The short answer is, when you have a first-party claim and the insurance company is not offering you what you think it should. But not when you have a third-party claim.

But what are first-party and third-party claims, you ask? A first-party claim is a claim that will be paid to a party covered by the policy. The boiler leaks in the cellar of your condominium and damages the building. Your property insurance should pay to repair the damages. That’s a first-party claim. If a unit owner has a storage bin in the cellar and boiler leak also gets into the bin and damages his property, then your condominium’s liability policy may pay for his damages. That’s a third-party claim.

But what about a public adjuster? A licensed public adjuster can represent your condominium to negotiate with the insurance company to get it to pay more for the condominium’s first-party claim that it otherwise would have. The public adjuster can do this because he or she understands your insurance policy and the real cost of repairs better than you do. The public adjuster gets paid a percentage of the extra he or she gets from the insurance company. This doesn’t work for third-party claims because the condominium, through its insurer, is the one paying the claim to someone else. If the third-party won’t accept what the insurance company offers, the third-party can sue, in which case the insurance company hires a lawyer, not a public adjuster, to defend the condominium.