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Public Adjuster Moratorium “Unconstitutional” per the Florida Supreme Court

In 2008, Florida law established a 48-hour moratorium on public adjusters. This month (July 2012), it was ruled unconstitutional by the Florida Supreme Court on grounds that it restricted commercial speech.

And what a logical decision it was. With insurance companies trying to people to sign quickly for low settlements while they are feeling desperate, what possible reason could there be to ban public insurance adjusters from soliciting policyholders during the first 48 hours after a damaging event? It simply violated peoples’ rights.

1800Adjusters applaud the Supreme Court of Florida. The insurance industry is not clapping, however.

Public Adjusters serve are trained and licensed advocates for insurance policyholders regarding the negotiation insurance claims. The now overturned law had been prevented them from getting involved in insurance cases at the beginning of an insurance crisis.

The 2008 Florida law had been created in the aftermath of Hurricane Katrina. The law was created with a great push from insurance companies alleging that unscrupulous Public Adjusters were causing them to pay unnecessary or inflated insurance claims.

Plaintiffs maintained that the first 48 hours after a damaging event are incredibly critical for a policyholder. This is the window when photos must be taken, paperwork initiated (and sometimes completed) as well as other important actions must be taken to protect evidence and meet the policyholder clauses which commonly allow insurance companies to deny payment if not done in the timeframe stated in the policy.

One of the roles of Public Adjusters is to serve as advocates for policyholders during this time, not just for the price negotiation itself, but also to help policyholders understand what responsibilities have been placed upon them via the policies; and, to help them meet those responsibilities to avoid a denied claim.

The Florida Supreme Court ruled that the commercial free speech rights of Public Adjusters’ were being violated under the law. Prohibiting Public Adjusters from soliciting people until 48 hours after an insured event was a violation of their rights. And, of course, there are also the rights of policyholders to be well-informed of all the facts and laws as well as nuances of the policies they hold.

Currently, Public Adjusters are allowed in 44 states where legislation provides for the licensing, authorization of, and/or regulation of Public Adjusters. Public Adjusters are not licensed in Alabama, Alaska, Arkansas, South Dakota, Virginia, and Wisconsin.

This decision in Florida may add further support to have Public Adjusters be allowed in all 50 states.

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