AB 357

This bill imposes registration and other requirements on an individual, known

as a public adjuster, who assists an insured person with a claim against the person's

insurance company for loss or damage to real or personal property that is located in

this state.

Under the bill, an individual may not perform services or solicit business as a

public adjuster unless he or she is registered with the Office of the Commissioner of

Insurance. In order to register with the commissioner, the individual must complete

an application that requires proof of good character and financial responsibility, pass

a written examination, and pay a fee. If the commissioner approves the application,

the registration is effective for two years and may be renewed if the individual fulfills

continuing education requirements. The commissioner may deny, suspend, revoke,

or refuse to renew a registration if the commissioner determines that the individual

has engaged in behavior that warrants the denial, suspension, revocation, or refusal.

Additionally, the commissioner may impose a civil penalty on the individual.

The bill requires a registered public adjuster to enter into a contract with the

insured before providing services to the insured. The contract must contain certain

provisions, including provisions that disclose the public adjuster's compensation and

the circumstances under which the insured may void the contract. The bill prohibits

the contract from containing provisions that impose collection costs and late fees on

the insured, require the insured to authorize the insurer to issue a check solely in the

public adjuster's name, or limit the insured's right to pursue civil remedies against

the public adjuster.

Under the bill, the public adjuster may not be paid prior to the insured receiving

payment from the insurer and, if the insurer pays the policy limit within five

business days from the date the loss is reported, the public adjuster may only be paid

a reasonable hourly rate for the time spent on the claim. Additionally, the public

adjuster's compensation may not exceed 10 percent of an insured's actual recovery

if the claim is due to a catastrophic disaster.

The bill imposes requirements on a public adjuster to address conflicts of

interest that may arise while working for the insured, including a requirement to

notify the insured if the public adjuster has a financial interest in, or may receive

compensation from, an entity working on the claim, such as a repair shop. The bill

also imposes other requirements and limitations on a public adjuster, including that

he or she must have the insured's written consent to agree to a settlement, may solicit

business only during certain hours of the day, and may not work as an adjuster for

an insurer or as an independent adjuster while registered as a public adjuster.