What Does Claim Adjusters Do?
The person who adjusts a claim is known as a claims adjustor. Every insurance company has a claims division or department that handles claims.
The process of determining coverage, legal liability, and settling a claim is known as claims adjusting. The claim function exists to ensure that the insurer’s promises to its policyholders are kept. Claim adjusting is critical to an insurer’s relationship with its policyholders.
The insurer’s reputation for settling claims has a direct impact on the marketing and retention of policyholder insurance.
Claim adjusters are in charge of investigating, evaluating, and negotiating a claim’s coverage, liability, and damages. An adjuster can be an insurer’s employee, an employee of an insurer-owned adjustment bureau, or an independent adjuster hired on a contract or on an individual basis.
Becoming an insurance claims adjuster is a complex job that is frequently overlooked as a career in the insurance industry.
Insurance claims adjusters play an important role in the insurance industry, and the demand for adjusters has remained consistent over time as natural disasters and accidents occur on a daily basis.
Adjusters are typically employed as field adjusters who work outside of the claim office or as inside adjusters who work within the claim office.
Field adjusters spend a significant amount of time on-site at a loss, interviewing witnesses, investigating damages, and coordinating the loss appraisal.
Inside the claim, adjusting is appropriate for claims with known expenses or claims that require a little investigation. The level of responsibility assigned to inside adjusters varies by insurer.
Duties of Claim Adjuster
- Investigate, assess, and resolve insurance claims
- Check to see if the insurance policy covers the claimed loss.
- Determine how much the insurance company should pay.
- Make certain that no claims are fraudulent.
- To obtain additional information on questionable claims, contact the claimants’ doctors or employers.
- When necessary, consult with legal counsel about claims.
- Negotiate agreements
- Approve Payments
Roles of Claim Adjuster
When you file a claim against someone you believe was at fault for your accident, you will normally negotiate with a claims adjuster for that person’s liability insurance company.
A claim may be referred to a firm of independent insurance adjusters rather than being handled by an insurance company’s own adjuster.
However, the process of negotiating a personal injury claim settlement is the same.
Negotiating with these government claims adjusters is similar to negotiating with private insurance adjusters.
The only significant difference in negotiating with a government claims adjuster is that, if a claim ends up in court, judges and juries are not overly generous in awarding damages with public money.
As a result, government-entity adjusters are less generous with settlement funds than private insurance adjusters.
If you have a claim against a government entity, your settlement will be 10% to 25% lower than if you had a claim against a private party. Find out more about injury claims against the government in your state.
Even if you have not filed a personal injury lawsuit, an attorney (not a claims adjuster) may negotiate with you about your claim.
Don’t be alarmed if an attorney handles your claim rather than a claims adjuster.
You do not negotiate a settlement with your own insurance agent if you file a claim under your own automobile collision, uninsured, or underinsured motorist coverage.
A claim adjustor must determine whether a covered loss occurred and the amount of the loss. Before the claim can be approved, a series of questions must be answered. The following are the most important questions:
Was the loss sustained while the policy was in effect?
Is the peril that caused the loss covered by the policy?
Is the property destroyed or damaged in the loss covered by the policy?
Is the claimant entitled to compensation?
Was the loss sustained at an insured location?
Is the loss type covered?
Is the claim genuine?
Types of Claim Adjusters
The major types of adjustors include the following:
Agent
An insurance agent is frequently authorized to settle small first-party claims up to a certain maximum limit. A first-party claim is one that the insured submits to the insurer, such as a minor theft loss.
The insured direct the claim to the agent, who has the authority to pay up to a certain amount. This method of settling claims has several advantages: it is quick, it reduces adjustment costs, and it preserves the policyholder’s goodwill.
Company adjustor
A claim can be settled by a company adjuster. The adjuster is typically a salaried employee who only works for one company.
Following receipt of notice of the loss, the company adjustor will investigate the claim, determine the amount of loss, and arrange for payment.
Independent adjustor
Claims can also be adjusted by an independent adjuster. An independent adjustor is a company or individual who handles claims for a fee.
Claims personnel are highly trained individuals who work full-time adjusting claims. When a catastrophic loss occurs in a specific geographical area, such as a hurricane, and a large number of claims are submitted at the same time, property and casualty insurers frequently use independent adjustors.
Furthermore, independent adjustors include people who live in areas where the volume of claims is too low to justify the expense of a branch office with full-time adjusters.
Public adjustor
A public adjuster may be involved in the settlement of a claim. A public adjuster is paid a fee based on the amount of the claim settlement and represents the insured rather than the insurance company.
If a complex loss situation occurs and technical assistance is required, as well as when the insured and insurer are unable to resolve a claim dispute, the insured may hire a public adjuster.
Also Read: What is a Subrogation Waiver and Why it Matters in 2022?
Standard of Conduct for Claim Adjusters
A. All claims adjusters must adhere to the following standards of conduct:
(1) An adjuster has no direct or indirect financial interest in any aspect of the claim other than the salary, fee, or other consideration agreed upon with the insurer.
(2) An adjuster may not acquire any interest in the salvage of property subject to the insurer’s contract.
(3) In connection with any loss or damage for which the adjuster is employed or concerned, an adjuster shall not directly or indirectly solicit employment for, recommend, or otherwise solicit engagement for any attorney at law, contractor, or subcontractor.
(4) An adjuster shall not directly or indirectly solicit or accept any compensation from, by, or on behalf of any contractor or subcontractor engaged by or on behalf of any insured by whom such adjuster has been, is, or will be employed or compensated, directly or indirectly.
(5) An adjuster must be fair to all claimants.
(6) No claimant shall be given preferential treatment by an adjuster.
(7) An adjuster must strictly adhere to the terms of the insurance contract when adjusting claims.
(8) An adjuster shall not conduct investigations, adjustments, or settlements in a way that is detrimental to the insured.
(9) Following a thorough investigation, an adjuster must provide truthful and unbiased reports of the facts.
(10) An adjuster must handle every adjustment and settlement with honesty and integrity, taking only the remuneration to which he is legally entitled.
(11) When handling a claim, an adjuster must act quickly and with due diligence to ensure that the claim is properly resolved.
(12) An adjuster must immediately report to the department any conduct by a licensed insurance representative in this state that violates any provision of this Title or a department rule.
(13) When dealing with elderly claimants, an adjuster must use reasonable care.
(14) An adjuster shall not negotiate or effect settlement directly or indirectly with any third-party claimant represented by an attorney if the adjuster is aware of such representation unless the attorney consents. The term “third-party claimant” does not include the insured or the insured’s resident relatives for the purposes of this paragraph.
(15) Without the consent of opposing counsel or a party, an adjuster may interview any witness or prospective witness. However, the adjuster must exercise extreme caution in making any suggestion that could induce a witness to suppress or deviate from the truth, or in any way affect the witness’s appearance or testimony during deposition or at trial.
(16) An adjuster shall not advise a claimant to avoid seeking legal advice or to retain counsel to protect the claimant’s interests.
(17) An adjuster shall not knowingly make any oral or written misrepresentation or statement about applicable policy provisions, contract terms, or applicable state laws.
(18) An adjuster shall not handle any claim for which he or she is not currently competent and knowledgeable about the terms and conditions of the insurance coverage, or which otherwise exceeds the adjuster’s current expertise.
(19) An adjuster shall not allow an unlicensed employee or representative of the adjuster to conduct business that requires a license under the provisions of this Part.
(20) No adjuster may represent or act as a public adjuster while licensed by the Department.
(21) No adjuster shall materially misrepresent the terms and coverage of an insurance contract to an insured or another interested party with the intent and for the purpose of settling a claim for loss, damage, or benefit under such a contract on less favorable terms than those provided in and contemplated by the insurance contract.
FAQ’s
How to become a claim adjuster?
An entry-level claims adjuster, examiner, or investigator typically needs a high school diploma or equivalent, though some positions require a bachelor’s degree or insurance-related work experience. Auto damage appraisers typically hold a postsecondary nondegree award or have work experience identifying and estimating the cost of automotive repair.
Skills required to become a claim adjuster
Analytical abilities: Adjusters and examiners must both determine whether the insurance company is obligated to pay a claim and how much to pay. To make a decision, adjusters must consider a variety of factors.
Communication abilities: Claimants, witnesses, and medical experts are all sources of information for claims adjusters and investigators. They must know the right questions to ask in order to gather the necessary information.
Attention to detail: Adjusters, appraisers, examiners, and investigators must thoroughly review documents and damaged property because minor details can have significant financial ramifications.
Interpersonal abilities: Adjusters, examiners, and investigators frequently meet with claimants and others who are upset by the situation that necessitates a claim or by the settlement offered by the company. These employees must be understanding of their company’s policies while remaining firm.
How much claim adjuster make?
Salaries vary by state, but the average base salary for a claims adjuster in the United States is around $65,000. Individuals with more experience can expect to earn more money as claims adjusters. Learn about Employment Projections.
How old do you have to be to become an insurance adjuster?
At least 18 years old
What are the qualifications to become an insurance adjuster?
A high school diploma or equivalent is typically required for investigator jobs. Some insurance companies prefer to hire people who have previously worked as law enforcement officers or private investigators because they have excellent interviewing and interrogation skills.
How do I get my claims adjuster license?
Begin by learning about the insurance licensing requirements in the states where you intend to work claims. If you live in a state that requires licensed adjusters, you should first obtain your home state license. That license will typically have reciprocity with many other states, allowing you to apply for a non-resident adjuster license without having to take the state’s adjuster licensing exam.
