The Florida Supreme Court on July 5 sided with an appellate court and struck down a 2008 law that barred public insurance adjusters from soliciting business right after a disaster.
The law was enacted to prevent public adjusters, hired by policyholders to represent them during the claims process, from contacting people when they’re in shock and haven’t had a chance to resolve a claim with their insurer.
Fred Kortum, a public adjuster, sued the state, saying the restriction violates the free speech rights of businesses, and the first 48 hours after a catastrophe are critical because a policyholder may make decisions that affect how much they’ll receive from an insurer. For instance, they might not preserve evidence or find all the damages.
The Department of Financial Services, led by Chief Financial Officer Jeff Atwater, had defended the law, saying public adjusters are driving up insurers’ claims costs and in turn, triggering rate increases.
Department of Financial Services press secretary Alexis Lambert said, “The office respects the Supreme Court’s authority and ruling in this case. No decision on next steps, if needed, has been made.”
A key disagreement was about whether the law applies to all forms of contact or just some: “A public adjuster may not directly or indirectly through any other person or entity initiate contact or engage in face-to-face or telephonic solicitation or enter into a contract with any insured or claimant under an insurance policy until at least 48 hours after the occurrence of an event that may be the subject of a claim under the insurance policy unless contact is initiated by the insured or claimant.”
The Supreme Court sided with Kortum on the issue: “The Legislature’s insertion of the broad phase ‘initiate contact’ causes us to conclude that [the law] bans all public adjuster-initiated communication with a potential claimant during the forty-eight-hour period. Contact means to ‘get in communication with,’ to ‘make connection with,’ or ‘to talk or confer with.’”
The court said public adjuster-initiated contact is protected as commercial free speech: “There is no reason for a public adjuster ... to contact a claimant but to engage in communication about the commercial transaction of public adjusting.”