Won’t change much. So now when the PA invents a claim, they simply will not have to change the date of loss to make it appear they are in compliance. It’s essentially giving the thief the keys to the safe and they tell us how much money was in it before they take it. The PA industry is inherently corrupt – anyone who tells you otherwise is either a PA or a trial lawyer dependent on a PA for work.
PA’s can be useful in situations where extenuating circumstances exist. In the vast majority of claims, they actually impede the process and inflate the cost. They operate on straight commission. If a policyholder sustains a $20,000 storm loss, the PA might get 15% or 3,000 for being an intermediary. That leaves the policyholder with $17,000 to cover a $20,000 loss. How does the PA make up the difference? By inflating the claim to bury his commission. This is a bad ruling by Fla. They already have enought problems without protecting this artificial layer of “adjusters”.
I’m sure PA’s differ in the minimum size cases they take on just as other business do. And they will justify their fees just like any other professional will. Before suggesting the idea that these
PA’s are not needed, and worse unethical, first consider the inherent conflict of interest of company adjusters, the near total
lack of understanding of their rights on the part of the vast majority of policyholders, and the fact that precident setting court cases in each state impact the settlement process, but none of them is reflected in the policy.
As an agent/broker over forty years, I’ve seen both sides. I haven’t written the book yet, but I hope too. Insurers resist change in policy language due to unfounded fears that simplification will cost them more in future litigation costs. They prefer to stick with wording that has already been tested in court (hopefully at someone else’s expense). Agents don’t want
over simplification for fear that if the customer could understand
the product, we be irrelevant (as so many people have always wrongly thought we already were). And attorneys don’t want clear
simple easy to understand contracts, because without legal disputes, there’s no work for attorneys (how are we going to put
our kids through college, and pay for the big house and cars?).
PA’s should be honest to everyone, and agree with you that they do inflate claim settlement costs. And you should be honest by not
suggesting that higher claims costs are in any way inappropriate,
because, if the claim is legal and fair, that’s all that counts.
A good PA could point out that without the policyholder knowing their rights, or being assisted by an unusual agent, or lawyer, most are at the mercy of their insurer. If the settlement offer
seems fair, they’ll take it and refuse to fight. After all who want to pick a fight with an big corp. after they’ve already lost
all they own? The problem with that “fair” and legal settlement is that it may have shorted the insured thousands, or tens or thousands, or 20%??? Only two people likely would know: the insurance company’s inside adjuster, and the PA your policyholder may not even know existed.
In conclusion if your own insurer offered you a very easy and seemingly fair settlement of $125,000 which was almost double what
you thought your loss was, and then you hired a PA who actually settled your case for $440,000, would you still be complaining about having to pay your PA 15% of that (maybe they charge more in FL, and on very small cases, but in CA 10% is normal)?
Q: Why do insurers hate attorneys and public adjusters?
A: Because they make them pay all they owe.
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Won’t change much. So now when the PA invents a claim, they simply will not have to change the date of loss to make it appear they are in compliance. It’s essentially giving the thief the keys to the safe and they tell us how much money was in it before they take it. The PA industry is inherently corrupt – anyone who tells you otherwise is either a PA or a trial lawyer dependent on a PA for work.
PA’s can be useful in situations where extenuating circumstances exist. In the vast majority of claims, they actually impede the process and inflate the cost. They operate on straight commission. If a policyholder sustains a $20,000 storm loss, the PA might get 15% or 3,000 for being an intermediary. That leaves the policyholder with $17,000 to cover a $20,000 loss. How does the PA make up the difference? By inflating the claim to bury his commission. This is a bad ruling by Fla. They already have enought problems without protecting this artificial layer of “adjusters”.
I’m sure PA’s differ in the minimum size cases they take on just as other business do. And they will justify their fees just like any other professional will. Before suggesting the idea that these
PA’s are not needed, and worse unethical, first consider the inherent conflict of interest of company adjusters, the near total
lack of understanding of their rights on the part of the vast majority of policyholders, and the fact that precident setting court cases in each state impact the settlement process, but none of them is reflected in the policy.
As an agent/broker over forty years, I’ve seen both sides. I haven’t written the book yet, but I hope too. Insurers resist change in policy language due to unfounded fears that simplification will cost them more in future litigation costs. They prefer to stick with wording that has already been tested in court (hopefully at someone else’s expense). Agents don’t want
over simplification for fear that if the customer could understand
the product, we be irrelevant (as so many people have always wrongly thought we already were). And attorneys don’t want clear
simple easy to understand contracts, because without legal disputes, there’s no work for attorneys (how are we going to put
our kids through college, and pay for the big house and cars?).
PA’s should be honest to everyone, and agree with you that they do inflate claim settlement costs. And you should be honest by not
suggesting that higher claims costs are in any way inappropriate,
because, if the claim is legal and fair, that’s all that counts.
A good PA could point out that without the policyholder knowing their rights, or being assisted by an unusual agent, or lawyer, most are at the mercy of their insurer. If the settlement offer
seems fair, they’ll take it and refuse to fight. After all who want to pick a fight with an big corp. after they’ve already lost
all they own? The problem with that “fair” and legal settlement is that it may have shorted the insured thousands, or tens or thousands, or 20%??? Only two people likely would know: the insurance company’s inside adjuster, and the PA your policyholder may not even know existed.
In conclusion if your own insurer offered you a very easy and seemingly fair settlement of $125,000 which was almost double what
you thought your loss was, and then you hired a PA who actually settled your case for $440,000, would you still be complaining about having to pay your PA 15% of that (maybe they charge more in FL, and on very small cases, but in CA 10% is normal)?
Q: Why do insurers hate attorneys and public adjusters?
A: Because they make them pay all they owe.