New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

George E. Pataki
Governor

Gregory V. Serio
Superintendent

The Office of General Counsel issued the following opinion on November 18, 2004 representing the position of the New York State Insurance Department.

Re: Licensing of Field Investigators as Independent Adjusters

Question Presented

Must an insurance company’s field investigator whose duties are limited to "taking statements from various parties concerning an accident, taking photographs of accident scenes, obtaining police reports and speaking with potential witnesses" become licensed as an independent adjuster pursuant to N.Y. Ins. Law § 2108 (McKinney 2000)?

Conclusion

No. Such action does not require an independent adjuster’s license under the N.Y. Ins. Law.

Facts

The inquirer indicated that the inquirer works for a Third Party Administrator that retains the services of a field investigator for the purposes of gathering information surrounding insurance claims. Within the inquirer’s email, and during a subsequent telephone conversation, the inquirer explained that the field investigator’s responsibilities are limited to those described above and are "exclusively clerical."

Analysis

Initially, please note that the New York State Insurance Law does not specifically define " third party administrator" and does not regulate activities of TPAs as such. However, any person or entity that engages in activities in New York that would require licensing (e.g., acting as an adjuster) must obtain the appropriate license from the New York Insurance Department.

N.Y. Ins. Law § 2101(g)(1) (McKinney 2000) (as amended 2003, 2004) defines an independent adjuster to be "any person…who for money commission or any other thing of value, acts in this state on behalf of an insurer in the work of investigating and adjusting claims arising under insurance contracts." Pursuant to N.Y. Ins. Law § 2101 and 2108, an individual acting as an independent adjuster on behalf of an insurer must obtain a license from the Superintendent of the New York State Insurance Department. See, N.Y. Ins. Law § 2108(a) (McKinney 2000).

With respect to whether the subject field investigator requires an independent adjuster’s license, merely investigating a loss does not constitute acting as an independent adjuster, since the statute [N.Y. Ins. Law § 2101(g)] requires investigating and adjusting. See, OGC Opinion dated September 2, 1992. Based on the facts presented by the inquirer, the field investigator does not need to obtain an adjuster’s license, as the investigator’s responsibilities are exclusively investigatory. However, please note that the field investigator would require a license should the investigator’s responsibilities ultimately include areas which are discretionary in nature such as reviewing and processing claims, authorizing payments, issuing and signing checks, handling inquiries from insureds, evaluating the merits of a loss and making recommendations to the insurer. See, OGC Opinion date January 13, 2003. Finally, please note that no opinion is provided as to whether the investigator would require licensing as a private investigator or otherwise.

For further information one may contact Supervising Attorney Paul Zuckerman at the New York City Office.