When Should You Hire A Public Adjuster?

Some property damage claims are simple and straightforward that you don’t need a public adjuster to help. However, in most cases, you could benefit by hiring one.

Managing an insurance claim can be a time-consuming, cumbersome, complex, and long process. It’s not easy for an inexperienced policyholder to navigate this process. In fact, the mistakes you could make due to your inexperience could end up costing you thousands.

Here are some scenarios where you could benefit from using a public adjuster:

1. There is extensive damage to your property.

The larger the damage to your property, the more substantial is the impact of your inexperience to your settlement. A study has shown that policyholders that used a public adjuster received an average of 574% more than those that did not use a public adjuster. This is an astounding statistic and to your claim, that could mean the difference between receiving a settlement of $100,000 and $574,000.

2. You don’t have the time to manage a claim.

Managing an insurance claim takes a significant chunk of your time. You could be spending countless hours on the phone. If your property suffered extensive damage that resulted in damage to a lot of your personal property, it could take you days/weeks trying to put together a complete inventory of your damaged property. A public adjuster could use a contents specialist to take care of that for you. If you don’t understand the correspondence you received from the adjuster, you could spend more hours trying to research what they mean. You don’t have to spend so much of your time this way only to end up with a settlement less than you would have if you used a public adjuster.

3. Your insurer is not responsive or Your Claim is not progressing.

If your insurer is stonewalling you and you are receiving messages such as “We’re still reviewing your claim” for weeks on end, or “This claim has just been assigned to me and I’ll reach out once I have reviewed it” a month after you reported your claim, your insurer may be stonewalling you. Public adjusters are experts at dealing with insurance companies and will help move your claim along.

4. You think that your insurer’s offer is significantly less than what you need.

Say you obtained quotes to repair the damage, however your insurer’s offer is substantially less. You tried to negotiate your settlement; however, your insurer is insisting that their offer is the best they can do. In this case, you should contact a public adjuster. They can review the damage to your claim and advise whether the offer is fair or if they can get you a much better settlement.

5. You think there’s more damage to your property than the insurer’s field adjuster accepts.

At the start of the claim, a field adjuster comes in to inspect the damage to your property. If you cannot agree with the field adjuster as to the extent of the damage, you should hire a public adjuster. Public adjusters are experienced in determining which damages are caused by the insured event.

6. Your insurer HAS DECLINED your claim.

If your insurer sent you a letter declining your claim, you should get a public adjuster to review your policy, the damage to your home, and the correspondence from your insurer. A public adjuster will be able to tell you if you can rebut a claim denial.

Managing a claim can be extremely stressful, frustrating, and time consuming. If you don’t know what you’re doing, there is a possibility that you’re going to receive a settlement that’s a lot less than what you need and deserve.

A public adjuster is your ally and advocate. Your public adjuster will take the burden and stress involved in managing your insurance claim from you. They will work with your insurance provider to ensure that you receive a claim settlement that returns you to your pre-loss condition and is in accordance with the terms and conditions of your insurance policy.

These are just some scenarios where hiring a public adjuster would greatly benefit you.

If you are considering using a public adjuster to manage your claim, you need to understand how they are paid.

When you hire a public adjuster, you have to clearly discuss the fee structure. There are two that are commonly used:

1. Contingency basis

This fee structure means that your public adjuster will take a percentage of whatever amount they recover for you. The allowable percentage range varies from state to state. The percentage that your public adjuster may charge depends on a number of factors such as: the public adjuster’s experience, the size of the claim, the complexity of the claim, the location of the loss, among others.

Public adjusters in New York, for example, can charge up to 12.5% of the claim.

2. Flat Rate

The flat rate structure is typically used in larger claims where the contingency basis would end up costing the insured more. For example, a $5,000,000 claim in New York, charged at 12.5% means the public adjuster receives $625,000 in fees. When the claim is of this size, you and the public adjuster could agree on a $300,000 flat fee. The fee is decided at the beginning of your arrangement with the public adjuster. You must ensure that the terms and conditions of the fee are clear.

Consider a claim where your property suffered substantial property damage. If you managed the claim on your own, your insurer could settle your claim for $200,000. As mentioned previously, a study has shown that policyholders received on average 574% more when using a public adjuster.

To be conservative, say your public adjuster negotiated your claim at $500,000. This is a $300,000 difference in settlement. Even with a 12.5% maximum public adjuster fee in New York which is $62,500, you still end up with $437,500, which is significantly more than the $200,000 you would have achieved on your own.