Public Adjuster In Illinois – What You Need To Know
Property Owner’s Rights On Claims & How To Fire Your Adjuster
Illinois public adjuster companies must be licensed, bonded, and insured. Know your rights as the property owner, because you have certain protections. These serve to benefit you the property owner when hiring a public adjuster.
Public adjusters are not attorneys. While public adjusters can negotiate, estimate, and settle insurance claims after a fire or flood, they may not practice law. The state of Illinois has enacted laws on which they must operate. These laws are for the protection of you, the property owner. Over the years many public adjusting companies have violated several of these laws and have been charged with committing crimes. Some continue to do so as of the writing of this blog.
A public adjuster in Illinois must be licensed by the State. Their license may be suspended or revoked for violations of the specific statutory mandates. Further, the public insurance adjuster’s statute, which is part of the Illinois Insurance Code, regulates virtually every aspect of their job, including the manner in which they maintain records, take licensing tests, comply with Illinois’ public adjuster contract forms, and receive reimbursement for services.
The performance standards that apply to all Illinois public insurance adjusters set forth that they may not provide legal advice, or engage in the unauthorized practice of law. A public adjuster may not agree to any loss settlement without the insured’s knowledge and consent. (215 ILCS 5/512.59(b), (g); see, also, 215 ILCS 5/512.59, 5/512.60 and 5/512.61).
As we are about to discuss, night solicitation is a serious problem in Illinois. Violations of the public adjuster rules should be referred immediately to the Illinois Department of Insurance noted below. If you have been solicited during night hours, 7:00 P.M. to 8:00 A.M. you are encouraged to report the illegal activity.
Public Adjuster Contracts, Bonds & The Rules Of Adjusting Claims
The guidelines and rules under and by which the public adjuster must conduct himself are set out in the Illinois statute and Illinois Department of Insurance administrative code.
Public adjusters and public adjusting companies must comply with the following:
- The adjusting firms’ contracts that are used must be approved by the Illinois Department of Insurance.
- The public adjusters and the adjusting company must maintain at a minimum a $20,000 bond.
- The public adjuster may not agree to any settlement with the insurance company without the prior approval of the property owner.
Solicitation By Public Adjuster – The Night Problem
One of the most abused portions of the Public Adjusting Act is NIGHT CHASING. The act says a public adjuster:
- Cannot solicit the property owner while the fire department is engaged at the fire scene.
- Cannot solicit the property owner between the hours of 7:00 P.M. and 8:00 A.M. NIGHT CHASING.
- Specifically, the act states… “A Public Insurance Adjuster may not propose or attempt to propose to any person that the Public Insurance Adjuster represent that person while a loss-producing occurrence is continuing nor while the fire department or its representatives are engaged at the damaged premises nor between the hours of 7:00 p.m. and 8:00 a.m. (215 ILCS 5/512.59(e)).
Over the years, the number of Night Chasers has risen. Some companies have dedicated Night Chasers and board-up trucks out running down fire losses. These individuals appear usually right behind the board-up vans owned by the same person who owns the Adjusting Company. These persons, committing illegal acts, should be avoided at all costs.
Some have even claimed to be representatives of the owner’s insurance companies. Owners are unaware of the laws regarding night chasing and are being victimized. If you have been victimized in such a manner please contact the department of insurance immediately.
What You Can Do
- By Phone 1-888-473-4858
- Go online at http://www.idfpr.com
- By email at consumer_complaints@ins.state.il.us
- By fax to (217) 558-2083
- By mail to 320 W. Washington Street, Springfield, IL 62767
You should also consider terminating your contract and firing the public adjuster. Yes, you can fire your public adjuster! Night chasing is improper and illegal. Only those who cannot operate legally are night chasing.
These are not persons you want to do business with or who you want to trust, and most importantly have named on your insurance check. Yes, the company you hire will have their name on your insurance check as a payee.
Can I Fire My Public Adjuster?
Per the Public Adjuster Act, the property owner is given 10 days in which to cancel the contract of adjusting services from the date the document is signed.
“At the option of the insured, any such contract which is executed within 5 business days after conclusion of the loss-producing occurrence shall be voidable for 10 days after execution. The insured may void the contract by notifying the Public Insurance Adjuster in writing by (i) registered or certified mail, return receipt requested, to the address shown on the contract; or (ii) personally serving the notice on the Public Insurance Adjuster. (215 ILCS 5/512.58(a)).”
This right to cancel the public adjuster and the claims adjusting contract must be stated clearly. This is not optional.
Further pursuant to another section of the code, per the requirements of the Fire Damage Representation Agreement Act [815 ILCS 625], the public adjusting contract must clearly set forth:
“Pursuant to Article XXXI¾ of the Code, a contract which is executed within 5 days after the conclusion of the loss-producing occurrence shall be voidable at the option of the insured for 10 days after execution of the contract. The written contract shall constitute the entire agreement between the public adjuster and the insured.” (Title 50, Section 3118.80(c)(4)).
At Harris Claims Services we are happy, upon request to give longer cancellation dates. We want you to be comfortable in your time of need. We strive to separate ourselves from the alleged competition.
Public Adjuster Must Provide Notice On How To Cancel The Contract
The Public Adjuster must provide the owner with the procedures on how to cancel the contract. The statute states:
The person undertaking the representation of the claimant by such an agreement must, at the time of the agreement, furnish the party with whom the agreement is made a copy of the agreement and the address to which the notice may be sent and a copy of this Act, and obtain written acknowledgment of receipt of such from the party represented. If he fails to do so, the 10-day period provided for in this Act does not commence to run until the agreement, address, and a copy of this Act are furnished. (815 ILCS 625/1).
Make Sure The Owner Of The Company Is Also A Licensed Public Adjuster
Several years ago the Public Adjusters Act was amended to require that the owner of a Public Adjusting Company must be licensed. That means the owner must have taken and passed an exam, is properly bonded, and has complied with all aspects of the Act.
This was done to ensure that the person or persons operating the company had the skills, knowledge, and passed the background checks of the Illinois Department of Insurance before there company could act as a public adjusting company.
Some are still not following this law. Some owners are not licensed and hide behind someone else’s license. These are usually the companies that operate illegally chasing fires at night. They do this because they cannot get a public adjusters license. Why, perhaps because they have a criminal history. Perhaps they have been convicted of crimes involving dishonesty and fraud. Perhaps they failed to meet the standards set forth by the State of Illinois and/or were deemed unqualified. Perhaps the background check with fingerprints revealed some issues.
We as public adjusters must follow the laws of Illinois. Many do not and those that do not spoil and bring upon the industry a cloud of distrust and disrespect. Violations of the Public Adjusters Act should be reported immediately.
The Public Adjusters at Harris Claims Services want you to understand and know your options and rights. We seek and strive to properly represent the insureds. If you have any questions regarding the information set forth above, if you think you were taken advantage of and are unsure on how to proceed, or if you simply want answers to real questions we are here to answer them.
We strive to provide you with what you need a deserve and need real answers to real questions. Harris Claims Services is located in Lincolnwood, Illinois near Chicago and we’re here to help you and your family.
Best Regards,
Jason Harris
