Sections 44-9201 to 44-9219 shall be known and may be cited as the Public Adjusters Licensing Act.

The purpose of the Public Adjusters Licensing Act is to govern the qualifications and procedures for licensing public adjusters in this state and to specify the duties of and restrictions on public adjusters, including limitation of such licensure to assisting only insureds with first-party claims.

As used in the Public Adjusters Licensing Act, unless the context otherwise requires:

(1) Business entity means a corporation, association, partnership, limited liability company, limited liability partnership, or any other legal entity;

(2) Catastrophic disaster means an event declared to be a catastrophic disaster by the President of the United States or the governor of the state in which the disaster occurred that (a) results in large numbers of deaths and injuries, (b) causes extensive damage or destruction of facilities that provide and sustain human needs, (c) produces an overwhelming demand on state and local response resources and mechanisms, (d) causes a severe long-term effect on general economic activity, and (e) severely affects state, local, and private sector capabilities to begin and sustain response activities;

(3) Department means the Department of Insurance;

(4) Director means the Director of Insurance;

(5) Home state means the District of Columbia or any state or territory of the United States in which the principal place of residence or principal place of business of the public adjuster is located;

(6) Individual means a natural person;

(7) Insured means a person insured under the insurance policy against which the claim is made;

(8) Person means an individual or a business entity;

(9) Public adjuster means any person who, for compensation, does any of the following:

(a) Acts for or aids an insured in negotiating for or effecting the settlement of a first-party claim for loss or damage to real or personal property of the insured;

(b) Advertises for employment as a public adjuster of first-party claims or otherwise solicits business or represents to the public that the person is a public adjuster of first-party claims for loss or damage to real or personal property of an insured; or

(c) Directly or indirectly solicits the business of investigating or adjusting losses or of advising an insured about first-party claims for loss or damage to real or personal property of the insured;

(10) Uniform business entity application means the uniform business entity application prescribed by the director which conforms substantially to the uniform business entity application for resident and nonresident business entities adopted by the National Association of Insurance Commissioners; and

(11) Uniform individual application means the uniform individual application prescribed by the director which conforms substantially to the uniform application for individual adjuster licensing adopted by the National Association of Insurance Commissioners.

(1) A person shall not operate as or represent that such person is a public adjuster in this state unless such person is licensed as a public adjuster in accordance with the Public Adjusters Licensing Act.

(2) A public adjuster shall not misrepresent to any insured that such public adjuster is an adjuster representing an insurer in any capacity, including acting as an employee of the insurer or acting as an independent adjuster unless so appointed by an insurer in writing to act on behalf of the insurer for that specific claim or purpose. A public adjuster is prohibited from charging any insured a fee when appointed by the insurer and the appointment is accepted by the public adjuster.

(3) A public adjuster shall not, directly or indirectly, solicit, or enter into, an agreement for the repair or replacement of damaged property on which such public adjuster has engaged to adjust or settle claims for losses or damages of the insured.

(4) Notwithstanding subsection (1) of this section, licensing as a public adjuster shall not be required for:

(a) An attorney admitted to practice in this state, when acting in the attorney’s 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, but not limited to, a photographer, estimator, private investigator, engineer, or handwriting expert;

(d) A licensed health care provider, or an employee of a licensed health care provider, who prepares or files a health claim form on behalf of a patient; or

(e) A person who settles subrogation claims between insurers.

An individual applying for a resident public adjuster license shall make application to the director on the uniform individual application and declare under penalty of denial, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of such individual's knowledge and belief. Before approving an application for a resident public adjuster license, the director shall find that such individual:

(1) Is at least eighteen years of age. Notwithstanding the provisions of section 43-2101, if an individual is issued a license pursuant to the Public Adjusters Licensing Act, his or her minority ends;

(2) Has his or her principal place of residence or principal place of business in this state;

(3) Has not committed any act that is a ground for denial, suspension, or revocation set forth in section 44-9211;

(4) Has paid the resident licensing fee, not to exceed one hundred dollars, prescribed by the director;

(5) Except as otherwise provided under the act, has passed the examinations required by section 44-9208;

(6) Is trustworthy, reliable, and of good reputation, evidence of which may be determined by the director;

(7) Is financially responsible to exercise the license and has provided proof of financial responsibility as required in section 44-9212; and

(8) Maintains an office in this state with public access to such office by reasonable appointment or regular business hours.

(1) An individual applying for a nonresident public adjuster license shall make application to the director in the manner prescribed by the director and declare under penalty of denial, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of such individual's knowledge and belief. Before approving an application for a nonresident public adjuster license, the director shall find that the applicant:

(a) Is licensed as a resident public adjuster and in good standing in such individual’s home state and that such home state awards nonresident public adjuster licenses to residents of this state on the same basis as provided for in the Public Adjusters Licensing Act; and

(b) Has paid the nonresident licensing fee, not to exceed one hundred dollars, prescribed by the director.

(2) The director may verify the licensing status of a nonresident public adjuster through the producer database maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries.

(3) As a condition to continuation of a nonresident public adjuster license, a licensed nonresident public adjuster shall maintain a resident public adjuster license in good standing in his or her home state.

(4) A nonresident public adjuster license issued pursuant to this section shall terminate and be surrendered immediately to the director if the home state public adjuster license terminates for any reason, unless the individual has been issued a license as a resident public adjuster in a new home state and such new home state has reciprocity with this state. A licensed nonresident public adjuster shall notify the director of any change to a new home state as soon as possible, but no later than thirty days after receiving a license as a resident public adjuster from the new home state. The nonresident public adjuster shall include both the new and the old addresses in the notice to the director.

(1) A business entity acting as a public adjuster in this state is required to obtain a public adjuster license and shall make application to the director on the uniform business entity application and declare under penalty of denial, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of the knowledge and belief of such entity. Before approving an application for a business entity public adjuster license, the director shall find that the applicant:

(a) Has paid the business entity licensing fee, not to exceed one hundred fifty dollars, prescribed by the director; and

(b) Has designated a resident public adjuster or a nonresident public adjuster licensed pursuant to the Public Adjusters Licensing Act to be responsible for compliance with the insurance laws, rules, and regulations of this state for such business entity.

(2) The director may require any documents reasonably necessary to verify the information contained in any application submitted pursuant to this section.

(1) An individual applying for a resident public adjuster license shall pass a written examination, unless exempt pursuant to section 44-9209. Such examination shall test the knowledge of the individual concerning the duties and responsibilities of a public adjuster and the insurance laws and regulations of this state and shall be conducted as prescribed by the director.

(2) The director may make arrangements, including contracting with an outside testing service, for administering the written examination required pursuant to subsection (1) of this section and collecting a fee prescribed by the director. The fee shall not exceed one hundred dollars.

(1) An individual who moves to this state, was previously licensed as a public adjuster in another state based on a public adjuster examination, and applies for a resident public adjuster license in this state within ninety days of establishing legal residence shall not be required to pass an examination pursuant to section 44-9208 in this state if:

(a) Such individual is currently licensed in the other state or if an application for a resident public adjuster license is received within twelve months of the cancellation of his or her previous license; and

(b) The other state issues a certification that such individual is licensed and in good standing in that state or was licensed and in good standing at the time of cancellation.

(2) An individual who applies for a resident public adjuster license and who was previously licensed as either a resident public adjuster or a nonresident public adjuster in this state shall not be required to complete an examination if the application is received within twelve months of the termination of such previous license in this state and if, at the time of such termination, the applicant was in good standing in this state.

(1)(a) An individual who meets the requirements for a resident public adjuster license shall be issued such license. An individual who meets the requirements for a nonresident public adjuster license shall be issued such license.

(b) Each resident public adjuster license and each nonresident public adjuster license shall expire on the last day of the month of such public adjuster’s birthday in the first year after issuance of such license in which his or her age is divisible by two.

(c) Each resident public adjuster license and each nonresident public adjuster license may be renewed within the ninety-day period immediately preceding the expiration date upon payment of the renewal fee, not to exceed one hundred dollars, prescribed by the director. A resident public adjuster or nonresident public adjuster who allows his or her license to lapse may, within the twelve-month period immediately following the expiration date, reinstate the same license without the necessity of passing a written examination upon payment of a reinstatement fee, not to exceed one hundred twenty-five dollars, prescribed by the director in addition to the renewal fee.

(d) The director may grant an individual licensee who is unable to comply with license renewal procedures due to military service or some other extenuating circumstance, including, but not limited to, a long-term medical disability, a waiver of any examination requirement or any other fine, fee, or sanction imposed for failure to comply with renewal procedures.

(2)(a) A business entity that has met the requirements of the Public Adjusters Licensing Act shall be issued a business entity public adjuster license.

(b) Each business entity public adjuster license shall expire on April 30 of each year.

(c) A business entity public adjuster license may be renewed within the ninety-day period immediately preceding the expiration date upon payment of the renewal fee, not to exceed one hundred fifty dollars, prescribed by the director. A business entity public adjuster that allows its license to lapse may, within the thirty-day period immediately following the expiration date, renew the same license upon payment of a late renewal fee, not to exceed one hundred twenty-five dollars, prescribed by the director in addition to the renewal fee.

(d) Any business entity public adjuster license renewed within the thirty-day period immediately following the expiration date pursuant to this subsection shall be deemed to have been renewed before the expiration date.

(3)(a) Each license issued pursuant to the Public Adjusters Licensing Act shall contain the licensee's name, address, and license number, the date of issuance, the lines of authority, the expiration date, and any other information the director deems necessary.

(b) Each licensee shall inform the director, by any means acceptable to the director, of any change of legal name, address, or other information submitted on the application within thirty days after the change. Any licensee failing to provide such notification shall be subject to a fine by the director of not more than five hundred dollars per violation, suspension of the license until the change is reported to the director, or both.

(c) Each licensee doing business under any name other than the licensee's legal name shall notify the director prior to using the assumed name.

(d) Each licensee shall be subject to the Unfair Insurance Trade Practices Act and the Unfair Insurance Claims Settlement Practices Act.

(e) Each licensee shall report to the director any administrative action taken against such licensee in another jurisdiction or by another governmental agency in this state within thirty days of the final disposition of the matter. This report shall include a copy of the order, consent to order, or other relevant legal documents.

(f) Each licensee shall report to the director any criminal prosecution of such licensee taken in any jurisdiction within thirty days of arraignment. The report shall include a copy of the initial complaint filed, the order resulting from the hearing, and any other relevant legal documents.

(4) The director may contract with nongovernmental entities, including the National Association of Insurance Commissioners or any affiliates or subsidiaries that the National Association of Insurance Commissioners oversees, to perform any ministerial functions, including the collection of fees, related to the administration of the Public Adjusters Licensing Act.

(5) The director may establish license renewal procedures by rule and regulation adopted and promulgated pursuant to the Administrative Procedure Act.

(1) The director may suspend, revoke, or refuse to issue or renew a resident public adjuster license, nonresident public adjuster license, or business entity public adjuster license or may levy an administrative fine in accordance with subsection (4) of this section, or any combination of such actions, for any one or more of the following causes:

(a) Providing incorrect, misleading, incomplete, or materially untrue information in the license application;

(b) Violating any insurance law or violating any rule, regulation, subpoena, or order of the director or of another state's insurance commissioner or director;

(c) Obtaining or attempting to obtain a license through misrepresentation or fraud;

(d) Improperly withholding, misappropriating, or converting any money or property received in the course of doing business;

(e) Intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance;

(f) Having been convicted of a felony or a Class I, II, or III misdemeanor;

(g) Having admitted or been found to have committed any insurance unfair trade practice, any unfair claims settlement practice, or any fraud;

(h) Using fraudulent, coercive, or dishonest practices or demonstrating incompetence, untrustworthiness, or financial irresponsibility in the conduct of business in this state or elsewhere or failing to comply with section 44-9217;

(i) Having an insurance or public adjuster license, or the equivalent thereof, denied, suspended, placed on probation, or revoked in Nebraska or in any other state, province, district, or territory;

(j) Forging another's name to an application for insurance or to any document related to an insurance transaction;

(k) Improperly using notes or any other reference material to complete an examination for an insurance license;

(l) Knowingly accepting insurance business from an individual who is not licensed;

(m) Failing to comply with an administrative or court order imposing a child support obligation pursuant to the License Suspension Act;

(n) Failing to pay state income tax or comply with any administrative or court order directing payment of state income tax; or

(o) Failing to maintain in good standing a resident license in the public adjuster’s home state.

(2) If the director does not renew or denies an application for a public adjuster license, the director shall notify the applicant or licensee and advise, in writing, the applicant or licensee of the reason for the denial or nonrenewal of the applicant's or licensee's license. The applicant or licensee may make written demand upon the director within thirty days for a hearing before the director to determine the reasonableness of the director's action. The hearing shall be held within thirty days and shall be held pursuant to the Administrative Procedure Act.

(3) A business entity public adjuster license may be suspended, revoked, or refused if the director finds, after notice and hearing, that a violation committed by an individual licensee providing services through the business entity was known or should have been known by one or more of the partners, officers, or managers acting on behalf of the business entity and the violation was neither reported to the director nor corrective action taken.

(4) In addition to or in lieu of any applicable denial, suspension, or revocation of a license, any person violating the act may, after notice and hearing, be subject to an administrative fine of not more than one thousand dollars per violation. Such fine may be enforced in the same manner as civil judgments. Any person charged with a violation of the Public Adjusters Licensing Act may waive his or her right to a hearing and consent to such discipline as the director determines is appropriate. The Administrative Procedure Act shall govern all hearings held pursuant to this subsection.

(5) The director shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by the Public Adjusters Licensing Act against any person who is under investigation for or charged with a violation of the act even if the person's license or registration has been surrendered or has lapsed by operation of law. No disciplinary proceeding shall be instituted against any licensed person after the expiration of three years from the termination of such license.

(1) Prior to the issuance of a resident public adjuster license or a nonresident public adjuster license and for the duration of such license, an applicant shall secure evidence of financial responsibility in a format prescribed by the director through a surety bond. The surety bond shall be executed and issued by an insurer authorized to issue surety bonds in this state, which bond:

(a) Shall be in the minimum amount of twenty thousand dollars; and

(b) Shall not be terminated unless written notice has been filed with the director and submitted to such public adjuster at least thirty days prior to such termination.

(2) The director may request the evidence of financial responsibility at any time the director deems relevant.

(3) A public adjuster shall immediately notify the director if evidence of financial responsibility terminates or becomes impaired. The authority to act as a public adjuster shall automatically terminate if the evidence of financial responsibility terminates or becomes impaired.

(1) Except as otherwise provided in this section, an individual who holds a resident public adjuster license or a nonresident public adjuster license shall satisfactorily complete a minimum of twenty-four credits of continuing education, including three credits of ethics, reported on a biennial basis in conjunction with the license renewal cycle.

(2) The requirements of subsection (1) of this section shall not apply to a nonresident public adjuster who has met the continuing education requirements of the adjuster’s home state and whose home state gives credit to residents of this state on the same basis.

(3) Only continuing education activities approved by the director pursuant to sections 44-3901 to 44-3908 shall be used to satisfy the requirements of this section.

(1) Public adjusters shall ensure that all contracts for their services are in writing and contain the following terms:

(a) Legible full name of the public adjuster signing the contract, as specified in director records;

(b) Home state, business address, and telephone number;

(c) Public adjuster license number;

(d) Title of "Public Adjuster Contract";

(e) Insured’s full name, street address, insurer name, and insurance policy number, if known or upon notification;

(f) Description of the loss and its location, if applicable;

(g) Description of services to be provided to the insured;

(h) Signatures of the public adjuster and the insured;

(i) Date contract was signed by the public adjuster and date the contract was signed by the insured;

(j) Attestation language stating that the public adjuster is fully bonded pursuant to state law; and

(k) The specific amount of compensation, including, but not limited to, the full salary, fee, commission, or other consideration the public adjuster is to receive for services.

(2)(a) The contract may specify that the public adjuster shall be named as a co-payee on an insurer’s payment of a claim.

(b) If the compensation is based on a share of the insurance settlement, the exact percentage shall be specified.

(c) Initial expenses to be reimbursed to the public adjuster from the proceeds of the claim payment shall be specified by type and the dollar estimates shall be set forth in the contract. Any additional expenses shall be approved in writing by the insured.

(d) Compensation provisions in a public adjuster contract shall not be redacted in any copy of the contract provided to the director.

(3) If the insurer, not later than seventy-two hours after the date on which the loss is reported to the insurer, either pays or commits in writing to pay to the insured the policy limit of the insurance policy, the public adjuster shall:

(a) Not receive a commission that consists of a percentage of the total amount paid by an insurer to resolve a claim;

(b) Inform the insured that the loss recovery amount might not be increased by the insurer; and

(c) Be entitled only to reasonable compensation from the insured for services provided by the public adjuster on behalf of the insured, based on the time spent on a claim and expenses incurred by the public adjuster, until the claim is paid or the insured receives a written commitment to pay from the insurer.

(4) A public adjuster contract may not contain any contract term that:

(a) Allows a percentage fee to be collected by the public adjuster when money is due from an insurer, but not paid, or that allows a public adjuster to collect the entire fee from the first check issued by an insurer, rather than as a percentage of each check issued by an insurer;

(b) Requires the insured to authorize an insurer to issue a check only in the name of the public adjuster;

(c) Imposes collection costs or late fees; or

(d) Precludes a public adjuster from pursuing civil remedies.

(5) Prior to the signing of the contract the public adjuster shall provide the insured with a separate disclosure document regarding the claim process that states:

(a) Property insurance policies obligate the insured to present a claim to his or her insurer for consideration;

(b) There are three types of adjusters that could be involved in the claim process. The definitions of the three types are as follows:

(i) Company adjuster means an insurance adjuster who is an employee of an insurer. He or she represents the interest of the insurer, is paid by the insurer, and will not charge the insured a fee;

(ii) Independent adjuster means an insurance adjuster who is hired on a contract basis by an insurer to represent the interest of the insurer in the settlement of the claim. He or she is paid by the insurer and will not charge the insured a fee; and

(iii) Public adjuster means an insurance adjuster who does not work for any insurer. He or she works for the insured to assist in the preparation, presentation, and settlement of the claim. The insured hires a public adjuster by signing a contract agreeing to pay a fee or commission based on a percentage of the settlement or other method of compensation;

(c) The insured is not required to hire a public adjuster to help the insured meet the insured’s obligations under the policy, but has the right to do so;

(d) The insured has the right to initiate direct communications with the insured’s attorney, the insurer, the company adjuster, and the insurer’s attorney, or any other person regarding the settlement of the insured’s claim;

(e) The public adjuster is not a representative or employee of the insurer; and

(f) The salary, fee, commission, or other consideration to be paid to a public adjuster is the obligation of the insured, not the insurer.

(6) The contract shall be executed in duplicate to provide an original contract to the public adjuster and an original contract to the insured. The original contract retained by the public adjuster shall be available at all times for inspection without notice by the department.

(7) The public adjuster shall provide the insurer a notification letter, which has been signed by the insured, authorizing the public adjuster to represent the insured’s interest.

(8) The public adjuster shall give the insured written notice of the insured’s rights as provided in this section.

(9) The insured has the right to rescind the contract within three business days after the date the contract was signed. The rescission shall be in writing and mailed or delivered to the public adjuster at the address in the contract within the three-business-day period.

(10) If the insured exercises the right to rescind the contract, anything of value given by the insured under the contract will be returned to the insured within fifteen days following the receipt by the public adjuster of the rescission notice.

(11) The director may require a public adjuster to file a contract with the department in a manner prescribed by the director.

A public adjuster who receives, accepts, or holds, on behalf of an insured, any funds toward the settlement of a claim for loss or damage shall deposit the funds in a non-interest-bearing escrow account in a financial institution that is insured by an agency of the federal government in the home state of such public adjuster or the state where the loss occurred.

(1) A public adjuster shall maintain a complete record of each transaction as a public adjuster. The records required by this section shall include the following:

(a) The name of the insured;

(b) The date, location, and amount of the loss;

(c) A copy of the contract between the public adjuster and the insured;

(d) The name of the insurer, amount, expiration date, and policy number for each policy carried with respect to the loss;

(e) An itemized statement of the amount recovered for the insured;

(f) An itemized statement of all compensation received by the public adjuster, from any source whatsoever, in connection with the loss;

(g) A register of all money received, deposited, disbursed, or withdrawn in connection with a transaction with an insured, including fees, transfers, and disbursements from a trust account and all transactions concerning all interest-bearing accounts;

(h) The name of the public adjuster who executed the contract;

(i) The name of the attorney representing the insured, if applicable, and the name of the claims representative of the insurer; and

(j) Evidence of financial responsibility in a format prescribed by the director.

(2) Records shall be maintained for at least five years after the termination of the transaction with an insured and shall be open to examination by the department at all times.

(3) Records submitted to the department in accordance with this section that contain information identified in writing as proprietary by the public adjuster shall be treated as confidential by the department.

(1) A public adjuster shall serve with objectivity and complete loyalty to the interest of the insured and shall, in good faith, render to the insured such information, counsel, and service, as within the knowledge, understanding, and opinion of such public adjuster will best serve the insurance claim needs and interest of the insured.

(2) A public adjuster shall not solicit, nor attempt to solicit, an insured during the progress of a loss-producing occurrence, as defined in the insured’s insurance contract.

(3) A public adjuster shall not permit an unlicensed employee or representative of the public adjuster to conduct business for which a license is required under the Public Adjusters Licensing Act.

(4) A public adjuster shall not have a direct or indirect financial interest in any aspect of the claim, other than the salary, fee, commission, or other consideration established in the written contract with the insured. Direct or indirect financial interest includes, but is not limited to, ownership of, employment by, or other consideration received from any business entity or individual that performs any work pertaining to damage related to the insured loss.

(5) A public adjuster shall not acquire any interest in salvage of property subject to the contract with the insured unless the public adjuster obtains written permission from the insured after settlement of the claim with the insurer.

(6) A public adjuster shall abstain from referring or directing the insured to obtain needed repairs or services in connection with a loss from any person:

(a) With whom the public adjuster has a direct or indirect financial interest; or

(b) From whom the public adjuster may receive direct or indirect compensation or other consideration for the referral.

(7) A public adjuster shall not undertake the adjustment of any claim if such public adjuster is not competent and knowledgeable as to the terms and conditions of the insurance coverage or if the loss or coverage otherwise exceeds the current expertise of the public adjuster.

(8) A public adjuster shall not knowingly make any false oral or written material statements regarding any person engaged in the business of insurance to any insured client or potential insured client.

(9) A public adjuster, while so licensed pursuant to the Public Adjusters Licensing Act, shall not represent or act as a company adjuster or independent adjuster in any circumstance.

(10) A public adjuster shall not enter into a contract or accept a power of attorney that vests in such public adjuster the effective authority to choose the persons who shall perform repair work.

(11) A public adjuster shall not agree to any loss settlement without the knowledge and consent of the insured.

(1) A public adjuster may charge the insured a reasonable fee for public adjuster services.

(2) A person shall not accept a commission, service fee, or other valuable consideration for investigating or settling claims in this state if that person is required to be licensed under the Public Adjusters Licensing Act and is not so licensed.

(3) In the event of a catastrophic disaster, there shall be limits on catastrophic fees. No public adjuster shall charge, agree to, or accept as compensation or reimbursement any payment, commission, fee, or other thing of value equal to or more than ten percent of any insurance settlement or proceeds resulting from a catastrophic disaster.

(4) No public adjuster shall require, demand, or accept any fee, retainer, compensation, deposit, or other thing of value prior to settlement of a claim unless the loss is being handled by the public adjuster on a time-plus-expense basis.

The director may adopt and promulgate rules and regulations to carry out the Public Adjusters Licensing Act.