These are 5 of the BIGGEST and most Outrageous myths about Public Adjusters that we’ve heard:

1.) PUBLIC ADJUSTERS TAKE A HUGE PORTION OF YOUR INSURANCE AWARD AND DO NOTHING FOR YOU

FALSE: Public adjusters fees are capped by the state on how much they can charge on each claim, and each claim takes a lot of time and effort to process.

During a declared state of emergency, public adjusters in most U.S. states are typically allowed to charge 10% of the total claim on residential claims (note: this does not apply in Louisiana, as the state statutes are significantly different for public adjusting), no matter how time-consuming or complicated the claim is.  Also, the state requires that the fee amount is clearly stated on the contract that both the policyholder and the public adjuster must sign.

While every public adjuster carries a different work ethic, most public adjusters file ALL of the claims paperwork, investigate and scope the property (which includes tons of measurements, photographs and notes), write-up a professional, detailed damage estimate and report, meet with insurance personnel more than once at the property to investigate and discuss, and make innumerable phone calls and emails throughout the process.  A public adjuster’s main objective is to build a case to present to the insurance company on your behalf, and that is a lot of work.

2.) PUBLIC ADJUSTERS ARE CROOKS

FALSE: Public Adjusters MUST be fingerprinted and pass a background check to apply for a license.

Not only are criminal charges frowned upon, but they also lead to a permanent bar from being able to even apply for licensure.  Public adjusters who commit crimes while licensed are punished with revocation of their license, fines, and even jail time, depending on the charge.  Here is a quote from the State of Florida’s website to find out more about the rigorous requirements:

“Persons who have committed certain felonies are permanently barred from applying for licensure. Other felonies and certain misdemeanors require the applicant to wait for a disqualifying period to lapse before applying for licensure. The permanent bar and the disqualifying periods apply regardless of whether adjudication was withheld or an applicant’s civil rights have been restored.
An applicant who has committed a felony of the first degree, a capital felony, a felony involving money laundering, fraud, or embezzlement, or a felony directly related to the financial services business is permanently barred from applying for a license. This bar applies to convictions, guilty pleas, or nolo contendere pleas, regardless of adjudication, by any applicant, officer, director, majority owner, partner, manager, or other person who manages or controls any applicant.” 

3.)  USING A PUBLIC ADJUSTER WILL CAUSE YOUR PREMIUMS TO GO UP

FALSE: Insurance companies are regulated by the state code of ethics which does not allow gauging.

While insurance companies tend to dislike it when you hire a Public Adjuster (because they end up paying out 747% more), they cannot go up on your insurance premium because of that reason. If insurance premiums are raised, it’s usually when many claims are being filed in one small area and the entire region’s premiums will go up, not just yours.

4.)  YOUR INSURANCE CARRIER WILL DROP YOU IF YOU USE A PUBLIC ADJUSTER

FALSE:  Because of the state code of ethics, they cannot drop your coverage to retaliate. While your insurance carrier can choose to non-renew your policy for ANY reason they see fit after your policy period is up, they cannot suddenly drop your coverage because you’ve decided to hire an advocate.  Usually, insurance carriers only drop coverage if you stop paying your premiums or a loss is deemed negligent.
(Example: You fell asleep with a cigarette in your mouth and subsequently burned your house down.)

5.) PUBLIC ADJUSTERS COMMIT INSURANCE FRAUD

FALSE:  Insurance carriers agree to pay the negotiated amount, they are not defrauded. Many are under the impression that Public Adjusters somehow defraud insurance carriers into paying out outrageous amounts of money so that they can capitalize off of it, leaving the poor carrier broken and penniless.  Be sure not to confuse your local agent with the insurance company.  They are not one and the same.  Insurance companies are billion-dollar businesses that don’t want a pity party or your allegiance; they want your business.  Local agents simply sell you a policy and collect premiums for the insurance carrier but are a separate business.
Public Adjusters build a case for the policyholder using state statutes, building codes, and insurance intel and they present it to the insurance carrier.  Then, the insurance company tries to refute the case, much like a trial case.  The two go back and forth, negotiating until a fair settlement is reached.  Once the settlement is reached, the carrier issues payment to the policyholder and the Public Adjuster.  There is no trickery or fraud, and it’s simply that the insurance company sees the loss for what it truly is and agrees to pay what is owed.  No, they don’t like it, but they agree, nevertheless, to pay the proper amount.  Insurance fraud is a serious offense and not many adjusters get away with it.  If an adjuster is found to have committed fraud, they lose their license, pay fines and face criminal charges.  Not only that, but they are NEVER aloud to apply for licensure again.  Most Adjusters are not willing to put it all on the line for a few extra bucks.

The most important thing when considering hiring a public adjuster is to do your homework.  Just like you would for any professional service, you should research reviews of company history and ask for references.  The government study by OPPAGA determined that by hiring a public adjuster, policyholders get a 747% higher claim payout than if they attempt to file a claim alone.  A difference that big, my friends, is worth a little research.  If you have a claim or think you might contact Noble Public Adjusting Group, a leader in the industry.