When it comes to the insurance industry, we tend to immediately think of insurance agents or agencies, and the companies they represent. But there is much more to insurance and the careers it offers than first meets the eye. So what is an independent adjusting firm? And how does it fit into the industry?
Independent Adjusting Firms, often called I.A. Firms, are relatively new to the long-standing insurance industry. The firms are comprised of insurance adjusters who often operate as independent contractors. When there is a spike in claim submissions, insurance companies hire these firms to handle their overflow claims.
Why Use an Independent Adjusting Firm?
The key word, however, is independent. These firms, and their employees, are not affiliated with any one insurance company. Instead, they work on behalf of the insurer that hired them to investigate, evaluate, and settle claims for the length or scope of the contract between the two parties. That contract may be for a set of dates, a specific weather event, or simply a long-term partnership.
So why can’t the insurance company and/or its employees, just handle the claims themselves?
The answer really boils down to the unpredictability of insurance claims.
Insurance companies spend a lot of money to predict risk. There are whole departments, models, programs, and recently, AI assistance helping them create averages and expectancies for insurance claims. But as we’ve seen, one storm can throw everything into chaos.
When there is a high influx of claims due to a large-scale weather event, they need a lot of adjusters at the ready so the claims can be handled immediately. However, if the insurance company kept that huge number of adjusters on staff all year, they wouldn’t have anything to do most of the time. There simply aren’t enough claims to justify having so many adjusters employed full-time.
This is why Independent Adjusting Firms were created. I.A. Firms have huge rosters of independent adjusters ready and willing to work when and where they are needed. The insurers will contract with the I.A. Firms to get the extra help they need to handle an influx of claims. Because I.A. Firms contract with multiple insurance companies at the same time, they can readily move staff to where they are needed the most.
Today, insurance companies regularly rely on I.A. firms to handle most major disaster work, such as hurricane catastrophe claims, as well as spikes in local “daily” claims. Or they might need to contract daily claims in areas where “holes” have been left from their adjusters who’ve been deployed to a disaster. Either way, it’s created an environment where the industry can efficiently shuffle claims adjusters to where they are needed most. This is best for both insurance companies AND policyholders.
Another benefit available to insurers is that some independent adjusting firms specialize in certain types of claims. This allows the insurer to access an expert in specific areas such as flood damage or large liability claims. They’ll get a more thorough and efficient investigation and a quicker resolution to the claim…all without keeping a knowledgeable expert on staff 24-7.
Who Works for an Independent Adjusting Firm?
Most independent insurance adjusters work for independent adjusting firms. In fact, most adjusters are on the rosters of multiple I.A. Firms at the same time. There are different kinds of firms, both large and small, with many different types of specialties all over the nation. You can read more details about where independent insurance adjusters work in our blog article.
If you’re interested in working with an IA Firm, make sure you get your adjuster license! Here at AdjusterPro, we can help make your journey quick and easy. Check out our courses to see what it’ll take for you to get your license!
