What Is a Public Adjuster on a Check?

An insurance claim check is typically issued to a policyholder to cover damages or losses. In some instances, however, an additional name may appear on this check, specifically that of a public adjuster. This arrangement stems from the specialized role these professionals play in representing policyholders during complex insurance claims.

The Role of a Public Adjuster

A public adjuster is an independent insurance professional hired directly by a policyholder to assist in the preparation, presentation, and negotiation of an insurance claim. Unlike adjusters employed by the insurance company, a public adjuster solely represents the interests of the insured. Their primary function involves evaluating damages, documenting losses, and communicating with the insurance carrier on the policyholder’s behalf to secure a fair settlement.

Policyholders often choose to engage a public adjuster when facing significant or complex claims, such as those involving extensive property damage from natural disasters or large commercial losses. Their expertise can be particularly beneficial when a policyholder lacks the time, knowledge, or experience to manage the intricacies of a claim themselves. A public adjuster can also provide assistance if there is a dispute with the insurer regarding the scope of damage or the value of the loss.

Reasons for a Public Adjuster on Your Check

The inclusion of a public adjuster’s name on an insurance settlement check typically arises from the contractual agreement between the policyholder and the public adjuster. Public adjusters generally work on a contingency fee basis, meaning their compensation is a percentage of the final claim settlement. This fee commonly ranges from 10% to 20% of the total amount recovered. The specific percentage is agreed upon at the outset of their engagement and outlined in a written contract.

Insurance companies often include the public adjuster as a co-payee on the settlement check to acknowledge this contractual obligation and protect themselves from potential liability. By issuing a check payable to both the policyholder and the public adjuster, the insurer ensures that the public adjuster’s fee is accounted for directly from the settlement funds. Consequently, the check cannot be cashed or deposited without the endorsement of both the policyholder and the public adjuster, necessitating coordination between the two parties.

Processing a Check with a Public Adjuster’s Name

When an insurance settlement check is issued jointly to you and your public adjuster, both parties must endorse the check for it to be processed by a financial institution. The public adjuster will typically endorse the check first, often at the same time they deduct their agreed-upon contingency fee. After retaining their percentage, the remaining balance of the settlement funds is then disbursed to the policyholder.

It is advisable to maintain open communication with your public adjuster regarding the handling of the check, including when and how the endorsement will occur. Common methods for endorsement include meeting in person to sign the check or, in some cases, arranging for the check to be mailed between parties for signatures. Any discrepancies or concerns about the settlement amount or the fee deduction should be addressed directly with the public adjuster before the check is deposited.