NAIC Working Group adopts independent adjuster licensing guideline, seeks comments
The National Association of Insurance Commissioners (NAIC) Adjuster Licensing Working Group has adopted revisions to its “Independent Adjuster Licensing Guideline” and is seeking public comment.
The purpose of the guideline is to govern the qualifications and procedures for licensing independent adjusters and specify their duties and restrictions. The guideline is not a model act.
NAIC told Repairer Driven News that its members adopted the guideline in 2008, and it hasn’t been revised since.
The revisions are now up for public comment through Sept. 11, including NAIC members, state insurance regulators, and consumer representatives.
The working group adopted the revisions on July 15. NAIC says they were presented and discussed during the Producer Licensing (D) Task Force meeting at the NAIC Summer National Meeting.
NAIC says after the comment period closes, the Producer Licensing (D) Task Force will review all submitted comments and continue its discussion of the guideline.
The Task Force is currently targeting final adoption during its conference call on Oct. 15.
A drafting note added to the proposed guideline revisions states: “This guideline is drafted to eliminate redundant licensure requirements with respect to the activities engaged in by a licensee. If licensed as an independent adjuster, third-party administrator, or similar business entity, licensees should not be required to obtain separate independent adjuster licenses, provided that the types of claims adjusted do not include life, health, annuity, or disability insurance claims.”
Individual states may adapt the guidelines to include staff (company) adjuster licensing where required, according to a separate drafting note added to the guideline document.
NAIC notes that states where staff adjuster licensure isn’t required could consider allowing a staff adjuster that is also a state resident to get a resident independent adjuster license to facilitate reciprocal licensure in other states.
The latest approved revisions focus on the definitions for “staff (company) adjuster” and “designated home state.”
Revisions show that “staff (company) adjuster” is proposed to be defined as “a person who is an employee of an insurer or an affiliate of the insurer, and who is engaged in adjusting insured losses solely for that company or other companies under common control or ownership.”
A drafting note adds: “While the definition of employee can vary depending on the context (e.g., labor laws, taxes), it is generally construed to mean a worker whose employer controls both the work performed and the methods used to complete it.”
The “home state” changes center on ensuring the definition includes a physical place of business or location “where an applicant or licensee physically spends the majority of their time conducting the business of insurance.”
According to other drafting notes, states that have adopted the Producer Licensing Model Act may not have to adopt written examination, non-resident license, and reporting of actions requirements.
Drafting notes with each of these sections read as follows: “Rather, the state may want to amend its relevant insurance producer statute to include independent adjusters.”
Specific to examinations, it’s noted that states “may wish to prescribe by regulation limitations on the frequency of application for examination in addition to other pre-licensing requirements.”
An effective date for the guideline revisions hasn’t been decided. The guideline notes that a minimum of six months to one year of implementation time is recommended to ensure adequate notice of changes, fees, and procedures.
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