PA Public Adjuster cheat sheet

Indemnity principle: a property policy restores the insured to the pre-loss financial position, not better; recovery is limited by policy limits, deductibles, and the valuation method.

ACV = replacement cost minus depreciation; RCV pays replacement cost but often withholds depreciation until repair or replacement is completed and documented.

Coinsurance recovery formula for property: (limit carried ÷ limit required) × covered loss, then subtract the deductible, capped by the policy limit.

Deductibles apply per occurrence or as the policy states; percentage wind, hurricane, or named-storm deductibles are calculated on a stated limit, commonly the dwelling limit.

The insuring agreement grants coverage; exclusions remove or limit coverage; conditions set duties; definitions control interpretation; endorsements modify all of these.

Typical post-loss duties: give prompt notice, protect property from further damage, cooperate with investigation, prepare an inventory, submit a sworn proof of loss when required, and preserve evidence.

Additional coverages such as debris removal, ordinance or law, and additional living expense often have separate limits or sublimits and are scoped separately.

Subrogation: after payment, the insurer may pursue responsible third parties; the insured must not release or impair those rights and must cooperate.

A Pennsylvania public adjuster license is required before soliciting, negotiating, or adjusting a first-party claim for compensation on behalf of an insured.

Licensure is personal and not transferable; a licensed entity must qualify and list licensed individuals as required by Department rules.

Core application elements include age 18 or older, good character, passing the examination, application and fees, and the surety bond or financial responsibility required by Act 21.

Pennsylvania public adjuster licenses renew biennially; renewal requires continuing education, fees, and current contact and disciplinary information.

Continuing education must be Department-approved and includes ethics; retain completion certificates to prove compliance in an audit.

Licensees must report changes in name, address, and material licensing or disciplinary events within Department timeframes.

Unlicensed adjusting is prohibited; exemptions are narrow and can include attorneys acting in the practice of law and insurer-employed staff adjusters.

The Department may deny, suspend, revoke, fine, or place conditions on a license for violations, fraud, or failure to meet licensing requirements.

Act 21 of 2012 is Pennsylvania's Public Adjuster Licensing Act; it establishes licensing, contract, conduct, recordkeeping, and enforcement rules enforced by the Insurance Department.

A public adjuster represents the insured, not the insurer, and owes loyalty, good faith, and full disclosure to the insured.

No solicitation of a public adjuster contract during the first 72 hours after a loss; emergency mitigation and safety communications must not become improper solicitation.

The contract must be written, signed by the insured, disclose compensation and services, and give the insured a three-business-day right to rescind by written notice.

Compensation must be disclosed and cannot include undisclosed rebates, kickbacks, or inducements; the adjuster may not accept compensation from the insurer for the same claim.

Prohibited conduct includes misrepresentation, false urgency, forging signatures, unlicensed practice, conflicts of interest, and acquiring an ownership interest in the claim or repair.

The adjuster must maintain claim and contract records as required by the Department and produce them on request; consumer privacy must be protected.

Violations can lead to license denial, suspension, revocation, fines, restitution, and referral for criminal prosecution; unlicensed adjusting is separately sanctionable.

First notice: record date and time, cause, location, policy number, insured contact, emergency mitigation, and any injuries or third-party involvement.

Coverage investigation: confirm policy period, insured interest, occupancy, cause of loss, exclusions, endorsements, deductibles, and other insurance before valuing damages.

Scene documentation: wide, mid, and close photographs; video; measurements; moisture readings; sketches; dated notes; and pre-loss condition evidence.

Statements and EUOs: prepare the insured, preserve documents, avoid speculation, and correct errors by supplemental sworn statement rather than alteration.

Experts: use engineers for structural or cause issues, accountants for business income, and certified remediators for contamination; define the scope in writing.

Proof of loss: a sworn statement of amount and facts; submit by the policy deadline or request an extension in writing; it is not a waiver of additional covered damage.

Claim diary: log every insurer contact, request, deadline, payment, and reservation-of-rights letter; confirm oral communications in writing.

Preserve evidence and subrogation: avoid spoliation, retain damaged items, identify third parties, and notify the insurer of potential recovery.

Measure before estimating: room dimensions, ceiling heights, roof pitch and perimeter, openings, and affected areas; convert roof area to squares at 100 square feet per square.

Water losses: classify Category 1, 2, or 3 and Class 1 through 4; category drives contamination controls, while class drives drying equipment and material removal.

Fire losses: separate fire, smoke, heat, and water damage; test cleaning versus replacement; document odor, soot residues, and hidden cavities.

Wind and hail: use test squares and manufacturer criteria; distinguish cosmetic from functional damage; document hail size, direction, and collateral impacts.

Structural damage: look for load-path cracks, deflection, separated framing, and foundation movement; refer structural calls to a licensed engineer.

Contents: inventory by room with age, condition, cost, replacement cost, and depreciation; photograph labels and serial numbers; identify salvage.

ALE and loss of use: document uninhabitability, increased living costs, receipts, and policy time limits; compare pre-loss and post-loss expenses.

Depreciation: base it on age, life expectancy, condition, and obsolescence; ACV = RCV minus depreciation; keep the calculation transparent.

Use a line-item estimate by trade: quantity, unit, unit cost, labor, material, overhead and profit, tax, permits, and debris removal; avoid unsupported lump sums.

Scope the cause-and-result damage, not just visible damage; include hidden damage only when documented by access, testing, or expert opinion.

Photograph and label every line item: wide shot, mid shot, close-up with scale, and a reference to the estimate line or room.

Roof measurement: squares = roof area ÷ 100; add waste based on complexity, often 10 to 15 percent; account for pitch, valleys, hips, and penetrations.

Contents valuation: RCV minus depreciation = ACV; document replacement cost with current pricing and depreciation with age and life evidence.

Proof-of-loss package: estimate, photos, inventory, receipts or invoices, expert reports, policy declarations, and a cover index; reconcile totals to the claim amount.

Supplements: document omitted damage, code upgrades, hidden conditions, and pricing differences; submit with photos, invoices, and a revised estimate.

Business income: calculate gross profit or loss, continuing expenses, mitigation, and period of restoration; support with financial statements and payroll records.

The contract must be in writing, identify the insured and loss, describe services, state compensation clearly, and disclose the three-business-day rescission right.

Compensation can be contingent as a percentage of settlement, hourly, or flat; the method and percentage must be disclosed before signing and applied consistently.

Compensation must comply with Act 21 disclosure and applicable fee rules; the insured must receive a copy of the signed contract.

Cancellation: the insured may rescind within three business days by written notice; the adjuster must honor it and account for any deposit or fee as required.

Consumer protection prohibits misrepresentation, high-pressure solicitation, false statements about insurer payment, and solicitation during the 72-hour post-loss bar.

The adjuster must not act as contractor, lender, or adverse party on the same loss without full disclosure and compliance; conflicts are disciplined.

Complaints go to the Pennsylvania Insurance Department; keep complaint records, respond truthfully, and preserve claim files for review.

Privacy: collect only needed personal and financial data, secure it, disclose its use, and do not share it without authorization or legal requirement.