How are Independent Adjusters Compensated?
How are Independent Adjusters Compensated?
Staff adjusters are almost always salaried employees of insurance companies. Therefore, compensation in the traditional form of a bi-weekly paycheck with taxes gets taken out.
Independent adjusters, however, are typically 1099 independent contractors who must calculate their own taxes (get an accountant and do it quarterly!).
THE PARTICULAR METHOD OF COMPENSATION IS GENERALLY DONE IN ONE OF TWO WAYS:
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Fee Schedule: In this arrangement, independent adjusters are now compensated on a per-claim basis. This is with the amount determined as a percentage of the final claim settlement amount. Rendered payments are roughly every two weeks. But only for those claims which have been successfully closed and paid out. Submission of a claim to “file review” does not constitute a successful closure!
- Daily Rate: As it sounds, a daily rate is a set amount an adjuster makes for each day on duty and can range widely. From $250 a day to upwards of $750 depending on the complexity of the work and the severity of the need. There are some basic expectations or even some hard and fast stipulations in place. Stipulations about how much an adjuster must do each day (i.e., average 3 claims inspected, 2 files submitted per day). This is a less common arrangement than a fee schedule.
STAFF ADJUSTERS RARELY IF EVER HAVE TO HANDLE TRAVEL EXPENSES
Independent adjusters, though, frequently must do so. This could include the purchase and upkeep of your own software estimating system. Systems like Xactimate, IntegriClaim. These are all significant but you are being compensated well enough to make it a good deal even still. That said, learning how to live thriftily becomes very important while on assignment. As your paychecks are often quite sizable it can be a challenge not to become a free-spender. Not only do you need to make hay while the sun shines, but you should also be putting most of it in the barn for winter!
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