Hire a Public Adjuster vs a Contractor for Hurricane Ian Help

Below are 2 documents summarizing the differences in roles that a Public Adjuster and a Contractor have when handling insurance claims.
After a major storm it is important for home owners to know who to contact for each part of the recovery process, which can be confusing amid the stress and frustration that storm clean up and repairs can bring.
The documents below are from the Florida Department of Insurance, you can also download and save the documents for your reference below:
WORKING WITH A PUBLIC ADJUSTER
Your Consumer Rights
As a policyholder, you have legal rights when working with a Public Adjuster. It’s important to know your rights and the Public Adjuster’s responsibilities prior to signing a contract.
A PUBLIC ADJUSTER’S ROLE IS TO REPRESENT YOU, THE POLICYHOLDER.
The Public Adjuster can file an insurance claim for you and act on your behalf to settle the claim. The Public Adjuster’s role can also include:
- Assisting with the necessary forms and documents needed to process your claim
- Helping to manage your claim by making sure claim filing requirements are met
- Helping to recover the amount you are owed under your insurance contract
REQUIREMENTS OF A VALID PUBLIC ADJUSTER CONTRACT
In order to be valid, the Public Adjuster contract must be in writing and include specific information such as:
- The full name, business address and license number of the Public Adjuster
- The full name of the public adjusting firm
- Your full name, street address, address of loss if different from your street address, your phone number, if available
- Your insurance company’s name and policy number, if available
- A description of the loss
- The percentage of compensation for the Public Adjuster’s services
- The type of claim (emergency, non-emergency, or supplemental)
- Details regarding your right to cancel the contract and how to cancel the contract
- The signatures of the public adjuster and all named insureds
- The date all parties signed the contract
- The following language in minimum 18-point bold type:
“You, the insured, may cancel this contract for any reason without penalty or obligation to you within 10 days after the date of this contract by providing notice to … (name of public adjuster) …,submitted in writing and sent by certified mail, return receipt requested, or other form of mailing that provides proof thereof, at the address specified in the contract.”
The contract must also include a fraud statement as outlined in Florida Law*, which essentially states that it is a 3rd degree felony for a person to intentionally defraud an insurance company or insurance consumer.
BE SURE TO REVIEW THE CONTRACT PRIOR TO SIGNING.
If the contract does not include all of the required information, the contract is not valid and is not enforceable.
THE PUBLIC ADJUSTER MUST PROVIDE**:
- 48-hour notice if the public adjuster needs access to you in order to schedule a meeting or needs access to your property for an onsite inspection (you may waive the 48-hour notice).
- A copy of the signed contract to the insurance company within 30 days after it is executed.
- A written estimate of the damages for submission as proof of loss to your insurance company within 60 days after the date of the contract. The written estimate must include an itemized estimate of all the repairs, including itemized information on equipment, materials, labor, and supplies.
RIGHT TO CANCEL THE PUBLIC ADJUSTER CONTRACT**
You have the right to cancel a contract with a Public Adjuster WITHIN 10 CALENDAR DAYS after the date the contract is executed.
Your notice of cancellation must be made in writing and sent by certified mail, with a return receipt requested, or another form of mailing that will provide proof to the Public Adjuster at the address listed in the contract.
HOW PUBLIC ADJUSTERS HANDLE CLAIMS**
- A Public Adjuster cannot accept a settlement of a claim unless it is authorized and approved by you.
- Any expenses that the Public Adjuster requests to be reimbursed for (out of the claims payment) must be specified in the contract and signed by all parties. An example of an expense that the Public Adjuster may incur and request reimbursement for could include a contract with an engineering firm to provide a more detailed report of the damage for submission to the insurance company.
- A Public Adjuster cannot make misleading statements when advertising.
- A Public Adjuster cannot ask or encourage you to submit a false or fraudulent claim.
- A Public Adjuster must avoid conflicts of interest and cannot enter into a contract to do both public adjusting and participate in the repair, restoration or construction of damaged property of the same claim.
- A Public Adjuster is only allowed to contact you Monday through Saturday between the hours of 8:00 a.m. and 8:00 p.m.
- A Public Adjuster cannot begin soliciting business from you before 8:00 a.m. or after 9:00 p.m., unless requested by you.
- A Public Adjuster is not allowed to give or offer anything valued at more than $25 to anyone for promotional purposes or to encourage them to enter into a contract.
- A Public Adjuster is not allowed to give or offer anything of value in exchange for allowing an inspection of a residential property owner’s roof.
- A Public Adjuster is not allowed to give or offer anything of value in exchange for filing an insurance claim for damage to a residential property owner’s roof.
- A Public Adjuster is not allowed to give or offer a loan or advance to you as a client or potential client.
- A Public Adjuster is not allowed to obtain salvaged property without your written consent and permission through a signed affidavit
PUBLIC ADJUSTER FEES**
A Public Adjuster is only allowed to charge the following fees based upon the amount of the claim payment they were able to obtain from your insurance company
20% OF THE CLAIM PAYMENT
Applies to new, reopened, and supplemental claims that are not declared by the Governor as a state of emergency.
10% OF THE CLAIM PAYMENT
Applies to hurricane losses and similar losses for up to one year for events that the Governor has declared are a state of emergency. After one year, the public adjuster can then charge 20% of the claim payment.
The Public Adjuster’s fee will be deducted from your claim payment. However, if you received any claim payments from your insurance company prior to signing the contract with a Public Adjuster, the Public Adjuster cannot charge you a fee based on the previous claim payments you received. A Public Adjuster that reaches out to you to provide services for a claim and does not enter into a contract with you, may not charge you for any services related to the claim.
CONSUMER TIPS
Verify the Public Adjuster’s License and Report Unlicensed Activity
Contact the Department of Financial Services’ Division of Insurance Agent and Agency Services at 850.413.3137 or www.MyFloridaCFO.com/Division/Agents/ Licensure
Research the Public Adjuster and Check References Before Hiring
Conduct an online search of the Public Adjuster (PA) and the company the PA works for to read reviews on their work from previous companies. The Better Business Bureau may also have reviews and feedback from consumers on the company.
Ask the Public Adjuster for references and call the listed persons to verify the PA’s work history or experience.
Contact the Department of Financial Services’ Division of Consumer Services at 850.413.3089 to determine if any complaints have been filed against the Public Adjuster.
Review The Contract Before Signing
Cancellation options and a statement regarding false and fraudulent insurance claims must be included in the contract.
The full name, business address, and license number of the Public Adjuster must be included in the contract.
The percentage of compensation for the Public Adjuster’s services must be included in the contract.
Document Accordingly
Keep copies of all correspondence and communication with the Public Adjuster, contractors and insurance company to support your claim.
Maintain an interaction log of both written and oral communication.
There are No Guarantees
The Public Adjuster cannot guarantee you that there will be a quicker claim settlement or that you will receive a larger claim settlement by entering into a contract for their services.
* Sections 817.234 (1)(a)4(b) and 626.8796(1)), Florida Statutes
** Applicable only to residential property and condominium unit owner policies. Section 626.854, Florida Statutes
CONTRACTOR PROHIBITIONS
Please review the scenarios below to determine if a contractor is breaking the law.
PERMISSIBLE | PROHIBITED | VIOLATION |
---|---|---|
Discuss, explain and offer a quote for construction or repair of property | Initiate, negotiate or influence the filing or settlement of an insurance claim on behalf of a consumer | 3rd Degree Felony Section 626.8738, Florida Statutes Section 626.854(15), Florida Statutes Section 626.854(19)(d), Florida Statutes |
Suggest or recommend a consumer contact their insurance company to determine if the repair is covered under their insurance policy | Interpret insurance policy provisions or advise a consumer on their insurance coverages, unless the contractor is also a licensed Public Adjuster | Fine of up to $10,000 and/ or other administrative actions such as license suspension or removal Section 489.129, Florida Statutes Section 489.147(2)(d), Florida Statutes |
Repair or replace damaged property | Enter into a contract to adjust a claim and engage in construction work on the same property | 3rd Degree Felony Section 626.8738, Florida Statutes Section 626.8795, Florida Statutes |
File an insurance claim on a property if an Assignment of Benefits is in place | File an insurance claim without an Assignment of Benefits | 3rd Degree Felony Section 626.8738, Florida Statutes Section 626.854(15), Florida Statutes Section 626.854(19)(a), Florida Statutes |
Discuss or explain a bid for construction or repair of a property | Advertise, solicit, offer to perform or perform public adjuster services, unless licensed as a Public Adjuster | 3rd Degree Felony Fine of up to $10,000 Section 626.8738, Florida Statutes Section 626.854(15), Florida Statutes Section 626.854(19), Florida Statutes |
Include an itemized good faith estimate with an agreement authorizing repairs | Provide an agreement authorizing repairs without also providing a good faith estimate that includes an itemized and detailed cost of services and materials for the repairs | Fine of up to $10,000 and/or other administrative actions such as license suspension or removal Section 489.129, Florida Statutes Section 489.147(2)(e), Florida Statutes |
Provide roof inspection, repair and replacement services | Offer a consumer anything of value in exchange for allowing an inspection of the roof or for filing an insurance claim for damage to the roof | Fine of up to $10,000 and/or other administrative actions such as license suspension or removal Section 489.129, Florida Statutes Section 489.147(2)(b), Florida Statutes |
Provide a notice before entering into a contract for repairing or replacing a roof that contractors cannot offer anything of value in exchange for allowing an inspection of the roof or for filing an insurance claim for damage to the roof | Entering into a contract for repairing or replacing a residential roof without including a notice that the contractor cannot offer a consumer anything of value in exchange for allowing an inspection of the roof or for filing an insurance claim for damage to the roof | Fine of up to $10,000 and/or other administrative actions such as license suspension or removal Section 489.129, Florida Statutes Section 489.147(5), Florida Statutes |
Construct or repair property with a valid license | Construct or repair property without a valid, active license | Up to a 3rd Degree Felony Section 489.127, Florida Statutes |
Must have required insurance including liability, property damage, workers’ compensation (or obtain an exemption) | Construct or repair property without proper insurance | Minimum $1,000 Penalty Section 440.107, Florida Statutes |
Obtain a building permit from local officials, as required | Construct or repair property without the appropriate permit or disregard local ordinances | Up to a 3rd Degree Felony Section 489.127, Florida Statutes |
Construct or repair within the scope of the license, i.e. building, roofing, pool/spa, etc. | Construct or repair outside of the scope of the license | Up to a 3rd Degree Felony Section 489.127, Florida Statutes |
Place a lien on your property for unpaid work – lien rights | Place a lien on a property for paid work | Sections 713.05 and 713.06, Florida Statutes |
Require consumer to pay insurance deductible | Waive an insurance deductible or offer services at no charge for filing an insurance claim | 3rd Degree Felony Section 817.234(7)(d), Florida Statutes |
Provide a Contractor’s Final Payment Affidavit to verify that you have paid all subcontractors and suppliers | Omit providing a Contractor’s Final Payment Affidavit | Section 713.06(3)(d), Florida Statutes |
Advertise construction services to potential clients | Mislead consumers using untrue or deceptive advertisements | Section 626.854(7), Florida Statutes |