Is Your Contractor Engaging in the Unauthorized Practice of Public Adjusting (UPPA)?
A public adjuster is an lowa licensed person or entity who is hired by the property owner to represent the property owner in negotiating a resolution of an insurance claim for loss or damage to property. In the event of a catastrophic disaster, the property owners can be charged up to 10% of the insurance claim amount for this service.
Example: A claim for $50,000 (cost for new roofing shingles & labor) would mean the Iowa consumer would need to pay $5,000 or 10% of the insurance proceeds to the Public Adjuster. In this example, the $5,000 fee is typically paid to the Public Adjuster directly from the insurance proceeds.
The expense for this service and any other services offered in the aftermath of storms should be carefully considered by the property owners prior to signing any agreements. Take the time necessary to carefully review complete copies of contracts. Insured property owners are entitled to hire a licensed public adjuster. A licensed public adjuster must be bonded and adequately trained to serve as the insured property owner's exclusive representative for the insurance claim.
Property owners are encouraged to talk with their insurance agent and allow their insurance company the opportunity to assess the damage to the property and provide detailed estimates. This is a common procedure for insurance companies and is completed at no additional expense to the property owner.
Unauthorized practice of public adjusting (UPPA) is what it sounds like - it occurs when someone other than a licensed public adjuster negotiates on behalf of an Iowa consumer to settle a property insurance claim. These entities can be out-of-state or local lowa contractors acting as public adjusters without a license, who travel to areas of the state after widespread storms. Entities engaging in UPPA are violating lowa law. Unlicensed public adjusters can be rife with fraud, taking advantage of property owners, exaggerating damage estimates or charging excessive fees exhausting the property owner's insurance coverage limits.