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Explaining the Obligations of the Public Adjuster   

https://zalma.com/blog

Most policyholders do not have the in-house capability to investigate,  evaluate, and negotiate significant property insurance losses. While  some losses, such as a small fire loss requiring only minor repairs, may  be dealt with easily, others, which involve more complex damages and  different potential causes of loss, are much harder to assess. Resolving  them may require expertise in understanding the scope of coverage  provided by the applicable property insurance policy, scientific or  other specialized background to determine the cause of a specific loss,  the ability to determine the cost to repair or replace the damaged  property, and the calculation of the amount of a time element (business  interruption) loss.In such cases, the policyholder may wish to engage a  public insurance adjuster (PA). PA\\u2019s are licensed by almost every state  and their contract forms must be approved by the state. 

All PAs claim to be experts on property loss adjustment. Most are. They  represent only policyholders in fulfilling the duty to prepare, file,  and adjust insurance claims. The PA should handle every detail of the  claim, working closely with the policyholder and the insurer to obtain a  prompt and reasonable settlement.  \'PAs invariably charge a contingency fee. When seeking an assignment,  the PA will present the contingency fee to the insured as a fait  accompli. Every person seeking the service of a PA must be aware that  the PA\\u2019s fee is negotiable.  The insured should negotiate with the various representatives of PA  firms who flock to fire and other loss sites, try to obtain the lowest  contingency as possible. Negotiating with a PA is much like negotiating  to buy a vase at an estate sale, one never pays the asking price. If  there are multiple representatives from PA firms seeking to provide  service it is appropriate to play them against each other to obtain a  fair contingency since whatever the PA takes will be funds not available  to repair the property.  For a major loss, more than one PA will arrive at the site seeking a  contract. Rates can be negotiated from a low of 3% to a high of 40%,  although the average charge for a run-of-the-mill loss is 10% to 15%.  When considering a PA, the insured must take into account the skill,  experience and reputation of the firm. The insured must also understand  the fact that even if the insurer pays the full amount of the loss, the  cost of the adjuster\\u2019s fee may not leave enough funds to fully repair  the damaged structure. If the insured is a busy professional his or her  time may be more valuable to the family than the fee paid to the PA who  will take on the arduous task of putting together a complete proof of  loss.  The public adjuster contract is technically an assignment of a portion  of policy proceeds due to the policyholder from the insurer. To protect  the ability to be paid the assignment gives the PA ownership of a  percentage of any claims payments.  Upon being retained, the professional PA will often do nothing until the  three-day cancellation provision most states require be in every PA  contract. Then, whether immediately or after the expiration of the  cancellation provision, the PA should:  Immediately inspect the loss site; meet at the scene with the insurer\\u2019s adjuster to set a scope of loss; analyze the damages; assemble the necessary support for the claim presentation; review the coverage to determine the portions of the loss which are  covered; assess the value of the loss; and negotiate with the insurance company to reach the end result 

 \\xa9 2021 \\u2013 Barry Zalma