Even a small house fire can quickly turn into a homeowner’s worst nightmare. Burst pipes can flood every room and ruin furnishings and belongings. When disaster strikes, you immediately think about your insurance coverage.
If this scenario happens to you, will you be asking yourself, “Should I use a public insurance adjuster?”
It’s a question you need to answer before you face the aftermath of a fire or flood at the house. We handle residential disaster restorations all across Chicago, and we’ve seen how problems with public adjusters can complicate the claims process. We want you to have the facts.
7 Important Differences Between Public Adjusters and Insurance Adjusters
Public adjusters and insurance adjusters provide similar services. They both handle paperwork and navigate the claims process. Insurance professionals refer to public adjusters as PAs. Because they’re independent contractors, PAs charge a fee for their services.
When you consider public insurance adjuster pros and cons, be careful. Is the public adjuster really advocating for you? Is the insurance adjuster only watching out for the company’s best interests? There’s more to both arrangements than simple representation.
1. The PA Contract Controls Access
One of the biggest problems with a public adjuster starts when you sign the contract. The PA’s agreement denies you access to and communication with anyone at your insurance company including your agent and the carrier’s adjuster.
2. Public Adjuster Expenses Add Up
A PA takes 10 to 30 percent of your settlement as compensation for services rendered. This expense is in addition to your policy’s deductible. When you work with your insurance adjuster, you only pay the deductible.
3. You Can Handle the Process
A big PA selling point focuses on handling paperwork. Your insurance agent or disaster restoration contractor can help too, and they don’t charge for the service. Most homeowners take care of the claims process by themselves.
4. Motivation Is an Important Factor
After a serious house fire, the public adjuster may advocate to rebuild instead of renovate. Maximizing your settlement works in the PA’s financial favor. You’re more likely to get a realistic damage assessment from your insurance agent.
5. High Settlements Can Count Against You
A public adjuster’s efforts to maximize final compensation can result in higher premiums. Reasonable repairs and replacements recommended by your insurance adjuster don’t have negative effects on your homeowners policy.
6. A Public Adjuster Won’t Negotiate
If you feel your public adjuster hasn’t handled your claim properly, your signed contract prevents you from negotiating a better arrangement. There aren’t any legal agreements attached to dealing with your insurance adjuster, but a PA can put a lien on your claim payment.
7. Your Insurance Agent Wants Your Business
A public adjuster works for you on a one-time basis. Your insurance company wants to keep you as a long-term client. That results in fair and personalized service now designed to ensure your satisfaction in the future.
Your Legal Rights as a Homeowner
Illinois statutes closely regulate the insurance industry and apply specific rules to public adjusters. Most homeowners aren’t aware of these important regulations.
• Illinois law requires a public adjuster to be licensed by the state’s Department of Insurance.
• You have the right to cancel your contract with a PA at any time for any reason.
• The PA isn’t allowed to make a final settlement with the insurance company without your approval.
• Any suggestion by the PA for remediation services must always include at least two competitive bids.
In the aftermath of a home fire or water disaster, we recommend you think twice when you ask, “Should I use a public insurance adjuster?” Please keep in mind your legal rights before you make any final decisions.
Our Teams Are on Your Side
We help homeowners across the city deal with overwhelming situations on a regular basis. It’s our goal to share information today that you can file away for the future. If the worst should happen, you shouldn’t have to worry about the claims process.
Let us know if our post clears up the details and answers your questions about public adjusters. As Chicago’s leading disaster restoration contractor, we work with insurance companies every day. We’re always happy to share our expertise, so just give us a call. Here at ServiceMaster Restoration by Zaba, we’re on your side.