In yesterday’s put up, When Roofers Grow to be Adjusters: Iowa Court docket Says Not So Quick, I mentioned how Iowa’s federal court docket 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 typically 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 Building, 1 a case that adopted the Iowa Supreme Court docket’s 2020 rulings. In that continuing, the Insurance coverage Commissioner supplied a transparent assertion of what contractors might do with out violating the legislation. As the order states:
33 Building and its brokers, representatives, staff and officers might carry out any of the next acts with out violating Iowa Code § 522C.6:
(1) Solicit and supply restore or reconstruction providers to owners or enterprise homeowners;
(2) Provide opinion to an insured house owner or enterprise proprietor as as to if injury was brought on by wind, hail, storm or different incident usually coated by an insurance coverage coverage;
(3) Put together an estimate and scope of labor for the loss;
(4) Focus on with the client 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 concerning the estimates.
This listing is critical as a result of it outlines the permissible boundaries of contractor and roofer involvement within the claims course of. A roofer can inform a house owner that the injury appears like hail injury, put together an in depth estimate, and even attend the insurer’s inspection. They’ll advocate that the house owner file a declare and reply questions on their estimate. What they can not 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 throughout 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 shopper safety coverage that contractors might restore and supply data, however solely licensed public adjusters might signify and negotiate.
For contractors, I counsel this implies coaching employees fastidiously to keep away from crossing the road. Gross sales representatives and venture managers should perceive that whereas they will talk about the scope of restore work and supply their skilled opinion about the reason for injury, they can not communicate on behalf of the house owner within the claims course of. For public adjusters, this determination confirms the unique nature of their function and the protections round their career. For regulators, the order supplies readability for enforcement, guaranteeing that shopper safety objectives are met with out stopping contractors from doing their official work.
The straightforward lesson is that roofers and restoration contractors can function confidently inside their lane in the event that they stick with 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 mates, I do know that no one likes being instructed they can not do sure issues. I can admire that many have a really completely different view of this and suppose that this legislation merely protects insurance coverage firms and public adjusters whereas harming these doing the restore work.
As a lawyer, I’ve to elucidate the legislation 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 least supplies steerage about what will be achieved 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 Building, No. 105269, 2021 WL 1717542 (Iowa Sec.Bur. Apr. 19, 2021).
