Generally speaking they wouldn't touch or even see your mitigation money. I would definately not give 10% in this case and would let homeowner know they owe your full bill. They are instances where I would gladly give 10% cut but not in this case
Actually it is legal for them to deduct payment from the check in most states. Even though you did the work, the payment is made to the home-owner. That is who the insurance company has a contract with. The home-owner and only the home-owner. The home-owner can let anyone he wishes have a cut off the top.
However, you have an agreement with the home-owner. He still owes you the entire fee you agreed to. If PA takes a cut, then the Home-owner still owes you part of your fee. You have a contract with the home-owner. He is the one responsible to pay you.
BTW - In some situations the mortgage company can also take funds of the check from the insurance company without your permission.
As a Public Adjuster in 5 States, an Insurance Consultant in 1 State and an Independent Adjuster in States where I am not a licensed PA let me try to dispel some important misconceptions
1) A Public Adjuster is contracted with the insured ONLY (homeowner or business-owner). The insured is responsible for payment of all fees. These fees can be deducted from the settlement proceeds BUT does not affect your invoice unless you elect to credit your portion of the fees for your service. Note: I work with many mitigation companies throughout the country because a knowledgeable PA WILL get you the pay rates you deserve. Example: I had a claim referred from a ServiceM***** that was upset with all the fees and unpaid line items the Insurance Carrier demanded and since its illegal for a contractor to negotiate they told the homeowner to discuss with our firm. Original offer on mitigation was $7600 and we settled at $67,000.
2) A PA cannot charge a fee unless the claim is increased. If you had a mitigation invoice for services BEFORE the PA was retained than the insured would not have a charge for your service invoice UNLESS the PA increased the settlement on YOUR work then you would be entitled to charge the amount of the increase. This requirement applies to every State that I know of but you can verify by googling your States Ins Dept for PA regulations and methods of payment.
3) Settlement checks are processed by the PA's Settlement Account( non-interest bearing Account) and distributed to the contractors (normally but some insureds request to make payments). This is similar to an Attorneys Settlement Account and is a Requirement of the Insurance Departments Regulations. Most people don't understand that when a PA is listed on the claim checks the ENTIRE claim amount becomes taxable to the PA (insurance company issues IRS Form 1099 at end of year) so the Settlement Account allows a method to account for all payments.
4) A PA contract in essence allows the PA to "control" the claim process BUT a good PA will NOT dictate how the contractors do their work.. YOU are the contractor THUS you are the professional.
5) SeaGrt, team up with a PA that is knowledgeable and understand how the insurance business "actually" works. You may appreciate your pay increase and the freedoms you may gain in doing a restoration project "fully and correctly" without the insurance company Adjuster breathing down your neck
6) SeaGrt, I understand your frustration that your fire job took 4 months before demo BUT you don't know what went on behind closed doors since you wouldn't have been privy to those discussions. Best way is to explain this is an actual example: client was offered $39,000 for fire damage mitigation/rebuild (based off a restoration companies estimate), we were retained and settled the claim 4 months later for nearly $700,000. Was it worth that homeowner waiting 4 months?
Everyone should understand there is a HUGE difference between a repair estimate and an indemnity estimate. If you don't know what an indemnity estimate is then the easy definition is: the amount that the insurance company is obligated to pay per the policy language. Also, Insurance is a BUSINESS first and foremost....
The insurance business is rapidly changing and if you want to be successful I encourage everyone to attend conferences that are offered to PA's, Policyholder Attorneys, engineers, hygienists and restoration contractors. A great conference in October is in Warwick, RI called the First Party Claims Conference. You would be shocked how many of the Restoration Companies have "teamed up" with Policyholder Advocates.
After nearly 30 years in the insurance business and 17 years as a restoration/general contracting business, I have never seen the insurance business change so radically as the last 5 years.
If anyone has any questions or concerns just shoot me a p.m.