The Contractor Who Wants to Adjust
After a hail storm in Dover, Delaware, homeowner Priya signs a document with Summit Exteriors. The document says Summit will 'handle the entire insurance claim,' negotiate with the insurer, and receive 20% of the insurance proceeds. Summit is a roofing contractor; it does not hold a Delaware public adjuster license. Summit prepares a $28,000 roof estimate and emails the adjuster: 'I represent Priya. Send all correspondence and the policy to me. Approve my scope and we can settle.' Priya's brother also sends a $19,500 estimate from another roofer. The adjuster calls Priya, who says she thought Summit was just the contractor and did not know she could talk to the adjuster directly. The policy has a $3,000 deductible and actual cash value settlement for the 18-year-old roof.
1. Is Summit engaged in public adjusting under Delaware licensing requirements? Explain the distinction between a contractor's estimate and public adjusting.
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A roofing contractor may inspect damage, prepare a repair estimate, and perform repairs. That is contracting work. Public adjusting is different: it involves representing the insured in negotiating, preparing, or settling the insurance claim for compensation. Summit's agreement goes beyond repair work. It says Summit will 'handle the entire insurance claim,' negotiate with the insurer, and receive 20% of the proceeds. That looks like public adjusting activity, and Summit does not hold a Delaware public adjuster license.
The adjuster should not treat Summit's estimate as the only evidence, but the estimate itself is useful. The licensing problem is the representation and fee arrangement, not the fact that a contractor provided a scope. The adjuster should separate the two: accept the estimate as a document, but do not negotiate the claim with an unlicensed representative as though Summit had authority to settle.
2. How should the adjuster communicate with Priya and Summit, and what should the adjuster refuse to do?
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The adjuster should communicate directly with Priya, confirm that she is the insured, and explain that she may speak with the adjuster herself. The adjuster should not send the policy or claim correspondence to Summit merely because Summit sent an authorization, especially where the authorization appears tied to an unlicensed public-adjusting arrangement. The adjuster should ask Priya to confirm in writing who may receive information and should explain that she may use a licensed public adjuster or an attorney if she chooses.
The adjuster should refuse to negotiate a settlement with Summit as her representative, refuse to approve Summit's scope without independent evaluation, and refuse any arrangement that treats the 20% fee as payable from the claim. The adjuster can tell Summit that the estimate will be considered but that the carrier will communicate with the insured.
3. What compliance or reporting steps are appropriate?
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The adjuster should document the contingency agreement, Summit's email, Priya's statement that she did not understand the arrangement, and the other roofer's estimate. The file should show that the carrier dealt with the insured directly and did not disclose claim information to an unauthorized third party. Compliance should review whether Summit's conduct requires a report of suspected unlicensed public adjusting.
The adjuster should also evaluate the claim on its merits: the roof is 18 years old, settlement is actual cash value, and the $3,000 deductible applies. The carrier should obtain its own inspection if needed and explain the ACV calculation to Priya. The adjuster should not accuse Summit of a crime in the claim letter; the appropriate step is a factual referral to compliance or the state insurance department if the carrier's procedures require it.