Kentucky public adjusters have suffered a devastating legal defeat, and so have the policyholders who want to hire them. In Brandi Dawn Carroll, et al. v. Russell Coleman, Jefferson Circuit Court Judge Jessica E. Green dismissed a constitutional challenge to Kentucky House Bill 568 — legislation that prohibits public adjusters from negotiating insurance claims on behalf of policyholders. The October 28, 2026, order dismisses the lawsuit with prejudice and is designated as final and appealable. 1
This is not merely a setback for an occupational group seeking to protect its livelihood. It is a decision with profound implications for insurance consumers who suffer property damage and want experienced professional assistance negotiating with their insurance companies.
I have not yet obtained the Attorney General’s motion to dismiss, or the briefing submitted by the parties. Nor have I spoken with the attorneys representing the public adjusters to determine whether they intend to appeal. Those are important limitations because the strength of any appellate argument depends on what was pleaded, what arguments were preserved, and what the parties actually presented to the trial court.
Nevertheless, several aspects of the decision concern me. Some of the court’s legal conclusions deserve further examination, and some of its factual assumptions seem remarkably disconnected from how property insurance claims are actually adjusted and negotiated.
The most troubling aspect of the decision is that the court accepts the legislature’s stated purpose of consumer protection without seriously examining whether the legislation protects consumers or instead leaves them at a substantial disadvantage when dealing with insurance companies. The court begins by correctly observing that constitutional challenges to legislation face a substantial burden. Courts generally defer to legislative judgments, particularly in the regulation of licensed occupations. A statute does not become unconstitutional simply because it is unwise, economically harmful, or based on questionable public policy.
Judge Green concludes that House Bill 568 has a rational basis because public adjusting is a licensed profession that the Kentucky legislature has historically regulated. She also notes that the legislation declares its purpose to be public protection.
The court then identifies what it considers a critical distinction between public adjusters and insurance company adjusters. Public adjusters charge policyholders for negotiating claims, while insurance company adjusters do not. This distinction deserves far more scrutiny than the court gives it.
Insurance company adjusters are not volunteers. They are compensated by insurance companies to investigate, evaluate, and negotiate insurance claims. Their compensation is part of the insurer’s operating expenses. The fact that a policyholder does not receive a separate bill for the company adjuster’s services does not make those services free.
More importantly, the insurance company adjuster works for the insurance company. The public adjuster works for the policyholder. This distinction goes to the heart of why public adjusting exists. A policyholder who suffers a significant fire, hurricane, tornado, or other property loss may have no experience estimating construction costs, evaluating damage, interpreting claim documentation, or negotiating a complicated insurance settlement. Meanwhile, the insurance company has an entire claims organization devoted to those activities. The public adjuster provides the policyholder with a professional who understands the claims process and can advocate for the policyholder’s financial interests.
The court’s reasoning seems to suggest that charging a fee for that representation provides a rational basis for prohibiting the representation itself. But professionals routinely charge consumers for services that help protect their interests. Attorneys, accountants, real estate brokers, engineers, and other professionals are compensated for their expertise.
The appropriate question is not whether public adjusters charge fees. It is whether prohibiting them from negotiating claims actually serves a legitimate consumer-protection purpose.
The Elephant in the Room: Who Benefits from Eliminating the Policyholder’s Negotiator?
This is the question that should be at the center of the debate. Who actually benefits when a policyholder can no longer hire a licensed public adjuster to negotiate an insurance claim?
The insurance company still has its professional adjusters. It still has claims supervisors, consultants, engineers, attorneys, and other specialists available to evaluate and negotiate claims. The policyholder, however, loses the ability to hire a licensed public adjuster to perform the negotiating function that has traditionally been central to public adjusting.
Under the restrictions described in Judge Green’s opinion, the public adjuster can prepare the estimate and advise the policyholder, but cannot negotiate the disputed amount with the insurance company on the policyholder’s behalf. The homeowner must attempt the negotiation personally or retain someone else legally authorized to do so, potentially an attorney.
How does that arrangement improve the policyholder’s bargaining position? How does eliminating an experienced advocate from the negotiation protect the consumer? The court does not meaningfully answer those questions.
Instead, it reasons that public adjusters can continue inspecting property, documenting losses, preparing estimates, organizing claim documentation, and advising insureds.
That observation brings us to another troubling aspect of the opinion. Judge Green acknowledges that negotiating claims is what the public adjusters themselves describe as their core function. Yet the opinion seems to minimize the consequences of prohibiting that function because other services remain available. This is a significant factual and economic assumption without any support.
If I were evaluating this case for appeal, I would examine that issue carefully. I would want to know whether the factual allegations were sufficiently developed, whether the court accepted those allegations as true under the applicable pleading standard, and whether any deficiencies could have been addressed through a further amended complaint. The court dismissed the case at the pleading stage. It did not conduct a trial examining the actual economic consequences of the legislation.
There is also an important consumer-protection issue involving the court’s observation that insurance company adjusters are regulated and insurers can face claims under Kentucky’s unfair claims settlement practices statute, KRS 304.12-230. The existence of legal remedies for unfair claims practices does not mean policyholders have adequate representation during the adjustment process.
A policyholder should not necessarily have to retain an attorney and pursue litigation simply to obtain meaningful professional assistance negotiating a property insurance claim. Indeed, one of the practical benefits of competent public adjusting is that disagreements may be resolved without litigation. A law that removes public adjusters from negotiations may therefore have consequences extending beyond the public adjusting profession. It may increase the burden on policyholders, attorneys, and the judicial system.
Those consequences deserve serious examination rather than assumptions.
What About Contracts Signed Before House Bill 568?
If an appeal were made, I would focus on the legislation’s impact on existing public adjusting contracts. This may be one of the most interesting legal issues in the entire decision.
The plaintiffs argued that House Bill 568 interferes with contracts they entered into before the legislation was enacted. Judge Green acknowledges that Sections 4 and 7 of the legislation expressly apply to contracts entered into on or after the effective date. Section 5, however, contains the prohibition against negotiating without the same express limitation.
What happens to a public adjuster who signed a valid contract to negotiate a policyholder’s claim before the legislature changed the law? The court concludes that the Contracts Clause of the Kentucky Constitution does not invalidate the legislation because public adjusting has always been heavily regulated and the legislature was exercising its police powers.
There is substantial legal authority recognizing the legislature’s power to regulate existing industries. But that does not automatically resolve every constitutional objection involving interference with existing contractual obligations. The nature and extent of the impairment deserve analysis.
The Unauthorized Practice of Law Question
Another issue deserves attention. In a footnote, Judge Green discusses Kentucky Bar Association Opinion U-48 concerning the unauthorized practice of law. She also observes that the record does not establish whether that opinion motivated the legislature’s passage of House Bill 568.
The overwhelming majority of states recognize an important distinction between negotiating the amount of an insurance loss and providing legal advice concerning disputed contractual rights. Public adjusters routinely evaluate physical damage, construction costs, repair methodologies, depreciation, and the factual amount of a loss. Attorneys address legal questions involving policy interpretation, contractual obligations, and legal rights.
Those functions can overlap in difficult claims, and there must be appropriate boundaries. But treating every negotiation over the amount of property damage as the practice of law would raise substantial questions about the longstanding role of insurance adjusters generally.
If the unauthorized practice of law is part of the justification for House Bill 568, I would want to understand precisely how Kentucky distinguishes permissible claims adjustment from legal representation. That distinction should be applied coherently, not merely in a manner that prevents policyholders from obtaining professional assistance while leaving insurers free to negotiate through their own adjusters.
Where Does This Leave Kentucky Public Adjusters and Policyholders?
For now, the public adjusters have lost their constitutional challenge in the trial court. The order dismisses the amended complaint with prejudice and expressly states that it is final and appealable.
I have not spoken with counsel and do not know whether an appeal will be pursued. I also do not yet have the briefing necessary to assess every argument presented or determine whether the plaintiffs adequately developed the factual allegations underlying their claims. Nevertheless, I believe this decision raises questions worthy of further judicial examination.
The larger concern extends beyond Kentucky. Public adjusting exists because policyholders sometimes need experienced assistance dealing with insurance companies. It is not a profession that should be immune from regulation. Public adjusters should be properly licensed, trained, accountable, and subject to meaningful consumer-protection requirements.
There are legitimate reasons to regulate fees, prohibit abusive solicitation, prevent misrepresentations, and discipline adjusters who violate their professional responsibilities. But regulating a profession to protect consumers is fundamentally different from prohibiting the profession from performing one of the services consumers hire it to provide.
The practical effect of House Bill 568, as described in the court’s order, is to preserve the insurance company’s professional negotiating resources while substantially restricting the policyholder’s ability to obtain comparable professional assistance from a licensed public adjuster. That is the elephant in the room.
I hope Kentucky’s appellate courts will have an opportunity to examine these issues carefully. I also hope the public adjusting profession will recognize that the consequences of this decision extend beyond Kentucky’s borders. Other states may look at this legislation and the resulting judicial decision when considering similar restrictions.
The public adjusting profession should be prepared to explain not merely why public adjusters deserve to remain in business, but why policyholders benefit from having the freedom to retain competent professional advocates during the insurance claims process.
Insurance companies have professional negotiators. Why shouldn’t policyholders have the right to hire their own?
Thought For The Day
“My greatness came and started in Louisville, Kentucky.”
Muhammad Ali
1 Carroll v. Russell Coleman, No. 26-CI-003349 (Ky. Cir. Ct. [Jefferson] Oct. 28, 2026).
