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Working with Adjusters

To begin, we need to make a distinction between an insurance agent or broker and an adjuster. Your insurance agent or broker is the person that assists you in acquiring an insurance policy. When you have a reason to make a claim, it is your insurance agent/broker that you call first. They can assist you in understanding your policy but they generally do not adjust the claim. An adjuster can be an employee of your insurance company (company adjuster) or an adjusting firm hired by your insurance company (independent adjuster). In either case, the adjuster has the responsibility to:

  • Investigate the claim
  • look for and determine whether there is coverage
  • Explain the coverage to you, the insured
  • Assess the damage and control the cost of the claim
  • Justify all expenditures
  • Protect the insurance company from liability
  • Compares cost of restoration to replacement
  • Determine whether or not outside experts will be needed
  • Properly document the file with pertinent information and organize supporting documentation.
  • Prepare all payments to you the insured and any outside experts utilized to assist in the settlement of the site, and
  • Close the file

    Understanding the claims process will help you in working with an insurance adjuster. There are two types of claims.

    A first party claim means that the insurance policy is your policy and you are the one making the claim. Any payments are made to you, the insured.  In a third party claim, you might be the insured, but someone else is making the claim and will receive the payments, if any. The insurance policy protects you against claims made against you.

    For the most part, adjusters are good people trying to help resolve difficult situations. They have an obligation to you and to the insurance company that they represent. This often means that they are caught in between the insurance company that wants them to control the cost of the claim and you, the policyholder, who wants to be compensated for your damages. Since adjusters see claims everyday, they might appear to lack empathy, but are merely going about the claims process in a business-like manner.

    When working with an adjuster, it is important that you maintain your composure; remain pleasant and do your utmost to be cooperative. Becoming aggravated does not move things along faster. It’s not always true that the squeaky wheel gets fixed first. Always document your conversations and requests, preferably in writing.  When writing letters, be professional and carefully explain your reasoning for your request.

    A word about Public Adjusters (PA)
    Public adjusters are licensed by the state the same as an independent adjuster with the exception that public adjusters are only allowed to work for you, the insured. If you decide to hire a PA, you will be asked to sign a limited power of attorney. That allows the PA to work directly with the insurance company in your behalf. It also means that the insurance company might only talk with your PA and not you. PAs are paid by you out of the proceeds paid by the insurance company. It is not unusual that they will require a 10% fee. In other words, they will get 10% of whatever is paid to you. On occasion, the presence of a PA will also slow down the process of settling your claim.