Written by Andy Gurczak

June 11, 2021

How to Negotiate a Settlement with an Insurance Adjuster

Fire Insurance Claim Help: How to Negotiate a Settlement with an Insurance Claims Adjuster

Most homeowners aren’t experts at dealing with insurance companies, initiating a claim or negotiating insurance claims. Homeowners usually only ever have to make one or two major insurance claims, if any. There are plenty of tricks and strategies you can use to negotiate settlement with your insurance claims adjuster. Likewise, you can make sure that you are fully paid for all of your property damages. Keep reading to discover the best insurance claim strategies, and advice, as well as how to negotiate a settlement with an insurance adjuster.

1. Make Sure that Filing A Property Insurance Claim is Your Best Option

Home insurance premiums usually increase after you file a home insurance claim. In many states, premiums can jump up from 15% to 30% after a single home insurance claim. For this reason, it may not be in your best interest to file a home insurance claim for ‘incidental’ incidents.

Home insurance companies consider small home insurance claims as ‘incidentals’. Despite being minor problems, these types of claims raise your premiums just like larger claims. As a result, The more home insurance claims you have within a seven year period, the higher your insurance premiums will be.

Home insurance companies can access your entire insurance history through your Comprehensive Loss Underwriting Exchange (CLUE) report. Some insurance experts recommend raising your deductible to 2% of your policy limits and only using your home insurance for incidents that cost more than your 2% deductible. You should then set up an emergency fund to cover ’incidental’. In conclusion, rely on your home insurance policy for major incidents.

It is also important to know that after a local natural disaster, your insurance rates may increase whether you file a claim or not. While the insurance company can’t raise individual rates for a weather-related claim, it can raise rates in that whole territory due to the number of claims filed.

2. Read Your Policy Before Making a Claim or Negotiate a Settlement with an Insurance Adjuster

Most homeowners don’t fully know or understand their home insurance policies. You might have basic knowledge of your home insurance coverage, including what’s covered and what isn’t. However, your insurance contract has plenty of fine print that can cause underpayment and even denial of your claim.

Read your policy before you make a claim. This might help you know how to negotiate a settlement with an insurance claim adjuster . Check your policy for specific sections related to your latest incident. For instance, a section on flood damage or fire damage.

It is highly recommended that you read your insurance policy before an incident, so that you understand what is and isn’t covered. If you attempt to read and understand your policy but you find it confusing, then it is best to seek help from a Public Adjuster. These can help you interpret your policy language and even make suggestions on how to find better coverage for your home.

3. Hire a Public Adjuster To Help Negotiate a Settlement with an Insurance Claim Adjuster

The insurance company’s adjusters are insurance experts that understand your policy better than anyone. They know all the tricks and stipulations to deny or reduce your claim. They work for your insurance company to lower your claim by as much as legally possible.

On the other hand, a public adjuster is an insurance expert that works for you instead of the company. For this reason, a public adjuster fights to maximize the value of your insurance policy.

  • First, a public adjuster knows how to negotiate a settlement with an insurance claim adjuster better than anyone.
  • Additionally, they only charge a fee once you have agreed with your insurance company’s final and best offer. The public adjuster establishes the fee upfront and upon writing. 
  • Thirdly, a public adjuster helps manage your insurance claim from beginning to end. As a result, this permits you to focus on more important things following a major incident.
  • They also handle communications with your insurance company, contractors, and others involved in the claims process.
  • Fifthly, public adjusters use proven tips and methods to ensure the maximum amount of coverage possible.

4. Arrange For An Inspection Of Your Property to Have a Comparison line to Negotiate a Settlement with an Insurance Claim Adjuster

Insurance companies often calculate repair estimates in a different way than other parties. After filing a claim, an insurance company adjuster arrives at your property to assess the damage. Sometimes, the adjuster might claim it will only cost $10,000 to repair your fire damage, despite the real cost being much higher. For this reason, you may need to be prepared to respond to a low settlement offer.

Consider having a local general contractor come by and generating an estimate on the restoration cost. Many of these contractors provide free estimates.

Based on the contractor’s estimate you can evaluate if the insurance has sent you a “low-ball offer”. If they have, it’s time to get a public adjuster to assess the damage. In most states won’t allow public adjusters to charge a fee unless they are able to recover more money for you.

Negotitate with an Insurance Claim Adjuster: A Policeman filling out a Report

5. A Police Report May be Necessary to Negotiate a Settlement with an Insurance Claim Adjuster

If you need to file an insurance claim and a crime has been committed on your property, then you need to contact the police for a police report. Some of the situations where you may want to file a police report include:

  • Arson
  • Theft, Robbery or Burglary
  • Vandalism or deliberate damage to your home or business

If you do not file a police report after an incident like this, you could be violating terms of your insurance policy contract. Consequently, your claim could cause suspicion.

6. Take As Many Photos As Possible, It can Help you Negotiate a Settlement With an Insurance Claim Adjuster

This is one of the best insurance claim tips we can give. The more photos and videos you take of the damage, the more success you might have while negotiating a settlement with an insurance claims adjuster.

Take clear, well-lit photos of damage from as many angles as possible. Additionally, keep photos organized in a systematic order. A single photo might make the difference between maximizing your insurance claim payout or having your claim rejected.

7. Be Present when the Insurance Company’s Adjuster Inspects the Property Location

Make sure you’re on-site when the insurance company’s adjuster comes to visit your property. This way, you can explain exactly what was damaged. Furthermore, you can ensure the adjuster takes note of everything. You could also give the adjuster a document explaining the damages from your point of view.

8. Be Careful with What You Say to the Adjuster, it Could Hurt your Negotiations

Your insurance company’s claim adjuster is a salaried employee or hired contractor of your insurance company. The insurance company’s adjuster wants to help your insurance company pay out the lowest amount legally required on your insurance claim. For this reason, it’s crucial to limit what you say to the adjuster.

Answer any questions the adjuster has with a simple yes or no. You are contractually obligated to cooperate. However, you don’t have to to offer information that that they don’t ask.

If you feel unsure with any of the questions that asked, you can simply say “I am not sure, can I get back to you on that?”. Proceed by seeking the advice of a Public Adjuster. Although some statements and questions may seem innocent, they could hurt future negotiations, reduce your claims payout or even cause a claim denial.

9. Be Prepared For Misinformation

Be aware at all times that you and your insurance company and insurance claim adjuster are adversaries. Many insurance company adjusters are amiable. In fact, they seem very sympathetic and may assure you that everything is going to be okay. Then, proceed to inform you the insurance company rejected or reduced your claim.

Don’t let your insurance company lull you into a false sense of friendliness. Don’t fall for the “I’m here to help” act. Some insurance companies might be genuinely personable and willing to cover your claim, but others use friendliness as a powerful negotiation strategy. Approach your insurance claim like a business deal.
You should not have to negotiate anything like the terms of your agreement with the insurance company since they are already stated in your policy. Instead, seek full reimbursement for your loss and never “negotiate” or settle for less.

Negotitate with an Insurance Claim Adjuster: Understand the Procedures and Policies of the Insurance Company

10. Document Everything: it’s the Best tool to Negotiate a Settlement with an Insurance Claim Adjuster

Know that the negotiation of a settlement with an insurance claims adjuster is way easier with the more documentation you have. It’s important to document all communications with your insurance company. It’s equally as important to document previous housework work done on your home previous to the incident or to mitigate damage.

Documentation strategies include:

  • When possible, use email to communicate with your insurance company. This is because it leaves an easily-verifiable record of your conversation
    If you choose to record phone conversations, be aware of your state’s recording laws since some states allow you to record someone without their consent, while others do not.
  • If the disaster forced you out of your home, save all receipts for additional living expenses like hotel rooms and meals. Many home insurance policies cover additional living expenses.
  • Avoid paying in cash, especially for contract work. Receipts are vital.
  • Take notes of the time and date of conversations, the person you spoke to, and the topic of the conversation
  • Write down your claim number and keep a log of all other pertinent details from your insurance claim. Keep it organized and accessible.
  • Keep receipts for major assets in your house.
  • Avoid keeping documents in your home. You can lose them in home accidents like fires or floods; upload pictures of your receipts to cloud storage or make other electronic copies to ensure they’re easily accessible.

11. Avoid Padding a Claim it can Hurt your Settlement Negotiation with an Insurance Claim Adjuster

Avoid padding or exaggerating your claim. This is insurance fraud. Insurance companies lose billions of dollars per year to fraud. For this reason, they devote considerable resources to fighting fraud and you will most likely get caught. If you do, it causes the rest of your claim to be regarded with suspicion. This also raises insurance rates for everyone to cover the costs of defending fraudulent claims.

12. Keep Track of Your Time and Money

Your insurance claim may also cover time and money you put into an insurance claim. If you spend time repairing damages, preparing for contractors to arrive, and performing other work, then this work could count as ‘claim preparation’.

You are taking time out of your life to deal with an insurance claim. With some major insurance claims, dealing with a claim becomes a full-time job. Keep track of the time and money you spend dealing with the claim, since you could receive compensation depending on the terms of your policy.

13. Understand What’s In Your Claim an How to Negotiate a Settlement with An Insurance Claim Adjuster

We mentioned the fact that insurers send lowball offers because it helps their bottom line, but there’s another reason they do it: They plan on you rejecting the first offer, so they line up a more “reasonable” one.
When you get your offer, ask the adjuster to break down the claim. They may point out different language in your policy that excludes certain damages; have them clarify those exclusions in simple English. Keep records of everything the claims adjuster tells you, and gather documents that provide evidence as to why the offer is too low. You should also prepare to question the claims adjuster in the event your claim is outright denied. Be polite and find out the reason for the denial.

THE ART OF NEGOTIATING WITH ADJUSTERS: Negotiate a Settlement With an Insurance Claim Adjuster

There are three basic techniques that adjusters use to suppress negotiation attempts. You should also know that there are some counter techniques to help you overcome these difficulties.

Adjuster technique #1: Insurance Adjusters Act Like it’s Impossible to Negotiate a Settlement with an Insurance Claim Adjuster.

Everything is negotiable. Adjusters may not want to negotiate with you personally, but they can’t deny negotiation.
In fact, when they encounter any claim situation that escalates to trial, they know there’s a chance they may lose. This is why insurance companies train adjusters in negotiation. Insurances know that making concessions is a necessary component of negotiation and negotiation itself, is a necessary component of any claims process.


Force adjusters to take the time, whether in person or by telephone, to review and discuss your differences. If you aren’t the property owner, you can appeal to the property owner and their agent to join the discussion. Do it from the agent’s office with the adjuster on speaker telephone. The agent will facilitate if he thinks his policyholder may be exposed to a mechanic’s lien because the adjuster is unreasonably refusing to discuss and negotiate.

Adjuster technique #2: Adjusters Often Make Much Smaller Offers than what’s been authorized.

In fact, some adjusters may even start negotiating at 50 to 75 percent of the amount they were originally authorized by the insurance company. Every adjuster should know that negotiation is likely to happen on any given claim. And most adjusters believe they have done a good job if negotiations save 10 percent of their authority.

After rejecting an insurance adjuster’s initial offer, make a counter demand. He or she can probably still increase the payout amount. However, they will strongly resist offering you his full authorization, since they need authorizations from superiors. But it is possible to get the full payout, particularly on larger losses.


Don’t be taken aback by a low-ball offer. Instead, make a counter demand that is a bit below your initial demand.

Adjuster technique #3: Everything needs approval from higher-ups, so Don’t Be Afraid to Negotiate A Settlement Claim with an Insurance Adjuster.

An insurance claim adjuster always knows what and how much he can concede on a claim. However, anything the adjuster offers is subject to final approval by a superior, particularly if it’s over his authority. Furthermore, many superiors simply agree to whatever the field adjuster recommends. After all, the field adjuster is the eyes and ears of the superior who sits at a desk, often thousands of miles away.

For this reason, an insurance claim adjuster could actually make any concession as long as he or she documents it properly. Whenever they say they can’t concede to a larger payout because his superiors won’t let them, they are probably trying to deflect your hostility onto someone else and possibly trying to discourage you.


Don’t be dissuaded. Continue to explain your position and try to educate both the adjuster on the process and your reasoning. Don’t be hostile. If possible, be diplomatic and professional at all times. Your perceived disposition should be that you are concerned that the property damages are resolved correctly and that the insurance company’s interests are protected as well.

Last Resort if You can’t Negotiate a Settlement with an Insurance Claim Adjuster

If you can’t reach an agreement on the settlement amount with your insurance company, contact your agent or your insurance company’s claim department manager. Make sure you have figures to back up your claim for more money. If you and your insurance company still disagree, policies typically allow for an independent appraisal of the loss. In this case, you and your insurance company hire independent appraisers who then choose a mediator. You and your insurance company each pay for your appraiser and share the other costs. However, disputes rarely get to this stage.

Some insurance companies may offer a slightly different way of settling a dispute called arbitration. This means that a neutral arbiter hears the arguments of both sides and then makes a final decision.

If everything above fails, your next and final option (besides simply accepting the offer) is to file a lawsuit. A lawsuit can be a long process which is why negotiation is always recommended.

Negotiate with an Insurance Claim Adjuster: Your Last Step is to File a Lawsuit
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