Only two-thirds of states license independent claims adjusters. The 34 states that do license, however, enacted their licensing laws decades ago, when claims adjusting was a very local endeavor. Today, however, claims adjusting is national, and the complex array of state laws and regulations make it difficult for qualified and experienced out-of-state adjusters to provide timely and efficient claims processing. Claims adjusters are expected to meet customer needs over the phone, online, and in person, including across state lines when processing claims. This means that adjusters need to be licensed in each state in which a claimant is located.
As a result of this patchwork system, claims adjusters are forced to deal with the inefficiencies, duplication, and bureaucracy of 34 different state licensing regimes, only a few of which are partially reciprocal. This results in wasted time, effort and expense, impacting consumers who can face delays and interruptions in service, and adjusters who must navigate this inefficient and archaic system to process claims for their customers.
The CLAIM Act (H.R. 4037) requires states to adopt uniform or reciprocal adjuster licensing laws for independent claims adjusters that will enable adjusters who are properly licensed in their designated home states to assess and settle claims across state lines without discrimination. The state-based regulation of independent adjusters would still remain in place, but the states would be incentivized to undertake needed reforms within four years of the law’s enactment.
If a state is unable to adopt uniformity and reciprocity after four years, the CLAIM Act would authorize independent claims adjusters to apply to the National Association of Registered Agents and Brokers (NARAB) for a license under which to operate in such non-conforming state.
The CLAIM Act represents a balanced approach; mirroring legislation already enacted by Congress for agents and brokers (known as NARAB I and NARAB II). The bill would enable 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.