Do I Need a Public Adjuster for an Insurance Claim?

Navigating property damage and the complexities of insurance claims can be challenging. Understanding the various roles involved in assessing damage and negotiating settlements is important when seeking appropriate compensation. This article explores different types of adjusters and clarifies when engaging a public adjuster might be beneficial.

Understanding Adjusters

When property loss occurs, several types of adjusters may assess damage and determine the insurance company’s liability. Understanding each adjuster’s allegiance is fundamental to the claims process.

Company adjusters

Company adjusters are direct employees of an insurance company, representing the insurer’s financial interests. They investigate claims, evaluate damage, and determine the payout based on policy terms. Their focus is on settling claims efficiently.

Independent adjusters

Independent adjusters are third-party contractors hired by insurance companies, often during high claim volume periods. They work for the insurer, assessing damage and determining liability under policy terms. They provide an evaluation to the insurance company to determine the claim amount.

Public adjusters

Public adjusters are licensed professionals who work exclusively for the policyholder, advocating for their interests in negotiating claims. They have no relationship with the insurance company and are compensated by the policyholder, typically through a percentage of the final settlement. Their objective is to ensure a fair settlement according to policy terms.

When a Public Adjuster is Beneficial

Hiring a public adjuster can be advantageous in situations where the policyholder may feel overwhelmed or disadvantaged. One scenario is with large or complex claims, such as extensive fire, hurricane, or significant structural damage. These losses involve intricate details, hidden damages, and substantial repair costs requiring specialized knowledge to document and value.

Public adjusters are also beneficial when a claim has been denied or significantly undervalued by the insurance company. They can review the initial assessment, identify discrepancies, and negotiate for a higher payout by presenting additional evidence and reinterpreting policy language. They are also helpful when the policyholder lacks the time, expertise, or emotional capacity to manage the claim process. The claims process can be time-consuming and demanding, involving extensive paperwork and communication, which a public adjuster can handle.

If there are disputes over coverage, the cause of damage, or the extent of the loss, a public adjuster can provide expertise to challenge the insurer’s position. They understand policy nuances and can advocate for the policyholder’s rights, leading to a more favorable outcome than if negotiated alone. Policyholders who feel outmatched by the insurance company’s resources or who are offered a quick, potentially low settlement may find a public adjuster’s advocacy valuable.

How Public Adjusters Operate

Once engaged, a public adjuster undertakes a process to represent policyholder interests and maximize settlement. The process begins with an initial consultation and a thorough assessment of the property damage. This includes documenting all visible and hidden damages through photos, videos, and detailed lists.

Following the initial assessment, the public adjuster conducts a review of the policyholder’s insurance policy to understand coverage limits, exclusions, and requirements. They then prepare detailed estimates for repairs and replacement costs, along with a proof of loss statement, a formal demand for payment submitted to the insurer. This documentation substantiates the claim and is presented to the insurance company.

Negotiation with the insurance company’s adjuster to reach a fair settlement is a significant part of their operation. Public adjusters act as the primary liaison, handling communications, paperwork, deadlines, and disputes. Their goal is to secure the maximum compensation possible under the policy, often resulting in higher payouts for policyholders.

Public adjusters are typically compensated through a contingency fee, a percentage of the final settlement. This percentage can range from 5% to 20% of the settlement, with some states capping fees, especially after a disaster. This structure motivates them to achieve the highest possible settlement, as their payment increases with the amount recovered.

Factors to Consider Before Hiring

Before engaging a public adjuster, policyholders should conduct due diligence to select a qualified professional. Verify the public adjuster’s license and credentials with the appropriate state regulatory body. Most states require licensing, and checking their status confirms legitimacy and adherence to professional standards.

Check references and reviews from previous clients to gauge experience and satisfaction. Understand the contract, which should outline the scope of services, fee structure, and payment terms. Confirm whether the percentage fee applies to the entire settlement or only to the increased amount secured.

Establish clear communication expectations, including update frequency and main point of contact. Recognize that while a public adjuster can improve the chances of a fair settlement, they cannot guarantee a specific outcome or an amount exceeding policy limits. Their role is to advocate for the maximum possible under existing policy terms.