Urge Congress to Support the CLAIM Act
Independent claims adjusters today handle thirty percent of the nation’s insurance claims, representing over $150 billion of claims payments. Claimants and insurers alike rely on independent adjusters to resolve claims as they arise in a timely and effective way. Responding to the needs of consumers quickly and efficiently requires flexibility and mobility to apply the right expertise to adjusting losses from natural disasters or individual accidents—especially in cases occurring across state lines in today’s nationwide economy.
Unfortunately, a patchwork of conflicting state laws frustrates interstate claims adjusting and prevents efficient, timely, and cost-effective customer service, whether for workers’ compensation, property and casualty, disability, residential, auto, or other claims.
The complex array of state laws and regulations can frustrate the ability of qualified out-of-state adjusters to work on a claim. Adjusters are expected to meet customer needs over the phone, online, and in person, including across state lines. Today, claims adjusters have to deal with the inefficiencies, duplication, and bureaucracy of 34 different state licensing regimes, only a few of which are partially reciprocal. The result is wasted time, effort and expense, and regulatory arbitrage for adjusters who must navigate this patchwork system. Ultimately, otherwise-avoidable costs affect consumers.
What is outdated and inefficient with the current insurance claims process?
The CLAIM Act advances uniformity, reciprocity, and consumer protections for claims adjusting across state lines by implementing the following provisions:
Each state has four years to adopt uniform licensing laws for independent claims adjusters and to work with the other states to adopt reciprocity standards to enable adjusters properly licensed in their designated home states to assess and settle claims across state lines without discrimination. The state-based regulation of independent adjusters remains in place, but the states must undertake needed reforms during those four years.
After that time, if such uniformity and reciprocity has not been achieved by a certain state, the CLAIM Act authorizes independent claims adjusters to apply to the National Association of Registered Agents and Brokers (NARAB) for a license under which to operate.
Since its inception, the ACP has been focused on advocating for enactment of legislation to resolve the current inefficiencies with the state adjuster licensing process. The CLAIM Act represents a balanced approach, enabling adjusters to handle claims more efficiently and effectively across states lines with both reciprocal licensing reforms and appropriate state oversight. More importantly, The CLAIM Act protects consumers and accelerates claims resolution by encouraging states to adopt uniform licensing criteria management programs, safer workplaces, and improved accident prevention programs.
Urge Congress to Support the CLAIM Act
In addition to ACP’s federal advocacy, the Association is actively involved in numerous adjuster and third-party administrator issues at the state level. The Association often engages in important regulatory educational efforts to inform state insurance commissioners and other regulators about the value and business practices of independent adjusters, and their positive impacts on the claims system. ACP also advocates at the state level, seeking uniformity and reciprocity in state adjuster licensing laws and regulations. AAICP’s advocacy to date has resulted in significant changes to state adjuster laws and regulations.
In 2015, the California Department of Insurance proposed that both public and independent adjusters be subject to a new licensing regime and to extensive revised new regulatory requirements. The California Assembly similarly began considering legislation to enact the Department’s proposed changes. The ACP quickly mobilized in Sacramento, and after extensive advocacy, the ACP successfully convinced the Department and the state Assembly that independent adjusters needed to be separately regulated from public adjusters.
Following the Association’s success in 2015, ACP worked closely with the Department of Insurance, the Assembly, and the State Senate to address the need for reform and to refine the independent adjuster-specific licensing legislation, both to determine whether reform was actually needed and if so, to clarify the scope and application of the legislation. Among the many important changes, ACP was able to clarify with the Department and the legislature that workers’ compensation adjusters are exempt from the new licensing regime. Numerous other changes were also made to improve the legislation. Following ACP’s extensive advocacy, on September 29, 2016, Governor Jerry Brown vetoed the legislation, noting he was “not convinced that an overhaul of the current licensing system [was] warranted.”