What is a Claims Adjuster?
A claims adjuster examines property damage or personal injury claims to help determine the amount of the loss and the insurance company's liability.
| Company adjuster | Independent adjuster | Public adjuster | Contractor |
|---|---|---|---|
| Insurance company employee. | Hired by the insurance company. | Hired & paid by the policyholder. | Does not work as an adjuster. |
| Also known as claims representatives | Not a salaried employee of the company; hired & paid on a contract basis. | Must be licensed. | Hired by the policyholder to prepare an estimate & repair property after a loss. |
| Prohibited from acting as both a public adjuster & a contractor |
Types of adjusters in the claims settlement process
Company adjusters
Company adjusters are individuals employed by the insurance company to handle claims for their policyholders. These individuals are also known as claims representatives. They guide the policyholder through the claims process and determine how much of the loss that the policyholder's insurance policy will cover. Company adjusters are salaried employees of the insurance company.
Independent adjusters
Independent adjusters are independent, professional individuals or organizations that are hired by an insurance company to help settle claims. They market their services to a company and never to a policyholder. They may be involved in investigating, negotiating, and settling claims on behalf of the insurance company. Independent adjusters are not employees of the insurance company. They are hired and paid on a contract basis.
Public adjusters
Public adjusters are individual professionals or part of a public adjusting firm that represents the policyholder during the claims process. They negotiate with the staff or independent adjuster assigned to the claim. Public adjusters exclusively market their services to policyholders. Public adjusters are paid by the policyholder directly, which may reduce the amount of the claim settlement that you receive.
Public adjusters must be licensed, and performing the acts of a public adjuster without a license can constitute insurance fraud. They are also prohibited from acting as both a public adjuster and a contractor.
Contractors
Contractors are independent entities that agree to furnish goods or services to set specifications, at a mutually agreed upon price and by a set deadline, to another independent entity. When it comes to the claims process, after a loss, contractors prepare an estimate for the scope of work needed to repair property and may perform the work to repair your property. There is a conflict of interest when contractors attempt to receive payment as an adjuster and also receive a fee for providing contracting services.
| What contractors CAN DO | What contractors CANNOT DO |
|---|---|
| Approach a homeowner or business owner offering repair or reconstruction services. | Investigate, appraise, evaluate, give advice, advocate on behalf of or assist their customer in adjusting a claim. |
| Offer an opinion to a policyholder as to whether damage is from a storm or other incident normally covered by a homeowner's policy. | Prepare the insurance claim for their customer. |
| Prepare an estimate and scope of work for the loss. | Negotiate the claim with the insurance company on their customer's behalf. |
| Discuss the estimate or scope of work with their customer. | Offer to review the insurance policy or advise their customer on the insurance policy's coverage. |
| Recommend that the policyholder file an insurance claim with their insurer. | Advertise or provide written materials that they can negotiate or investigate a claim on their customer's behalf. This includes advertising to be "claim specialists" or "claim analysts" or any other similar terms, or advertising or claiming that they can "deal with insurance companies" or in any way increase the claim settlement amount for the policyholder. |
| Be present when an insurer's adjuster inspects the damage. | |
| Answer questions the policyholder or the insurer's adjuster has about the estimates. |
Source: Delaware Department of Insurance
Laws pertaining to adjusters and the claims process may vary by state. If you have any questions about your claims settlement process, call your independent insurance agent or insurance company representative.