WASHINGTON— The Association of Claims Professionals (ACP) commends the signing of an Executive Order which aims to reduce overly burdensome occupational licensing requirements which have posed significant barriers to entry for many professionals, especially independent claims adjusters. The order directs federal agencies to investigate the issue and provide recommendations on what could be done to minimize state-level licensing burdens.
“We commend the Administration for recognizing the need to reduce overly burdensome occupational licensing requirements and outlining a framework to move forward with meaningful reforms,” said Steve Hurley, General Counsel, Americas at Sedgwick. “This is an important development in the pursuit of licensing uniformity and reciprocity for independent claims adjusters and we look forward to working with this Administration – and the next – to implement common-sense solutions.”
Under the Executive Order, the Assistant to the President for Domestic policy – in consultation with the Secretaries of Commerce, Labor, the Director of the Office of Management & Budget (OMB), the Administrator of the Small Business Administration (SBA) and the Director of the Intergovernmental Affairs (IGA) – shall submit a report identifying recommendations the federal government can take to reduce occupational licensing burdens. The Order also requires the agencies to review state, territorial, and tribal policies concerning occupational licensing requirements and develop recommended actions to reward such entities that have implemented reforms.
Occupational licensing requirements for independent claims adjusters in particular is an area that is ripe for the federal government to review. At least 34 states require independent claims adjusters to hold a license, and inconsistencies within state requirements cause nearly all adjusters to face licensing and regulatory barriers when working across state lines. According to a recent survey commissioned by ACP, the average adjuster must hold between 10 and 12 different state licenses in order to operate effectively. These barriers make it difficult for adjusters to respond quickly to events like natural disasters, where timely processing of claims is needed to ensure recovery efforts proceed as smoothly as possible.
A 2018 report from the Pacific Research Institute examined the economic impact of these duplicative licensing regulations on independent claims adjusters, highlighting how burdensome state requirements make it more difficult for adjusters to operate, drive up prices for consumers, and limit opportunities for new adjusters to enter the workforce. According to the report, the current patchwork of state licensing regulations imposes a cost of $2,617 on the average insurance adjuster. Extrapolated to the estimated number of adjusters in the United States – 125,000 according to a survey commissioned by ACP – implies a total annual licensing cost of $327.1 million.
The ACP is currently advocating for common-sense reforms to the adjuster licensing process at the federal and state levels. The bipartisan The Claims Licensing Advancement for Interstate Matters (CLAIM) Act (H.R. 4037), introduced in Congress by Representatives David Kustoff (R-TN) and Bill Foster (D-IL), requires states to adopt uniform, reciprocal licensing laws for adjusters within a four-year period, after which adjusters would be authorized to apply for a license through the National Association of Registered Agents and Brokers (NARAB). At the state level, ACP is engaged with policymakers in California and New York to remove redundant and burdensome surety bond requirements for adjuster licensure.
To read the Administration’s Executive Order, CLICK HERE.
About Association of Claims Professionals (ACP)
The Association represents the interests of independent claims professionals. Since its inception in 2002, the Association has promoted adjuster licensing uniformity and reciprocity to enhance quality and ensure prompt and equitable reimbursement of claims. In 2016, the Association updated its name to the Association of Claims Professionals and repositioned itself to embrace the forward-looking vision of its member companies. ACP’s vision for the future is a claims management industry viewed as a trusted advisor and business partner by its customers and as a helpful and caring frontline responder by claimants. ACP companies are committed to providing career opportunities to attract the next generation of claims professionals. Learn more at claimsprofession.org.