How much may a Public Adjuster Charge for Handling a Property Damage Claim Under a Homeowners Insurance Policy?

In Michigan, Public Adjusters may charge up to 10% of the recovery made under a homeowners' policy for property damage claims. The State of Michigan Department of Insurance and Financial Services defines an Adjuster for the Insured (public adjuster) as "An individual allowed by license to contract with and represent the insured who have suffered losses covered by insurance for fire and other hazards. Adjusters for the insured may not adjust workers' compensation losses."

The Michigan Insurance Code regulates the rates that public adjusters may charge their clients. MCL 500.1226 provides that a public adjuster shall not charge a rate for his or her services which exceeds 10% of the amount paid by the insurer in settlement of the loss.

Additionally, MCL 500.1226(4) states that public adjusters must only use contracts approved by the Director of the Department of Insurance and Financial Services. The law further requires a public adjuster to contract with the insured in writing on a form approved by the State of Michigan Insurance Commissioner.

The contract approved by the Insurance Commissioner includes, among other provisions, that a contract executed within 48 hours after conclusion of the loss-producing occurrence is voidable at the option of the insured for 10 days after execution.

The Department of Insurance and Financial Services website includes a search engine to verify whether a public adjuster is licensed in the State of Michigan, which can be found here: https://difs.state.mi.us/locators

The contract approved by the State of Michigan Insurance Commissioner can be found here: https://www.michigan.gov/difs/industry/licensing-ins/adjuster/general-info/other/adjuster-for-the-insured-contract