Setting Standards by Supporting State Statutes: NAPIA LEGISLATIVE BLOG

By Brian S. Goodman, Esq., NAPIA Counsel, PESSIN KATZ LAW, P.A Wednesday, February 20, 2013

It is now legislative season throughout the country and this means that NAPIA is busy on many fronts in numerous states dealing with legislative and regulatory issues to protect the Public Insurance Adjusting profession. There are always hot button issues, and this year is no different than most years. Here are a few:

1) SOLICITATION — A number of states have solicitation rules, and NAPIA in general will support these if they are reasonable. We will agree to and support reasonable hours restrictions, as are seen in some states, but we oppose restrictions that unfairly curtail access. We assisted in the recent Florida case which saw that state’s 48-hour solicitation ban after a loss declared unconstitutional by the Florida Supreme Court, and we are currently assisting to reverse a 36-hour ban in Maine, the only remaining state with such a ban.

2) FEE CAPS — Currently, 14 states impose reasonable fee caps of some sort on public adjuster contracts. As a policy, NAPIA does not advocate for fee caps. We prefer to see the markets determine the proper fee, knowing that NAPIA members adhere to high ethical standards in dealing with insureds and insurers. Our position has been and remains consistent. We do not advocate or lobby for fee caps. However, when caps are presented as a requirement by a state DOI or legislature, we accept them and work with regulators and legislators to assure that they are fair and reasonable to the profession and the consumer. For instance, when licensing was enacted in Mississippi post Katrina, the proposed legislative and DOI requirement was a 7 per cent fee cap. NAPIA worked with regulators in Mississippi to consider a higher cap, which ended up at 10 per cent. This is consistent with what we are doing now in other states.

3) RESCISSION — Some states have this — others do not. The standard in most states and under the NAIC Model Public Adjuster Act is 3 days, which is reasonable. We are working to see that this remains the standard.

In legislation and regulation, choices often must be made. NAPIA always does its best to assure that these choices are measured and consistent with the proper and ethical practice of public adjusting. We have been and remain the gold standard of the industry. As we work in the various states and with the NAIC, you can be proud that we are viewed this way due to our ethics and efforts.

How Long Must A Minority-Owned Business Be In Operation Before Applying For Certification As A Minority Business Enterprise (“MBE”) In Baltimore City?

Under the Baltimore City Code, before a minority-owned business is eligible to apply for certification as an MBE, the business must have been in operation in the Baltimore City Market Area for at least twelve (12) months.  Under the Code, the Baltimore City Market Area includes Baltimore City, Baltimore County, Anne Arundel County, Howard County, Harford County, Carroll County and Queen Anne’s County. 

Additionally, the minority owner(s) must have at least 51% ownership of the business as well as control of the business during the entire twelve (12) month period.  That is, the minority owner(s) must possess the power to direct or cause the direction of the management and policies of the business as well as make day-to-day decisions and decisions on matters of management, policy and operations for the entire twelve (12) month period.  There can be no formal or informal restrictions that limit the discretion of the minority owner(s) or prevent the minority owner(s) from making business decisions without the cooperation or vote of a non-minority.  

Certification of a business can be a viable tool for developing and maintaining business relationships. Businesses seeking certification as an MBE in Baltimore City may want to consider obtaining legal advice concerning eligibility requirements for certification prior to applying for certification.    

Employers Can’t Discourage Employees From Jury Service

Effective October 1, 2012, an employer can’t deprive an individual of employment or coerce, intimidate, or threaten to discharge an employee due to time lost because of court mandated jury service. The new legislation prohibits an employer from requiring an employee who spends four or more hours in one day, including travel time, in jury service, to start a work shift that begins on or after 5 p.m. on the day of jury service or before 3 a.m. on the following day. An employer violating the law is subject to a fine not to exceed $1,000.

For more information about this new legislation or for more information on Maryland labor and employment law contact PK Law Labor and Employment Attorneys Rochelle S. Eisenberg at, Leslie R. Stellman at or Edmund J. O’Meally at or go to

Property Owners Remain Vulnerable To Lead Paint Lawsuits

The Maryland General Assembly ended its legislative session in April 2012 without passing proposed legislation that would have provided up to $200,000 of insurance for owners of residential rental properties facing lead paint lawsuits. Under this proposed legislation, to qualify for the insurance, property owners would have to pay an annual fee between $50 and $500 per rental unit, depending on the level of compliance with the state’s lead paint guidelines.

While many Baltimore City property owners supported the proposed bill, property owners in other jurisdictions in Maryland, who feel they have less exposure to potential lead paint suits, thought the annual fees per rental unit were too high. Accordingly, the General Assembly has called for a work group to study the proposed legislation. This work group will include attorneys and property owners as well as other interested representatives.