The Office of General Counsel issued the following opinion on October 29, 2003, representing the position of the New York State Insurance Department.
Re: Solicitation of Claims by Non-licensees on Behalf of Public Adjusters.
May a non-licensee call prospective clients who have recently sustained a loss, based upon information retrieved from newspaper articles or the internet and ask such clients whether they wish to schedule an appointment with a specific public adjuster with whom the non-licensee is affiliated?
No. A non-licensee may not engage in such activities without becoming licensed as a public adjuster pursuant to Article 21 of the Insurance Law.
The inquirer states that he is considering hiring unlicensed appointment setters to schedule appointments for his companys public adjusters. Specifically, these individuals would schedule appointments by using the phone during the hours of 9:00am- 4:00pm Monday through Friday. The list of prospective clients would come from newspaper articles or the internet and would include individuals or businesses that have had a fire or some other type of property loss. The appointment setters would ask the prospective clients whether they would like to set up a time to meet with a licensed public adjuster.
N.Y. Ins. Law § 2102(a)(1)(McKinney 2000) prohibits any person, firm, association or corporation from acting as an insurance adjuster in New York without the appropriate license. Section § 2108(a)(3) states that no adjuster may act on behalf of an insured unless licensed as a public adjuster. Section § 2101(g)(2) defines the term "public adjuster" as follows:
(g)(2) [A]ny person, firm, association or corporation who, or which, for money, commission or any other thing of value, acts or aids in any manner on behalf of an insured in negotiating for, or effecting, the settlement of a claim or claims for loss or damage to property of the insured in this state caused by, or resulting from, any of the risks as enumerated in paragraphs four, five, six, seven, eight, nine and ten and subparagraphs (B) and (C) of paragraph twenty of subsection (a) of section one thousand one hundred thirteen of this chapter, not including loss or damage to persons under subparagraph (B) of paragraph twenty of subsection (a) of such section1 or who, or which, advertises for, or solicits employment as an adjuster of such claims, and shall also include any person who, for money, commission or any other thing of value, solicits, investigates, or adjusts such claims on behalf of any such public adjuster . . . (emphasis supplied)2
Pursuant to the express language of the statute, the definition of the term public adjuster includes a person who solicits claims on behalf of such public adjuster. Although the term "solicitation" is not specifically defined by the Insurance Law, the Department defines solicitation as "to ask for the purpose of receiving" and "to move to action, to endeavor to obtain by asking, and implies personal petition to a particular individual to do a particular thing." See Circular No. 5 (2001).
Consequently, a non-licensee who engages in the activities that the inquirer described would be soliciting claims within the meaning of Section 2101(g)(2) and would have to become licensed as a public adjuster pursuant to Article 21 of the Insurance Law.
Please note that this opinion is limited to the factual situation specified herein. Nothing in this opinion would prohibit a non-licensee from setting up appointments after the licensed public adjuster has already made the initial contact with the prospective client or in a situation where the prospective client has initiated the contact with the public adjuster.
For further information you may contact Senior Attorney Pascale Joasil at the New York City Office.
1 N.Y. Ins. Law § 1113(a)(4), (5), (6), (7), (8), (9), (10) and (20)(B) and (C) (McKinney 2000) covers fire insurance, miscellaneous property insurance, water damage, burglary and theft insurance, glass insurance, boiler and machinery insurance, elevator insurance, marine and inland marine insurance, not including loss or damage to persons).
2 Section 2101(g)(2) contains exemptions to this licensing requirement, none of which are applicable to this inquiry.