DE | The Delaware Department of Insurance has become aware that consumers are often confused by the role of adjusters and contractors. Delaware asks insurance companies to assess and implement methods to improve policyholder education about the role of adjusters and contractors involved in property damage claims, and are asking adjusters to be fully informed of their duties and obligations during claims processing.
Examples that may help policyholders understand the role of adjusters and contractors include:
- Decode the adjuster jargon and fairly explain the differences between company, independent and public adjusters, and the different role of each in the claim settlement process.
- Warn customers of a conflict of interest when a contractor attempts to receive payment as an adjuster and also receive a fee for providing contracting services.
- Verify the license of anyone performing the tasks of a public adjuster on claims, as well as encourage all adjusters to explain their authority and what they are restricted from doing when assisting with a claim.
Adjusters should be aware that:
- It is against the law in Delaware for a contractor or other vendor to act as a public adjuster unless licensed as a public adjuster.
- A public adjuster is prohibited from acting as both a public adjuster and a contractor.
- Performing the acts of a public adjuster without a license could constitute insurance fraud, which can be prosecuted as a class G felony, punishable by incarceration. Adjusters should report suspected fraudulent claim activity to their company’s Special Investigation Unit and to the Department’s Fraud Prevention Bureau.
The following are examples of what contractors can and cannot do without a Delaware public adjuster license:
- Contractors may approach a homeowner or business owner offering repair or reconstruction services, but they may not investigate, appraise, evaluate, or assist their customer in adjusting a claim.
- Contractors may offer an opinion to a policyholder as to whether damage is from a storm or other incident normally covered by a homeowner’s policy. Contractors cannot offer to review the insurance policy or advise their customer on the insurance policy’s coverage.
For more information, including what contractors can and cannot do without a Delaware public adjuster license, click here.