How to Become an Independent Claims Adjuster
Learn how to become an independent claims adjuster. Research the job description and the education and licensing requirements, and find out how to start a career in insurance claims.
Should I Become an Independent Claims Adjuster?
Independent claims adjusters handle insurance claims for the loss of property, damages, or personal injury. They examine claims, negotiate settlements, and approve or reject claimants' payments. A claims adjuster may be tasked with interviewing police, medical professionals, witnesses, attorneys, or claimants to compile information regarding accidents and any resulting injuries. The claims adjuster then uses the information compiled from the interviews to complete a report and determine whether and how much to pay a claimant.
The adjuster must stay abreast of and work within the guidelines of insurance company regulations. Independent claims adjusters can work for many insurance companies, or they can work on a contractual basis in a designated area for one insurance company. Long hours might be worked, and adjusters must often schedule their tasks according to the availability of those they need to interview. Additionally, the pay for these workers was higher than the average in 2012, according to the U.S. Bureau of Labor Statistics.
|Degree Level||High school diploma or GED, although many employers prefer a college degree|
|Degree Field||Insurance, business, finance|
|Licensure and/or Certification||Adjuster's license often required; requirements vary by state|
|Experience||Experience requirements vary, depending on job and level, but typically 1-5 years|
|Key Skills||Analytical ability, verbal and written communication, interpersonal and customer service, mathematics ability, Word processing, spreadsheets, appraisal software (Xactimate); Medical knowledge may be required for some positions; willing to travel locally on a frequent basis, willing to work evenings and weekends|
|Salary (May 2014)||$62,220/year (Median salary for claims adjusters, examiners, and investigators)|
Sources: Online job postings (December 2012), U.S. Bureau of Labor Statistics
Step 1: Get a Degree
Most insurance companies prefer that claims adjusters have an associate's or bachelor's degree. Colleges and universities might offer degree programs specific to the industry, such as an associate's degree in insurance services or a bachelor's degree in risk assessment and insurance. Coursework is designed to help students gain an understanding of the industry with classes in business, finance, risk management, and law. Some degree programs include an insurance industry internship and licensing exams.
Step 2: Complete a Pre-Licensing Course
Approximately one-third of all states require licensing in order to become an independent claims adjuster. In these states, candidates must pass a licensing exam that covers the basics of adjusting, take an accepted course in insurance on loss adjusting, supply character references, be a state resident, submit a surety bond, and meet minimum age requirements.
To prepare for the test, the applicant can take pre-licensing courses, which are available online and in the classroom through both public schools and private companies. Pre-licensing courses for insurance adjusters are typically around 40 hours long and may be completed in four days to a week. In some states, such as Florida and Texas, completion of a course exempts the student from taking the state exam.
- Be able to pass a background check. As part of the procedure for applying for a license, applicants usually undergo a background check, which includes fingerprinting and possibly a criminal records database. Certain felony convictions preclude a person from becoming an insurance claims adjuster, according to federal law.
Step 3: Pass the Licensing Exam
Each state has different regulations for adjusters, with most requiring a license acquired through examinations or by completing the required paperwork along with a fee. The claim adjuster licensing exam format varies from state to state, as does the length and specific content. For example, in California, the areas covered include the Adjuster's Act, agency law, investigation techniques, and several types of insurance coverage, such as auto, business income, and business owners' policies. In Idaho, 41 questions test knowledge of insurance terms and related concepts as well as types of policies.
Some private associations also offer certification, including the International Claims Association (ICA), which provides members with experience and the knowledge needed to be a successful adjuster. The Associate, Life and Health Claims (ALHC) professional designation exam offered by the ICA usually takes 2-3 months of preparation coursework and certifies members to work as public claims adjusters.
Step 4: Gain Experience
Experience through an entry-level position or internship in the insurance field can provide a foundation in the information and specific processes necessary for claims adjusters to do their jobs within the guidelines of the law. Many insurance companies offer internships or trainee positions that provide an inside look into how claims are processed through shadowing claims adjusters. Claims adjusters should have knowledge of how claim quotes work, laws specific to the insurance industry, and medical terms, as well a good sense of debating skills to be able to support claim figures.
Step 5: Maintain Licensure with Continuing Education
States that require licenses may also require continuing education credits to renew the license. An independent claims adjuster can acquire these credits from Internet correspondence courses and employer-provided training sessions that address new trends in the industry. Credits may also be earned by publishing articles or giving lectures about the insurance claims industry.
For example, in Minnesota, an independent claims adjuster must complete a minimum of 24 hours of continuing education courses of which three hours must be in ethics every two years. In California, the requirement is also 24 hours during the two-year term.
- Join a professional organization. Organizations such as The National Association of Independent Insurance Adjusters (NAIIA) offer members opportunities for continuing education, conferences, and courses to enhance knowledge of ethics in the work place.