Pennsylvania's new law limits what public adjusters can charge your business—and it takes effect 180 days after the bill is signed.
Most auto service owners don't realize that if they hire a public adjuster to help recover from a major loss—whether it's storm damage, a fire, or another catastrophic event—Pennsylvania law now caps what that adjuster can charge them.
This protection comes from HB1972, a bill that overhauled Pennsylvania's public adjuster licensing and fee structure. Buried in the bill is a straightforward but significant provision: public adjusters can no longer charge whatever they want.
Under Section 4.1 (Fees) of HB1972, public adjusters face statutory fee caps:
That's it. If a public adjuster tries to charge more, they're violating state law.
When a disaster hits your shop—a roof collapses, a vehicle fire spreads, severe weather causes major damage—you're already stressed. You may not have the time or expertise to negotiate with your insurance company alone, so you hire a public adjuster to handle it.
Before this law, public adjusters could negotiate their own fees with you, and there was no legal ceiling. In a vulnerable moment, you might agree to terms you'd later regret. Now, the state sets the maximum. You know upfront that a catastrophic claim won't cost you more than 10% of what you recover, and an ordinary claim won't exceed 20%.
This protects small businesses. Your settlement is already reduced by the adjuster's fee—the cap ensures that reduction stays reasonable.
If you work with a public adjuster, they must comply with these caps or face license revocation. Any fee agreement that violates the cap is unenforceable. Public adjuster firms across Pennsylvania are restructuring their contracts to meet the new limits.
The fee caps go into effect 180 days after HB1972 is enacted (Section 5, Page 19 of the bill). This gives public adjusters time to update their fee agreements and disclosures.
If you're currently working with a public adjuster or considering hiring one, review any fee agreement against these caps. If an adjuster is charging more than the legal limit, that agreement violates state law. If you're in the middle of a claim, ask your adjuster to confirm their fee in writing—it should be 10% or 20% depending on your claim type, nothing more.
Keep copies of your fee agreement. If a dispute arises over what you owe, the statutory caps are your protection.
For a free, detailed guide to HB1972's provisions and how they affect Pennsylvania auto service businesses, contact your local trade association or the Pennsylvania Department of Insurance.