Ethics, Consumer Protection, and Unfair Trade Practices
Ethics, Consumer Protection, and Unfair Trade Practices
This domain tests the fiduciary and statutory duties that make public adjusting consumer-facing. Ohio prohibits unfair and deceptive acts and unfair claim settlement practices under ORC 3901.20 and related rules.
Core rules
- The public adjuster represents the insured; disclose conflicts and never serve the insurer on the same loss.
- Use a written contract stating services, fee, cancellation rights, and that the adjuster does not guarantee a settlement.
- Do not misrepresent policy coverage, claim value, or authority.
- No rebates, kickbacks, or undisclosed referral fees; do not steer insureds to a contractor in exchange for compensation.
- Protect confidential information and handle claim funds properly.
- Unfair claim practices include unreasonable delay, failure to investigate, misrepresenting policy terms, and offering substantially less than owed.
Worked example
An adjuster tells a homeowner, “Sign today and I’ll waive my fee if you use my brother’s restoration company.” The waiver is an undisclosed inducement tied to a vendor, creating a conflict and a possible unlawful referral arrangement. The contract also lacks the required cancellation notice. Even if the settlement is fair, the conduct violates consumer-protection and ethics standards; the adjuster should disclose the relationship, remove the steer, and use a compliant contract.
Traps
- Believing a good settlement excuses a bad contract.
- Using oral fee agreements or blank contracts.
- Promising a specific dollar outcome.
- Treating “everyone does it” as an ethics defense.