RULE CAPS ADJUSTER FEES AT 10 PERCENT

An emergency rule capping adjuster fees at 10 percent of the claim payment has been issued in Florida to prevent Hurricane Katrina’s victims from becoming “gouged” by public insurance adjusters.

In addition to limiting fees, the rule contains other consumer protections for victims who consider contracting with public adjusters.

It gives consumers 14 days to cancel a contract made with a public adjuster without penalty and prohibits public adjusters from demanding any up-front payments or compensation prior to final settlement of the claim.

Florida’s Chief Financial Officer Tom Gallagher found the need to impose the rules after Hurricane Charley hit in August 2004 and there were reports of adjusters demanding fees of up to 25 percent.