FL Adjuster Claim Professional Exam: Adjuster Duties and Practices
The Adjuster’s Role
An adjuster is an insurance professional retained by an insurer to assist the insured in proving a loss, embodying the insurer’s commitment to good faith and fair dealing.
Key Role: Adjusters resolve claims by determining the loss amount, cause, and settlement value, often navigating complex, ambiguous situations through negotiation and compromise.
Duties and Responsibilities
| Type of Adjuster |
Duties |
| Property Adjuster |
- Help the insured prove the loss to the insurer.
- Explain policy terms and conditions.
- Investigate to identify third-party responsibility for subrogation to recover deductibles or non-covered losses.
|
| Liability Adjuster |
- Protect the insured against third-party liability for accidental torts within the policy’s “occurrence” definition.
- Treat claimants fairly, resolving claims promptly if liability exists, without neglecting duties to the insured.
- Confirm coverage, insured’s liability, and achieve a reasonable resolution for the insurer.
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Example: A property adjuster helps a homeowner document storm damage, while a liability adjuster negotiates with a third party injured on the insured’s property.
Adjusters must act professionally to uphold the insurer’s promise of service, protection, and security, avoiding bad faith conduct that could lead to litigation.
Types of Adjusters
- Staff Adjuster: Employed by the insurer, handles claims directly.
- Independent Adjuster: Contracted by insurers or self-insureds to handle claims.
- Public Adjuster: Represents the insured to maximize claim recovery.
Adjusters must avoid practicing law unless licensed, consulting legal counsel for coverage disputes or legal interpretations.
Claim Investigation Process
Every investigation follows three steps:
- Obtain Information: Gather facts, documents, and details relevant to the claim.
- Verify Information: Confirm accuracy using multiple sources (e.g., catalogs for property costs, medical reports for injuries).
- Analyze Information: Assess consistency, reliability, and need for further investigation.
Example: An adjuster verifies a stolen property list by checking store prices and confirms a claimant’s injury with medical records.
Thorough Investigation Steps
- Read the loss notice and policy.
- Review lawsuits, if filed, alongside policy wording.
- Interview the insured and obtain a recorded statement.
- Interview witnesses and claimants (or their attorneys if sued).
- Inspect the loss scene.
- Collect relevant documents (e.g., police reports, medical records).
- Consult experts (e.g., engineers, lawyers, accountants).
- Advise the insured of coverage decisions or consult management if coverage is denied.
Claim File Documentation
Documentation is critical, enabling transparency and efficiency in claim handling. It includes:
- File notes, letters, reports, photos, and statements.
- Logs of all calls, emails, and actions taken.
A well-documented claim file allows anyone to understand the claim’s progress, supports regulatory audits, and protects against bad faith allegations in litigation.
Types of Reports
| Report Type |
Description |
| Initial/First Filed Report |
Includes insured’s details, policy number, loss date, location, and incident description to set up the claim file. |
| Interim/Status Report |
Completed within 15 days of assignment, then at 30-, 90-, and 180-day intervals, detailing progress and next steps. |
| Full Formal Report |
Notifies insured of final coverage determination; informs third parties of payment decisions without quoting policy language. |
Adjusting Property Losses
Duties of the Insured After a Loss
- Notify police if a law violation occurred.
- Promptly notify the insurer.
- Protect property from further damage.
- Provide inventory of damaged/undamaged property.
- Allow inspection of property and records.
- Submit to questioning under oath if requested.
- Submit a sworn proof of loss within the specified period (e.g., 60 days).
Proof of Loss
A formal statement required by the insurer to assess coverage, including:
- Date and cause of loss.
- Insured’s interest in the property.
- Other parties’ interests.
- Other applicable insurance.
- Damage specifications, repair estimates, and receipts.
Depreciation and Actual Cash Value
Actual cash value = replacement cost - depreciation, considering:
- Physical deterioration.
- Functional and economic obsolescence.
- Effective age and future life expectancy.
Salvage and Restoration
Insureds cannot abandon damaged property. Insurers may opt to repair or replace. Salvage plans prioritize materials and address fire, smoke, water, or odor damage.
Florida Property Adjusting Practices [627.70131 F.S.]
- Acknowledge Claim: Within 7 days of receiving communication.
- Begin Investigation: Within 7 days of receiving proof of loss.
- Physical Inspection: Conduct within 30 days of proof of loss; provide adjuster’s name and license number.
- Estimate Delivery: Send loss estimate within 7 days, with a bold 12-point notice of possible revision.
- Partial Payment Notice: Include a bold 12-point notice with payments indicating ongoing evaluation.
- Pay or Deny Claim: Within 60 days of notice, unless beyond insurer’s control.
Test Your Knowledge!
Question: What are the three basic steps of a claim investigation?
Obtain information, verify information, and analyze information.
Question: When must an insurer acknowledge receipt of a claim communication per Florida law?
Within 7 calendar days.
For Your Review
- Adjusters embody the insurer’s promise, resolving claims with good faith.
- Property adjusters assist insureds; liability adjusters protect insureds and resolve third-party claims.
- Investigations involve obtaining, verifying, and analyzing information.
- Documentation ensures transparency and compliance with regulations.
- Florida law mandates timely claim handling and clear communication.