The Art Of Adjustment: Navigating The Fine Line Of Insurance Claims

An insurance adjuster, also known as a claims adjuster, is a person who investigates an insurance claim to determine if the insurer should pay for damage or injuries, and if so, how much they should pay. The adjuster works for the insurance company paying the claim and is paid to calculate the lowest possible compensation on the insurer's behalf. Therefore, it is important to remember that the adjuster is not an objective party and does not advocate for the claimant. Instead, they are on the side of the insurance company and will perform their duties with a certain degree of bias.

To accomplish their goal of a quick and inexpensive resolution to a case, adjusters often employ a wide array of misleading tactics to trick claimants into taking a lower settlement amount than they deserve. For example, adjusters may avoid communication to cause frustration, use a claimant's medical records against them, or try to record the claimant to sneak in questions with answers that can be taken out of context and hurt their claim.

While insurance adjusters do not have a tendency to over-adjust, their role and the tactics they employ can make it seem like they are working against the interests of the claimant. It is crucial for claimants to understand the adjuster's role and their options to help the claims process go more smoothly.

Insurance adjusters are hired by insurance companies to assess claims and determine payouts

Adjusters are usually assigned to cases involving car accidents, where they verify that the claimant has the applicable coverage and that the damage is covered. They review the details of the accident, collect statements from those involved, and review police reports, video footage, and other relevant information. They then go over the options with the claimant, who can choose to proceed with repairs or get an inspection to determine the repair costs.

Adjusters also work on other types of insurance claims, such as property damage or personal injury claims. They may inspect the claimant's property, evaluate the extent of the damage, and collect evidence to support the claim. They often speak with witnesses and consult with relevant experts to help determine the appropriate settlement amount.

It is important to remember that insurance adjusters work for the insurance company and are focused on settling claims quickly and cheaply. They may employ various tactics to lower the potential payout, such as delaying communication or trying to get the claimant to admit fault. Claimants can protect themselves by being cautious in their interactions with adjusters, seeking legal advice, and considering hiring a public adjuster to represent their interests.

They may use tricks to minimise payouts, such as causing frustration through lack of communication

Insurance adjusters are employed by insurance companies to investigate claims and determine how much they should pay out. While they are meant to act in good faith, they are incentivised to minimise claim payouts to increase insurance company profits.

One way they do this is by causing frustration through a lack of communication. A typical claims adjuster handles approximately 150 cases at a time, so it can be difficult to get in touch with them. Sometimes, this communication breakdown is strategic. Adjusters may fail to answer or return phone calls, hoping that claimants will get frustrated and give up. They may also refuse to contact claimants, hoping that the statute of limitations will run out, leaving claimants unable to recover through the claims process or a lawsuit.

• Rushing claimants into a conversation and offering a quick low-sum settlement in return for a release agreement.
• Using statements against claimants, twisting words to dispute or minimise harm.
• Discouraging claimants from seeking legal help, as this tends to result in higher payouts.
• Asking for authorisation to see claimants' medical records and using unrelated past injuries to discredit current claims.
• Putting claimants under surveillance, including monitoring social media activity, to catch them doing activities that contradict their claimed injuries.
• Trying to get claimants to admit fault, even partially, for an accident.
• Delaying the payment of claims, knowing that financial pressure may force claimants to accept a lower settlement.

Adjusters are incentivised to save money for their employer, not the claimant

There is a common misconception that insurance adjusters are incentivised to save money for their employer at the expense of the claimant. However, this is not the case. In fact, adjusters are typically evaluated on their ability to settle claims in a timely and fair manner, without dispute.

The pay structure for insurance adjusters varies depending on the type of adjuster and their employer. Some adjusters are paid a fixed salary, while others may earn a percentage of the settlement or a fee based on a 'fee schedule'. This fee schedule is determined by the insurance company and can vary widely. For example, during the 2017 hurricane season, adjusters working on catastrophe claims could earn $500 for claims between $3,000 and $5,000, $650 for claims between $5,000 and $7,500, and $750 for claims between $7,500 and $10,000. It's important to note that these percentages can change with demand and an adjuster's experience.

While it is true that insurance companies want to protect their bottom line, they are also highly regulated and must follow certain guidelines when settling claims. Adjusters who underpay or deny claims unfairly can face serious consequences, including fines and loss of licensing. Additionally, insurance companies can be shut down by state departments of insurance if they are found to be regularly paying less than reasonable amounts on claims.

Ultimately, insurance adjusters must strike a balance between protecting the interests of their employer and ensuring that claimants receive fair compensation. While there may be pressure to keep costs down, adjusters are not directly incentivised to save money for their employer at the expense of the claimant. Doing so would be unethical and could result in legal repercussions.

Claimants can request a different adjuster if they feel they are being treated unfairly

If you feel that you are being treated unfairly by an insurance adjuster, there are several steps you can take. Firstly, try to communicate with the adjuster and resolve any issues. If that doesn't work, you can ask to speak to their supervisor or the claims manager. They will be able to look at your claim with fresh eyes and may have more discretion to negotiate a settlement. If you are still not satisfied, you can file a complaint with the insurance department in your state or contact the Insurance Commissioner.

It is important to remember that you have the right to reject an insurance adjuster's offer and request a settlement that you feel is fair. You can also choose to work with a private claims adjuster, who works solely for the insured, or hire a lawyer to represent your interests and help you navigate the insurance claim process.

Claimants can also hire a public adjuster to advocate for their interests

When claimants file an insurance claim, they will have to work with an insurance adjuster from their insurance company. This adjuster evaluates the claimant's property, determines the compensation they'll receive, and rules on their claim. However, it's important to remember that this adjuster does not advocate for the claimant. Instead, they are paid to calculate the lowest possible compensation on the insurer's behalf.

Claimants can also hire their own public adjuster to evaluate property loss and help them file insurance claims. A public adjuster is an independent trained insurance professional that exclusively advocates for policyholders. They are licensed and trained insurance professionals who are often more thorough in their damage analysis than company adjusters because of their training and their loyalty to the policyholder, not the insurance company.

Public adjusters can:

• Evaluate damages and estimate the cost and time it will take to repair or replace property or structures.
• Help claimants understand their insurance policy, track the claim, file documents, and meet deadlines.
• Act as a liaison between the claimant, the insurer, and any other third parties such as attorneys or witnesses.
• Negotiate with the insurance company to achieve a fair payout.

Public adjusters charge a percentage of the total claim payout, with fees ranging from 3% to 30% of the insurance settlement. Claimants might also be able to negotiate a lower percentage fee for large claims.

There's no specific rule regarding when to hire a public adjuster, but some circumstances that make it worth considering include:

• Filing a large claim for high-value, significant, or complex damage to your home, like a fire.
• Not feeling confident with the assessment performed by the insurance company's adjuster.
• Feeling that the insurance company's adjuster underestimated the claim or that the payout isn't fair.
• Needing assistance with a complex claim or the claims process.

While hiring a public adjuster can be beneficial in certain situations, it's important to consider the potential drawbacks. Public adjusters may only take on large claims, as they work on a contingency basis and get paid a percentage of the settlement amount. Additionally, involving more people in the claims process may slow down the process, especially if there is more back-and-forth negotiation between the public adjuster and the insurance company.

Frequently asked questions