What Is a Public Adjuster?

What a Public Adjuster Does

A public adjuster is a licensed insurance professional who works for you, the policyholder. The adjuster does not work for your insurance company. Texas law defines a public adjuster as a person who, for compensation, acts on behalf of an insured in negotiating or settling a claim for loss or damage under a property insurance policy ^[1].

A public adjuster inspects your property, documents your damage, reviews your policy, prepares a claim estimate, and negotiates with your insurance company on your behalf. You hire and pay the public adjuster yourself.

A public adjuster also reviews your policy for coverage you may have missed. The adjuster then presents evidence to the insurer that supports a complete and accurate payment under your policy terms.

States regulate this work because it involves money moving between an insurer and a policyholder. Texas requires every person who acts as a public adjuster to hold a license from the Texas Department of Insurance ^[2]. Most states license public adjusters, though the exact rules differ by state.

A public adjuster is different from a lawyer. A public adjuster adjusts the claim itself. A lawyer handles a legal dispute, such as a lawsuit over a denied claim. Some claims involve both roles at different stages.

A public adjuster usually gets involved after a covered loss, such as a fire, a storm, a water leak, or another event your policy covers. The adjuster does not decide whether your policy covers the loss. Your insurance policy and your state's insurance law decide that question.

You can hire a public adjuster at different points in the claims process. Some policyholders hire one before they file a claim. Others hire one after they receive an initial estimate from their insurer, or after a claim is denied. The services included in the fee may change depending on when you hire the adjuster.

Public Adjuster vs. the Insurance Company's Adjuster

Your insurance company assigns its own adjuster to evaluate your claim. That adjuster works for the insurer. Learn more about this role in our guide to what an insurance adjuster does.

The insurance company's adjuster may be a staff employee or an independent contractor hired for your claim. Our guide on staff vs. independent adjusters explains that difference. Both roles represent the insurance company, not you.

An independent adjuster is a licensed contractor the insurance company brings in during a period of heavy claim volume, such as after a large storm. The insurance company does not employ this adjuster directly, but the independent adjuster still represents and is paid by the insurer, not by you.

A public adjuster represents only the policyholder. You hire and pay a public adjuster, and the adjuster works to document and present your claim to your insurer.

This difference in who the adjuster represents is the main reason the two roles exist. The insurance company's adjuster and your public adjuster can each reach a different estimate for the same damage, because each one works from the interests of the party that hired them.

How Public Adjusters Get Paid

A public adjuster usually works on a contingency contract. You do not pay an hourly rate or a flat fee up front. The contract sets a percentage of your claim settlement as the adjuster's fee. If the adjuster does not recover a payment for you, you typically owe nothing under this type of contract.

The percentage can depend on the size of the claim, the complexity of the loss, and when in the claims process you hire the adjuster. A larger or more complex claim may carry a different percentage than a smaller one, within whatever cap your state sets.

States set different limits on this percentage, and some states set no limit at all. For residential property and condominium unit owner claims, Florida caps a public adjuster's fee at 10% of the claim payment for claims tied to a declared state of emergency, for the year after the declaration ^[3]. After that year, and for claims not tied to a declared emergency, Florida caps the fee at 20% of the claim payment ^[3].

Florida also caps the fee at 1% of the payment when a claim pays out at the full policy limit, and at 0% for any payment the insurer made before you signed the public adjuster contract ^[3]. A separate cap limits compensation on a reopened or supplemental claim to 20% of that additional payment, and a contract covering a reopened claim cannot exceed the other limits in the fee schedule ^[3].

These caps apply to residential property and condominium unit owner claims in Florida. Ask your own state insurance department which caps, if any, apply where you live, and whether the cap depends on the type of property or policy you have.

• Ask for the exact fee percentage before you sign a contract.
• Ask whether the percentage changes if your state issues a disaster declaration while your claim is open.
• Ask whether the fee is based on the full settlement or only on the amount above the insurer's first offer.
• Ask what happens to the fee if you cancel the contract or settle the claim yourself.
• Get the fee percentage and any state fee cap written into the contract itself, not only stated verbally.

Your Rights in a Public Adjuster Contract

Many states give you a window to cancel a public adjuster contract without a penalty. For residential property and condominium unit owner claims, Florida law lets you cancel a public adjuster contract, without penalty or obligation, within 10 days after you sign it ^[4].

Florida extends that window for claims tied to a declared state of emergency. You may cancel within 30 days after the date of loss or 10 days after you sign the contract, whichever period is longer ^[4].

Florida law also lets you cancel without added penalty or fees if the public adjuster does not give you a written estimate within 60 days after you sign the contract, unless the delay was outside the adjuster's control ^[4].

Read the entire contract before you sign it. Look for the scope of work the adjuster will perform, the exact fee percentage, the cancellation terms, and any clause about what happens if you fire the adjuster or settle part of the claim yourself.

A written contract should also state who pays for repair estimates, photographs, and any engineer or contractor the public adjuster brings in. Ask the adjuster to put each of these costs in writing before you sign.

How to Verify a Public Adjuster's License

Every public adjuster must hold a license in the state where they handle your claim. Texas requires this license under Texas Insurance Code Chapter 4102 ^[2]. Each state sets its own licensing rule, so confirm the requirement where you live.

Each state insurance department keeps a public license lookup tool on its website. Use the tool to check a public adjuster's name or license number before you sign a contract.

A license lookup usually shows the adjuster's license type, the license status, and the state or states where the license is active. Some public adjusters hold a license in more than one state, since claims and storm damage do not stop at a state line.

1. Find your state insurance department's website.
2. Open its license lookup or "check a license" tool.
3. Search by the adjuster's name, the firm's name, or the license number.
4. Confirm the license status shows as active, not expired or inactive.
5. Look for any listed complaints or disciplinary action against the adjuster.
6. Call your state insurance department directly if the lookup tool returns no result for the name you searched.

Ask the public adjuster to show you their license before you sign anything. A licensed adjuster can produce this on request. If the adjuster hesitates or cannot produce a license number, do not sign the contract.

Questions to Ask Before You Hire a Public Adjuster

Ask these questions before you sign a contract with a public adjuster:

• Are you licensed in this state? Can I see your license number?
• What is your fee structure, and what percentage do you charge?
• What services are included in that fee?
• How will you keep me informed about my claim's progress?
• Have you handled claims similar to mine?
• Can you provide references from past clients?
• What happens if my insurance company denies the claim?
• What are my cancellation rights under this contract?
• Will you coordinate repairs, or only handle the insurance claim?
• How many open claims are you currently handling at the same time as mine?

When People Hire a Public Adjuster

Hiring a public adjuster is a personal decision. This guide does not recommend hiring one or handling a claim without one.

Some policyholders hire a public adjuster for a large or complex claim, for a claim with many categories of damage, or for a commercial claim with multiple buildings or business-interruption components.

Some policyholders hire a public adjuster after a claim is denied or after they believe a settlement offer is too low. Others hire one because they do not have time to document damage and manage paperwork themselves.

A business owner with a commercial property claim may hire a public adjuster to handle business-interruption calculations alongside the property damage claim. A homeowner with a single straightforward loss, such as a small plumbing leak, may not face the same level of complexity.

Other policyholders choose to work directly with their insurance company's adjuster, especially for a smaller or more straightforward claim. Some policyholders decide a public adjuster's fee would cost more than the value the adjuster adds, particularly on a claim the insurer has already accepted without dispute.

Read your policy and talk with your insurance company before you decide. A licensed attorney can advise you on your specific claim, and your state insurance department can answer general questions about public adjuster rules in your state.

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