What is an adjuster license? Update and latest news
- The global insurance agencies market is projected to grow at a compound annual growth rate (CAGR) of approximately 1.9% to USD $111.9 billion during 2021.
- This growth is driven primarily by businesses beginning to rearrange their operations and step away from the restrictive measures that were initiated during the COVID-19 era.
- By 2025, the market is expected to reach a market value of USD $135 billion, at a CAGR of 4.8%.
Introduction to AI-related platforms and services is quickly becoming a leading trend within the insurance agencies industry. Both technology and insurance companies are helping insurance agencies by independently developing unique technology-enabling services which enhance customer experience rates.
Increased awareness relating to the ample benefits of insurance coverage is additionally expected to propel the global insurance agencies market. This has partly been driven by the unprecedented COVID-19 pandemic, which inadvertently forced the public to educate themselves on the importance of life insurance- particularly in a family context.
Unsurprisingly, the demand for insurance plans has seen an exceptionally high increase over the last year or so, with the percentage of individuals aspiring to buy rising to 60%.
An insurance adjuster (also known as a claims adjuster/specialist), is an individual that investigates the claims made against a specific insurance policy- regardless of whether it is one that concerns a property damage claim or a personal injury claim.
The main role of an insurance adjuster is to: a) talk with the property owners, b) gather information from any witnesses, c) inspect the damage in question, d) review the police reports (if relevant and existing), and e) gather specific information relating to injuries, pain and suffering, and medical expenses involved.
Below we discuss the various types of adjuster licenses, provide coherent steps which delineate how to best obtain an insurance adjuster license – as well as why that is important, and finish off by commenting on the specific requirements that one must satisfy to make sure that they maintain their license.
Types of adjuster licenses
There are three types of adjuster licenses.
- Company adjusters (also known as employee adjusters) usually work full time for an insurance firm or an insurance adjuster company. They are generally salaried, and often receive all of the benefits associated with employment status under the U.S. legal jurisdiction- including life insurance, education training, and a retirement plan.
- Independent adjusters, on the other hand, are not employees. As the name suggests, they work for themselves (independently) or for a plethora of different insurance firms as freelancers. Insurance firms usually rely on third-party claims handling companies, who in turn tend to hire independent adjusters for the majority of their work.
- Public adjusters work on behalf of the individuals who are policyholders. They assist the insured individual during any negotiations if necessary, as well as through any other procedural difficulty. Most commonly, they are hired by individual policyholders when the suggested settlement from an insurer is deemed to be quite low or inadequate.
All of these types have separate licensing requirements.
How to become a licensed insurance adjuster
1. Decide what type of insurance adjuster you want to be
As illustrated above, there are multiple types of insurance adjusters; depending on the type that you go for, your day-to-day operations could vary significantly. Moreover, the type of work you will be involved in will also be highly different.
Whereas a company adjuster may spend a prolific amount of time working closely with a leading insurance firm, for example, a public adjuster may receive more satisfaction helping potentially wronged individuals dispute insufficient settlement proposals.
2. Research the types of adjuster licenses which are available in your state
Not all states will require you to be licensed in order to be able to adjust insurance-related claims- although the majority do.
If you live in a state that doesn’t require one, you may want to acquire a Designated Home State (DHS) license; this is an insurance adjuster license that has been tailor made so as to allow individuals in such states to become licensed adjusters.
This would allow you to work as an adjuster anywhere in the United States by ”designating” another state as your home state through the extensive DHS process.
So, if you are currently residing in a state that doesn’t require (or doesn’t offer) an adjuster licence, you may want to enroll within the DHS process via a state that does- such as Texas. A Texas dhs adjuster license would allow individuals outside of Texas to take the exam, become licensed insurance adjusters, and work in any area within the U.S without being limited geographically.
3. Complete a pre licensing course
It is always recommended to enroll in an adjuster licensing course before attempting to pass your exam; whilst this is not strictly necessary, the data available (first-attempt pass rates) suggests that it greatly improves your chances of passing on your first attempt.
Make sure to spend an adequate amount of time researching what pre-licensing class you choose, however, as the package, diversity, and pricing involved can differ significantly.
4. Pass the licensing exam
This step may be a bit obvious, but (in the states that require you to be licensed) you will need to take and pass your licensing examination. Generally, the majority of states require a score between 60 and 75% to grant applicants a license.
As there are two parts to the exam, it is crucial that you adequately prepare for both.
5. Maintain your license
After obtaining your insurance adjuster license, you will still need to follow a few steps every now and then to ensure you can ”maintain” it.
Your license must be renewed at specific intervals (this is dependent on your state, but is usually every two years), and you must make sure that you update the Department of Insurance if you change your (or your business’s) physical address or name within 30 days of the change.
Failure to do so can cause significant issues, and commonly can involve a prolific amount of procedural rigmarole if wanting to renew it at a later date- so make sure you follow your specific state’s requirements.
Getting an insurance adjuster license is not always mandated, but as previously touched on above it is necessary in most of the states within the U.S.
If it is not necessary in your current state of residence, your best option would likely be to enroll in a DHS adjuster license program remotely, leaving as many career options as possible available for yourself in the future.
We hope you enjoyed reading.
Story by Giuliana Speranza