CHEAP HOME INSURANCE FAQ

Say your house has just been badly damaged by an earthquake, fire, or other calamity. You can't remember the last time you looked at your home insurance policy. Do you know what you're entitled to?

Unfortunately, most people don't know the details of their policies because they are chock full of legalese. However, in the case of home or property damage (not auto-related), consumers can turn to public claims adjusters to decipher their policies and get them a fair settlement with their insurance company. Public adjusters work for both individuals and businesses, but most cater to the individual policyholder.

You don't need to hire an adjuster for minor damage, such as some smoke damage from a stove-top fire. However, you should hire an adjuster if your lifestyle is significantly disrupted. That is, bring in a public adjuster when you can't handle finding new living arrangements, filing a large claim, and arranging for a survey of extensive damage to your property.

Public adjusters must follow the guidelines written in their state that say what they can and can't do. Adjusters aren't allowed to handle bodily injury claims, auto claims, or third-party claims (such as a trust or an estate). They also are obligated to give you timely service (states usually require a settlement within 10 to 15 days after liability has been established), make sure you're given a reasonable offer from the insurance company, and disclose every part of the claims process to you.

Advantages of using a public adjuster
Public claims adjusters know the insurance process inside and out, so they can minimize the hassle that comes with collecting documents and evidence, and then negotiating with the insurance company. The adjuster will file all your pertinent paperwork with the insurance company, arrange for the inspections of your damaged property if needed, and then haggle with the insurance company if it refuses to pay your full claim.

A good adjuster will also help control what you say to your insurance company. The adjuster will be forthright with your insurer, but won't divulge any information that might damage your case. Remember, the adjuster is your employee and will pursue your interests only.

Pay up
If you do decide to have a public claims adjuster help you out with your claim, expect them to take between 5 and 50 percent of your claim settlement. As the settlement amount goes up, the adjuster's cut generally goes down. For example, if you settle for $5,000, the adjuster might take 30 percent of that.

Adjusters' fees also depend on the nature of the claim and your marketplace. If there are a lot of competing adjusters in your town, you are likely to get a better rate.

You'll have to sign a contract with your adjuster when you decide to hire him or her. You agree to give a portion of your settlement to your adjuster by signing the contract, but if you have second thoughts, you can terminate the agreement within 72 hours of signing.

You also have the right to sue your public adjuster if he doesn't perform his job correctly.

Experience is a prerequisite
Adjusters must be licensed in most states. Certification comes from passing an exam and taking certification-update classes. The industry also tries to police itself, keeping an eye out for uncertified adjusters who might ruin the industry's reputation.

Do I need an adjuster's help?
Depending on who you talk to, you may or may not need a public adjuster. One piece of advice is to seek a public adjuster's service right away. Often it's nearly impossible for consumers to know what to expect from an insurer in a homeowners claim situation, even after they read their policies. In addition, it's difficult for an adjuster to come in when a claim is in the middle of being processed.

Insurers contend that their claims staffs are professionals who make the claims process as easy for their policyholders as possible, and they assert that it's questionable whether a policyholder comes out ahead in a settlement when the adjuster's fee is figured in.