NM Public Adjuster flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

New Mexico Insurance Code

The body of law in NMSA 1978, Chapter 59A, administered by the Office of Superintendent of Insurance, governing insurance licensing, solvency, and trade practices.

Unfair claim settlement practices

Acts defined in NMSA 1978, §59A-16-20, including misrepresenting policy provisions, failing to act promptly on claims, and refusing to pay without reasonable investigation.

New Mexico Guaranty Association

A statutory entity that pays covered claims of insolvent insurers up to specified limits, funded by assessments on member insurers, and does not cover all policy types.

OSI examination authority

The Superintendent may examine the affairs of any licensee and require production of records; licensees must maintain records for at least five years and make them available.

Public adjuster license requirements

Age 18+, completion of prelicensing education if required, passing the public adjuster exam, fingerprint background check, and appointment or authorization to represent insureds.

Public adjuster contract

A written agreement signed by the insured stating the fee or percentage, the right to cancel within three business days, and that the adjuster cannot settle without written consent.

Public adjuster fee cap

Fees are limited to a reasonable amount; in a declared catastrophe, fees may not exceed 10% of the claim amount unless the OSI approves a higher amount.

Public adjuster continuing education

Twenty-four hours of CE every two years, including at least three hours of ethics and three hours of New Mexico insurance law, required to renew the license.

Indemnity principle

Insurance restores the insured to approximately the pre-loss financial condition, no better and no worse, using actual cash value or replacement cost as the policy provides.

Insurable interest

A financial interest in the person or property insured such that the insured would suffer a loss if the event occurred; required at the time of loss for property insurance.

Contra proferentem

The rule that ambiguities in an insurance policy, a contract of adhesion, are construed against the insurer that drafted the language.

Coinsurance formula

Penalty = (limit carried / limit required) × loss, where limit required equals the coinsurance percentage times the value of the property, subject to policy terms.

HO-3 special form

A homeowners policy covering the dwelling and other structures on an all-risk basis and personal property on a named-peril basis, with standard coverage parts A through F.

Replacement cost coverage

Pays the cost to repair or replace damaged property with new material of like kind and quality, without deduction for depreciation, subject to policy limits.

Ordinance or law endorsement

An endorsement that pays additional costs to comply with building codes or ordinances when repairing or replacing damaged property, often with a specified sublimit.

Business income coverage

Pays lost net income plus continuing operating expenses during the period of restoration after a covered loss, typically with a 72-hour waiting period for civil authority actions.

CGL occurrence form

Commercial general liability coverage for bodily injury and property damage caused by an occurrence during the policy period, with occurrence and aggregate limits.

Additional insured endorsement

An endorsement extending liability coverage to a party such as a landlord or general contractor, with scope determined by the specific endorsement wording.

New Mexico minimum auto limits

25/50/10: $25,000 per person and $50,000 per accident for bodily injury and $10,000 for property damage, with UM/UIM required unless rejected in writing.

Pure comparative fault

New Mexico's negligence rule that reduces a claimant's recovery by the claimant's percentage of fault, even if the claimant is more than 50% at fault.

Proof of loss

A sworn statement by the insured detailing the claimed loss, required by the policy within a specified time after the insurer's request.

Examination under oath

A formal investigative tool in which the insured answers questions under oath, supported by the policy's duty to cooperate condition.

Reservation of rights

A letter preserving the insurer's right to deny coverage later while the investigation continues, without waiving any policy defenses.

Actual cash value

Replacement cost minus depreciation, reflecting the pre-loss value of the damaged property, used when the policy does not provide replacement cost coverage.

Claim file documentation

A chronological record including correspondence, photos, estimates, invoices, and notes of every contact with the insured and insurer, maintained for at least five years.

Settlement authority

The limit within which an adjuster may settle a claim, granted by the insurer or client; a public adjuster cannot settle without the insured's written authorization.

Appraisal provision

A policy process for resolving disputes over the amount of loss: each party selects an appraiser, and the appraisers select an umpire to decide.

Settlement breakdown

An explanation of the gross loss, depreciation, deductible, prior payments, and net payable to the insured, which the adjuster must provide.

Fiduciary duty

The obligation of a public adjuster to act in the insured's best interest, avoid conflicts of interest, and disclose any compensation from other parties.

Client trust account

A separate account for holding client funds; commingling with the adjuster's own funds is prohibited and may result in license discipline.

Disaster solicitation restriction

A public adjuster may not solicit a client during a declared disaster or emergency unless the client initiated the contact, under NMAC 13.4.3.

Rebating prohibition

Offering or giving anything of value not specified in the policy as an inducement to purchase insurance is an unfair trade practice under NMSA 1978, §59A-16.