It is not always necessary to hire a public claims adjuster to deal with your insurance claims, however if you are struggling to sort out an insurance claim yourself then it may be a good idea and it is important to understand how public adjuster fees are structured. The very first step is to decide if you need a claims adjuster for you insurance claim. Whether you simply don’t have the time to work through the time consuming pay out process, or if you feel that your insurance company has offered you less than what you are owed, then it is advisable to get the paid services of a professional public adjuster.
They will deal with every detail of your case; they will learn your policy scheme inside out, assess the damage to your property and negotiate the highest payout that is legally possible for your claim.
A public adjuster does not have any affiliation to the insurance company, and they are only there for your benefit. Therefore, you will be expected to pay for their services.
How Much Does a Public Adjuster Charge?
There are many different ways that a public adjuster can charge fees for their services. They could charge a flat rate, an hourly rate, or quite commonly, contingency fees. You should always remember to settle a fee rate and way of payment with your public adjuster before you enter into any agreements. They should tell you upfront what their rate is and which method they use, this should also be added into your signed contract with the public adjuster. Fees for public adjusters are regulated on the state level and many states have rules and restrictions on when, how much, and the methods allowed, for public adjuster fees charged.
• Flat Rate: If you have a large claim, but it is a very simple case that has a very clear outcome, then your public adjuster may charge a flat fee for the entire process. It is important to ascertain what the fee covers and doesn’t cover, as you don’t want to be caught out by additional costs such as expert opinions and other expenses. This fee should be decided on before the contract is signed.
• Hourly Rate: This is not a common way for public adjusters to charge for their services, however there are some who do practice it. An hourly rate will depend on the state where you are situated, the public adjusters experience and expertise, their operating costs and the type of policy that your claim falls under. An experienced public claims adjuster should be able to tell you how many hours they will have to work on the claim.
• Contingency Fees: This is the most popular way for public adjusters to charge for their services. They will take no direct fee from you, but rather will get a percentage from the overall payout. The amount they charge varies on experience, as well as state regulations. For example public adjusters in Florida are not allowed to charge more than 20% of the final fee in a situation that isn’t declared a disaster, and not more than 10% if it has been declared a disaster. Most public adjusters will charge between 5 and 15%, and this can regress if the amount of money being paid to the claimant increases.
While a large majority of public adjusters are honest and competent at their work, it is still very important to watch out for potential scams. Some people will ask for a deposit before they start work and then leave with your money, others may refer dodgy contractors who may not be the best for the job but they receive referral compensation from, or have financial interest in. In many states, both of these practice methods are illegal.
Whenever you hire a public claims adjuster it is important that you ensure you are getting someone who is honest and proficient at his/her job. It is up to you to have a rigorous interview process, and that you sort out the matter of fees before you sign any contracts.
When Do Public Adjusters Get Paid?
Public adjusters typically get paid when you accept the final offer from your insurance company. After a series of negotiations, the insurance company will present a final offer to you. You can accept that final offer or push for higher compensation.
Once you accept the final offer from your insurance company, the public adjuster will take a pre-arranged cut of the final payout.
In most cases, this is the one and only time the public adjuster gets paid and you do not pay your public adjuster a dime until you receive the final payout from your insurer.
Because of this fee structure, which is most often a percentage of the final settlement, your public adjuster will be extra motivated to push for higher compensation. The only way the public adjuster gets paid is when you, the policyholder, accept a final offer from your insurance company. Until you accept the final payout, the public adjuster receives no compensation.
There are other fee structures and situations where a public adjuster may charge a prearranged fee or hourly rate, as discussed above, but the public adjuster is still usually paid only after a final settlement has been reached.
Many States Prohibit Public Adjusters from Charging a Fee Until the Claim is Settled
In many states, laws prohibit public adjusters from accepting any payment until a claim is settled.
That means policyholders like you enjoy an extra layer of protection. It means you do not have to pay your public adjuster until you choose to accept your insurance company’s final offer. It means you have the power to accept or deny the final claim. If you’re unsatisfied with the final offer from your insurance company, then you can tell your public adjuster to keep pushing for a higher settlement.