Proposed Rules On Florida Public Adjuster Conduct and Ethics Requirements Withdrawn

Amendments to proposed Rules 69B-220.051 and 69B-220.201 relating to Florida public adjuster conduct and ethics requirements have been withdrawn.  However, amendments to Rule 69B-220.001 relating to licensing of emergency adjusters have not been withdrawn.  To view the notice, which will be published officially on Friday, September 17, 2010, click here.

The proposed Rules had previously been reviewed at a Florida Division of Insurance Agents and Agency Services Rule Development Workshop on July 30, 2010.

Of particular contention among those who testified at the Workshop was Section (3) (f) of proposed Rule 69B-220.201 (3) (f) which pertains to the requirement for all adjusters to respond specifically to requests for claims status within 15 days from the date of the request.   The proposed Section reads as follows:

(3) Code of Ethics. The work of adjusting insurance claims engages the public trust. An adjuster shall put the duty for fair and honest treatment of the claimant above the adjuster’s own interests in every instance. The following are standards of conduct that define ethical behavior, and shall constitute a code of ethics that shall be binding on all adjusters:

 (f) An adjuster, upon undertaking the handling of a claim, shall act with dispatch and due diligence in achieving a proper disposition of the claim.

At the Workshop, Property Casualty Insurers Association of America Assistant Vice President and Regional Manager William Stander noted that performance measures do not belong in the adjuster code of ethics.  Further, Florida Statutes 626.9541 and 627.70121 already address claims communications.  Therefore, the changes in (3) (f) are inconsistent with the statutory requirements.  Mr. Stander suggested that this regulation should apply only to public adjusters, because the referenced statutes address insurance company adjusters, not public adjusters. 

There was an apparent consensus among those presenting during the July 30 Workshop that section (3) (f) does not belong in the code of ethics.  It also was agreed that the section applies to all lines of business and likely will give rise to increased litigation.

Additionally, limiting these regulations only to property lines of business was suggested, since the proposed Rules seem to be focused on public adjuster issues. 

Concerns also were expressed with new language in the proposed Rules that partially defines the failure of an adjuster to perform services for the client as lack of dispatch and due diligence.  It was suggested that this language be limited to public adjusters.

A Rule Challenge and petition for an administrative hearing was subsequently filed by the Florida Association of Public Insurance Adjusters on August 25, 2010.

To view a summary of the aforementioned Rule Development Workshop, click here.

Colodny Fass will continue to monitor this issue and provide updates as they become available.