Pennsylvania’s Proposed Public Adjuster Licensing Amendments: What Consumers Need to Know

When Pennsylvanians file an insurance claim, they expect the process to be straightforward and fair. But the reality is often far more complicated, with technical policy language, strict deadlines, and negotiations that tilt in favor of insurance companies. 

That’s why the state’s laws governing public adjusters, licensed professionals who advocate for policyholders, are so important. 

Right now, Pennsylvania is considering sweeping changes to its Public Adjuster Licensing Law (63 P.S. §1601,1608), and the outcome could significantly affect how consumers recover after property damage.

Key Changes Being Proposed

The draft legislation includes:

• Fee Caps: Public adjuster fees would be capped at 10% for catastrophic claims and 15% for all other claims.
• Ban on Financial Interests: Adjusters would be prohibited from having any financial interest in restoration, demolition, or salvage services connected to claims.
• 30-Day Contract Rescission: Consumers would have up to 30 business days to cancel a public adjuster contract if signed shortly after a loss.
• Increased Bond Requirements: The minimum bond for licensing would double, from $20,000 to $40,000.
• Expanded Definitions and Restrictions: Terms like “solicit” now include “urge,” which could even make casual recommendations legally questionable.

Why These Changes Matter to Consumers

On the surface, some of these provisions may look like consumer protections. But organizations like the American Adjuster Association (AAA) and the Mid-Atlantic Association of Public Insurance Adjusters (MAPIA) have raised strong concerns:

• Reduced Access to Representation: The average homeowner’s claim between 2018–2022 was just $15,570 (Insurance Information Institute). Under a 15% cap, a public adjuster would earn only about $2,300, an amount often insufficient to cover the hours of work, documentation, and negotiation required. This means many smaller claims could go unrepresented, leaving homeowners to face insurers alone.
• Loss of Consumer Choice: Banning public adjusters from having any financial interest in repair or restoration companies might sound protective. Both AAA and MAPIA argue that disclosure, not prohibition, is the better path. Many homeowners rely on trusted recommendations when selecting contractors, and insurers themselves often use preferred vendor networks that involve referral fees.
• Unfair Cancellation Rules: A 30-day rescission period could allow a consumer to cancel after a public adjuster has already done significant work. Without fair compensation, many adjusters may be forced to avoid taking on urgent cases—ironically harming the very policyholders the law intends to protect.
• Overregulation of Speech and Practice: Restrictions on recommending contractors or even “urging” someone to hire an adjuster could limit free speech and keep homeowners from accessing reliable guidance.

AAA’s Position: Protect Consumers, Don’t Limit Them

AAA’s formal comments to the DOI emphasize that regulation should focus on transparency, disclosure, and accountability, not blanket prohibitions that reduce consumer options. Heavy-handed rules risk punishing the many for the misconduct of a few.

Instead, AAA supports:

• Strengthened disclosure requirements when financial interests exist.
• Flexibility in fee arrangements to ensure small claims can still be represented.
• Fair cancellation policies that protect consumers without making it impossible for adjusters to serve them.
• Education and oversight targeted at bad actors, not broad restrictions that limit consumer rights.

The Bottom Line

As these proposed amendments move forward, Pennsylvanians deserve a system that prioritizes their recovery, not one that limits their options. Overregulation could discourage adjusters from taking on smaller claims, restrict homeowners’ ability to choose trusted professionals, and ultimately leave families navigating complex insurance disputes on their own. 

AAA, along with MAPIA and NAPIA, is committed to tracking, reviewing, and responding to legislation like this to ensure that consumer rights remain protected. Our goal is simple: to preserve access, choice, and fairness in the claims process so that policyholders aren’t left to navigate insurance battles alone.

If you’d like to support these efforts or learn more about how AAA is advocating for policyholders, sign up to become a member and join the cause.