For state insurance officials, the 'p' term is a
Article Courtesy of The Sun Sentinel
May 16, 2018
Shhh. There’s a term state insurance officials
apparently dare not use right now.
That term is “public insurance adjuster.”
Public insurance adjusters are often seen by insurance companies as
adversaries because — unlike regular claims adjusters who work for
insurance companies inspecting damages and working up repair cost
estimates — public adjusters work directly for policyholders and often
challenge estimates by insurance companies’ adjusters.
In a tip sheet presented as a list of “myths” and
“facts” about hurricane insurance released last week, Jimmy Patronis,
Florida’s chief financial officer, avoided using the term even as he
urged policyholders confronted with a claim denial or inadequate claim
payment to “always get a second opinion to verify the cause of loss
and/or the cost to repair or replace the damage.”
Providing second opinions — then helping manage the claim to ensure
policyholders get every dollar to which they are entitled — is what
independent public insurance adjusters do.
They work for a fee or percentage of the claim and, yes, they often work
to the chagrin of insurers who would prefer policyholders accept their
decisions as the last word. Disagreements cost more money — whether they
result in expanding the scope of the repair, or fighting it out in
When it calls for new laws aimed at reducing costly litigation against
insurers, state-owned Citizens Property Insurance Corp. often points out
how much more money claims “with representation” cost the company. Its
description of “with representation” refers to claims in which
policyholders have hired either plaintiffs attorneys or public insurance
Public insurance adjusters are often seen by
insurance companies as adversaries because they work directly for
policyholders and often challenge estimates by insurance companies’
Claims with representation cost Citizens, on average,
three times as much as when customers don’t challenge estimates by
It’s not just Patronis who apparently doesn’t want to be connected to
The Sun Sentinel asked Patronis spokeswoman Anna Alexopoulos Farrar
whether the “second opinion” that Patronis urged claimants to “always
get” was an endorsement of hiring a public adjuster. Farrar responded
with this statement:
“As with any major repair, the CFO recommends consumers get a second
opinion from a licensed contractor or other licensed professional on
repairs made to their home. For example, making sure you are getting the
right types of repairs made, and the appropriate amount of repairs (not
Asked whether her response about getting a second opinion from a
licensed contractor or “other licensed professional” could be
interpreted as advocating hiring a public adjuster, Farrar said “yes”
but again did not include the term in her second response: “Yes it could
include but also licensed professionals like roofers or plumbers.”
Even Erin VanSickle, deputy chief of staff for Florida Insurance
Commissioner David Altmaier — whose office is overseen by Patronis —
refused to use the “p” term when asked whether Patronis’ tips sheet
could be interpreted as endorsing use of public adjusters.
“If a claim is denied or if the claim payment is inadequate to
effectuate covered repairs, a consumer has a number of options to
pursue, including a followup call to a contractor or engineer, the
consumer’s insurance agent, the [Department of Financial Services]
Consumer Services helpline, or other professionals qualified to render
an opinion on coverage or scope of damages,” VanSickle said.
Every occupation has its share of bad apples, and some public adjusters
have been caught committing claims fraud. Insurers also don’t like when
public adjusters solicit business from policyholders by advertising or
canvassing neighborhoods — creating claims where none might have
Earlier this decade, complaints by insurance companies led to new
regulations governing public adjusters, which are compiled on the chief
financial officer’s website.
A database on that same website shows there are about 1,800 public
insurance adjusters licensed in the state of Florida, indicating there’s
plenty of demand for the service they offer.
Paul Handerhan, who is senior vice president for public policy at the
Florida Association for Insurance Reform and a licensed public adjuster,
says the mainstream of the public adjuster industry takes a dim view of
adjusters who canvass neighborhoods, “knocking on doors, saying, ‘I want
to come in and look at your pipes and flooring,’ and incentivizing a
policyholder to file a claim.”
An honest public adjuster will explain to policyholders, before filing a
claim, that they will be responsible to pay a deductible and the public
adjuster’s fee of up to 20 percent of the claim before they receive any
claim settlement check, Handerhan said. An honest public adjuster will
tell the policyholder that an insurance policy isn’t meant to be used as
a home warranty contract, that all claims show up on the insurance
industry’s equivalent of a credit report, and that filing three claims
within 36 months could trigger a non-renewal and make it difficult to
find another willing insurer, he said.
“They’ll tell [policyholders] that they need to be careful about filing
claims,” Handerhan said.
State officials have sided with insurers over public adjusters before.
In 2008, the state Legislature enacted a law barring public adjusters
from soliciting policyholders within 48 hours of a hurricane or other
major event. In 2012, the state Supreme Court overturned the law, ruling
it was unconstitutional and violated free speech.
Responding to a request for comment about Patronis’ tip sheet, Jimmy
Farach, president of the Florida Association of Public Insurance
Adjusters (FAPIA), pointed out that Patronis’ two predecessors didn’t
hesitate to use the words. Farach provided videos of former CFOs Alex
Sink and Jeff Atwater acknowledging the importance of public insurance
“I understand the important place public insurance adjusters have in the
whole scheme of the world of insurance. What would we do without public
adjusters? Where would people go if they had no other place to turn?”
said Sink, speaking at what a Florida Association of Public Insurance
Adjusters spokeswoman said was a “political event” in 2010.
And Atwater, serving as keynote speaker at the association’s 2013 annual
dinner, said: "The work of public adjusting is defined by the noble work
of helping somebody navigate a path they have no way of knowing how to
navigate themselves, and don't believe they can."
Plus, said Handerhan, not all policyholders use public adjusters for
adversarial purposes. Some claimants who have busy work lives find it
worth the fee to hire a public adjuster to handle complicated claims, he
“That can also benefit the insurance company,” he said, “to work with a
public adjuster who understands the terms and coverages in the insurance
contract and has the ability to evaluate damages.”
Here are Patronis’ “myths” and “facts” about hurricane insurance:
MYTH 1: I already have homeowner’s insurance, so everything on my
property is covered and I’m financially prepared for the storm season.
FACT: All homeowner’s insurance policies contain limitations and
exclusions. Also, you may need a separate policy for windstorm or flood
if these coverages are not included in your homeowner’s policy. It is
important to review your policy to understand your coverages and
MYTH 2: When an insurance company denies a claim, or provides an
inadequate claim payment, I must pay out-of-pocket to cover any
additional expenses from damages that occurred to my property.
FACT: You should always get a second opinion to verify the cause
of loss and/or the cost to repair or replace the damage.
MYTH 3: When contractors offer to waive my insurance deductible
to provide repairs at a discounted rate, this is simply a kind gesture.
FACT: Waiving the deductible or providing a discounted rate
directly to you is a form of insurance fraud.
MYTH 4: An Assignment of Benefits (AOB) agreement is the only way
to get immediate assistance for Floridians who have damage to their
FACT: You do not need to sign an Assignment of Benefits to get
your residence repaired, even for emergency repairs. You should make
first contact with your insurance company by immediately reporting the
MYTH 5: Insurance companies can take as long as they want to
respond to an insurance claim filed by Floridians.
FACT: Typically, insurance companies must acknowledge your
insurance claim within 14 days from the date the claim was reported and
they must pay undisputed amounts of your claim within 90 days from the
date of damage.
MYTH 6: If my neighbor’s property is blown into my yard and
damages my own property, my neighbor’s insurance will cover the cost of
FACT: The damage to your property is covered by your own
homeowner’s insurance policy, unless you can prove your neighbor was
negligent, then the damage would be covered under their homeowner’s
MYTH 7: My insurance agent is the only person I need to contact
when filing an insurance claim.
FACT: While you may call your agent, you should immediately
report the claim to your insurance company. Most insurance companies
have a toll-free claim number to report your claim.