How to choose a public adjuster and check their license

Check the license with your state insurance department before you talk terms. Then compare at least two adjusters on who will do the work, what the fee is charged on, and how you can cancel.

If you have not yet decided whether to hire anyone, read Do I need a public adjuster? first.

How do I check a public adjuster’s license?

Public adjusters are licensed by state insurance regulators. A card, a shirt logo or a website is not proof.

1. Ask for the adjuster’s full name and license number. In Florida, the Department of Financial Services suggests comparing the license to a government photo ID.
2. Look them up with the state. In Texas, call the Department of Insurance help line at 800-252-3439. It can tell you whether the adjuster is licensed, how many complaints have been filed, and whether the state has disciplined them. Florida has an online licensee search. For other states, the NAIC directory lists every insurance department, and our directory and license check links to each state’s lookup.
3. Confirm the license is their own. United Policyholders, a consumer nonprofit, notes that some people work under another person’s or a firm’s license. Ask to see the individual’s license for your state.
4. Ask about any complaint you find. United Policyholders says one isolated complaint is not a reason to rule someone out. Ask the adjuster to explain it.

What questions should I ask before hiring?

These come from United Policyholders’ list of questions to ask before hiring:

• Will you personally handle my claim, or will someone else take over after I sign?
• How many other claims have you taken on in this area? After a disaster, an adjuster with too many files may not have time for yours.
• How long have you been licensed as a public adjuster, and how long have you worked in this state?
• Can you give me at least three local references from claims you handled in the past three years?
• What is the fee, and is it charged on money the insurer has already paid or agreed to pay?
• Can I still talk to my insurer’s adjuster directly?
• Will your name be on the insurer’s checks?
• If I cancel before the claim settles, what will I owe?

Call the references. Ask whether the adjuster did the work themselves, stayed in touch, and got a better result than the owner expected to get alone.

What must be in the contract?

State law sets the required contents, and it differs by state. The NAIC’s model law, a template that states can adopt, is a useful checklist. It calls for a written contract that shows:

• The adjuster’s full name as it appears on the license, business address, phone and license number.
• Your name and address, your insurer and your policy number.
• A description of the loss and of the services the adjuster will provide.
• The full fee. If it is a percentage, the exact percentage.
• Any expenses you will be charged, listed by type with dollar estimates.
• Both signatures and the dates signed.

The model law also says a contract should not let the adjuster take the whole fee out of the first check, or require checks to be made out only to the adjuster. Texas law goes further. Claim checks must name you as a payee, and a public adjuster may not sign or endorse a check for you.

Your right to cancel should be in writing too:

Florida also requires the cancellation notice to be printed in large bold type just above your signature line. Our contract check tool lists what to look for in your state.

What are the warning signs after a storm?

The NAIC warns that scam artists often arrive quickly after a disaster. United Policyholders says to resist high-pressure sales pitches and not to hire too early. Watch for these:

• Someone at your door during or right after the storm. Texas says public adjusters cannot knock on doors for business during a natural disaster or after 9 p.m. Florida allows solicitation only Monday through Saturday, 8 a.m. to 8 p.m.
• Pressure to sign today. A real claim will still be there next week. You can take time to check the license and read the contract.
• A promised result. The NAIC points out that the insurer does not have to accept a public adjuster’s estimate, so nobody can promise a number. Florida treats a pitch that says filing a claim carries “no risk” as deceptive.
• An offer to pay or waive your deductible. The NAIC model law bars public adjusters from using this to win your business.
• A contractor who says they will handle the claim. In Texas, contractors cannot advertise that, and a public adjuster on your claim cannot be your contractor. In Florida, a contractor needs a public adjuster license to adjust a claim.
• Steering you to one repair company. Texas says public adjusters cannot take referral fees from contractors or attorneys involved in your claim. Florida bars them from paying for referrals, except to another public adjuster.
• No license number, or reluctance to show it.
• A contract that sends claim checks to the adjuster alone.

Can I negotiate the fee?

Yes. United Policyholders says fees are negotiable in every state. The Illinois Department of Insurance says all fees can and should be negotiated. You can ask for:

• A lower percentage, especially on a large loss.
• A fee charged only on money above what the insurer has already offered.
• No fee on additional living expenses, the coverage for hotel and meal costs while you are out of your home.
• A fixed dollar amount in place of a percentage. Texas regulators note you can ask for this.

Some states cap the fee. The cap is the most an adjuster may charge, and you can ask for less. Before you agree to a number, run it through the fee calculator and read how public adjuster fees work.