Guides
Working with an insurance adjuster on a business claim
What a commercial adjuster does, what to document, how recorded statements and proof of loss work, and when to use a public adjuster, counsel or appraisal.
An adjuster investigates your claim for the insurer, decides what the policy covers and recommends or pays an amount. Treat the adjuster as a professional counterparty: cooperative, organized and precise, because the adjuster works under the policy and under the insurer's reserves and guidelines, not as your advocate. The best outcomes come from fast notice, documented damage, a clear business income presentation and written follow-up of every important conversation.
Know which adjuster you have
| Type | Who they work for | What to expect |
|---|---|---|
| Staff adjuster | The insurer (employee) | Handles the claim start to finish, or the assigned part |
| Independent adjuster | An independent firm retained by the insurer | Common after catastrophes and for field inspections; authority limited by the insurer |
| Desk or inside adjuster | The insurer | Handles smaller claims by phone and photos |
| Forensic accountant | The insurer or you | Reviews business income and extra expense documentation |
| Engineers and experts | Retained by the insurer or by you | Causation, structural and scope opinions |
| Public adjuster | You | Licensed in most states, usually paid a percentage of recovery; see below |
Ask for the adjuster's name, company, license number if applicable, phone and email, and who has authority to approve payment. Ask what the next step and deadline are after every contact.
The first 48 hours
- Report the claim promptly to your agent or the insurer's claims line, and keep the claim number. Late notice can prejudice coverage in some states; see notice of claim and late notice: why timing matters and how to file a business insurance claim, step by step.
- Protect the property. Standard property forms require reasonable steps to protect covered property from further damage and keep records of repair costs. Do not discard damaged items before the adjuster sees them or you document them.
- Document. Photograph and video everything before cleanup, keep receipts, record dates and times, and list damaged items.
- Gather the policies. Have the declarations page, forms list and endorsements available.
- Start tracking time and money. Business income and extra expense claims depend on records. The business insurance claim checklist gives a full list.
What to say and what to provide
Be factual. Answer the question asked, say "I don't know" when you do not, and do not guess at cause, value or timing. Offer documents when requested and keep a log of what you sent.
Recorded statements. Insurers often ask for recorded statements. You may be asked to cooperate under the policy conditions, which typically require you to submit to examination under oath and provide records on request. Before giving a recorded statement on a large, disputed or possibly suspicious loss, consider asking for the questions in advance and having your broker or counsel present. Review the transcript if offered.
Proof of loss. The ISO building and personal property form (CP 00 10) allows the insurer to request a sworn proof of loss, which you must provide within 60 days after the request. The form then gives the insurer 30 days after it receives the proof to notify you of its intentions, and payment is due within 30 days after agreement on the amount or an appraisal award. Carrier forms differ and state law may set other deadlines. Missing the proof of loss deadline is a common avoidable problem; calendar it. See the sworn proof of loss: what it is, when it's due and how to prepare it.
Business income documentation. The adjuster, often with a forensic accountant, will ask for prior-period financial statements, monthly sales and expense records, payroll, tax returns, projections and evidence of lost orders or cancellations. Present a clear calculation tied to the policy's terms. The standard business income form (CP 00 30) pays net income and continuing normal operating expenses during the period of restoration after a 72-hour waiting period, subject to the policy's terms. Use the business income (interruption) limit calculator and see documenting a business interruption claim, from day one to final payment.
Advances. Ask for partial payments on undisputed amounts. Many insurers will advance funds for emergency repairs, relocation or payroll.
Reading the adjuster's position
Expect three kinds of communication: a coverage position, a scope-and-price estimate, and a request for information.
- Reservation of rights. If the insurer is investigating coverage questions while handling the claim, you may receive a reservation of rights letter. It is not a denial but it is a signal to read the cited provisions and consider counsel.
- Estimate differences. Insurer estimates and contractor bids often differ on scope, unit prices, overhead and profit, and code upgrades. Ask for the adjuster's estimate in a format you can compare line by line, and give your contractor's itemized estimate with photos.
- Depreciation and holdbacks. Replacement cost policies often pay actual cash value first and release the remainder when repairs are completed. See replacement cost vs actual cash value for business property.
- Denial or partial denial. Ask for the reasons in writing with the policy provisions cited, and see what to do when your business insurance claim is denied.
Insurers must follow state claim handling standards. State laws based on the NAIC Unfair Claims Settlement Practices Act (Model 900) and its regulation (Model 902) typically require prompt acknowledgment, reasonable investigation and timely decisions, and some states have specific statutory deadlines. Texas, for example, has prompt payment provisions in Texas Insurance Code chapter 542, and Florida regulates property claim handling and public adjusters by statute. The details vary by state, so check Texas, Florida or the relevant state guide and the department of insurance. If the insurer is not responding, see how to complain to your state insurance department.
When to bring in help
Your broker. A commercial broker can help with notice, coverage interpretation, documentation and escalation, and will often attend the first adjuster meeting on larger losses.
A public adjuster. A public adjuster is a licensed professional who represents the policyholder in preparing and negotiating a claim, usually for a percentage of the recovery. Licensing, contract requirements and fee limits are set by each state, so they vary, and some states restrict solicitation after a loss. Florida, as one example, caps fees under Fla. Stat. 626.854(11) at 10% of claim payments for claims made within a year after a governor's emergency declaration and 20% otherwise, and bars fees on amounts the insurer paid or committed to pay before the contract was signed. Other states set different caps, flat fees or none. Always read the contract, check the license with your state's department of insurance and understand what you pay for. See public adjusters: when to hire one for a business property claim.
An attorney. Consider coverage counsel when there is a denial, a reservation of rights on a large loss, alleged misrepresentation or fraud, a dispute about causation, or significant delay. Counsel can also advise on recorded statements and examination under oath.
Appraisal. If you and the insurer agree coverage applies but disagree on the amount of loss, the appraisal clause can resolve the number. Appraisal rules and what the appraisers can decide vary by state and recent court decisions; see the appraisal clause in commercial property disputes.
A hypothetical example
Say a restaurant has a kitchen fire. The owner reports it the same day, photographs the damage, hires a mitigation company with insurer approval, and sends the broker the policy. The adjuster requests the last three years of financial statements and monthly sales. The owner provides them with a spreadsheet of sales by month, payroll and continuing expenses, a timeline of reopening, and extra expense receipts for a rented prep kitchen. The owner asks for an advance for payroll and receives a partial payment in two weeks. The proof of loss is calendared for the 60-day mark. The sequence shows habits that help, but outcomes depend on the policy and the loss. The numbers and timing here are invented.
Key takeaways
- The adjuster works under the policy and the insurer's guidelines. Be cooperative, factual and organized, and put important points in writing.
- Document damage before cleanup and calendar the proof of loss deadline: 60 days after request under the ISO property form.
- Business income claims succeed on records, so give the adjuster a clean calculation tied to the policy.
- Public adjuster licensing and fee limits vary by state; verify the license and read the contract. Escalate to counsel on denials and large disputes.