I recently attended the National Association of IndependentInsurance Adjusters annual conference in Palm Springs. It is noteasy to get into or out of Palm Springs. Because the last flightout to Salt Lake City for a connection back to theCincinnati/Northern Kentucky International Airport was at noon, Iwas unable to get out the day of my speech and had to remainovernight. Alas, poor me; but, as one of my companions remarked inresponse to my complaint, “Bruce, there are worse things than beingstranded in Palm Springs overnight.” Indeed there are. Stop andsmell the flowers buddy — or just sit by the pool.

To my mind, there is not a better adjusted bunch than the NAIImembers. These are professionals exhibiting a deep involvement intheir chosen field. There is a close-knit aspect to the membershipthat heralds cooperation, focus, over-arching goals, and integrity.Friendliness and courtesy also prevail.

Some of that is because of the family-business nature of many ofthe member companies. I was impressed by the session exclusivelyfor sons and daughters of independent adjusting company owners.They grapple with several of the same problems regarding successionand planning that face many of the independent agencies making upthe Independent Insurance Agents & Brokers of America.

I particularly want to follow up on some of the items that wediscussed in my talk before the group. I was to speak on topics ofimmediate interest to the group at large, what some of thechallenges facing the adjusting profession are from the perspectiveof the editors of FC&S.

We talked about change in the insurance industry and theincreasing speed of change in the world at large. We talked aboutthe transition from agrarian society to industrial society, whichoccurred over a period of 60 to 100 years or more, while the shiftfrom the industrial to the information age took just under 20.

I told the story of how, in my 23 years with FC&S, the speedof response to subscribers' coverage inquiries has been cut fromtwo weeks to hours. When I got here in 1982, letters from FC&Susers generally were attended to within two weeks of their receipt.That was our stated policy and it was all right with our users. Bythe early '90s, faxes had replaced letters, and we would get secondrequests two or three days after receipt of the faxes. Now, in thegreat age of e-mail, we get questions from subscribers that arefollowed up by e-mail messages marked with red exclamation pointswithin hours of getting the original messages. We know that this isthe speed of your business today. What you had weeks for 20 yearsago, you get two hours for today.

We talked about where adjusters get into trouble and theunauthorized practice of law in a rousing exchange that touched onthe differences between independent adjusters and public adjusters.I reviewed important case law, including the seminal 1939 case,Liberty Mutual Ins. Co. v. Jones, 130 S.W.2d 945 (Mo. 1939), inwhich the Missouri Bar Association sued six mutuals doing businessin the state because, of all things, they were making decisions onwhat was covered under an insurance policy and what was not,without the aid of attorneys. The insurance companies won, allowingthem to advance the profession of insurance adjusters.

We talked about how the adjusting business can be the practiceof law, and not the unauthorized practice of law, wherein theadjuster will be held to the standard of a practicing attorney inthe event that his negligence causes harm to an insured. We talkedabout the developing minority opinion in several states in which adirect cause of action has been established against an independentadjuster working on contract for an insurance company, along withthat insurer (see Charleston Dry Cleaners v. Zurich American Ins.Co. [2003 WL 22119885, S.C.])

Not by any means least of all, we talked about adjusters' doingthe right thing, as fellow speaker J. Southall Stone, vicepresident of first party claims for Essex Insurance put it. Thiscame out of a comment that a perception exists that insuranceadjusters are given bonuses for cutting insurance recovery toclaimants. Southall, voicing the opinion of all in the hall, heldforth that a bonus structure like that is “not doing the rightthing.” People pay insurance premiums to cover losses that theyincur, and minimizing recovery for insureds is not why we are inthis business, he maintained. “I'm not going to pay one dollar morethan necessary to indemnify an insured, but I'm sure not going topay one dollar less, either. And I'll err on that side, if I haveto,” said Stone, who also is an incoming officer for the LossExecutive Association, to whom he will carry that message.

It was an interesting couple of days: a great meeting program,fine networking opportunities, and just good folks. I wanted totake some space here to tell the group, “Thanks.” Keep doing theright thing and we'll be OK.

Bruce Hillman is editorial director, Professional PublishingDivision, of the National Underwriter Co.

The FC&S Claim Queue is prepared and written by theeditorial staff of The Fire, Casualty and Surety (FC&S)Bulletins, the most widely used encyclopedic reference servicedevoted to insurance policy interpretation and coverage topics.FC&S is published by The National Underwriter Company.