For any claim filed under any policy of Citizens, a public adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value greater than 10% of the additional amount actually paid over the amount that was originally offered by the corporation for any one claim.
A number of public adjusters have called and written about this, some in disbelief. In response, this is the actual wording in the new law:
6. For any claim filed under any policy of the corporation, a public
adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value greater than 10 percent of the additional amount actually paid over the amount that was originally offered by the corporation for any one claim.
A past President of the Florida Association of Public Insurance Adjusters (FAPIA), Randy Paul, believed that the wording was made to prevent more than ten percent of any re-opened or supplemental claim from being charged because twenty percent is allowed in other parts of the legislation. This has some validity, as I noted:
Current law provides that a public adjuster may not charge more than 10% of the amount of insurance claim payments made for claims based on an event that is the subject of a declaration of emergency by the Governor. The 10% limitation applies to claims made up to 1 year after the declaration. This law is amended to provide that after the 1 year period, the public adjuster fee limitation is 20% of the amount of insurance claim payments.
Unfortunately, though, the law was not written to apply only to re-opened or supplemental claims. The new statute says "any claim."
"The amount that was originally offered" is vague. What constitutes the amount "originally offered?" In third party scenarios, adjusters "offer" an amount to settle and get a release. In first party claims practice, insurance companies pay undisputed amounts of money as determined. An offer should only be made if there is a bona fide dispute.
Does the limitation to ten percent also include the costs of a public adjuster? Does the broad language include phrases such as "other thing of value?" Experts are often retained by public adjusters with approval of their clients to help analyze a loss. It’s not clear whether the ten percent limits the fee or includes these costs.
It is hard to see how any qualified public adjuster can make a profit when a ten percent cap is applied to monies obtained after Citizens, in good faith, fully pays a loss as its original offer. Of course, whether Citizens Property Insurance Corporation will act in "good faith" is another issue. I have heard dozens of Citizens stories in the last 48 hours and plan to share those with others in the future.
Still, the law is an unreasonable restraint of trade as written, and it will be challenged in court. It will be a topic at the next legislative session. The law is not good policy because it prevents policyholders from retaining professional services who will help them obtain the full benefits to which they are entitled. Why do our legislators want to prevent their constituents from receiving help in the wake of a disaster?
Our firm will continue to do everything we can to fight against and prevent these types of wrongs and injustice. We will never give in: