Public Adjuster vs. Company Adjuster vs. Independent Adjuster

Three kinds of adjuster, and whom each one works for

After a loss, someone has to measure the damage and decide what the policy pays. That person is an adjuster, but three different kinds use the title. They differ in who employs them and whose interest they represent.

The Illinois Department of Insurance defines all three in its public adjuster consumer rights notice ¹. A company adjuster is an employee of an insurance company, represents the insurer’s interest and is paid by it.

An independent adjuster is hired on a contract basis by the insurer to represent the insurer’s interest in settling the claim and is paid by the insurer.

A public adjuster does not work for any insurance company. He or she works for the insured to help prepare, present and settle the claim, and the insured pays the fee.

The NAIC, the organization of state insurance regulators, gives the same split in its Post-Disaster Claims Guide: an independent adjuster does the same work as a company adjuster and you do not pay one, and a public adjuster has no ties to the insurance company and you have to pay one ³.

Our guide to working with an adjuster covers the inspection itself, evidence and supplements. This page covers only the comparison of the three roles.

How each kind of adjuster fits into a claim

The order below is a typical sequence. Your insurer’s process and your state’s rules may differ.

1. You report the loss. The insurer assigns a company adjuster, or an independent adjuster when it has no adjusters on staff or needs more than it has available ³.
2. The insurer’s adjuster inspects. The NAIC says the adjuster will inspect, take photographs and measurements, and may begin to calculate the damage and repair cost ³.
3. You decide whether to hire a public adjuster. This is optional. If you do, you sign a contract that states the services and the fee ¹³.
4. The public adjuster prepares your side. The NAIC says a public adjuster estimates the damage, reviews your insurance coverage and negotiates a settlement for you ³.
5. The insurer still reviews. The NAIC says the insurance company does not have to accept the public adjuster’s estimates, and may still send its own adjuster ³.
6. You and the insurer settle, or dispute. If you disagree, your policy may provide an appraisal and your state department of insurance takes complaints.

Company, independent and public adjusters side by side

Example: how a public adjuster fee percentage works

The first row is the Texas Department of Insurance’s own example. The other rows are plain illustrative arithmetic using round numbers; they are not typical settlements and not a prediction of any outcome. They show how a percentage fee is calculated on the total payment, not only on the disputed amount.

The point is the base. A percentage of the total payment can cost more than a percentage of the increase. Ask for the fee in dollars, which TDI says you can request, and compare it with the work you expect.

Where you will meet each one

You meet the company or independent adjuster first, by phone or at the property. Their name appears on the inspection report and the estimate. You meet a public adjuster only if you hire one, for example after a first offer that seems low, or when someone offers help soon after a storm.

The public adjuster’s paperwork is a contract. Texas says a public adjuster’s contract should answer whether they will inspect the damaged property, whether they will talk to your insurer and ask for a larger amount, and how long they expect to take ².

Illinois requires a written disclosure if the public adjuster is paid by contractors or service providers they refer you to, or has a financial interest in a business they refer you to ¹.

Restoration companies, contractors and others may mention public adjusters, but none should require you to hire one. See avoiding restoration scams for pressure tactics to recognize, and restoration work authorization for the document a contractor may ask you to sign.

What a public adjuster can and cannot do for you

Limits: what the comparison cannot tell you

First, the roles are general. A company adjuster is an employee and may be a fair professional, and a public adjuster may be less helpful than hoped. The label tells you whom the person works for, not how good they are.

Second, state rules differ widely. The NAIC says that in some states the maximum a public adjuster can charge is set by law, that it may vary if a widespread catastrophe caused the loss, and that some states prohibit public adjusters from negotiating claims so that only a licensed attorney can represent you ³.

We loaded two state pages, Texas and Illinois, and we do not generalise beyond them.

Third, the figures here change. The Texas page was last updated on 3/25/2025 and the Illinois notice is revision 12/2023, effective 01/2024. Fee caps can be changed by law, and emergency declarations can alter them. Check the current rule with your state department of insurance before you sign.

Finally, this page does not say whether you should hire anyone. That depends on your claim, your policy and your comfort with the process. It is general information, not legal or insurance advice.

What a public adjuster costs, and what changes the cost

Company and independent adjusters cost you nothing; the insurer pays them ¹. A public adjuster costs you the fee in the contract.

Depending on state law, the NAIC says it can be a flat fee or a percentage of your settlement, and some states set a maximum that may vary after a widespread catastrophe ³.

Texas allows up to 10% of the total amount the company will pay, based on the total settlement and not only on the amount in dispute, and you can ask for the fee as a dollar amount ².

Illinois caps compensation on a personal residence at 10% of total claim payments, and the insurer will not cover the cost of hiring a public adjuster ¹.

The Insurance Information Institute says a public adjuster could cost as much as 15 percent of the settlement and that after some disasters the percentage is set by the insurance department ⁴.

What changes the cost to you: the base the percentage applies to (total payment or increase), any referral compensation the adjuster receives from contractors ¹, your deductible, and the time the case takes.

We publish no price for the service and no average. No lifespan or warranty applies to a claim service; the contract is the only guarantee, so read it. For repair costs themselves see the cost guide.

If you are considering a public adjuster: what to check

The steps below combine the Texas and Illinois consumer pages and the NAIC guide. They are not a recommendation to hire one.

1. Confirm the license. TDI says to call its Help Line to find out if a public adjuster is licensed by TDI, how many complaints have been filed and whether it has taken disciplinary action ². Illinois licenses its public adjusters through its Department of Insurance ¹.
2. Ask about fees. Ask how much they charge and try to negotiate ². Ask whether it is based on the total paid or on the amount the adjuster negotiates ³.
3. Read the contract. It should explain the services and the amount you will pay ³. Look for whether they will inspect, talk to your insurer and how long it should take ².
4. Know your cancellation right. Texas says you have 72 hours after signing to cancel ². Other states differ; do not assume.
5. Look for referral compensation. Illinois requires written disclosure of compensation from referred contractors or financial interests in referred businesses ¹.
6. Ask for updates. The NAIC says to ask the adjuster to routinely update you on the claim ³.
7. Report problems. Complaints go to your state department of insurance ²¹.

Managing the relationship once a claim is open

Whichever adjuster you work with, the habits below keep the file clean.

• Be there for the inspection and show the damage. The NAIC suggests being present when the adjuster comes ³.
• Get names and contact details for every adjuster, and note what each said and when ³.
• Keep a log of calls and letters and copies of everything you send or receive. The California Department of Insurance recommends this ⁵.
• Keep contractor bids line by line. The NAIC says bids should detail materials, prices and labor line by line ³.
• Do not sign releases or accept a “full” settlement without understanding it. California’s guide warns to be wary of initial offers represented as full settlements requiring a release ⁵.
• Report new damage to the insurer and adjuster as soon as you find it ³.

Warning signs and when to stop and check

• Door-knocking during a disaster or after 9 p.m. Texas says public adjusters cannot do this ².
• Someone who is both your adjuster and your contractor. Texas says public adjusters cannot act as your contractor ².
• A promise of a guaranteed larger payment. The insurer does not have to accept a public adjuster’s estimate ³.
• A request for payment up front or a fee you cannot read in the contract.
• Pressure to sign right now. You have cancellation rights in some states, but not all.
• An adjuster who will not let you speak with your insurer. Texas says public adjusters cannot keep you from talking with your insurance company ².

Licensing, fee rules and where to complain

Texas. Public insurance adjusters are licensed by TDI.

They can charge up to 10% of the total amount the company will pay; you have 72 hours to cancel; they cannot act as your contractor, practice law, get referral fees from attorneys or contractors, or knock on your door during a natural disaster or after 9 p.m. ².

The page was last updated 3/25/2025.

Illinois. Public adjusters are licensed by the Illinois Department of Insurance. Total compensation on a personal residence is capped at 10% of total claim payments, and on non-residential property after a catastrophic event at 10% unless the Director approves more in writing.

Referral compensation must be disclosed in writing. Complaints go to the Department, and the notice cites Article XLV of the Illinois Insurance Code and Department Rule 3118 ¹. Revision 12/2023, effective 01/2024.

Other states. The NAIC says many states require public adjusters to be licensed, and some prohibit them from negotiating claims. We loaded only Texas and Illinois and do not describe any other state.

Your policy. The policy sets what is covered and how disputes are handled, including any appraisal clause. See proof of loss and insurance depreciation for terms that affect the amount.

Public adjuster vs. attorney vs. contractor

Common myths about adjusters

Myth The adjuster from my insurer works for me.

Reality Company and independent adjusters represent the insurer’s interest ¹.

Myth I have to hire a public adjuster.

Reality The Illinois notice says you are not required to hire one ¹.

Myth A public adjuster guarantees a bigger check.

Reality The insurer does not have to accept their estimates, and you may still owe the fee ³².

Myth The fee is only on the extra money they win.

Reality In Texas the fee can be based on the total settlement, not just the disputed amount ².

Myth My contractor can also act as my public adjuster.

Reality Texas says public adjusters cannot act as your contractor ².

The regional variable: your state’s public adjuster rules

When this matters most, and your next step

The distinction matters right after a loss, when several people offer help, and again when an offer looks low. Knowing whom each person works for lets you decide whom to ask for what.

Your next step is to write down who is who on your claim: the insurer’s adjuster and company, any contractor, and anyone offering to represent you.

If you think about hiring a public adjuster, check the license and the contract with your state department of insurance first. Use should I file a claim and the claim timeline to organize the sequence.

This page is general information, not legal or insurance advice. It does not recommend hiring or avoiding any professional.

Related terms

Insurance Adjuster

An insurance adjuster is the person who investigates a claim, inspects the damage and decides what the policy pays. A company adjuster works for the insurer; a public adjuster is hired by the policyholder.

Water Damage Insurance Claim

A water damage insurance claim is a request to your insurer to pay for a covered water loss. Whether it is covered depends on the cause of the water, the policy wording and its exclusions, not only on the damage.

Proof of Loss

A proof of loss is a formal, signed statement you give your insurer that describes a loss and the amount you are claiming, and some policies require it to be sworn.

Insurance Depreciation and Recoverable Depreciation

Insurance depreciation is the amount an insurer subtracts from the cost of a damaged item because of its age, wear and condition, which may be paid back later as recoverable depreciation if the policy allows.

Restoration Work Authorization

A restoration work authorization is the document you sign to let a restoration company begin described work at your property on stated terms, and it can be the first paper handed over after a loss.

Restoration Estimate

A restoration estimate is a company's itemized proposal for the drying, cleaning and repair work it plans to do. Mitigation and reconstruction are priced as separate documents, and a good estimate lists quantities, not just totals.

Gradual Water Damage Exclusion

The gradual water damage exclusion is a home insurance policy clause that removes coverage for damage caused by water that leaks or seeps over a long time, as opposed to a sudden discharge.

Restoration Contractor Red Flags

Restoration contractor red flags are patterns that suggest a company will not protect you: pressure to sign an assignment of benefits, no written scope, no drying records, full payment upfront, or door-knocking after a storm.

Also referenced from: Sudden and Accidental Water Damage, Gradual Water Damage Exclusion, Insurance Depreciation and Recoverable Depreciation, Proof of Loss