Wednesday, January 4, 2023
HomeProperty InsuranceAre Insured-Appointed Appraisers And not using a Public Adjuster License Breaking the...

Are Insured-Appointed Appraisers And not using a Public Adjuster License Breaking the Regulation? | Property Insurance coverage Protection Regulation Weblog


The State of Florida, by means of its Division of Monetary Companies, is making a authorized argument that these appointed as an appraiser by an insured should fall throughout the license necessities of a public adjuster. Florida is making this argument in an administrative listening to the place they’re attempting to self-discipline a public adjuster.1 Buried in that case is the next argument by the Division, which, if profitable, will change who could also be appointed as appraisers: 

The Counts VI, IX, and X require evaluation of two threshold points: 1) as to Counts VI

and X, whether or not appraising is conduct that falls throughout the scope of the definition of a public adjuster in part 626.854(1), Florida Statutes….

The time period ‘Public Adjuster’ is outlined in part 626.854(1), Florida Statutes.

A ‘public adjuster’ is any individual, besides a duly licensed lawyer at regulation as exempted beneath s. 626.860, who, for cash, fee, or every other factor of worth, instantly or not directly prepares, completes, or information an insurance coverage declare for an insured or third-party claimant or who, for cash, fee, or every other factor of worth, acts on behalf of, or aids an insured or third-party claimant in negotiating for or effecting the settlement of a declare or claims for loss or injury lined by an insurance coverage contract or who advertises for employment as an adjuster of such claims. The time period additionally consists of any one who, for cash, fee, or every other factor of worth, instantly or not directly solicits, investigates, or adjusts such claims on behalf of a public adjuster, an insured, or a third-party claimant.

Underneath the primary check, people act as a public adjuster after they: instantly or not directly act or support within the negotiation for or in effecting a settlement of a declare or loss injury lined by an insurance coverage contract, on behalf of an insured, for cash, fee, or every other factor of worth.

Underneath the second check, people act as a public adjuster after they: instantly or not directly examine a declare, on behalf of a public adjuster, insured, or third-party claimant, for cash, fee, or every other factor of worth.

As a result of the work of an appraiser falls throughout the statutory definition of ‘public adjuster,’ an appraiser is topic to the necessities of the Florida Insurance coverage Code. This would come with the Adjuster’s Code of Ethics. Accordingly, Respondent is topic to self-discipline for misconduct occurring throughout Respondent’s work as an appraiser.

With the lots of of appraisal case opinions in Florida and hundreds of appraisal circumstances within the nation, there’s not one case opinion by any decide ever saying that the policyholder’s appraiser should be a licensed public adjuster. The Florida Division of Monetary Companies is asking this administrative decide to be the primary to make such a pronouncement.    

Researching the difficulty, I surprisingly discovered one opinion seemingly supporting the Division’s place—a 2018 submit written by a former Merlin Regulation Group lawyer as a part of this weblog, Are Property Insurance coverage Appraisers Regulated? – A Reminder of Lately Enacted HB 911 for These Heading to Florida to Help with Hurricane Michael:

The amended statutes have made clear that the who is simply a public adjuster and/or an lawyer at regulation which will for cash, fee, or every other factor of worth, instantly or not directly, put together, full or file and declare for an insured; negotiate or impact the settlement of a declare; or examine, or regulate a declare on behalf of the insured. Because the process of an appraiser is to research, regulate, put together or full the declare, and negotiate or impact the settlement of a declare, an appraiser that isn’t a licensed adjuster could regrettably be discovered to be adjusting with no license or participating within the unauthorized apply of regulation.

For what it’s price, that isn’t my authorized opinion. Appraisal is just not adjusting work.  It’s what could occur after the adjustment fails. Public adjusting is just not appraisal. 

I did elevate the difficulty a 12 months in the past in The Florida Division of Monetary Companies Wrongly Believes Appraisers Must Be Florida-Licensed Adjusters, the place I said:

Appraisers in an insurance coverage appraisal continuing should not adjusters. They aren’t adjusting the declare. Adjusting a declare could be very totally different from what contributors in an appraisal are required to do. Possibly insurance coverage regulators want to point out up for some persevering with schooling programs at subsequent month’s Windstorm Convention or at an IAUA coaching seminar to be taught extra about these variations between adjustment and appraisal and the way value determinations are an alternate dispute decision course of. 

If we need to write legal guidelines so individuals know what’s authorized versus unlawful, they need to be clear.  If we need to require a license to be an appraiser or an umpire within the appraisal course of, we must always write a regulation particularly explaining that. We will write a regulation limiting appraisers to licensed adjusters, however there isn’t a such regulation at present.

It seems to me the Division of Monetary Companies attorneys are merely attempting to win their case at any value. They’re making an alternate argument about how a statute with legal implications may be argued to use to appraisal when no decide, no case, and no clear statute has ever indicated that solely public adjusters is usually a policyholder’s appraiser.  

Then again, there’s a first time for all the things! Possibly the Administrative Choose will agree with the Division of Monetary Companies.  In that case, who may be appointed as an appraiser can be far more restricted and have legal implications for these not licensed.     

Thought For The Day  

An clever individual isn’t afraid or ashamed to seek out errors in his understanding of issues.

—Bryant H. McGill


1 Dept. of Monetary Companies v. Thomas, DOAH No. 22-984PL [Department’s Proposed Written Report and Recommended Order] (Fla. Div. of Admin. Hrgs. – filed Dec. 16, 2022).

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