The Delaware Department of Insurance published a bulletin outlining the requirements for insurance adjusters and property repair contractors when dealing with a property damage claim.
There is a big difference between the roles of an insurance adjuster and a property repair contractor when dealing with a loss, and what actions they are allowed to take by law. Senate Bill 80 states an insurer may only assign a policy to someone with the legal authority to represent the insured. Adjusters have that authority but contractors do not. Delaware law also prohibits a public adjuster from acting as both a public adjuster and a contractor.
The Department encourages carriers to communicate to their policyholders the differences between company adjusters, independent adjusters, and public adjusters. Consumers should be aware of the conflict of interest if a contractor tries to receive a fee as an adjuster and also for contracting services. Insurers are also encouraged to verify public adjusters are licensed.
A contractor acting as a public adjuster without a license could be prosecuted as a felony. Contractors cannot investigate, appraise, or assist their customers in adjusting claims. They cannot prepare, submit, or negotiate the claim on their customer’s behalf. They cannot offer their opinion on whether damage is covered under the policy. They cannot advertise that they can investigate a claim on the customer’s behalf. Lastly, they cannot subvert licensing requirements through power of attorney.
What contractors are allowed to do include: offer their repair or construction services to a home or business owner; offer their opinion on whether damage is from a storm or other event; provide and discuss an estimate and scope of work; and be there while an adjuster inspects the damage.
The bulletin can be found here.