Much has been said about unsavory advertising by public adjusters (PA’s), and…much has been done about it in Florida statutes, including provisions recently enacted in SB-408. However, statutory language falls short requiring full disclosure for institutional advertising that I call, “advertorials”–public service ads that use consumer advice to mask promotion of public adjusters or a public adjuster.
Each hurricane season it seems like the newest president of the Florida Association of Public Insurance Adjusters (FAPIA) publishes an ad that includes advice on how to protect property and file a claim; and then, directs consumers to call public adjusters or consult the website of FAPIA. Current FAPIA president, Pat Cuccaro, did so in a recent ad which, like those of his predecessors, omitted important facts including the typical PA cost arrangement.
Since homeowners’ insurance premiums already include the costs of claim service and post-claim consultation, hiring a public adjuster often results in paying “again”; especially the vast majority of situations when the hiring of a PA is unnecessary to receive fair payment.
After a loss, one of the first things a policyholder can do is call their insurance agent. Many are “independent” and, while appointed by carriers, they hold licenses which include state-sanctioned authority to adjust claims and assist policyholders in receiving their money. Of course, agents are appointed by the carrier and can’t adjust claims without permission, but…they are prohibited from charging additional sums for helping customers with claims and their locally-owned business and livelihood is based on customer satisfaction. I have personally had agents help me with a claim and even liaison with the carrier on my behalf.
Also, I have personally sought and received insurance claim assistance from the state of Florida. Hundreds of others do this every year and it includes a full mediation hearing which can often result in a higher payment. This assistance, as well as that generally provided by the state Insurance Consumer Advocates office has also already been paid for (via taxes) and is easily accessed by dialing 1-877-693-5236 (877-my-fl-cfo). This important information about “free” assistance did not appear in Mr. Cuccaro’s “advertorial” which, again, made it appear as though calling a public adjuster was the first, and perhaps only, option. He said…
“….print out contact information for public insurance adjusters in your area that you can quickly contact in case damage occurs. Public adjusters are licensed by the state of Florida to represent and protect insured consumers during the often time-consuming and tedious process of filing an insurance settlement.”
Likewise, Cuccarro never mentioned calling a lawyer. In some instances, the services of a qualified, duly licensed attorney can be helpful and their fees are usually recouped from the insurer.
Public adjuster fee’s, on the other hand, are taken directly from the consumers claim payment and can be as high as one-fifth (20%) of the total needed to make repairs; another fact Cucarro failed to mention.
In essence, those who pay public adjusters, pay three times—once to the insurance company who has contracted with the local agent (and sometimes an independent adjuster) to assist and service policyholders; once to the state of Florida for the Insurance Consumer Advocate and the consumer helpline, and then; again, when a public adjuster receives the claim check from the insurer and subtracts his or her fee before passing it on.
The legislature recognized the serious nature of the typical PA compensation arrangement when it changed the law regarding Citizens claims. With Citizens, the maximum percentage is now 10% across the board and applies only to the additional amount recovered by the PA. This makes sense to consumers who want what they deserve regardless of whether they hired an attorney, a PA or utilized the free services of the state.
To be completely accurate, “Advertorials” need to at least mention that the client fee for a Public Adjuster comes out of the consumers claim payment. In fact, assuming Mr. Cucarro is a licensed public adjuster who would like to receive calls from a consumer as a result of his advertorial, some assert his ad should have included the following statutorily mandated statement:
THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU MAY DISREGARD THIS ADVERTISEMENT.
I’ll let others opine on whether any public adjuster advertising laws were broken (click here to review such laws). In the meantime my advice to consumers is; if you have a loss covered by an insurance policy, follow the required procedures in your policy. Call your insurance agent. Call the state consumer helpline. And, by all means, follow Mr. Cucarro’s excellent advice on protecting your property, but…
…never sign away any portion of what you deserve until you first exhaust the options you’ve already paid for!