Public Adjuster Cannot Serve as “Disinterested” Appraiser
by Thomas J. Moody
Parrish v. State Farm Fla. Ins. Co., No. SC21-172, 2023 Fla. LEXIS 261 (Feb. 9, 2023)
The Florida Supreme Court has held that a public adjuster working for an insured under a contingency fee agreement is not disinterested, and cannot serve as a disinterested appraiser.
In Parrish, the insured brought a claim after Hurricane Irma damaged his home. The insured hired a public adjuster pursuant to a statutory ten precent contingency fee agreement. The claim went to appraisal. Over State Farm’s objection that the public adjuster was not disinterested as required by the policy’s appraisal provision, the trial court allowed the public adjuster to serve as the insured’s appraiser. The Second District Court of Appeal reversed and certified conflict with the Third District Court of Appeal.
On review, the Florida Supreme Court found that the contingency fee agreement disqualified the public adjuster from serving as the insured’s appraiser. Quoting both Black’s Law Dictionary and Webster’s Third New International Dictionary, the Court held that the plain meaning of disinterested is “self-explanatory” and a “disinterested person cannot, consistently with the generally understood meaning of that word, have a pecuniary interest in the matter at hand.”
Learning Point: Insurers and/or their counsel should first identify whether the policy’s appraisal provision requires a disinterested appraiser—many common policy forms only require a competent appraiser. If the policy requires a disinterested appraiser, public adjusters should be excluded. Insurers and/or their counsel should work to identify how a proposed appraiser is compensated for serving as an appraiser, and seek to disqualify those with contingent fee arrangements.