By William S. Cook
WHAT IS A PUBLIC ADJUSTER?
A public adjuster is educated and trained in the policy issues that effect
the entitlements of a named policyholder on first party property damage
claims. Public adjusters work exclusively to enhance the benefits of a
policyholder. Public adjusters also known as PA's, in many states, are
required to pass stringent certification examinations and attain a surety
bond before the Department of Insurance will grant a license. Attorneys
and public adjusters are the only parties that are allowed by law to represent
and pursue another party's interest on an insurance claim.
WHY IS A PUBLIC ADJUSTER DIFFERENT
FROM ADJUSTER SENT FROM THE INSURANCE COMPANY?
A public adjuster is employed and paid by the policyholder and his/her
fiduciary responsibility and duty must be to the policyholder. The adjuster
employed by the insurance company works for the best interest of the insurance
company, accordingly their responsibility and duty must be to their paymaster.
It is impossible for any insurance adjuster to protect and maximize the
policyholders interests while their paychecks, bonuses, instructions and
future business must come from the insurance company.
WHY SHOULD I RETAIN A PUBLIC
ADJUSTER TO BE PAID WHAT I AM OWED UNDER MY POLICY?
You may consider retaining a public adjuster if the claim has derailed
or you suspect that you will not receive all of the coverage benefits
for which you paid a premium. If the insurance company representative
attempts low-ball tactics by using an insurance industry preferred contractor
or wrongly denies your claim, you may find yourself in the uncomfortable
position representing your interest against an army of experts. They often
try to make you prove that loss coverage exists and the amounts sought
for repairs are justified. The preparation and presentation of the facts
can be complicated, burdensome and time consuming.
The policy requires that the policyholder substantiate
and document their damage. To allow the company's adjuster to compute
your damages seems like a good idea in the early stages. Rest assured
his loyalty is to his paymaster, but he will help as long as he determines
how much and what you will get paid for. This procedure allows the basis
of any dispute or arguments to be from the insurer's perspective. Many
details and variables can be easily overlooked. There is overwhelming
evidence that a majority of policyholders do not receive a proper settlement
without professional assistance. Public adjusters will almost always obtain
much greater settlements than individuals representing themselves or depending
on the representative sent by the insurance company. Most policyholders
lack the education and the skills for evaluating, estimating, and appraising
covered damage. More importantly, they lack the knowledge to deal with
the "ins and outs" of the insurance industry experts. As is true in any
profession, the more experience and training one has acquired the better
Now with all that being said, if the claim is simple,
and gets adjusted and paid in a proper manner and does not severely impact
your financial or physical well-being, the services of a public adjuster
are not required.
WILL I GET A HIGHER SETTLEMENT
IF I USE THE SERVICES OF A PUBLIC ADJUSTER?
Almost always. With a thorough and complete evaluation by a professional
of the applicable coverages that may apply to the individual circumstances
of your claim, the results usually equal higher settlements. The meticulously
attention to the details of the loss are where most public adjusters are
worth their weight in gold. Most public adjusters have computer programs
that allow maximizing the details of the loss and the ensuing increase
in the settlement amount. Having a professional public adjuster, whose
compensation is directly linked to achieving your best settlement, assures
a mutual interest of achieving the full entitlements under the policy.
DO I HAVE TO PAY A RETAINER
OR UP FRONT FEES?
Public adjusters usually work on contingency fees ranging from 10 - 15%
for a normal uncomplicated claim. Fees are not paid until the payment
is collected from the insurance company. The fee structure may encompass
all aspects of your coverages or you may elect to pursue portions of your
claim on your won such as personal property or additional living expenses,
get an agreement in writing to avoid future misunderstandings.
As a general rule the fees charged by an attorney
are much greater than the fees charged by a public adjuster and in nearly
all cases, litigation expenses are enormous and paid by the insured..
Should you elect have an attorney become involved, the information and
services provided by the public adjuster will always enhance the objectives
of the attorney if they are able to work together..
However, you must understand that if an attorney
does get involved after a public adjuster has not successfully brought
a claim to its conclusion, the public adjuster, unless otherwise negotiated,
will have to be compensated. Simply put, be sure to negotiate a written
"Plan B" with your public adjuster if their efforts fail and you are forced
to seek legal remedies against your insurance company.
WHO USES THE SERVICES OF PUBLIC
Public adjusters are used wherever a first party property claim may arise.
All types of businesses and professions, including banks, accountants,
attorneys, and even insurance adjusters and agents consider using a public
adjuster for their personal losses. Once an insured has experienced the
benefits of a claims expert's services, they will rarely attempt to settle
a claim without the consulting effects of a PA. However, as with attorneys,
you need to interview several potential public adjusters before deciding
IF I HAVE A MOLD CLAIM, SHOULD
THE PUBLIC ADJUSTER HAVE AN EXPERTISE IN MOLD ISSUES?
Few public adjusters have seen the necessity of seeking training and expertise
to address the complex issues of mold related losses. Many insurers are
now creating mold teams to respond to the complex issues found in the
recent avalanche of mold related claims. Attorneys for claimants and insurers
are being invited to seminars and classes to become better-informed processors
of mold related losses. Restoration companies are clamoring for certification
as "Mold Remediators". Industrial hygienist and professional engineers
are attending classes to be better informed about the hazards of mold.
It only makes sense to enter the battlefield with the most knowledgeable
representatives working for your best interest. Finding a public adjuster
with the background specialty or enhanced knowledge of mold is rare. Interview
several and select the one that you feel the most comfortable with, that
has an available track record for your review.
WHAT IF MY CLAIM HAS BEEN
DENIED IN PART OR IN TOTAL?
Errors in the application of the policy terms to the circumstances of
your loss can cost you thousands of un-collectable dollars. The insurance
company representative could be misinformed as to the conditions of coverage
afforded by your policy or may wish to be a hero adjuster. An unfavorable
answer provided by a representative from insurers is often considered
by policyholders to be the final authority of an insurance company response
to a reported loss. A public adjuster provides an excellent source to
verify the correctness of questionable coverage calls. Many professional
PA's will review a policy and your circumstances for as little as a one
time fee of $250.00. That policy review could save you from losing thousands
Agent are licensed to sell insurance and they are
not licensed in most states to investigate or deny a reported claim. Lack
of knowledge, lack of a full investigation, lack of time or an unannounced
quota agenda may influence an agent's decisions on your coverage. An agent
may be a long time friend or a new business associate; but he is not he
best person to determine your claim agenda.
CAN A CLAIM THAT HAS BEEN
CLOSED BY THE INSURANCE COMPANY BE REOPENED?
There are some public adjusters that specialize in revisiting claims that
have been concluded. (for up to five years in some states) Absent the
involvement of a public adjuster many of those claims will remain dormant
forever in the warehouse of the insurance company and the policyholder
will never gain benefit of the coverage for which he or she paid a premium.
Legislative rules change as do court decisions on a daily basis, and you
can rest assured that insurers will not be digging through their closed
files to find the cases that might warrant a second look.
S Cook resides in Orlando Florida and has been licensed by departments
of insurance in seven states and the Caribbean to work for insureds. He
currently consults on water intrusion/mold losses on a national basis.
He has worked for and against insurers for over thirty years. He has been
involved with environmental issues since 1990. He is the vice president
of the Florida Association of Public Insurance Adjusters and a member
of the American IAQ Council. His hobbies include researching court cases
involving insurance claims and their resolutions.
Policyholders of America ("POA") rarely recommends
public adjusters. There are a few, however, who have proven to be knowledgeable
and reputable. POA will provide names of those public adjusters to members
who request such information.