Forums

Not a simple question, Tim. There are any number of factors that could be considered in determining the answer. The first would be, "What is the fee schedule?" Fee schedules are negotiated by people other than the adjuster. In many cases, the vendor sales staff or executive who "negotiated" the fee schedule should be pounding the pavement looking for a new job. Yesterday I spoke to a staff adjuster at a major vendor. He was compalining to me about having to travel about 120 miles round trip to inspect a hail claim for a flat fee (0 to $5000 loss) of $165, no miles, no photos. The insured on the claim was represented for some reason by a public adjuster. The correct answer to that fee schedule would be that an experienced and proven adjuster should be paid at least 300% of that fee billing. The cat department at the same company has recently been bucking the trend and simply saying to companies with abysmal fee schedules that they simply do not need their business, no matter the volume. Imagine that! Now that's courage on the part of the vendor's cat department.

The second factor involves what the carrier expects in terms of file requirements. Do they expect an unagreed estimate and close? Do they expect full adjustment? Do they expect us to deal with public adjusters, reopens, etc. under the original fee or do they then become time and expense files?

Then there is the expense factor. If I am handling claims from home as daily claims or branch assist, then 50% may be acceptable. If I am incurring road expenses, 60% is bare minimum. 65% to 70% would be better. This would also vary depending on whether the vendor is providing workers comp, errors and ommissions, and whether the vendor hires us as an "as needed" employee and pays social security.

Supply and demand will also play a part in what is a fair commission, but I hope we never need to get so desperate for work that we see the fee schedules and commission percentages erode to pre-2004 levels again. File requirements never go down. Our costs never go down. Gas prices go down only in preparation for assaulting us with new highs. Fee schedules and commission percentages should not be going down either.

     Is this a trick question?

Measure all compensation by the Independant Contractor status. Pilot one of the largest and best pays 65% of a schedule that has no hidden charges(charge the carrier more than your copy). This is VERY important. Next you are a temp. employee, with FICA and Tax taken out of your pay. Pilot has 401 K and pays unemployment tax in ever state. Workers Comp  and E & O.  An advance with deployment. A cut off payday date and direct deposit twice monthly. The real biggie is Pilot encourges their people to draw unemployment on the down times.  Measure all others against this and 75-80% would not be unreasonable," IF" you can get it. Good luck.