this way. My mom taught me how to do it this way. It’s it’s no longer a a folklore brought down from generation to generation. It now has to be done and documented the right way because the people on the other side of the fence from us, the carriers, also are expecting that, and the homeowners and and property owners are expecting that as well. And then well documented, I don’t think I can I can overemphasize that when you walk into the loss, you have got to document from from the moment you walk up to the home to the moment you walk into the property? That is becoming more and more apparent as they are dictating the way this has to be done. And, yeah, as a restorer, you just gotta follow the process. And it it’s it’s it’s not rocket science, but it’s it’s hard to stay consistent. And I’m gonna need my glasses. Scrutiny over expectations. What I would tell you here is, you know, there’s there’s both sides of the fence. Right? There there’s the carrier side that, you know, not necessarily do you have this great onboarding. In many circumstances, they’re gonna give you the MSA and SLA. And you really can’t just go to your teammates and expect in in one in in one sit down, in one education, in a in a classroom within your restoration company that they get it, and they’re off and running perfectly. There’s gotta be quality control built into all that. And then the other side of the the equation here is the expectations now of the policyholder themselves with Paul, you brought up AI a little bit ago. I’m now able to take my policy, drop it into AI, and ask AI, am I covered for all this stuff? We used to at least I’m because I’m an older guy, I used to take my policy, all that paper, and stick it in the drawer and probably never look never look at it and just renew it year after year. Well, now the expectations are different. And I I you know, as as a business owner, you should be savvy enough to know that and and know that you’ve gotta you’ve gotta communicate properly to all people and hold yourself to the highest standards possible. So, you know, RIA survey after RIA survey after RIA survey sort of list these as well. Right? Delayed approvals. If you’re not documented properly, you can run into issues with with delayed approvals. Crew crews have gotta operate exactly the same. I tell this story all the time that when I was in restoration and we would do a multistory building, I would have a crew on floor one and two working and another crew on floor three and four working, and I’d walk down the hallways, and we weren’t consistent with the way we were putting cords to the side and the way we were drying the drywall. And that’s not all my employees. That was on me. I’m the one that need to do I I yes. I could train them in the classroom, but I needed to do quality control work too and and make sure that every day there there was that consistency. So these delays are coming to us because two sides. One, we, as restorers, may not be as consistent as on every single job that we do documenting it properly, communicating properly. And then on the other side of the fence, you you have the carriers that their frontline person might not be trained in all their disciplines as well. Maybe their onboarding process wasn’t as wonderful as it should have been. So because of that, you run into delays. Delays run into late payments. We end up arm wrestling more than what we should. And then you as you as the owner, you’ve got margin pressures. And and I don’t need to tell you as we watch, oil prices go up that there’s cost, additional cost coming at us that, you know, we just can’t recoup as rapidly as we would like to. And it it’s it’s not easy owning a restoration company right now. But to your point earlier, Paul, all of us working together sort of mitigates this as as we have communications with carriers and all the stakeholders in the ecosystem. Okay. So why ethics? Right? We talk we’ve talked about the technical side of this, but we really haven’t got into the ethical side of this. And as we we are, you know, absolutely blessed to have Mark Springer who has led this initiative for, the RIA members, and he has done an outstanding job at bringing carriers to the table where monthly, Mark and a mem and a group of restorers would get together and chat about what are the carriers’ expectations and ethics, what are RIA’s expectations and ethics. And as I got into this, I started looking at some of the greatest brands in the world and and how they treated ethics. And, it is a caveat. It is a pillar of their organizations. And we, RIA, have started treating ethical standards, the code of ethics exactly the same way. This is a this is a foundation pillar of where we are where we are going. I’m not saying that the restorers prior to yesterday weren’t operating in an ethical manner, but Mark has done a really great job with the carriers, with members of the with RIA members at sort of revamping ethics to bring us into this 21st century. Yesterday, I will not tell you the state, but yesterday, I was on a call with the insurance commissioner of a state and her staff. And when I explained to them what we were doing with the code of ethics, they were thrilled to hear that. The proof then becomes in the pudding. Right, Paul? We’re not only do we have to put a code of ethics out there, we would expect the RIA members to to take the training, sign off on the code of ethics, but you’ve gotta get that code of ethics down to all your employees. They’ve gotta understand that. And and, you know, when I was an independent restore in a independent restoration company, we had our own ethical standards, but mirroring what RIA is doing now to what we had is would only have made us better. And I am telling you in the work that I do with regulators and legislators, letting them know that we’ve got a an adherence to a code of ethics has resonated extremely well. It really differentiates us. So, what are we trying to protect? Right? So my role is to safeguard the restoration member. No if, ands, or buts. That’s what I do day in and day out. There are policymakers that are out there that are are creating legislation that impacts the restorer. You as a restoration company yourself have gotta have a you you need to protect yourself as a company. You need to protect your team. You need to have these ethical standards. And then for me, UPS UPS engineer trained me, I always say, and GE sent me to Six Sigma School. For me, everything comes down to a process. And if you take the new code of ethics, implement it within your organization, build a process so that you ensure that it’s being compliant among all your employees, you you stand a better chance to win. And to your point earlier, Paul, we’re all in this together. The more that that all RIA members can rally around this, the better off we’re gonna be. So I love this next quote coming up from Warren Buffett. As I told you earlier, I kinda look at some of the titans and, try to learn from them. You know, it takes 20 years to build a reputation and only five minutes to ruin it. And another quote that I love that he said, which really I find impactful is lose money for the firm, and I’ll be understanding. Lose a shred of reputation, and I will be ruthless. You know, that’s from one of the titans in the industry. And I recall, as an independent, when someone would give us a poor Google review, we would go ballistic internally trying to figure out where did we drop the ball, how could we improve. We got back to every single customer. That shred of reputation, and not only with customers, but even with your subcontractors. These ethical standards have gotta be everything that you do within the entire ecosystem. So I told you a little bit about Mark Springer and and he leading the efforts on behalf of our RIA into the code of ethics. These are the eight pillars that the foundation is built upon. We are in the midst right now. We just made the announcement for those of you that were at the national conference two weeks ago. We just revealed it at the national conference. We are asking all our RIA members to sign off on the code of ethics, to take the training on the code of ethics, which is still in development, should be done sometime late this summer. And then there is going to be a process by which if you find a restorer that is operating unethical, there’s gonna be a governance process by which to report on it. So yesterday, when I was with, this insurance commissioner, the question that got asked to me was, how are you gonna hold people accountable? And, they were thrilled to hear that we are in the midst of finalizing that as Mark and the team have built out the framework for what that’s all about. But listen. I don’t think anyone on this call or anyone watching this webinar is gonna look at one of these and say, no. That’s not what I do today. Right? The question is, do all your people do that? Not just you, the owner, not just you, the leader. Does everyone operate that way? Okay. So, you know, we talked about restoration is not just a trade that has been passed down from your parents to you or a trade that, you know, one of your one of your friends taught you it’s about. This you know, restoration really is about science, and we’ve gotta be doing it the absolute right way. When when I look at what matters and and on the understanding behind this, you know, when I look at water damage, water damage is a, it’s a it’s a physical problem. It’s it’s a problem that has to be dealt with. Fire damage is is a chemistry problem. It’s a problem that has to be dealt with. You need to know how to protect the customer. You need to know you need to have that education by which you have the ability of protecting your customer, the justification that you can stand behind, that you followed, whatever that whatever that standard is. If it’s it’s if it’s the IICRC S500, like, did you follow that process properly? Did you document it properly to justify the work that you did? And not only not only on the back end to justify the work that you did, but do your people know exactly what the expectation of them is, and are you monitoring that day in and day out to justify the work you did? Because at the end of the day, you have to stand behind the invoice that you presented, and you you just, I mean, it only makes sense that it’s gotta be done the right way. Right? The next slide, you know, I you can take a WTR class or or you could take one of our IA’s classes and take it once a couple years ago and then put it on a shelf and never see it again. You can become a triple master and, and never take another CE class again. That’s not that’s not gonna work. In in this day and age, you’ve gotta do continuing education, stay on top of things. Paul, you brought up AI. As you as you as you will articulate a little bit later, technology is is moving at rapid speed in this industry and trying to stay on top of that. You owe it to your employees. You you owe it to your teammates to to continue to develop yourself and develop your teams. Paul, I think Thanks, Vince. Yeah, man. Yeah. I’ll take it over from here, until that you, and I’ll invite you back when your slides come up. But listen. Vince is right. We need to be creating careers for our people within the restoration companies, within your companies, not just jobs. Jobs can be unfulfilling and painful. Careers can be fulfilling and have a positive impact on the industry. And so training is important. Documentation is your game changer. I I see a couple of comments in the chat that talk about, hey. I put in this scope and estimate. It was approved, and then they nickeled and dined me after I wrote it in Xactimate. Documentation and AI properly applied is solving that issue, and I’ll talk to it in a few points in a few moments. But at the end of the day, listen, we all know this. Restoration contractors get paid for what they document, not the work you do. So when you look at, you know, a defensible file, it is a full story start to finish. It’s your photos, videos, notes, floor plan, moisture map with full daily readings, its its contents, its any preexisting damages to the structure, to the contents. And now that sounds like a lot to cover, but it’s a game changer after the fact. So what I always tell restorers is there’s an upfront cost, but I’m gonna tell you the downstream benefits are far greater in higher margins, less work to get paid, lower accounts receivable, and the impact on your business is profound. So documentation helps you better manage your team so that you can upscale and ensure that they’re following your SOPs. But, also, it educates those uneducated folks in the claim review process. And then as we get up further, it may not be people reviewing your your claim file or your your job file. It’s probably gonna be AI, and that’s gonna be arbitrary. And that’s either you win with the facts or you lose without the facts. It it’s gonna be, you know, pretty binary. So there’s two versions to every job. Right? There’s and next slide there. There’s the the version of what actually happened. And as you know, a a mid job can be very chaotic, especially in high capacity events. It’s chaotic. You’re making decisions in real time. You’re moving fast. It’s physical. It’s demanding. People are tired. How do you ensure that you can capture the information to convey all of the relevant facts irregardless of the circumstances. That’s key. Because at the end of the day, and most of you have probably experienced this, where two weeks later, you’re arguing the facts with an armchair quarterback who’s not educated necessarily in restoration work. They’re simply following a list of rules that they will not pay for that is kinda arbitrary, but makes no sense when you compare it to IICRC standards, OSHA standards, and the things that you just have to do to run a profitable shop. The documentation is the piece that overcomes that, and everybody in your organization has to understand it. You need to document as if every file was gonna go through an audit process, either with a human or an AI bot. So if you look at your files, take the last five or ten files, analyze those, and take an honest view and say, what does this file And tell me about this job? If it was the only thing I know or saw about this job, could I make the right conclusion that aligns with your scope and estimate? And if not, those are the areas to improve on. So next slide. The so the risk versus, you know, good work in documentation are unbelievable. Like, it’s night and day. So by cutting corners, not documenting, or documentation being what you do at the end of the job to think that’s what’s gonna get you paid, well, that’s gonna get you elements of the file denied. You’re gonna have to rewrite estimates. It’s it it with the policyholder, it could damage your reputation. But with the adjuster, the more friction points, the less trust, and definitely damages reputation there. And then last but not least, exposure to liability. The reward of doing it right, though, is trust is earned. And the nice thing is that there’s now tools available to help you with that. I’ll use an example here. Our AI scoping tool, it takes all of your documentation, your photos, your videos, your notes, your video inputs when your PM discuss describes the cause of loss resulting damages and work that needs to be done, and we compare all of that. Now it’s run through a proper private rules engine before it even hits a large language model or an AI model because we wanna make sure we’re not exposing any PII or anything that shouldn’t be exposed to ELM, and we wanna avoid hallucinations. But the output is a very clearly articulated scope that will ask your your PM, did you mean to rip out the underpad? Because under the IICRC rules, it says that you should inspect it to possibly dry it in place. These are the recommendations that are needed on every job to ensure your teams are making the right decision, and it’s really training them at the point of where they’re gonna learn the best. These are tactile oriented workers. In the field is where they’re gonna learn the good processes or develop the bad habits that are gonna take you years to unwind. So what that good documentation does is it it protects the policyholder. It protects your company. And by reinforcing IICRC standards, which we also bring in our AI scope and soon to be AI estimating, that now substantiates the work you did and why it has to be done that way, and it’s tougher to hear to refute. And that is applied on day one in your report to the carrier so that it’s up front on day one. We’re not arguing on day seven what IICRC standards were followed or weren’t followed and how that fits into the the estimate. So it’s important that we are focused on developing good SOPs that drive the good documentation. And that right now is the difference between those operators that can weather the cyclicality of the industry and still thrive and have money left over to reinvest in their teams versus those that struggle just to make ends meet. I believe every restorer should be able to run a profitable shop with the right habits instilled within their organization. And so next slide, the rule of technology is critical, but let me throw in a caveat here. And you’re seeing this in the legal industry. There are some lawyers that are building cases using AI. Well, listen. You don’t hire an attorney, or AI is your attorney. You hire an attorney to make good decisions for you. Your customer is not hiring AI to make decisions for them. They are hiring you as a educated restorer to make the right decisions for the optimal outcome. So the proper use of technology needs to be thought through because I hear people or I hear individuals, especially at the RIA conference, that we’re they’re throwing information into a large language model Chat GPT, Claude, you name it. And they’re letting it develop an output and reference IICRC standards. The problem there is it may look right, but when it runs through an audit process, it won’t stand up to scrutiny. The reason being is these large land language models are designed to give you an answer whether it’s right or wrong, and they will reinterpret what the IICRC standards is. Well, there’s no interpretation of this. The standards need to be quoted as what they are and what they’re intended to be without iteration or any sort of, interpretation on top of it. And that’s why we work closely with the IICRC, to make that happen. So what can technology do? Well, number one, let’s be clear. AI is not replacing the restore. Your job is secure, and this industry has lots of runway to grow. Relationships are important. Trust, you’re not gonna, like, trust is just gonna be a fundamental part. And think about us as individuals. Who do when we find somebody, a contractor, a sub trade, somebody that we trust, isn’t it a game changer for us? We don’t have to think about it. We don’t have to do the research. We just trust that they’re gonna operate ethically. They’re gonna charge us the right part price. Right? That feels good. That’s the way people should look at your brand. And documentation, training, and the right processes will help you get there, and you’re not gonna replace that with AI. Empathy. AI is not gonna empathize with policy holders had a loss. No way. They’re they’re gonna rely upon you as the one to come in and understand their circumstances and help them recover, restore their life back to their pre loss condition. And then, of course, the actual work, you cannot circumvent professional work being done. That is just table stakes. And, of course, that’s what’s gonna reduce your liabilities long term. Profitability isn’t just on the on the first, you know, iteration of the job. It’s how how many recalls can you avoid? You know? Can you do the job right the first time without any return work or additional cost? Because, again, this is where restorers get nickeled and dimed and and lose money. So the ethical use of technology. I talked about, you know, restorers using these large language models without constraints, and that’s really dangerous. I’ll I’ll give you one thing one point with the IICRC. They’re they’re not happy that their copyrights are being pushed into ChatGPT and other large language models like the S500. Even the S550 was was put in there, by by somebody. This is against their copyrights and undermines the work that they’re doing because these large language models will interpret this work as hard work that’s been done by individuals. That’s not ethical. And the IICRC, frankly, wants to work with companies like ours and you to ensure that you have access to the standards and can properly apply them in such a way that it backs up the industry and ensures that those regulations are followed, but also honored. And then use of technology honestly. Let’s go back a slide. Using it honestly is listen. The review engines are going to be the AI review engines are gonna look at time stamps, geolocates, and who captured the information. If if you’re fudging the data or putting it in all at the end, it’s not going to help you where you need it, which is substantiating not only the what happened, but why you did what you did. And that’s the part that gets you paid. So we need to use, the technology to substantiate the actual facts when they happen, when the decision was made so that it lines up in a complete auditable file, and then use it to teach. By reviewing the files with your teams on a regular basis, you can cover over where they’re missing, where they’re where their documentation is lacking, and where they can improve. When we launched our AI scoping and there’s a section in there that says, here are the gaps in your file. You don’t have photos for this. Your readings, you don’t have dry standards that are that apply to the readings. You’re missing these elements. We see course correction happening in near real time. We need to use these tools to really uplevel our teams in the field because, you know what, at the end of the day, sometimes they’re tired. And when we’re tired, we forget to do things. Let’s apply technology that actually helps them do it right whether they’re tired or not, whether they have they’re educated at the highest training level or not. We need to make sure that the data is captured in a way that still substantiates the file but also trains the the user to do the job right. And then we use that file as the advocate. A complete file is an advocate for the policyholder. It’s an advocate for you, and it’s also an advocate for the RIA and the IICRC, which back up this industry. Next slide. So why it all matters? Key here is that documentation isn’t paperwork, just paperwork. This is a way to get a win win win. We all know about all the inefficiencies in this industry, the administrative overhead that is just unnecessary because, you know, you squawk about it. I try and solve the problem. The carriers are frustrated by it. There is a win win win here. So number one, carriers get defensible data, and that replaces just abject opinions, which is what you don’t want. For you, the contractor, it protects margins, protects your business and your reputation. And for the policyholder, it builds confidence and trust right from the get go. So with that, let me turn it over to Vince to talk about industry direction and advocacy. Thanks, Paul. You know, industry direction for me, I’m gonna give you I’m gonna give you my perspective from what I’ve seen. When we were at RIA’s conference two weeks ago, I think I reported out that in the first, just shy of four months of the year, we looked at two hundred and sixty one pieces of legislation that had some sort of impact in them specific to what restores do. And and from that, we built, I don’t know, fifty nines fifty nine, sixty one plans on on what our path should be. So from that perspective and from being in a in a number of customer facing meetings, I would I would tell you my vision of where the direction is heading is three primary spaces we’ve already talked about. One is the proof that of of ethics, the the underlying current that you take it down to all your employees and your employees understand exactly how you want them to operate among themselves, among all stakeholders. Two, you’ve gotta be trained in the disciplines that you’re doing the job in. I think those, folks that claim to be restorers that are going out and doing, performing activities that they have not been trained formally trained on, I think, are gonna lose in the long run. I think the rest of us that trained our staffs are doing everything we possibly can. Paul, you brought up SOPs, that we’ve got SOPs in place, that our staffs are following those SOPs, that we run quality control checks to make sure everybody understands what the expectation of them is and that we’re communicating properly with the customer. I think that’s pillar number two as we move forward into this new world. And then lastly, Paul, you’ve been talking about it the last couple minutes is the documentation. No longer do we do we succeed by telling the customer that their place of business is dry or that their home is dry? We’ve gotta have the documentation, the science, and the proof to and the science proof behind it that we did it exactly the right way. So where the industry is heading is in that direction, in my opinion. The other opinion I would give you is, you need to get involved. If if I know how difficult it is. I was I was in probably many of your shoes where, we were fighting hard just to get through every single day, much less me pay attention to what what was happening in my state and what rules and regulations that they were may they were they were creating. But with the work that you’ve all allowed me to do, I see a lot of states trying to make some decisions about how we operate as restorers. And I’m I’m not asking you to call upon your capital houses, but what I am asking you to do is that get on RIA’s website and register you and the members of your team. Because when I pick up the phone from my home in in Maryland and I call a senator in Louisiana, the likelihood that he or she really wants to speak to me is slim to none even though I represent RIA. If I can walk in there and and have you by my side, if you’re from Louisiana, that is much more impactful. So the direction that we’re heading is, I think, it’s no longer the the teams that win are no longer those teams that just do a great job. It’s the team that wins that does a great job and advocates on their on their own behalf. Advocacy for me is twofold. One is, what are you doing for your your employees, your company, and your industry? In every job that you do, you’ve gotta advocate with your employees that you’re doing it the right way. You’ve gotta advocate with the stakeholders that you’re doing it the right way. That’s when I think you put your head on the pillow at night, and you can sleep without any issues, right, when when that is your focal when that’s your focus point. Let’s go to the next slide, and let’s talk about, you know, where this all lies and where the gaps are. I’d really rather speak to the opportunities. Too many jobs handled by memory. I I don’t I don’t know how many folks are out there that are actually just sending crews out and hoping that they remember how to do a job and and not actually going out and making sure they’re trained properly. There are industry standards that exist, and I would tell you that the expectation would be that you’re you are following those industry standards. That is a way to alleviate some of the gaps that you have. In advocacy, you’ve gotta advocate for yourself. And like I said, with your team, with your customers, with the carriers you interact with, with the TPAs you interact with, you you as a team have got to be involved in that. Let me give you a little insight to what RIA has done. They created this position January first of of 2026, so so we are very fortunate. I I don’t mean to blow my own horn, but we’re very fortunate to have someone in that position that is spending their their their time advocating on behalf of RIA. The other thing that RIA did back in 2025 is once every five years, the office of management and budget out of the White House hears petitions for a new North American industry standard classification system code. I know that sounds very long, but we, as an industry, have no trade identification. So as states try to decide what to do with us or the federal government and FEMA decides whether we should be allowed in on a on a a natural disaster, because we don’t have any code, we have zero representation of who we are. There is it’s it’s almost it’s it’s it’s extremely challenging to determine the size of our industry, again, because we don’t have codes. So what we’ve been working really hard in states to do that are trying to determine what to do with restoration is we are trying to get industry identifications by state in hopes that the federal government provides us our own NAICS code, it’s it’s called. But beyond that, we’re trying to we’re trying to do that in at the state level as well. We’ve also joined the National Council of Insurance Legislators that brings legislators together four times a year, and we had a huge win last year where they were able to give us a carve out for the mitigation work that y’all do and not whole and it was a model legislation, so states don’t have to enact that. But it told states that if you are going to build rules and regulations around restoration companies, you must allow them to operate mitigation part of their business as they do today with those with standards in place. So let’s go to the next slide. So advocacy really isn’t a part time job. Like, you like, you you really have to as you sit down with your company, I don’t know if you all do this every year the way we used to do it, but when you sit down in that September, October time frame and you start putting your plans together for next year and bounce it off your business plan and and whether it still fits in, we tip I typically found that it was work it was necessary to make some modifications. I would go into RIA’s website. I would look at the position papers that are in place. I would look at the direction that they’re heading on the legislative side. I would look at the code of ethics, and I would build a plan on how to build this into my business. That way, you protect your employees, you protect your customers, and you do the right thing by your business and our industry. Paul, I I think I think you’re taking us home, buddy. You bet. Alright. Thank you, Vince. And, folks, yes, we’re about to wrap up here and open it up to q and a. But there’s five key things that we wanna take away. That is ethics earns trust, and it’s critical for the sustainable of this industry and your business going forward. I I can’t, you know, overemphasize that enough. And what builds on that is training and and the quality standards that we hold our teams to. And it’s not this is not just in your industry. I’ll tell you in the software industry, with AI playing a critical part, we are in the same boat. We are revamping the knowledge that our teams have and how they apply AI and how they work day in and day out. That’s gonna be within your organization as well. And the better training and the better tools we can provide to the field level to help improve decisions and workflow at the field is gonna mean better margins for you. It’s gonna be mean less friction, higher degree of trust. And then, of course, you’ll be able to work effectively with those AI review systems. And documentation proves the value that you’re bringing, and it tells the what, the why, the how, and it substantiates it with aligned time stamps, geolocates, who captured the information. That metadata that sits behind the documentation you capture is going to be critical to be able to allow that defensible file to flow through the AI review tools. And there’s no circumventing the OSHA standards, the IICRC standards. Carriers can push back on it, but I will tell you that if they build a resistance to those standards within their AI models and review tools, they’re opening up a bunch of liability on their behalf. And I don’t know that they will take that risk. Now there’s a a defensible plausibility that, hey. My my adjuster didn’t know or my reviewer didn’t know when they pushed back on ABC restoration company or pushed back on the standards. But building a system to true to truly circumvent those standards, that’s offside, and I don’t think that they’ll get away with that. So I think and I’m confident that good documentation by you, the restore, is gonna win over in the end, and it’s gonna prove the professional efficacy of this industry. So technology is a multiplier. It amplifies your skills and your ethics, but it is not a replacement for it. Just like you wouldn’t hire AI to be your attorney, nobody’s gonna hire AI to be my restoration contractor. We rely upon your domain expertise. Next slide. So the key, we need to show up as professionals in our work, in our documentation, and in our industry. And as Encircle, my my team and I are committed to your success in these areas. So wherever we can help you on building those SOPs, those documentation workflows, let us know. And like we just launched the AI scoping, which it dramatically reduces the administrative overhead to produce a highly accurate scope with defensible IICRC standards. Right? While still on the job site, You’ll see our AI estimating, which fully backs up and and supports ethical workflows. We’ll be launching in the July time frame. So very exciting tools coming to help you operate more effectively and back up the ethics, the training, the documentation, and the advocacy. We’re going to support you in in in driving this industry because our success depends on your success. So with that, let’s open it up to Q&A. Do we have any questions, Serena, that we think, that come come up first? Yes. Absolutely. Well, thanks so much, Paul and Vince, for, talking about this very important topic. I’ll start with some of the questions that came in through the registration page ahead of time. The first one is the code of ethics keeps rising on the RIA agenda, but with only two thousand members out of sixty thousand plus restorers, it’s an internal standard for a small fraction of the industry. Meanwhile, claim volume is down significantly. Premiums and deductibles are up. Coverage is shrinking, and carriers are coordinating legislation nationwide to handcuff contractors and limit re resources for insureds. Why is an ethics code the front runner over advocacy against the forces that are actually threatening contractor livelihoods? How do yep. Sorry. That’s the end of the question. You want me take that, Paul? You go ahead, Vince. That’s that’s a lot in the question. No. A couple couple points I would make. Why is efficacy front and foremost? I I don’t think it’s anything that RIA or the members of RIA dreamt up. I think it’s customer demand, and RIA and the members of RIA recognize that it’s customer demand, and it is only one of many attributes of a restorer being looked at as the restorer of choice that customers want. That’s that’s one, I would say. Two, two thousand members out of ten thousand members. Yesterday, I was on the phone with restoration companies in Louisiana as we are dealing with legislation down in Louisiana. And one of the gentlemen that owns a restoration company down there said to me yesterday, he’s like, hey, Vince. You know what I can do? I can pick up the phone and call about five or six other restores in the area. I don’t think they’re RIA members, but I can get them to rally around this bill, and I can tell them what RIA is doing because I think it’s wonderful. So I also when I was an independent, I knew restorers that weren’t RIA members. I as I now know better, there’s so much value in just this this webinar that that Encircle and Paul y’all put together that this is the benefit that they get from being a member and and the advocacy piece as well. I think that was all that question. And and if not, that individual can ask me more than I’m more than willing to take an email, and I’m happy to help them. Perfect. Thanks, Vince. The next question we have is how do independent restorers pivot and position themselves for success in the next five to ten years? Paul, you want that? Yeah. I’ll, yeah, I’ll I’ll start with it’s the way you operate. You can’t operate the way you’ve done in the past based on a handshake, and and also your team members can’t operate that way. You have to operate a tight professionalship that is backed up by, you know, really well documented SOPs, good training for your teams, and, you know, exceptional documentation that stands up to the audit, which you need good tools to deliver that, but the tools are there. And with that, you’re gonna build a scalable organization, but one that can to can thrive in this world of AI and automated decision making. I don’t know, Vince, if you had anything more to add to it. You know, I mean, I think the challenge that we that I ran into as an independent versus the big players is when I’d walk into, you know, a company with multiple locations that I really couldn’t service all their locations. But I think it it’s no different whether you’re big or small. To your point, Paul, you gotta do it the right way, and you can’t you can’t assume that it’s being done that way. You’ve gotta walk the floor and make sure your employees understand what a good day for each employee looks like. And and if they do, then I feel as though, at the end of the day, if you if you put your people first, you put a vision to them first and and what their expectations are, I I think you win that way. I think it’s I I don’t mean to simplify it, but people first wins. Perfect. Great advice. And kind of building off of that, the next question is what what safeguards do you personally use to ensure your decisions remain unbiased? I’ll leave that for you, Vince. Yeah. I’ll take that. I I think I think the way you do it is is the way we’re trying to do it. Right? We’re trying to bring the whole restoration ecosystem together, and let’s sit at the table and have a conversation. On the advocacy side, I can say because of the folks that are on this call, you all are the subject matter experts. So when a state has questions about how to regulate our industry, it is wonderful to have RIA members come to the table and sit down and talk with them and talk through the issues and explain from their perspective the way things are done in the real world. It’s no different in our industry than it wasn’t than it is in any other industry. The medical industry is the same way. The the way that they’re regulated by by collaborating together and having these conversations, we come up with better answers. I’m I’m I’m never the smartest guy in the room, and, you know, you gotta surround me with people that can get my brain working. And and then I think collectively, make the best decisions. Yeah. I think I would add to that too. With really good documentation, we can build a lot of case studies and case law that helps us be able to argue the points within the various regulators in each of the states. You need the data. You can’t just have conjecture. Otherwise, you’ll you’ll just get steamrolled by the carriers and others that have deeper pockets. But, again, the facts will speak for themselves. The standards are already set. The OSHA standards are set. The IICRC standards are set. They’re used in the court of law. Now we need to have the documentation that leverages those standards to prove that this industry needs support and support from the regulators. Great. Yeah. Thank you both for the those insights. We have a few more here and about five minutes left. So we’ll try to get to as many questions if as we can. And to any ones we don’t answer, we’ll work on following up with those people afterwards. So the next question, how does RIA differ from IICRC, or do they work together? I I would say RIA is is the group that sets the standards, to Paul’s point that he just articulated. Right? It’s it’s a it’s a it’s a group of men and women that get together that really understand the science behind whatever the discipline is that they’re working on, do a ton of research, and they set the standards. RIA on the other side, we we train on the business side of all of this. We, all all the they’re they’re absolutely our trainings in the disciplines themselves, but we help you manage your company, follow the code of ethics, understand business practices. So, yes, we work closely with one another, but I would say they’re the key differences. Paul, anything different? No. The IICRC sets the standards, but a lot of the standards body is RIA members, active members. So and and they are independent or, you know, part of franchise groups. There’s a good mix there that are building the standards. Perfect. Thank you. The next one, with carrier side AI platforms now benchmarking files within forty eight hours of submission before a human adjuster reviews them, how is RIA thinking about pre submission documentation standards versus post submit submission advocacy? I’ll jump in here, Vince. It’s you you need to be submitting in your twelve hour report full justification for the job. So a full detailed scope is backed up with IAC or c standards, OSHA standards, brings in all of the elements related to hazardous materials, PPE, you name it. It’s gotta be built into that upfront scope of work. And, ideally, what we’re going to get to, you know, in a very short period of time, couple of months, is that’s coupled with an immediate estimate. That really sets the the stage. It says, me, the restorer, as a professional organization, here is my standard of work. And if they refuse to accept that at the early stage, well, that’s where you wanna have that discussion, not after the fact, not post when the job is done on day seven or day nine because that’s always a losing factor. I don’t know if Vince Yeah. The only thing would only thing I would add to that is, do you have a clear expectation with whomever you’re talking to upfront? Right? So in many circumstances, somebody’s gonna hand you an MSA or an SLA. Did you read it? Is it part of your scope of work? Because I I agree with the the question that there are folks on the carrier side or whomever’s determining how you’re gonna get paid that don’t agree with the doc even if you did great documentation, they’re gonna say, no. That’s not the way I need it. I need it this way. Well, if you know exactly what what you’re supposed to give them, there is pushback. You can ask to speak to their boss, or you you can elevate the challenge that you have. Listen. I don’t do everything right every single day either. Like, I’m I miss things myself. So I think if we’re if if we’re civil with one another and somebody challenges you on paying a claim, okay. Why did you challenge me? What what’s the what’s the issue? And then if you know the way what the expectations were and you did it the right way, you’ve got every just cause to push back. Amazing. Easier said than done. I get it. But Yeah. No. Thanks, Vince, for that example. Great. I think we’re just about at time. So, again, any questions we didn’t address, we can follow-up afterwards. No. Just thank you for joining us. And, you know, both from Vince and I, we care about this industry deeply. And, you know, while we may make things seem easy, we know your job is tough. There’s no free lunch for anybody, but you’ve got the opportunity to win, and you’ve got support, behind you. So thank you. I I would say thank you, Paul, to you and your team and the whole Encircle group. I really appreciate you, allowing me to address everyone and and taking the time. My final comment would be this. Don’t sit back and just wait for other people to do it for you. You got we we could use your help. And whether that’s just calling your neighbor that’s not an RIA member and asking them to join, or it’s going to your employees and saying, hey. Would you do me a favor? Key in your address, so that, when we talk to a delegate or a representative, we can represent, our our industry properly. The gentleman that asked the question about two thousand versus ten thousand, hundred percent right. We’re gonna need everybody in this boat together in order to rise the boat for all of us. So I’d I’d ask you just find a half hour next week and just and and take on an action step. Thank you all.