Which category of adjuster is required to hold a license from the Maryland Insurance Administration under Insurance Article Title 10, Subtitle 4?
A. Staff adjusters employed directly by an insurance company
B. Independent adjusters retained by an insurer to investigate claims on the insurer's behalf
C. Public adjusters, who are hired and paid by the policyholder to represent the insured's interests in a claim
D. No adjusters of any kind are required to be licensed in Maryland
Show answer and reasoning
Correct answer: C. Public adjusters, who are hired and paid by the policyholder to represent the insured's interests in a claim
Correct: § 10-403 requires a license before a person may act as a public adjuster in Maryland, since public adjusters represent and are paid by the policyholder rather than the insurer.
- A: Section 10-402 excludes adjusters employed by or acting for an insurer (such as staff adjusters) from the licensing requirement in this subtitle.
- B: Independent adjusters working on behalf of an insurer, like staff adjusters, fall outside Subtitle 4's public adjuster licensing scope; Maryland does not maintain a separate independent-adjuster license.
- D: Maryland does license one category of adjuster, the public adjuster, under Title 10, Subtitle 4.
Source: Md. Code, Ins. § 10-403
Why does an adjuster who works for an insurance company adjusting claims on the insurer's behalf typically fall outside Maryland's public adjuster licensing requirement?
A. Because Maryland exempts all adjusters from licensing regardless of who they represent
B. Because § 10-402 limits the subtitle's scope to adjusters representing policyholders for compensation, excluding adjusters employed by or representing insurers
C. Because insurer-side adjusters must instead hold a producer license
D. Because insurer-side adjusters are regulated exclusively by federal law, not state law
Show answer and reasoning
Correct answer: B. Because § 10-402 limits the subtitle's scope to adjusters representing policyholders for compensation, excluding adjusters employed by or representing insurers
Correct: § 10-402 defines the scope of the public adjuster subtitle, and it does not reach adjusters who work for or represent the insurer rather than the policyholder.
- A: Maryland does license one category of adjuster (public adjusters); the exemption is specific to insurer-side adjusters, not a blanket exemption for everyone.
- C: A producer license authorizes selling/soliciting insurance; it is not the substitute credential for an insurer-side claims adjuster.
- D: Adjuster regulation in the U.S. is primarily a state insurance-law matter under the McCarran-Ferguson framework, not exclusive federal regulation.
Source: Md. Code, Ins. § 10-402
What must a Maryland public adjuster contract contain, at minimum, under § 10-411?
A. Only the adjuster's name and a handshake agreement on fee
B. The adjuster's name, business address, license number, a description of services, and the fee or compensation arrangement, with the document titled 'Public Adjuster Contract'
C. A blanket assignment of the entire insurance policy's benefits to the adjuster with no fee disclosure
D. Nothing specific; Maryland leaves contract contents entirely to the parties' discretion
Show answer and reasoning
Correct answer: B. The adjuster's name, business address, license number, a description of services, and the fee or compensation arrangement, with the document titled 'Public Adjuster Contract'
Correct: § 10-411 requires a written contract titled 'Public Adjuster Contract' that includes the adjuster's name, business address, license number, description of services, and fee/compensation details, signed by both parties.
- A: Maryland requires a written contract with specific mandatory contents, not an informal handshake arrangement.
- C: The statute requires clear fee disclosure; it does not permit an undisclosed blanket benefit assignment.
- D: The statute specifically mandates required contract elements; contents are not left entirely to the parties.
Source: Md. Code, Ins. § 10-411
As of the 2024 amendment effective October 1, 2024, how many business days does an insured have to rescind a signed public adjuster contract in Maryland?
A. 3 business days
B. 5 business days
C. 10 business days
D. 30 business days
Show answer and reasoning
Correct answer: C. 10 business days
Correct: the 2024 amendment (effective October 1, 2024) extended the insured's right to rescind a public adjuster contract from 3 to 10 business days from the date the contract is signed.
- A: 3 business days was the prior rescission period before the 2024 amendment extended it.
- B: 5 business days is not the period established by Maryland's public adjuster contract rescission rule.
- D: 30 business days significantly overstates the rescission window under Maryland law.
Source: Md. Code, Ins. § 10-411 (as amended by 2024 Ch. 826, H.B. 36, eff. Oct. 1, 2024)
If a public adjuster's fee under a Maryland contract is based on a percentage share of the insurance settlement, what must the contract specify?
A. Nothing further, since percentage-based fees are self-explanatory
B. The exact percentage to be paid, clearly stated in the contract
C. Only a maximum dollar cap, with the percentage left undisclosed
D. The percentage may be disclosed verbally instead of in writing
Show answer and reasoning
Correct answer: B. The exact percentage to be paid, clearly stated in the contract
Correct: when compensation is based on a share of the settlement, § 10-411 requires the public adjuster contract to specify the exact percentage to be paid.
- A: The statute requires an explicit, specific disclosure, not an assumption that a percentage arrangement is self-explanatory.
- C: A dollar cap alone does not satisfy the requirement to state the exact percentage.
- D: The fee terms must be part of the written public adjuster contract itself, not communicated only verbally.
Source: Md. Code, Ins. § 10-411
