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304.9-430
Independent, staff, or public adjuster's license -- Application by
individual or business entity -- Qualifications -- Evidence of financial
responsibility -- Exceptions to license requirement -- Temporary emergency
registration following catastrophe -- Nonresident license.
(1)
(2)
(3)
Except as provided in this section and KRS 304.52-060, no person shall in this state
act as or hold himself, herself, or itself out to be an independent, staff, or public
adjuster unless then licensed by the department as an independent, staff, or public
adjuster.
An individual applying for a resident independent, staff, or public adjuster license
shall make application to the commissioner on the appropriate uniform individual
application and in a format prescribed by the commissioner. The applicant shall
declare under penalty of suspension, revocation, or refusal of the license that the
statements made in the application are true, correct, and complete to the best of the
individual's knowledge and belief. Before approving the application, the
commissioner shall find that the individual to be licensed:
(a) Is at least eighteen (18) years of age;
(b) Is eligible to designate Kentucky as his or her home state;
(c) Is trustworthy, reliable, and of good reputation, evidence of which shall be
determined through an investigation by the commissioner;
(d) Has not committed any act that is a ground for probation or suspension,
revocation, or refusal of a license as set forth in KRS 304.9-440;
(e) Has successfully passed the examination for the adjuster license and the
applicable line of authority for which the individual has applied;
(f) Has paid the fees established by the commissioner pursuant to KRS 304.4010; and
(g) Is financially responsible to exercise the license.
(a) To demonstrate financial responsibility, a person applying for a public
adjuster license shall obtain a bond or irrevocable letter of credit prior to
issuance of a license and shall maintain the bond or letter of credit for the
duration of the license with the following limits:
1.
A surety bond executed and issued by an insurer authorized to issue
surety bonds in Kentucky, which bond shall:
a.
Be in the minimum amount of twenty thousand dollars ($20,000);
b.
Be in favor of the state of Kentucky and shall specifically
authorize recovery of any person in Kentucky who sustained
damages as the result of erroneous acts, failure to act, conviction
of fraud, or conviction for unfair trade practices in his or her
capacity as a public adjuster; and
c.
Not be terminated unless written notice is given to the licensee at
least thirty (30) days prior to the termination; or
2.
An irrevocable letter of credit issued by a qualified financial institution,
which letter of credit shall:
a.
b.
(4)
(5)
(6)
(7)
(8)
Be in the minimum amount of twenty thousand dollars ($20,000);
Be subject to lawful levy of execution on behalf of any person to
whom the public adjuster has been found to be legally liable as the
result of erroneous acts, failure to act, conviction of fraud, or
conviction for unfair practices in his or her capacity as a public
adjuster; and
c.
Not be terminated unless written notice is given to the licensee at
least thirty (30) days prior to the termination.
(b) The commissioner may ask for evidence of financial responsibility at any time
he or she deems relevant.
(c) The public adjuster license shall automatically terminate if the evidence of
financial responsibility terminates or becomes impaired and shall be promptly
surrendered to the commissioner without demand.
A business entity applying for a resident independent or public adjuster license shall
make application to the commissioner on the appropriate uniform business entity
application and in a format prescribed by the commissioner. The applicant shall
declare under penalty of suspension, revocation, or refusal of the license that the
statements made in the application are true, correct, and complete to the best of the
business entity's knowledge and belief. Before approving the application, the
commissioner shall find that the business entity:
(a) Is eligible to designate Kentucky as its home state;
(b) Has designated a licensed independent or public adjuster responsible for the
business entity's compliance with the insurance laws and regulations of
Kentucky;
(c) Has not committed an act that is a ground for probation or suspension,
revocation, or refusal of an independent or public adjuster's license as set forth
in KRS 304.9-440; and
(d) Has paid the fees established by the commissioner pursuant to KRS 304.4010.
The commissioner may require additional information or submissions from
applicants and may obtain any documents or information reasonably necessary to
verify the information contained in an application.
Unless denied licensure pursuant to KRS 304.9-440, a person or business entity
who has met the requirements of subsections (2) to (5) of this section shall be issued
an independent, staff, or public adjuster license.
An independent or staff adjuster may qualify for a license in one (1) or more of the
following lines of authority:
(a) Property and casualty;
(b) Workers' compensation; or
(c) Crop.
Notwithstanding any other provision of this subtitle, an individual who is employed
by an insurer to investigate suspected fraudulent insurance claims, but who does not
adjust losses or determine claims payments, shall not be required to be licensed as a
staff adjuster.
(9) A public adjuster may qualify for a license in one (1) or more of the following lines
of authority:
(a) Property and casualty; or
(b) Crop.
(10) Notwithstanding any other provision of this subtitle, a license as an independent
adjuster shall not be required of the following:
(a) An individual who is sent into Kentucky on behalf of an insurer for the sole
purpose of investigating or making adjustment of a particular loss resulting
from a catastrophe, or for the adjustment of a series of losses resulting from a
catastrophe common to all losses;
(b) An attorney licensed to practice law in Kentucky, when acting in his or her
professional capacity as an attorney;
(c) A person employed solely to obtain facts surrounding a claim or to furnish
technical assistance to a licensed independent adjuster;
(d) An individual who is employed to investigate suspected fraudulent insurance
claims, but who does not adjust losses or determine claims payments;
(e) A person who solely performs executive, administrative, managerial, or
clerical duties, or any combination thereof, and who does not investigate,
negotiate, or settle claims with policyholders, claimants, or their legal
representatives;
(f) A licensed health care provider or its employee who provides managed care
services as long as the services do not include the determination of
compensability;
(g) A health maintenance organization or any of its employees or an employee of
any organization providing managed care services as long as the services do
not include the determination of compensability;
(h) A person who settles only reinsurance or subrogation claims;
(i) An officer, director, manager, or employee of an authorized insurer, surplus
lines insurer, or risk retention group, or an attorney-in-fact of a reciprocal
insurer;
(j) A United States manager of the United States branch of an alien insurer;
(k) A person who investigates, negotiates, or settles claims arising under a life,
accident and health, or disability insurance policy or annuity contract;
(l) An individual employee, under a self-insured arrangement, who adjusts claims
on behalf of his or her employer;
(m) A licensed agent, attorney-in-fact of a reciprocal insurer, or managing general
agent of the insurer, to whom claim authority has been granted by the insurer;
or
(n) A person who:
1.
Is an employee of a licensed independent adjuster or an employee of an
affiliate that is a licensed independent adjuster or is supervised by a
licensed independent adjuster, if there are no more than twenty-five (25)
persons under the supervision of one (1) licensed individual independent
adjuster or licensed agent who is exempt from licensure pursuant to
paragraph (m) of this subsection;
2.
Collects claim information from insureds or claimants;
3.
Enters data into an automated claims adjudication system; and
4.
Furnishes claim information to insureds or claimants from the results of
the automated claims adjudication system.
For purposes of this paragraph, "automated claims adjudication system"
means a preprogrammed computer system designed for the collection, data
entry, calculation, and system-generated final resolution of consumer
electronic products insurance claims that complies with claim settlement
practices pursuant to Subtitle 12 of KRS Chapter 304.
(11) Notwithstanding any other provision of this subtitle, a license as a public adjuster
shall not be required of the following:
(a) An attorney licensed to practice law in Kentucky, when acting in his or her
professional capacity as an attorney;
(b) A person who negotiates or settles claims arising under a life or health
insurance policy or an annuity contract;
(c) A person employed only for the purpose of obtaining facts surrounding a loss
or furnishing technical assistance to a licensed public adjuster, including
photographers, estimators, private investigators, engineers, and handwriting
experts;
(d) A licensed health care provider or its employee who prepares or files a health
claim form on behalf of a patient; or
(e) An employee or agent of an insurer adjusting claims relating to food spoilage
with respect to residential property insurance in which the amount of coverage
for the applicable type of loss is contractually limited to one thousand dollars
($1,000) or less.
(12) Notwithstanding any other provision of this subtitle, a license as a staff adjuster
shall not be required of an employee or agent of an insurer adjusting claims relating
to food spoilage with respect to residential property insurance in which the amount
of coverage for the applicable type of loss is contractually limited to one thousand
dollars ($1,000) or less.
(13) For purposes of this section, "home state" means any state or territory of the United
States or the District of Columbia in which an independent, staff, or public adjuster
maintains his, her, or its principal place of residence or business and is licensed to
act as a resident independent, staff, or public adjuster. If the state of the principal
place of residence does not license an independent, staff, or public adjuster for the
line of authority sought, the independent, staff, or public adjuster shall designate as
his, her, or its home state, any state in which the independent or public adjuster is
licensed and in good standing.
(14) Temporary registration for emergency independent or staff adjusters shall be issued
by the commissioner in the event of a catastrophe declared in Kentucky in the
following manner:
(a) An insurer shall notify the commissioner by submitting an application for
temporary emergency registration of each individual not already licensed in
the state where the catastrophe has been declared, who will act as an
emergency independent adjuster on behalf of the insurer;
(b) A person who is otherwise qualified to adjust claims, but who is not already
licensed in the state, may act as an emergency independent or staff adjuster
and adjust claims if, within five (5) days of deployment to adjust claims
arising from the catastrophe, the insurer notifies the commissioner by
providing the following information, in a format prescribed by the
commissioner:
1.
The name of the individual;
2.
The Social Security number of the individual;
3.
The name of the insurer that the independent or staff adjuster will
represent;
4.
The catastrophe or loss control number;
5.
The catastrophe event name and date; and
6.
Any other information the commissioner deems necessary; and
(c) An emergency independent or staff adjuster's registration shall remain in force
for a period not to exceed ninety (90) days, unless extended by the
commissioner.
(15) (a) Unless refused licensure in accordance with KRS 304.9-440, a nonresident
person shall receive a nonresident independent, staff, or public adjuster license
if:
1.
The person is currently licensed in good standing as an independent,
staff, or public adjuster in his, her, or its home state;
2.
The person has submitted the proper request for licensure, and has paid
the fees required by KRS 304.4-010;
3.
The person has submitted, in a form or format prescribed by the
commissioner, the uniform individual application; and
4.
The person's designated home state issues nonresident independent,
staff, or public adjuster licenses to persons of Kentucky on the same
basis.
(b) The commissioner may verify the independent, staff, or public adjuster's
licensing status through any appropriate database or may request certification
of good standing.
(c) As a condition to the continuation of a nonresident adjuster license, the
licensee shall maintain a resident adjuster license in his, her, or its home state.
(d)
The nonresident adjuster license issued under this section shall terminate and
be surrendered immediately to the commissioner if the resident adjuster
license terminates for any reason, unless the termination is due to the adjuster
being issued a new resident independent or public adjuster license in his, her,
or its new home state. If the new resident state does not have reciprocity with
Kentucky, the nonresident adjuster license shall terminate.
Effective: June 29, 2021
History: Amended 2021 Ky. Acts ch. 36, sec. 13, effective June 29, 2021. -- Amended
2019 Ky. Acts ch. 8, sec. 2, effective June 27, 2019. -- Amended 2017 Ky. Acts ch.
34, sec. 2, effective June 29, 2017. -- Amended 2012 Ky. Acts ch. 74, sec. 5,
effective July 12, 2012. -- Amended 2010 Ky. Acts ch. 24, sec. 1073, effective July
15, 2010; and ch. 83, sec. 11, effective July 15, 2010. -- Amended 2002 Ky. Acts ch.
273, sec. 34, effective July 15, 2002. -- Amended 2000 Ky. Acts ch. 393, sec. 32,
effective July 14, 2000. -- Amended 1984 Ky. Acts ch. 262, sec. 3, effective April
1,1985. -- Created 1970 Ky. Acts ch. 301, subtit. 9, sec. 43, effective June 18, 1970.
Legislative Research Commission Note (7/15/2010). References to the "executive
director" of insurance in this section, as amended by 2010 Ky. Acts ch. 83, sec. 11,
have been changed in codification to the "commissioner" of insurance to reflect the
reorganization of certain parts of the Executive Branch, as set forth in Executive
Order 2009-535 and confirmed by the General Assembly in 2010 Ky. Acts ch. 24.
These changes were made by the Reviser of Statutes pursuant to 2010 Ky. Acts ch.
24, sec. 1938.
Legislative Research Commission Note (7/15/2010). This section was amended by
2010 Ky. Acts chs. 24 and 83. Where these Acts are not in conflict, they have been
codified together. Where a conflict exists, Acts ch. 83, which was last enacted by the
General Assembly, prevails under KRS 446.250.
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