Types of Adjusters, Vendors, & Claim Representatives
If you’re preparing to file a claim, it’s important to know the different kinds of adjusters, vendors, and other individuals involved in the claim process. Knowing their roles is important when disclosing information and facts about your claim. You want to protect your interests and avoid compromising your claim.
(1) Public adjusters are insurance adjusters who do not work for insurance companies. They work for insureds or property owners in the preparation, presentation, negotiation, and settlement of claims. Insureds sign contracts and agree to pay public adjusters fees based on a percentage of settlements or other methods of compensation (Phoenix Public Adjusting only charges a fee in the event of a successful settlement). Public adjusters must be licensed in the state(s) where they provide services in order to represent their clients’ interests during claims processes. Public adjusters are not attorneys; they do not offer legal services or give legal advice.
Although insureds are not required to use the services of a public adjusting firm, they have the right to use them to prepare and handle insurance claims. Public adjusters cannot solicit business while a loss is ongoing. A public adjuster contract should clearly indicate the fee structure, which the insured acknowledges by signing the contract. The insured pays any fee, salary or commission, not the insurance company.
(2) Company adjusters are insurance adjusters who are direct employees of insurance companies. This type of adjuster represents insurance companies’ interests. They will not and cannot charge fees and may not be individually licensed or tested by the state.
(3) Independent adjusters are the same as company adjusters, except they are third parties that insurance companies use when they are understaffed or don’t have local employees or company adjusters. Insurance companies hire independent adjusters on a contract basis to represent them in the settlement of claims. Independent adjusters will not and cannot charge fees. They must be individually licensed by the state and must work for a licensed firm as well. They are paid by insurance companies and solely represent their interests.
(4) Contractors and Restoration Companies are third party vendors that the insurance companies hire to reduce the cost of claims. They are usually vendors who agree to make required repairs below market value, typically using the lowest quality materials possible. If insureds decide not to use insurance companies’ vendors, their estimates are used to compare to the ones that the insureds provide. In most cases, the insureds’ estimates are higher than insurance companies’ estimates. Most insurance companies pay out based on their vendor’s numbers. It’s a negotiation process; this is where the insurance expertise and claims experience of public adjusters ensure that insureds get the maximum compensation for their losses. Some insurance vendors will try to fool insureds into thinking they need to use them for repair services. Vendors even try to get them to sign contracts for the repairs. Insureds and property owners should contact a firm such as Phoenix Public Adjusting prior to signing any contracts or paperwork for a consultation.
During large catastrophic events, many contractors and restoration companies will solicit insureds and property owners into placing claims on their own. They will make insureds sign contracts to use their restoration companies for repairs. Contractors and restoration companies are not knowledgeable about policy coverages and are only concerned with compensation for their work. Often, many property owners’ claims are compromised because they aren’t fully compensated for coverages that apply to their losses. This happens because contractors or restoration companies are not licensed to actually adjust claims and are not concerned with the other coverages. This could mean a difference of thousands of dollars in compensation. Firms like Phoenix Public Adjusters make sure that insureds are educated and fully compensated. The firm puts compensation funds in the clients’ pockets, giving them control to select vendors based on competitive bids. They have the opportunity to choose the best vendor for the job as opposed to dealing with vendors that have arrangements with carriers to provide the bare minimum in their estimates and repairs in order to minimize the carriers’ payouts.
(5) Attorneys are third party representatives that can represent an insured’s interest; however, attorneys are not insurance coverage experts. Unlike public adjusters, they do not inspect property or prepare estimates. Instead, they rely on hired contractors or estimates of insurance companies’ adjusters! Attorneys are law experts, but not insurance experts. People wouldn’t hire public adjusters to represent them in a court of law, so why would they hire attorneys to represent them on insurance claims? An attorney cannot adjust claims. They are not as familiar with different claims as a public adjuster, who comes into contact with damaged properties and claims on a daily basis. Attorneys usually charge a higher percentage or even by the hour; settlements may be smaller due to unfamiliarity with policy coverages and lack of involvement in the scope and estimate process. Leave the claim handling to the experts; Phoenix Public Adjusting will only charge fees in the event of a successful settlement; no recovery, no fee. There is no need for an attorney unless a lawsuit is filed or until after the initial claim is made and carefully documented by the public adjuster and has been unfairly denied by the insurance company.