When you buy insurance, the claims process sounds so simple: You suffer a loss, you file a claim, and you get your money. The reality can often be more complicated, and it may be to your advantage to hire someone familiar with the claims process to help you. That someone is a public adjuster.
"A public adjuster is a representative for the policyholder who interacts with the insurance company and assists the policyholder in presenting his or her claim for insurance benefits," explains Sherman Spitz, an attorney with Berger, Kahn, Shafton, Moss, Figler, Simon & Gladstone in Irvine, California, who specializes in representing insurance companies.
Spitz says claims for business losses are often complex, and, in many cases, entrepreneurs may find it worthwhile to delegate the task of handling them. But it's important, he adds, to have the right public adjuster--one who is experienced with commercial claims, has handled claims similar to yours, and has a reputation for honesty and integrity. Be wary of an adjuster who promises more than you are entitled to: The insurance company will likely scrutinize his work more closely, and an inflated claim could lead to charges of insurance fraud.
Public adjusters are listed in the Yellow Pages under "adjusters," but your best bet for finding one is through referrals. Spitz suggests asking your insurance company's adjuster who they like to work with because a certain level of trust will already have been established between the two companies. Also ask friends or other business owners for recommendations. Find out how long the adjuster has been in business, what his or her insurance claims-handling background is (look for substantial claims experience from both the insurance company side and the policyholder side), and get references.
Fees are negotiable and are typically based on the amount recovered. According to Spitz, they range from 8 to 15 percent, with most being in the 10 to 12 percent range.
Finally, once you've hired an adjuster, don't totally abdicate responsibility for the claim. Spitz recommends requiring that the adjuster provide you with regular status reports and copies of correspondence, and consult with you as significant events occur.
Do you always need a public adjuster? No, says Spitz. If the claim is simple and straightforward, you'll save money by handling it yourself.
Berger, Kahn, Shafton, Moss, Figler, Simon & Gladstone, (949) 474-1880, firstname.lastname@example.org (attn: Sherman Spitz)