MT Public Adjuster cheat sheet

Indemnity principle: a property claim restores the insured to pre-loss financial position, no better; betterment is deducted unless policy or replacement-cost endorsement provides otherwise.

Insurable interest must exist at the time of loss for property coverage; a person with no financial stake at loss time cannot collect, even if interest existed at policy inception.

Montana requires the named insured to be given at least 45 days' written notice of cancellation for nonpayment of premium on most personal lines; short-form notice rules differ for nonrenewal and midterm cancellation for cause.

Montana's unfair trade practice statutes (MCA Title 33, chapter 18) prohibit misrepresentation of policy terms, unfair claim settlement practices, and failure to acknowledge claim communications within a reasonable time.

Doctrine of reasonable expectations and contra proferentem: ambiguity in an insurer-drafted policy is construed against the insurer and in favor of coverage for the insured.

Utmost good faith is mutual: material misrepresentation on the application can void coverage, but the insurer also owes a duty of good faith and fair dealing in claims handling.

Subrogation lets the insurer step into the insured's shoes after paying a loss; insured must not impair subrogation rights by releasing the tortfeasor without insurer consent.

Montana is a modified comparative negligence state (50% bar); this matters when a third-party tortfeasor claim underlies a subrogated property loss.

HO-3 covers the dwelling on an open-peril basis and personal property on named perils; HO-5 covers both on open peril; HO-2 is broad named peril; HO-8 is for older homes with functional replacement.

Replacement cost = cost to repair or replace with new materials of like kind and quality, no depreciation; actual cash value (ACV) = replacement cost minus depreciation; some policies use ACV = RC less depreciation, others use market value.

Coinsurance clause formula on commercial property: (insurance carried / insurance required) x loss = recovery, subject to the policy limit; insurance required = coinsurance percentage x value at risk.

Deductibles apply per occurrence, not per item; a percentage deductible (common for wind/hail) is calculated on the Coverage A limit, not on the loss amount.

Business income (business interruption) pays lost net income plus continuing normal operating expenses during the period of restoration, after the waiting period (commonly 72 hours).

Liability coverage triggers: occurrence policies respond to injury/damage during the policy period; claims-made policies respond when the claim is made, subject to retroactive date.

CGL Coverage A pays sums the insured becomes legally obligated to pay for bodily injury or property damage; Coverage B pays personal and advertising injury; Coverage C pays medical payments regardless of fault.

Duties after loss commonly include prompt notice, proof of loss, protection of property from further damage, cooperation, and submission to examination under oath.

Claim lifecycle: loss report, assignment, contact and inspection, damage documentation, coverage analysis, reserve setting, negotiation, settlement offer, payment, and file closure.

Reserves are estimates of ultimate claim cost (indemnity plus expense); adjusters revise them as facts develop, and reserve adequacy is reviewed at diary intervals.

Proof of loss is a sworn statement of the amount claimed; the policy sets the deadline (commonly 60 days after insurer request), and failure can bar the claim absent waiver or estoppel.

Scope of damage should separate covered cause from excluded cause; when a covered and excluded peril combine, examine the efficient proximate cause and any anti-concurrent causation language.

Depreciation is calculated by age/life expectancy or by a depreciation schedule; recoverable depreciation is held back until the insured repairs or replaces and submits invoices.

Documentation standards: photographs with scale and orientation, moisture readings, itemized Xactimate-style line items, receipts, and contractor bids supporting RC versus ACV figures.

Salvage and subrogation are pursued after payment; salvage value offsets the loss, and subrogation recovery is allocated per policy or state law after deductible recovery.

Montana requires insurers to acknowledge claim notification within a reasonable time and to conduct a prompt, fair, and equitable investigation; unreasonable delay is an unfair claim practice.

Montana licenses public adjusters under MCA Title 33, chapter 17; a public adjuster represents the insured for compensation and must be licensed before negotiating or settling a first-party claim.

Public adjuster contracts must be in writing, disclose the fee or percentage, and give the insured a right to rescind within a statutory period (commonly 3 business days) after signing.

Fee caps and prohibitions: a public adjuster may not charge a fee on the amount of a claim that was not procured by the adjuster's efforts, and may not advance funds to an insured contingent on settlement.

Fiduciary duty: any funds held for the insured (for example, claim payments received on the insured's behalf) must be held in trust and accounted for promptly.

Prohibited conduct includes misrepresenting the adjuster's authority, soliciting during a declared disaster or emergency in restricted circumstances, and using deceptive or high-pressure tactics.

Continuing education and license renewal are required; adjusters must report address changes and must not transact business with an expired or suspended license.

Conflicts of interest: an adjuster may not represent both insurer and insured on the same claim, and must disclose any financial interest in a repair vendor or contractor.

Recordkeeping: maintain claim files, correspondence, and settlement documentation for the period required by Montana regulation, and produce them on request during an examination.