Too many in Puerto Rico are still dealing with the catastrophic effects of Hurricane Maria. Today the focus is on getting basic supplies like drinking water to nearly half the population. An insurance claim is likely not a priority at this moment for those owning homes or businesses in Puerto Rico. However, insurance companies must keep their promise to policyholders and comply with the Unfair Claim Adjustment Practices or Actions statute – 26 L.P.R.A. § 2716a – which provides:

In the adjustment of claims no person shall incur or carry out any of the following unfair actions or practices:

(1) Misrepresent the facts or the terms of a policy relative to a coverage in dispute.

(2) Fail to acknowledge receipt and act reasonably prompt within ninety (90) days after a claim has been filed and notified under the terms of a policy.

(3) Fail to adopt and implement reasonable methods for the expeditious investigation of claims which may arise from the terms of a policy.

(4) Refuse to pay a claim without carrying out a reasonable investigation based on the information available.

(5) Refuse to confirm or deny coverage of a claim within a reasonable term after the loss statement is completed.

(6) Not to attempt in good faith to make a rapid, fair and equitable adjustment of a claim when responsibility is clearly present.

(7) Compel insureds or claimants to institute litigation to recover amounts due under the terms of a policy, by offering the insured claimant substantially less than the amount ultimately recovered in actions brought or by wrongfully denying coverage under the terms of the policy.

(8) Attempt to settle a claim for less than the amount to which the claimant or insured is reasonably entitled to by reference to the written or printed material sent to him/her or that was made part of the application.

(9) Attempt to settle a claim based on an altered application without the consent or knowledge of the insured.

(10) Make payments of claim to the insured or beneficiaries which are not accompanied by a statement showing the coverage under which payment is made.

(11) Make the policyholder or claimants believe in the practice of appealing from an arbitration award in favor of the claimant or policyholder with the intention of forcing them to accept a transaction or adjustment for less than the amount awarded by the arbitrator.

(12) Refuse to settle rapidly a claim when the responsibility is clearly and reasonably established under a part of the coverage for the purpose of inducing him to a transaction under another part of the coverage of the policy.

(13) Refuse to offer a reasonable explanation of the terms of a policy with regard to the facts and the law applicable so as to refuse a claim or an offer of transaction.

(14) Delay an investigation or the payment of a claim by requiring from the insured, claimant or his physician to submit a preliminary report of the claim and then require a formal statement of loss which substantially contains the same information of the preliminary report.

(15) Deny the existence of the policy coverage when the insured turned down the payment offer of a claim for such coverage.

(16) Deny the payment for a valid claim solely due to a mere suspicion of fraud or misrepresentation of the facts.

(17) Deny the payment for a claim on the pretext of insufficient information when the same could have been acquired through regular investigation methods.

(18) Reserved.

(19) Compel the insured or claimant to sign a waiver which may be construed as releasing the insurer of such contractual obligations that were not the object of the transaction.

(20) Require unreasonable conditions to the insured or claimant in order to conduct or delay the claim adjustment.

The Commissioner shall adopt the necessary regulations to make effective the provisions of this section.

If you own property in Puerto Rico, or are a representative assisting policyholders in Puerto Rico, it’s important to review this claims handling statute when adjusting claims with insurance carriers.

  • Jim

    I am glad to see those regulations in Puerto Rico to hold all in the claims business to high ethical standards which are a pillar of conduct for our small adjusting co. I just finished writing a claims work feasibility inquiry letter to the PR dept. of ins. moments ago. Should it become feasible for us to offer our service there, I will then be looking to contact insurance carriers in Puerto Rico that may be interested in talking with us. Any input from you readers in this regard is kindly appreciated. I will paste a copy of my letter of today below this post…Jim

    Howdy PR Ins. Dept.,

    This is an inquiry regarding our adjusting company providing claim handling work in PR.

    are a nationally and internationally experienced, catastrophe insurance
    adjusting company for the last 28 years. Our home base is in Montana.
    We are a family owned, small business,

    We have been adjusting
    hurricane claims since Hugo in 1989 and having personally lived through
    various hurricanes since Carla in 1960, are compassionately aware of the
    trauma being endured by the people of PR.

    Back in
    1996 I had been put on stand-by as a cat adjuster for another adjusting
    co. for a hurricane bearing down on PR, but losses were not sufficient
    for me to be deployed. Now, thanks to a very dear friend’s reminder,
    I’m looking into the feasibility of our co. doing claims work in PR.
    This humble friend, originally from Mexico, who lives his life to help
    others was my interpreter, starting working with me in South Florida in
    1992 on Hurricane Andrew claims

    My first question is
    in which states does PR have a reciprocity agreement on adjuster
    licensing? A follow-up question regards emergency PR non-resident
    license fees and requirements? Our adjusters are licensed in various
    states around the country, some of which are here in Montana. Would we
    also need to be licensed as an adjusting company to work in PR?

    other important question in determining if we should offer our services
    in PR regards housing for adjusters, which will most likely be
    difficult to find for some time after power is restored. Typically,
    this has always been a time consuming challenge when working hurricane
    disasters here on the mainland. Temporary housing will be exceedingly
    more difficult there on the island for all the emergency response
    personnel needed in so many facets of the recovery process.

    first and foremost, stress to our adjusters the absolute requirement of
    having the highest regard in helping families, having sustained
    catastrophic and traumatic losses, in their recovery process,
    emphasizing that these folks should be treated as they would their own

    Though I am not, we do have some bi-lingual staff
    members. I will look forward to hearing back if you feel our co. could
    be of service in your recovery efforts and your opinion regarding the
    logistical aspects of our deploying there, along with your timing
    estimate on how far out before such a deployment should be
    contemplated. Thank you kindly for your time in replying.

    Happy Recovery Trails,


    Jim Farley, Gen. Mgr. RMCAT

  • Nelson Rey

    Hello, is the requirement to provide invoices of all claimed personal property a fair claims handling practice in Puerto Rico?

    • Ashley

      That sounds like a policy-specific requirement. However, generally you can only provide copies of invoices in your possession and I wouldn’t think they could deny your contents claim solely because copies of invoices aren’t available. Again, this depends on how the policy is worded.

      • Nelson Rey

        Hi Ashley,
        It is an ISO commercial policy form and does not contain any wording with this requirement.