RDCSB186 4282 4986
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
DIGEST
SB 186 Reengrossed 2022 Regular Session Henry
Present law provides that a public adjuster can charge a reasonable fee, but also provides that
a contingency fee agreement between a public adjuster and an insured is contrary to public
policy and is null and void.
Proposed law provides that, except for the fee limitation set forth under present law, a public
adjuster who enters into a contract or arrangement with an insured can charge a reasonable
fee that includes full flat fees, hourly fees, percentage fees, or any other valuable
consideration for services rendered, and the fee cannot exceed 10% over and above the
disputed amount successfully paid by the insurer in order to resolve the claim.
Proposed law provides that a public adjuster shall offer in the contract or agreement with the
insured all three options that consists of a flat fee, an hourly fee, or a percentage of the fee.
Proposed law provides that a public adjuster shall not require, demand, or accept any fee,
retainer, compensation, deposit, or other thing of value from an insured prior to the insurer
making payment on a claim.
Present law provides that a public adjuster cannot be paid commissions, service fees, or other
valuable considerations to another for public adjusting in this state if the state requires a
public adjuster to be licensed under present law and he is not licensed.
Proposed law retains present law but deletes commissions and service fees and adds full flat
fees, hourly fees, and percentage fees provided for by proposed law.
Present law provides that a person cannot accept commissions, service fees, or other
valuable consideration for public adjusting in this state if the state requires a public adjuster
to be licensed under present law but he is not licensed.
Proposed law retains present law but deletes commissions and service fees and adds full flat
fees, hourly fees, and adds percentage fees provided for by proposed law.
Present law requires that public adjusters have written contracts for their services that
include the full salary, fees, compensations, or other valuable considerations paid for their
services.
Proposed law retains present law but deletes commissions and service fees and adds full flat
fees, hourly fees, and adds percentage fees provided for by proposed law.
Present law provides that compensation provisions in a public adjusting contract shall not
be redacted in any copy of the contract provided to the commissioner of insurance. Such a
redaction shall constitute an omission of material fact.
Proposed law retains present law and provides that if a public adjuster's compensation is
based on a share of the insurance settlement, the exact percentage shall be specified in the
contract.
Proposed law provides that initial expenses to be reimbursed to the public adjuster from
proceeds of a claim payment shall be specified by type with dollar estimates set forth in the
contract and with any additional expenses approved by the insured, prior to payment.
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Present law provides that prior to the signing of a contract, a public adjuster is required to
provide an insured a disclosure document that includes the full salary, commissions, fees,
or other considerations to be paid to the public adjuster.
Proposed law retains present law but deletes full salary, fees, compensations, and other
considerations, and adds full flat fees, hourly fees, percentage fees, and other valuable
considerations and provides that disclosure document may be signed at the time the contract
is signed.
Proposed law provides that the disclosure document shall state the public adjuster payment
options, which include a flat fee, an hourly rate, or a percentage fee. The amount of the flat
fee, the hourly rate charged, and the percentage to be applied, respectively, shall be
disclosed.
Proposed law provides that the contract shall provide that the insured may terminate the
contract upon written notice of his desire to terminate the contract.
Proposed law provides that if the contract provides for compensation by a percentage fee and
the insured terminates the contract, the following provisions apply:
(1)The fee shall be the agreed upon percentage applied to the difference between the
amount paid by the insurer prior to the retention of the public adjuster and the
amount committed to be paid by the insurer as of the date of termination.
(2)If the insurer made no payments between the date of retention and the date of
termination, the public adjuster shall be entitled to compensation of the hourly rate
listed by the public adjuster in the disclosure document for the time spent by the
public adjuster adjusting the claim as well as expenses incurred in furtherance of the
claim during the term of retention.
(3)A public adjuster shall not be entitled to apply a percentage fee to proceeds
committed to be paid by an insurer after the date the contract is terminated.
Effective on January 1, 2023.
(Amends R.S. 22:1703, 1704(A)(intro para) and (A)(11), (B), and (E)(intro para) and (E)(5);
Adds R.S. 22:1704(E)(6) and (K))
Summary of Amendments Adopted by Senate
Senate Floor Amendments to engrossed bill
1. Clarifies that the public adjuster fees shall not exceed 10% over and above
the disputed amount successfully paid by the insurer in order to resolve a
claim.
2. Provides that a public adjuster shall offer in the contract or agreement with
the insured all three options that consists of a flat fee, an hourly fee, or a
percentage of the fee.
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Insurance to the
reengrossed bill:
1. Provide that a public adjuster shall not require, demand, or accept any fee,
retainer, compensation, deposit, or other thing of value from an insured prior to
the insurer making payment on a claim.
2. Provide that if a public adjuster's compensation is based on a share of the
insurance settlement, the exact percentage shall be specified in the contract.
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3. Provide that initial expenses to be reimbursed to the public adjuster from
proceeds of a claim payment shall be specified by type with dollar estimates set
forth in the contract and with any additional expenses approved by the insured,
prior to payment.
4. Provide that the disclosure form shall be signed prior to or at the signing of the
public adjuster contract.
5. Provide that the disclosure form shall include the public adjuster payment
options and the amount of the flat fee, the hourly rate charged, and the
percentage to be applied, respectively.
6. Provide certain payment provisions that apply if a public adjuster contract
provides for compensation by a percentage fee and the insured terminates the
contract.
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