N.Y. Insurance Law § 2108: Adjusters; licensing and duties

§ 2108. Adjusters; licensing and duties. (a) (1) Adjusters shall be

licensed as independent adjusters or as public adjusters.

(2) The superintendent may prescribe the types of independent

adjusters' licenses according to the kind or kinds of insurance claims

which the licensee is to be authorized to investigate and adjust.

(3) No adjuster shall act on behalf of an insurer unless licensed as

an independent adjuster, and no adjuster shall act on behalf of an

insured unless licensed as a public adjuster.

(4) No insurer, agent or other representative of an insurer shall pay

any fees or other compensation to any person, firm, association or

corporation for acting as an independent adjuster except to a licensed

independent adjuster or to a person excepted from the licensing

requirement pursuant to subsection (g) of section two thousand one

hundred one of this article.

(b) The holder of a license under this section may act as an adjuster

without any other or additional license.

(c) (1) The superintendent may issue an independent adjuster's license

or a public adjuster's license to any person, firm, association or

corporation, hereinafter designated as licensee, who, or which, is

trustworthy and competent to act as an adjuster in such manner as to

safeguard the interests of the people of this state and who, or which,

has complied with the prerequisites herein prescribed.

(2) A license issued to a corporation may name as sub-licensees only

the officers and directors of such corporation, and a license issued to

a firm or association may name as sub-licensees only the individual

members of such firm or association. Each sub-licensee named as such in

the license issued to a firm, association or corporation must be

qualified to obtain a license as an independent adjuster or as a public

adjuster, as the case may be, and for each such sub-licensee a fee must

be paid at the times and at the rate hereinafter specified. Each such

sub-licensee shall be authorized, pursuant to such license, to act as an

independent adjuster or as a public adjuster, as the case may be, only

on behalf of the licensee.

(3) Every individual applicant for a license under this section and

every proposed sub-licensee shall be eighteen years of age or over at

the time of the issuance of such license.

(d) (1) Before any such license or any renewal thereof shall be issued

by the superintendent there shall be filed in his office a written

application therefor. Such application shall be in the form or forms and

supplements and contain information the superintendent prescribes.

(2) Each person or individual signing such application shall, with

such application, submit to the superintendent fingerprints of his two

hands recorded in such manner as may be specified by the superintendent

or his authorized representative. Before approving such application it

shall be the duty of the superintendent or his authorized representative

to compare such fingerprints with fingerprints filed with the division

of criminal justice services. Such fingerprints may also be submitted to

the federal bureau of investigation for a national criminal history

record check.

(3) Except in the case of an application for a license to act as an

independent adjuster, such application shall be approved, as to each

person or individual so signing the same, by not less than five

reputable citizens of the community in which such applicant resides or

transacts business, each of whom shall certify that he or she has

personally known the person or individual for a period of at least five

years prior to the filing of such application, that he or she has read

such application and believes each of the statements made therein to be

true, that such person is honest, of good character and competent, and

not related or connected to the person so certifying by blood or

marriage. The certificate of approval shall be subscribed by such

reputable citizens and affirmed by them as true under the penalties of

perjury.

(e) (1) The superintendent shall, in order to determine the

trustworthiness and competency to act as a public adjuster of each

individual applicant for such license, and of each proposed

sub-licensee, except in the case of a renewal license, require every

such individual to take and pass, to the satisfaction of the

superintendent, a personal written examination. No individual shall be

deemed qualified to take the examination without having demonstrated by

evidence satisfactory to the superintendent that (A) the applicant

possesses a minimum of one year experience in the insurance business,

with involvement in sales, underwriting or claims or other experience

considered sufficient by the superintendent, or (B) the applicant

successfully completed forty hours of formal training in a course,

program of instruction or seminars approved by the superintendent.

(2) The superintendent may, in his discretion and on such terms as he

prescribes, dispense with such examination in the case of any individual

applicant or proposed sub-licensee who shall previously have held a

public adjuster's license issued subsequent to January first, nineteen

hundred thirty-six.

(f) (1) The superintendent shall, in order to determine the

trustworthiness and competency to act as an independent adjuster of each

individual applicant for such license, and of each proposed

sub-licensee, except in the case of a renewal license, require every

such individual to take and pass, to the satisfaction of the

superintendent, a personal written examination. The superintendent may

prescribe the types of written examinations according to the kind or

kinds of insurance claims which the applicant is to be licensed to

investigate and adjust.

(2) Any person who at any time served with the armed forces of the

United States, and who immediately prior to entering such military

service had been continuously engaged in bona fide operation in this

state as an independent adjuster for a period of five years, may within

one year after the termination of such military service file with the

superintendent an application in such form as he prescribes, and upon

the payment of the requisite license fee may be licensed by the

superintendent as an independent adjuster without being required to take

and pass such examination.

(3) The superintendent may also, in the superintendent's discretion

and on such terms the superintendent prescribes, dispense with such

examination in the case of any individual applicant or proposed

sub-licensee who shall previously have held an independent adjuster's

license provided the applicant applies within two years following the

date of termination of such license.

(g) The superintendent may, in his discretion require an applicant for

a license under this section to present evidence, in such form as he

prescribes, that such applicant has been employed, for a period which he

deems reasonable, by an insurer, an independent adjuster or a public

adjuster, in the performance of duties which in his opinion would

provide the applicant with a satisfactory preliminary training for the

duties and responsibilities which would devolve upon him as a licensee

under this section.

(h) (1) Any person who has had at least five years experience in

adjusting claims as an employee of an authorized insurer and has made

application for a license as an independent adjuster, or any person

holding a valid estimator's license issued by the commissioner of motor

vehicles and has made application for a license as an independent

adjuster within ninety days of the expiration of the estimator's

license, may file with the superintendent, in such form as the

superintendent prescribes, a written application for a temporary permit

to adjust claims, during the pendency of the application for a license

as an independent adjuster, as:

(i) an employee of a licensed independent adjuster; or

(ii) in the case of an auto body repair estimator, an employee of an

authorized insurer or any adjustment bureau or association owned and

maintained by insurers to adjust or investigate motor vehicle body

damage losses.

(2) Notwithstanding the requirement of subsection (f) of this section

that each individual applicant for an independent adjuster's license or

sub-license shall take and pass a personal written examination in order

to satisfy the superintendent as to trustworthiness and competency, the

superintendent may in the superintendent's discretion, if satisfied that

the person applying for such temporary permit has in all other respects

met the requirements of this section with respect to the licensing of

independent adjusters and is qualified by training and experience to

adjust claims as an employee of a licensed independent adjuster,

authorized insurer, or any adjustment bureau or association owned and

maintained by insurers to adjust or investigate motor vehicle body

damage losses, issue such temporary permit to be effective for such

period of time as the superintendent may specify therein but, in no

event, for a period in excess of one hundred twenty days. The

superintendent may summarily suspend or revoke any temporary permit

issued pursuant to this subsection upon ten days' notice in writing to

the permittee of the superintendent's intention to do so, which notice

shall be given in accordance with the applicable provisions of

subsections (a) and (d) of section three hundred four of the financial

services law.

(i) (1) At the time of application for every adjuster's license and

for every renewal thereof, there shall be paid to the superintendent by

each individual applicant and by each proposed sub-licensee a fee of

fifty dollars for each year or fraction of a year in which a license

shall be valid; except that amounts paid to the commissioner of motor

vehicles pursuant to subdivision five of section three hundred

ninety-eight-d of the vehicle and traffic law, by any person who held an

auto body repair estimator license prior to January first, nineteen

hundred ninety-six shall be considered by the superintendent.

(2) No license fee shall be required of any person who served as a

member of the armed forces of the United States at any time and who (A)

shall have been discharged, under conditions other than dishonorable, or

(B) has a qualifying condition, as defined in section one of the

veterans' services law, and has received a discharge other than bad

conduct or dishonorable from such service, or (C) is a discharged LGBT

veteran, as defined in section one of the veterans' services law, and

has received a discharge other than bad conduct or dishonorable from

such service, in a current licensing period, for the duration of such

period.

(3) A license fee of fifty dollars for each year or fraction of a year

in which a license shall be valid for an independent adjuster's license

shall cover any one or more of the various types of independent

adjusters' licenses issued by the department.

(4) Every individual applying to take any written examination shall at

the time of applying therefor pay to the superintendent, or at the

discretion of the superintendent, directly to any organization that is

under contract to provide examination services, an examination fee of an

amount which is the actual documented administrative cost of conducting

said qualifying examination as certified by the superintendent from time

to time. An examination fee represents an administrative expense and is

not refundable. If, however, the applicant or a proposed sub-licensee

should withdraw his or its application or the superintendent should deny

his or its application before the license applied for is issued, the

superintendent may refund the fee paid by the applicant for the license

applied for, excepting any examination fees required pursuant to this

subsection.

(j) (1) Every adjuster's license issued pursuant to this section shall

be for a term expiring on the thirty-first day of December of even

numbered years, and may be renewed for the ensuing two calendar years

upon the filing of an application in conformity with subsection (d)

hereof. In the case of a license issued to a new applicant, the

superintendent may issue a license for a term of more than two years,

provided however, such term shall not exceed thirty months.

(2) If an application for a renewal license shall have been filed with

the superintendent by December thirty-first of the year of expiration,

the license sought to be renewed shall continue in full force and effect

either until the issuance by the superintendent of the renewal license

applied for or until five days after the superintendent shall have

refused to issue such renewal license and shall have given notice of

such refusal to the applicant and to all proposed sub-licensees named in

such application.

(3) If such refusal is based on any grounds other than failure to pass

a written examination and if the applicant or any proposed sub-licensee

shall within thirty days after such notice is given notify the

superintendent of his or its request for a hearing on such refusal, the

superintendent shall within a reasonable time after receipt of such

notice grant such a hearing, and he may, in his discretion, reinstate

such license.

(k) Any firm, association or corporation licensed as an adjuster under

this section may at any time make an application to the superintendent

for the issuance of a supplemental license authorizing additional

officers or directors of such corporation or additional members of such

firm or association, as the case may be, to act as sub-licensees, and,

if the requirements of this section are fully complied with as to each

of such proposed sub-licensees, the superintendent may thereupon issue

to such licensee a supplemental license naming such additional person,

or persons, as sub-licensees.

(l) (1) No adjuster's license or renewal license, other than an

independent adjuster's license, shall be issued to any applicant unless

there shall be on file with the superintendent of financial services a

bond, executed by such applicant and by approved sureties, in the penal

sum of one thousand dollars conditioned on the faithful performance by

such licensee and by all sub-licensees named in such license, of their

duties as such adjusters.

(2) Such bond shall be approved as to form by the attorney general and

as to sufficiency of security by the superintendent.

(3) Such bond shall be made to the state of New York and shall

specifically authorize recovery by the state of the penal sum provided

therein in case the adjuster or any sub-licensee shall have been guilty

of fraudulent or dishonest practices in connection with the transaction

of his or its business as such adjuster or shall have been convicted

under any of the sections contained in article one hundred fifty of the

penal law.

(m) If an application for a license under this section be rejected by

the superintendent, he shall forthwith give notice to the applicant, or

to the licensee, as the case may be.

(n) Notwithstanding the provisions of this section, the

superintendent, in order to facilitate the settlement of claims under

insurance contracts involving widespread property losses arising out of

a conflagration or catastrophe common to all such losses, may issue a

temporary permit for a term not exceeding one hundred twenty days to any

person, whether he be a resident of this state or a non-resident, to act

as an independent adjuster on behalf of an authorized insurer or

insurers, provided any such insurer shall execute and file in the office

of the superintendent a written application for the permit in the form

prescribed by the superintendent, which application shall contain such

information as he may require and shall certify that the person named

therein to be designated in the temporary permit is qualified by

experience and training to adjust claims arising under insurance

contracts issued by any insurer. The superintendent may in his

discretion renew such permit for an additional term or terms as may be

necessary to adjust such claims.

(o) No licensee shall in connection with the transaction of his

business as an adjuster make any misrepresentation of facts or advise

any person on questions of law.

(p) No adjuster shall have any right to compensation from any insured

for or on account of services rendered to such insured as a public

adjuster unless such right to compensation is based upon a written

memorandum, signed by the party to be charged, and specifying or clearly

defining the amount or extent of such compensation. The superintendent

shall establish and prescribe regulations:

(1) to provide for a standard form and terms of said written

memorandum for compensation, including the maximum amount to be charged;

(2) to provide for compliance with article ten-A of the personal

property law relating to door to door sales; however, for the purpose of

this section, "door to door sale" in addition to the definition thereof

contained in subdivision one of section four hundred twenty-six of the

personal property law, shall include any contract entered into by a

public adjuster to adjust losses;

(3) to provide for maintenance of appropriate books and records to be

maintained by public adjusters which shall be kept subject to inspection

and examination by the superintendent; and

(4) to provide for such other regulations that are deemed necessary by

the superintendent for the proper and adequate supervision of public

adjusters.

(q) The superintendent may issue a replacement for a currently in

force license which has been lost or destroyed. Before such replacement

license shall be issued, there shall be on file in the office of the

superintendent a written application for such replacement license,

affirming under penalty of perjury that the original license has been

lost or destroyed, together with a fee of fifteen dollars.

(r) (1) The following continuing education requirements shall apply to

resident and non-resident persons licensed as public adjusters.

(2) Resident and non-resident persons licensed as public adjusters and

any person previously so licensed whose license was not in effect on the

effective date of this subsection and who has subsequently been

relicensed pursuant to the provisions of this article, shall biennially

satisfactorily complete such courses or programs as may be approved by

the superintendent, as follows:

(A) Any person holding a license as a public adjuster shall, during

each full biennial licensing period, satisfactorily complete courses or

programs of instruction or attend seminars as may be approved by the

superintendent equivalent to fifteen credit hours of instruction.

(B) During the same calendar year biennial licensing period, a

licensee may use accumulated continuing education credits to meet the

requirements of similar classes of licenses including those authorized

by subsection (b) of section two thousand one hundred three, section two

thousand one hundred four, section two thousand one hundred seven of

this article with respect to general insurance consultants, and section

two thousand one hundred eight of this article with respect to public

adjusters.

(C) Excess credit hours accumulated during any biennial licensing

period shall not carry forward to the next biennial licensing period for

that same class of license.

(3) (A) The courses or programs of instruction successfully completed,

which shall be deemed to meet the superintendent's standards for

continuing education shall be:

(i) Courses, programs of instruction or seminars, approved as to

method and content by the superintendent, covering portions of the

principal branches of insurance related to the kinds of insurance

covered by the public adjusting license, and given by a degree

conferring college or university whose curriculum is registered with the

state education department at the time the person takes the course,

whether such course be given as part of such curriculum or separately,

or by any other institution, association, trade association or insurer,

which maintains equivalent standards of instruction and which shall have

been approved for such purpose by the superintendent.

(ii) Continuing education as required by the state in which a

non-resident licensee resides and maintains an office, provided the

superintendent deems them equivalent to New York continuing education

requirements. If the state in which the non-resident licensee resides

and maintains an office has no continuing education requirements, or the

superintendent does not deem them equivalent, the licensee must satisfy

New York continuing education requirements.

(B) The number of credit hours assigned to each of the courses or

programs of instruction set forth in paragraph one of this subsection

shall be determined by the superintendent.

(4) A person who teaches any approved course of instruction or who

lectures at any approved seminar, and who is subject to these continuing

education requirements shall be granted the same number of credit hours

as would be granted to a person taking and successfully completing such

course, seminar or program, provided that such credit hours shall be

credited only once per approved course during any biennial licensing

period.

(5) Every person subject to these continuing education requirements

shall furnish, in a form satisfactory to the superintendent, written

certification attesting to the course or programs of instruction taken

and successfully completed by such person, and executed by the

sponsoring organization or its authorizing representative.

(6) (A) Any person failing to meet applicable continuing education

requirements shall not be eligible to renew the license.

(B) Any person whose license was not renewed shall not be eligible to

become relicensed during the next biennial licensing period until that

person has demonstrated to the satisfaction of the superintendent that

continuing education requirements for the last biennial licensing period

were met.

(C) Any person whose license was not renewed pursuant to subparagraph

(A) of this paragraph, who accumulates sufficient credit hours for the

prior licensing period to qualify for relicensing in the biennial period

following such non-renewal, may not apply those same credit hours toward

the continuing education requirements for the current biennial licensing

period.

(7) (A) Any entity eligible to provide continuing education courses,

programs of instruction, or seminars shall file for approval by the

superintendent on a biennial basis, to conform with its areas of

instruction, a provider organization application and a course submission

application for each course, program, and seminar.

(B) The provider organization application shall include the names of

all instructors to be used during the contract period, and instructors

may be added during the period by notifying the superintendent and

paying the appropriate filing fee.

(C) The completed applications shall be returned in a timely manner,

as specified by the superintendent with a non-refundable filing fee of

two hundred dollars per organization, fifty dollars per course, program,

and seminar, and fifty dollars per instructor.

(D) Approval of the application shall be at the discretion of the

superintendent.

(8) Each licensee shall pay a biennial fee of ten dollars per license,

for continuing education certificate filing and recording charges, to

the superintendent, or, at the direction of the superintendent, directly

to an organization under contract to provide continuing education

administrative services.

(s) (1) Every public adjuster shall have an affirmative duty to act on

behalf and in the best interests of the insured when negotiating for or

effecting the settlement of an insurance claim for the insured or

otherwise acting as a public adjuster.

(2) (A) No public adjuster shall receive any compensation, either

directly or indirectly, for a referral of the insured to an individual

or entity for services, work or repairs, relating to any insurance claim

for which the public adjuster represents the insured or has negotiated

or effected a settlement, unless the compensation is prominently and

clearly disclosed to the insured in the written memorandum described in

subsection (p) of this section. Any such compensation received shall be

deemed to be compensation from the insured and, in combination with any

other compensation received from the insured, shall not exceed the

maximum amount that the adjuster may charge in accordance with the

regulations required pursuant to subsection (p) of this section.

(B) No public adjuster who has a financial or ownership interest in

the individual or entity that performs the services, work, or repairs,

shall refer the insured to the individual or entity unless the financial

or ownership interest is prominently and clearly disclosed to the

insured in the written memorandum described in subsection (p) of this

section. If a public adjuster refers an insured to an individual who is

related to the individual by blood or affinity to the second degree of

consanguinity, or to an entity owned or controlled by such an

individual, for services, work, or repairs, relating to any insurance

claim for which the public adjuster represents the insured or has

negotiated or effected a settlement, then the public adjuster shall

disclose the relationship to the insured in the written memorandum

described in subsection (p) of this section.