Bill > HB1972

This bill amends the Public Adjuster Licensing Law to strengthen regulations for public adjusters, who are individuals licensed to help policyholders settle insurance claims. Key provisions include expanding the definition of a "catastrophic event" to encompass a wider range of disasters and emergencies, increasing the required bond amount for public adjusters from $20,000 to $40,000, and clarifying that this bond must be maintained with notice given to the Insurance Commissioner if it's terminated or replaced. The bill also introduces new rules regarding fees, prohibiting public adjusters from charging fees before a claim is settled or collecting fees from portions of a claim offered before they were retained. It mandates that public adjusters provide a separate disclosure document to insureds before a contract is signed, explaining the claim process, the roles of different types of adjusters, and the insured's rights. Furthermore, the bill prohibits public adjusters from having financial interests in repair or restoration companies related to a claim they are adjusting, and from referring insureds to such companies with whom they have a financial tie or receive compensation for the referral. It also clarifies that property insurance policies can restrict the assignment of rights and benefits to entities other than those legally authorized to represent the insured, preventing property repair contractors from circumventing licensing requirements through powers of attorney. The bill also introduces stricter contract requirements, including specific rescission periods for contracts based on the type of claim and timing of solicitation, and prohibits certain contract terms such as those that allow collection of the entire fee from the first check issued by an insurance company or require a check to be made out solely to the public adjuster. Finally, it expands the grounds for license revocation or suspension to include receiving referral fees from salvage or repair companies and designates unlicensed activity and violations of financial interest rules as insurance fraud offenses, subject to criminal prosecution and civil penalties.

Budget and Finance, Business and Industry

https://www.palegis.us/legislation/bills/2025/hb1972