PRINTER'S NO. 3366
No. 2460 Session of 1976
INTRODUCED BY BELLOMINI, MUSTO, DOMBROWSKI, PETRARCA AND SALOOM,
JUNE 3, 1976
REFERRED TO COMMITTEE ON CONSUMER PROTECTION, JUNE 3, 1976
AN ACT
1 Amending the act of April 25, 1921 (P.L.276, No.136), entitled,
2 as amended, "An act requiring persons, partnerships,
3 associations, or corporations advertising for or soliciting
4 business as adjusters of claims within this Commonwealth for
5 loss or damage arising out of policies of insurance, surety,
6 or indemnity on property, persons, or insurable business
7 interests within this Commonwealth, to be licensed by the
8 Insurance Commissioner; requiring persons, partnerships,
9 associations, or corporations acting as solicitors for said
10 adjusters to be licensed by the Insurance Commissioner;
11 regulating the issuance and revocation of such licenses;
12 prescribing certain conditions for the transaction of such
13 business; providing for the filing of bonds by public
14 adjusters and public adjuster solicitors, and for recovery
15 thereon by parties in interest; and providing penalties,"
16 permitting public adjusters to advise, assist, negotiate,
17 adjust and settle claims for any person making a claim for
18 damages arising out of a policy of insurance.
19 The General Assembly of the Commonwealth of Pennsylvania
20 hereby enacts as follows:
21 Section 1. Section 1, act of April 25, 1921 (P.L.276,
22 No.136), entitled, as amended, "An act requiring persons,
23 partnerships, associations, or corporations advertising for or
24 soliciting business as adjusters of claims within this
25 Commonwealth for loss or damage arising out of policies of
26 insurance, surety, or indemnity on property, persons, or
1 insurable business interests within this Commonwealth, to be
2 licensed by the Insurance Commissioner; requiring persons,
3 partnerships, associations, or corporations acting as solicitors
4 for said adjusters to be licensed by the Insurance Commissioner;
5 regulating the issuance and revocation of such licenses;
6 prescribing certain conditions for the transaction of such
7 business; providing for the filing of bonds by public adjusters
8 and public adjuster solicitors, and for recovery thereon by
9 parties in interest; and providing penalties," amended June 22,
10 1931 (P.L.605, No.207), is amended to read:
11 Section 1. Be it enacted, &c., That the term, "public
12 adjuster," as used in this act, [shall include] includes every
13 person, copartnership, association, and corporation
14 [advertising, soliciting business, or holding] (i) who
15 advertises, solicits business, or holds himself or itself out to
16 the public, as an adjuster of claims for losses or damages
17 arising out of policies of insurance, surety, or indemnity upon
18 property, persons, or insurable business interests within this
19 Commonwealth, and [receiving] receives any compensation or
20 reward for the giving of advice or assistance [to the assured]
21 in the adjustment of claims for such losses, or (ii) who for
22 compensation or reward, whether by way of salary or commission
23 or otherwise, directly or indirectly, [solicit business,
24 investigate or adjust losses, or advise] solicits business,
25 investigates or adjusts losses, or advises the assured with
26 reference to claims for losses, on behalf of any other person,
27 partnership, association, or corporation engaged in the business
28 of adjusting losses.
29 The term does not include an agent or employee of an
30 insurance company, association, or exchange, through whom a
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1 policy of insurance was written, in adjusting loss or damage
2 under such policy, nor does it include a broker or agent acting
3 as adjuster if the services of the agent or broker in the
4 adjustment are without compensation.
5 A public adjuster solicitor is a person, copartnership, or
6 corporation who or which solicits, directly or indirectly, in
7 any manner or aids in securing for a public adjuster a contract
8 with the assured for the adjustment of a loss.
9 Section 2. The act is amended by adding sections to read:
10 Section 2.1. The Insurance Commissioner shall make such
11 rules and regulations as may be necessary to implement the
12 provisions of this act.
13 Section 2.2. Every applicant for a public adjuster's license
14 shall pass an examination administered by the Insurance
15 Department relating to the duties of an adjuster. The
16 examination shall include questions to determine, inter alia,
17 the applicant's knowledge of the principles of torts and rules
18 of evidence.
19 Section 3. Section 3 of the act, amended June 22, 1931
20 (P.L.605, No.207), is amended to read:
21 Section 3. The Insurance Commissioner shall issue adjusters'
22 licenses and adjuster solicitors' licenses to persons,
23 partnerships, associations, or corporations applying therefor
24 who passes the examination and whom he deems to be trustworthy
25 and competent to transact business as public adjusters and
26 public adjuster solicitors, respectively, in such manner as to
27 safeguard the interests of the public; but no license shall be
28 issued to any person, partnership, association, or corporation
29 engaged or interested in, or receiving any profit from, nor
30 shall the holder of any such license engage or be interested in,
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1 or receive any profit from, any salvage or similar business.
2 No licensed public adjuster shall, directly or indirectly,
3 act within this Commonwealth as a public adjuster without having
4 first entered into a contract, in writing, in a form approved by
5 the insurance commissioner, and executed in duplicate by the
6 public adjuster and the [assured] person suffering damage, or
7 his duly authorized representative, one copy of which contract
8 shall be kept on file by the public adjuster, open at all times
9 to inspection, without notice, by the Insurance Commissioner,
10 his deputy or his examiners.
11 No public adjuster solicitor shall use any form of contract
12 other than that approved for the public adjuster for whom he is
13 soliciting, nor shall he make any contracts or agreements for
14 himself or for the public adjuster other than such as are
15 specified in the approved contract.
16 Every licensed public adjuster shall keep a full record of
17 his transactions as public adjuster, open at all times, without
18 notice, to the inspection of the Insurance Commissioner, his
19 deputy or his examiners, showing: (1) the name of the assured;
20 (2) the date, location and amount of the loss; (3) the name of
21 the insurer, amount, expiration, date and number of each policy
22 of insurance carried with respect to such loss; (4) an itemized
23 statement of all recoveries by the assured from all sources; (5)
24 the name or names and addresses of any person or persons
25 soliciting the adjustment and the date when solicited; (6) the
26 total compensation received for adjustment and the amount of
27 commission, salary or compensation paid to each employe and
28 solicitor; and (7) such other information as the insurance
29 commissioner may require.
30 Every public adjuster solicitor shall keep a full record of
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1 his transactions as such, open at all times, without notice, to
2 the inspection of the Insurance Commissioner, his deputy or his
3 examiners, showing: (1) the name of the assured; (2) the date
4 and location of the loss; (3) the name or names and addresses of
5 any person or persons soliciting the adjustment for or with him,
6 and the date or dates when solicited; and (4) such other
7 information as the insurance commissioner may require.
8 A license issued to a corporation, partnership, or
9 association shall authorize only the officers and directors of
10 the corporation or the members of the partnership or association
11 specified in the license. The fee to be paid to the Insurance
12 Commissioner by the applicant for a public adjusters' license at
13 the time the application is made, and annually thereafter for
14 the renewal thereof, shall be one hundred dollars. If the
15 applicant is a corporation, partnership, or association, such
16 fee shall be paid for each person specified in the license.
17 The fee to be paid to the Insurance Commissioner by the
18 applicant for a public adjuster solicitor's license at the time
19 the application is made, and annually thereafter for the renewal
20 thereof, shall be fifty dollars. If the applicant is a
21 corporation, partnership, or association, such fee shall be paid
22 for each person specified in the license.
23 Section 4. The act is amended by adding a section to read:
24 Section 3.1. (a) Each public adjuster who solicits business,
25 investigates or adjusts losses, or advises persons other than an
26 assured or an insurance company shall retain an attorney at law
27 for consultation before a claim is settled.
28 (b) An attorney at law who accepts a client who had been
29 represented by a public adjuster shall, before representing the
30 client, so notify the president judge of the court of common
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1 pleas of the judicial district and obtain the written approval
2 of the president judge to represent the client.
3 (c) A public adjustor solicitor shall not solicit or aid in
4 securing for a public adjuster a contract from a person other
5 than an assured.
6 Section 5. Section 6 of the act, amended June 22, 1931
7 (P.L.605, No.207), is amended to read:
8 Section 6. A license issued under this act shall be revoked
9 by the commissioner if, after due investigation, he determines
10 that the holder of such license: (a) has violated any provisions
11 of this act; or (b) has made a material mis-statement in the
12 application for such license; or (c) has been guilty of
13 fraudulent practices; or (d) has, in the judgment of the
14 Insurance Commissioner, demonstrated his incompetency or
15 untrustworthiness to transact the business of a public adjuster:
16 Provided, The Insurance Commissioner may, in his discretion, in
17 cases warranting such action, impose a fine of not more than one
18 thousand dollars ($1,000) for each and every act in violation of
19 this act. Before the Insurance Commissioner shall take any
20 action as above set forth, he shall give written notice to the
21 person, company, association, or exchange accused of violating
22 the law, stating specifically the nature of such alleged
23 violation, and fixing a time and place, at least ten (10) days
24 thereafter, when a hearing of the matter shall be held. After
25 such hearing or upon failure of the accused to appear at such
26 hearing, the Insurance Commissioner shall impose such of the
27 above penalties as he deems advisable. When the Insurance
28 Commissioner shall have taken any action as above set forth, the
29 party aggrieved may appeal therefrom to the [court of common
30 pleas of Dauphin County] Commonwealth Court.
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1 All complaints or charges against a public adjuster in the
2 performance of his duties shall be brought under this section
3 exclusively and no court shall have jurisdiction until the
4 administrative remedies have been exhausted.
5 A public adjuster who acts within the scope of his license
6 shall not be subject to the act of July 12, 1935 (P.L.708,
7 No.271), entitled, as amended, "An act empowering the Department
8 of Property and Supplies, with the approval of the Governor and
9 the Board of Trustees of the Pennsylvania Institution for
10 Defective Delinquents, to grant a right of way or easement to
11 the Pennsylvania Electric Company, successor of the Penn Central
12 Light and Power Company across lands of the Pennsylvania
13 Institution for Defective Delinquents, on certain conditions."
14 Section 6. This act shall take effect in 60 days.
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