House bill proposes strict limits on public insurance adjusters, clients

OKLAHOMA CITY (KFOR) — Oklahoma lawmakers are considering a bill to put stricter limits on public insurance adjusters and the people who hire them.

Right now, if a person feels like their insurance company isn't paying enough on a claim they filed, they can hire people known as 'Public Insurance Adjusters,' who are licensed by the state to make their own damage assessment, and work with a person's insurance company to pay out more for a claim.

"I support public adjusters. I think there's a need for them," Oklahoma State Representative Mark Tedford (R-Jenks) told News 4.

But Tedford says he filed House Bill 3094 after the Independent Insurance Agents Association of Oklahoma asked lawmakers to crack down on what they feel are predatory practices by some public adjusters.

"The concern is that in a state like Oklahoma in which there's a lot of catastrophic losses… you have, you know, a swarm of out-of-state public adjusters that come in and promise unrealistic settlements to homeowners," Tedford said. "And they induce them into signing contracts which are bad deals for them."

He said in some cases, some particular public adjusters have locked clients into contracts awarding the adjuster significant portions of a final claim payout as a form of payment.

HB 3094 would stop public adjusters from pocketing any more than "ten percent of the amount of the insurance settlement" they work out with a person's insurance company as a form of payment for their work.

It would also stop "public adjusters from participation in lawsuits" against a person's insurance company if they can't settle with the company.

"This is very, very harmful to consumers," said Alice Young, a Licensed Public Insurance Adjuster for Brown O'Haver, a public insurance adjustment firm in Moore.

Young is also a vice president for the National Association of Public Adjusters.

"What's happening in there is it's putting in restrictions that are so heavy that it will restrict public adjustors from being able to work with the insured," Young said.

She says she's all for cracking down on bad actors, and even helped state lawmakers craft a bill last decade she feels is already doing that.

"Back in 2015, we actually worked this language," Young said. "I mean, this was a full bill and it goes through everything."

Young says she's also concerned because Rep. Tedford owns Jenks-based Tedford Insurance—a private insurance company.

"I would definitely think it's a conflict of interest," she said.

News 4 asked Telford if HB 3094 would make it harder for people to use public adjusters to get bigger payouts from companies like his, if it passes.

"I normally like to get public adjusters involved in the very difficult claims. I think they help," Tedford said "So this is, you know nothing against public adjusters from my point of view… It has really nothing to do about my business. It's just fairness for the policyholders in the state of Oklahoma."

HB 3094 would also bar construction contractors and public school districts from hiring public adjusters to help settle insurance claims they may have. News 4 is hearing from school districts across Oklahoma and will continue to follow this story.