In yesterday’s put up, When Roofers Turn into Adjusters: Iowa Court docket Says Not So Quick, I mentioned how Iowa’s federal courtroom confirmed that contractors can’t step into the sneakers of licensed public adjusters. The Shamrock case demonstrates that states can draw a distinction between contracting work and claims adjusting. However roofers and restoration contractors usually ask me, “Chip, what precisely can we do with out being accused of unlicensed public adjusting?”
The reply comes straight from an Iowa Insurance coverage Division administrative determination involving 33 Carpenters Development, 1 a case that adopted the Iowa Supreme Court docket’s 2020 rulings. In that continuing, the Insurance coverage Commissioner offered a transparent assertion of what contractors might do with out violating the regulation. As the order states:
33 Development and its brokers, representatives, workers and officers might carry out any of the next acts with out violating Iowa Code § 522C.6:
(1) Solicit and provide restore or reconstruction providers to householders or enterprise house owners;
(2) Supply opinion to an insured house owner or enterprise proprietor as as to whether injury was brought on by wind, hail, storm or different incident usually lined by an insurance coverage coverage;
(3) Put together an estimate and scope of labor for the loss;
(4) Focus on with the shopper the estimate or scope of labor;
(5) Advocate to an insured house owner or enterprise proprietor that the policyholder file an insurance coverage declare with their insurer;
(6) Attend any inspection of the injury by an insurer’s adjuster; and
(7) Reply questions the policyholder or the insurer’s adjuster has in regards to the estimates.
This listing is important as a result of it outlines the permissible boundaries of contractor and roofer involvement within the claims course of. A roofer can inform a home-owner that the injury appears like hail injury, put together an in depth estimate, and even attend the insurer’s inspection. They will suggest that the house owner file a declare and reply questions on their estimate. What they can’t do is negotiate with the insurer, advocate for protection, or current themselves as an insured’s consultant within the claims settlement course of. These actions fall squarely inside the area of licensed public adjusters.
The 33 Carpenters administrative order is a sensible guidepost. It acknowledges that contractors inevitably work together with insurance coverage points when repairing storm injury, however it attracts a agency line at claims advocacy and negotiation. That distinction displays the state’s client safety coverage that contractors might restore and supply info, however solely licensed public adjusters might signify and negotiate.
For contractors, I recommend this implies coaching employees fastidiously to keep away from crossing the road. Gross sales representatives and mission managers should perceive that whereas they will focus on the scope of restore work and supply their skilled opinion about the reason for injury, they can’t converse on behalf of the house owner within the claims course of. For public adjusters, this determination confirms the unique nature of their position and the protections round their occupation. For regulators, the order supplies readability for enforcement, making certain that client safety targets are met with out stopping contractors from doing their authentic work.
The straightforward lesson is that roofers and restoration contractors can function confidently inside their lane in the event that they follow estimates, repairs, and factual opinions about injury and prices. The second they start to barter with insurers, maintain themselves out as declare representatives, or promote public adjusting-type providers, they cross into public adjusting and expose themselves to enforcement.
For my restoration building and roofing buddies, I do know that no one likes being advised they can’t do sure issues. I can admire that many have a really totally different view of this and suppose that this regulation merely protects insurance coverage firms and public adjusters whereas harming these doing the restore work.
As a lawyer, I’ve to clarify the regulation and ask that everybody observe it. What sort of nation would this be if no one needed to observe legal guidelines and no one was held accountable? This administrative matter at the very least supplies steering about what might be accomplished with out violating public adjusting licensing legal guidelines, which explains for the put up.
Considered the Day
“Readability affords focus.”
—Thomas Leonard
1 Within the Matter of 33 Carpenters Development, No. 105269, 2021 WL 1717542 (Iowa Sec.Bur. Apr. 19, 2021).
