What is an insurance adjuster and what do they do?

Fact-checked with HomeInsurance.com

1

At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict , this post may contain references to products from our partners. Here’s an explanation for

Filing an insurance claim after a disaster is a stressful process. To avoid having to deal with the hassle, and with hopes of getting accurate compensation from the insurance company, many homeowners seek the help of a public adjuster, also known as an insurance adjuster. Unlike the adjuster you’ll be assigned by your insurance company, you hire this person to handle the claim on your behalf.

This person can step in to make sure you’re getting a claim check from your insurer in an amount that’s both fair and correct. But does it make sense to go through the extra work and cost of finding and hiring an insurance claims adjuster? To understand this requires additional context.

What is an insurance adjuster?

A public adjuster is an insurance claims specialist who interprets the homeowner’s policy, assesses the damage and how much it will cost to repair and negotiates with the insurance company on behalf of the homeowner until the claim is settled.

Public adjusters market themselves as professionals who act solely on behalf of the policyholder and help ensure homeowners get the money they are entitled to under their policy. They differ from adjusters hired by the insurance companies to assist with the claim because their compensation comes out of the homeowner’s pocket (typically in the form of a 5-20% commission on the final payout total), not the insurance company’s.

Homeowners don’t always need the help of a public adjuster, though, so it’s important to understand when hiring your own insurance claims adjuster can help you.

When you should hire an insurance adjuster

Some people decide to hire an adjuster simply because they don’t have the time to deal with the insurance claim process. This makes more sense if you expect to get a large payout from your claim (part of which can be used to pay for the adjuster’s services), or if there is a significant discrepancy between the insurance estimate for repairs and what your general contractor has quoted you for required repairs. A larger claim might help you negotiate a lower fee with your adjuster.

If your insurance company’s adjuster doesn’t return calls or answer questions properly, or if you think the adjuster left any damages off your claim, you may want to get your own public adjuster even if you have a smaller claim. That way, your adjuster can come alongside your insurance provider’s adjuster, ensuring the claim is handled with your best interests (and the insurer’s legal obligations) in mind.

How to find a public adjuster

One place to start your search for a public adjuster is the National Association of Public Insurance Adjusters (NAPIA) website. The organization has a vetting process and requires members to be licensed and to have been in business for at least two years to become members. These are good indicators of a fairly reputable public adjuster, but ultimately, research and recommendations are worth the effort to ensure you pick the right one to handle your claim.

Check out the website of any public adjusters you’re considering. Ask friends and family if they have any recommendations or referrals. Inquire if potential adjusters have any references they can share as well.

It’s also helpful to check with your state’s department of insurance to see if there are any complaints filed against the adjuster you’re about to hire.

What to expect from an adjuster

A public adjuster should assess your losses and help you get every what you are owed from your insurance company, but don’t expect miracles. Your insurance provider will take your insurance claims adjuster’s findings into consideration, but they won’t necessarily greenlight everything just because you have your own adjuster involved.

Homeowners should be aware that hiring a public adjuster after the process and negotiation of the claim is already started can slow the process, too.

Usually, homeowners don’t contact the adjuster until they start to have problems with the adjuster who has been assigned to them by the insurance company. In those cases, hiring an adjuster might add another 30 to 60 days to the process because the public adjuster has to revisit and renegotiate much of what’s been done with the previous adjuster. That being said, public adjusters have legal room to set deadlines for the insurer to adhere to, which can prevent an otherwise drawn-out process from dragging out any longer than necessary.

Does it pay off to hire an adjuster?

Sometimes the wait pays off. But there are no guarantees homeowners will get more money by hiring an adjuster than they would by simply working with the adjuster provided by their insurance company.

That said, the data can be convincing for the pro-adjuster side. The Florida Association of Public Insurance Adjusters (FAPIA) reported that homeowners who hired their own insurance claims adjuster saw more money from their insurers. According to the study, the typical settlement to those who had the help of a public adjuster was about $22,266, compared to $18,659 without a public adjuster.

But public adjusters come at a cost, usually about 5-20% of the amount you get from the insurance company.

Can you negotiate the adjuster’s payment?

The rate is negotiable and can vary from claim-to-claim. For example, on a smaller claim, where the payout — and respectively, the amount your adjuster will take home — is low, the adjuster might ask for a higher percentage. Larger claims might be an opportunity to negotiate a smaller percentage for the adjuster’s fee.

While this may answer questions like, “what is an insurance adjuster?” and “what does an insurance adjuster do for you?”, it’s ultimately up to you to decide if hiring a public adjuster is the best course of action in your specific case.

If you’ve got a large loss on your hands and you want to make sure you’re being reimbursed accurately, it might make sense to hire an insurance adjuster to work on your behalf.