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Illustrated Code of Ethics – Claims Adjusters

This is your Code of Ethics. Each section is illustrated with stories based on either actual disciplinary decisions, or deficiencies observed in the field or by the Syndic’s Office. Its goal is to help you, as newly certified claims adjusters, to reflect on certain ethical breaches in order to help you adopt best practices and fulfill your ethical obligations.

Please note that this is not an exhaustive selection of stories, and that the sections of the Code can apply to a variety of situations. Please do not hesitate to contact us for any questions you may have about your ethical obligations.

Although all claims adjusters are governed by the same ethical obligations, the stories you are about to read involve the following types of adjusters:

Claims adjusters acting for an insurer :  

  • Employed by an insurer;

  • Employed by an independent claims adjustment firm. 

Claims adjusters offering services to insureds, often called “public claims adjusters.” 

Division I General

From day one, claims adjusters have always aimed for the highest standards of professionalism…  

Section 1 reminds readers that the ChAD’s mission is to protect the public. It explains why the Code exists and the importance of your professional practice in protecting the public.

Insurance contracts are complex and there is a significant information imbalance between the insured and you, the expert in claims adjustment. You are therefore the first line of defence in protecting insureds.


A personal-lines damage insurance claims adjuster is assigned a claim file for a theft from a business. The claim is for $5,000.

Always up for a challenge, she accepts the commercial lines file without actually having the required certification to do so. This is contrary to the Act and its regulations.

Resource: Review the page on Certification and registration.


Ressource : Consultez la page Certification et inscription.

A claims adjuster has just been assigned a claim file. Due to a lack of time, he asks a contractor with whom he works regularly to hold the initial meeting with the insured and report back to him afterwards. The adjuster promises the contractor extra compensation for doing so.

The contractor introduces himself to the insured as the person in charge of his file and says that he will report to the insurer, mandate the suppliers and supervise the work.

The claims adjuster should not have promised to compensate an individual who is not certified in claims adjustment to act in this capacity.

A  company’s building suffers water damage due to a leaky roof.

The company’s insurer mandates an independent claims adjustment firm to produce a report on the causes of the loss. The firm is short-staffed, however this is a large, lucrative file. It therefore asks a retired claims adjuster who is no longer attached to the firm and who has not renewed his certificate to take on the file. An officer of the firm promises the insurer’s certified revisor a trip to Florida if he closes his eyes to the fact that a retiree is taking care of the file.

The revisor cannot accept this proposal. The claims adjuster mandated by the firm must be duly certified.

A claims adjuster who often deals with water damage files is approached by the manager of a disaster cleanup company. The manager promises to pay him $150 each time the adjuster hires his company for claims requiring cleanup services.

The adjuster agrees; he feels he deserves a little bonus to bump up his income.

Compensation for recommending clients to the cleanup company is not authorized under the Act and its regulations. The claims adjuster must not accept money or any other benefit from a person or a supplier whose professional services he has not retained.


Resource: Compensating certain secondary occupations is permitted as long as these occupations do not appear on the list of incompatible occupations under sections 2 and 3 of the Regulation respecting the pursuit of activities as a representative.

A claims adjuster asks a firefighter friend to notify her when he arrives at the scene of a fire. Why? She wants to arrive there too and propose her services to the victims.

In exchange for this information, she promises the firefighter that she will pay him a commission for each time she lands a new client thanks to him.

The claims adjuster should not have promised to pay the firefighter a commission, or to pay anyone else a benefit, for instance in exchange for referring a potential client. The only exception: when the person is a professional whose services have been retained. For example, a claims adjuster can call upon a specialist such as an engineer if he is working on a claim where the weight of the snow might be the cause of the loss. In this case, the adjuster can obviously promise to compensate the engineer for his work.

Resource : To find out more, read Le poids de la neige : les enjeux en cas de sinistre [The weight of snow: Issues when a loss occurs, in French only]

The certified manager of a claims adjustment firm would like to develop a closer business relationship with an insurer so that the insurer will send more business their way.

The manager invites the head of the insurer’s underwriting team to spend an all-expenses-paid weekend at a luxury inn in Mont Tremblant with his family.

The manager should not have offered this type of benefit in order to obtain more business from the insurer. Professionalism is the key to improving a business relationship. For example, the firm could make sure the insurer’s mandates are carried out with diligence and integrity.

A claims adjuster is working on a file that promises to be quite complex: a luxury home has been declared a total loss in the wake of a fire.

To ensure that his invoices are approved quickly, the insured’s contractor promises the claims adjuster a pair of hockey tickets and an all-expenses-paid weekend at the playoffs if the adjuster offers a trouble-free settlement for the maximum allowable amount; the settlement must be to the insured’s complete satisfaction.

The adjuster should not have accepted this offer. Other than the compensation to which he is entitled, he cannot receive any benefit related to his professional activities.

A claims adjuster working for an insurance company has a brother who owns a disaster cleanup company. His company is on the list of her insurance company’s service suppliers.

To help him out, the adjuster makes it a practice to involve her brother or one of his employees in most of her cases requiring cleanup services; she does not consider other service suppliers on the insurer’s list who are in the area where the loss occurred. This results in higher costs for the insurer and the claimant, since her brother’s company bills for extra travel costs. The claims adjuster promptly approves these invoices.

The claims adjuster is in a conflict of interest: she should not favour a family member when granting a mandate. The adjuster should use objective criteria such as geographical location when mandating the required service suppliers.

A claims adjuster employed by an insurer often deals with automobile insurance claims. He always recommends the same auto body shop to insureds living the Quebec City area, without taking into consideration his employer’s supplier-referral procedure.

In exchange, the auto body shop repairs the claims adjuster’s personal vehicle as well as his wife’s for free.

The claims adjuster is in a conflict of interest: he should not receive a personal benefit, such as free repairs on his vehicles, within the context of his work. The adjuster should have followed his employer’s supplier-referral procedure and refused any personal benefit.

An insured notices water damage in her home but cannot find the source. She decides to contact her insurer. A claims adjuster is sent to her home.

He asks the insured to contact a contractor to determine the cause of the loss since in his opinion, it is always the insured’s responsibility to do so.

The claims adjuster has neglected to fulfill his professional duty. Remember, claims adjusters have three main roles: investigating the loss, including determining its cause; estimating the damages; and negotiating the settlement. He should have investigated the cause of the loss in order to determine whether the claim was allowable.

A claims adjuster’s neighbours suffer a fire, and their house is deemed a total loss. The adjuster, who works for the neighbours’ insurer, is assigned their claim file.

Since the adjuster would like to buy the land and build a garage on it, he convinces his neighbours to accept the insurer’s offer of compensation and put their land up for sale without rebuilding the property. He tells them that their contract includes a clause that allows them to accept compensation without the obligation to rebuild.

The claims adjuster should not have given the insureds advice that would give him a personal benefit.

A claims adjuster is settling the claim file of a couple who suffered a house fire. During the restoration work, the couple has to move out. They mention to the adjuster that they will be staying with relatives.

The adjuster and his wife own a number of rental properties and he strongly encourages the insureds to move into one of his apartments. He tells the insurer that the insureds have chosen to rent an apartment while their house is being rebuilt. The claims adjuster pays the rent with a cheque made out to his spouse.

The claims adjuster should not have taken advantage of the situation to gain a financial benefit above and beyond his compensation. He should not have acted as he did unless he had disclosed his personal interest in offering this apartment to the insureds and had obtained the insurer’s approval.

A claims adjuster who offers her services to insureds has a contact at a disaster restoration company. This person lets her know every time an insured calls with an emergency.

Thanks to this “helping hand,” the adjuster lands mandates that she may never have heard about otherwise.

The claims adjuster must stop this practice. She cannot ask a third party to notify her when a loss occurs so that she can obtain a mandate.

Following a loss related to water damage, an insured makes an appointment with a public claims adjuster; he is considering entrusting the adjuster with a claim file that could potentially be costly and complex. In preparation for the meeting, the adjuster contacts the insured’s damage insurance broker and asks him for a copy of the insurance contract and also asks some preliminary questions regarding the insured’s claims history.

When he meets with the insured, the adjuster is already aware of the contract’s coverages and limits and hypothesizes on the amount of compensation he will be able to negotiate with the insurer. Impressed with the adjuster’s abilities, the insured agrees to sign a contract with him.

The adjuster should not have asked a third party for information on an insurance contract in order to obtain the mandate. The purpose of this obligation is to prevent undue client solicitation, which harms the honour and dignity of the profession. The adjuster should have waited to sign a clear mandate with the insured before analyzing the coverages and limits included in his insurance contract.

A claimant is not convinced that the compensation he received corresponds to what is stipulated in his insurance contract. He would like to get a second opinion from a claims adjuster who he would mandate to act on his behalf. He therefore asks the claims adjuster mandated by his insurer for a copy of the repair estimate.

The insurer’s adjuster refuses, saying that a claims adjuster mandated by the insured would only complicate the settlement process. She also tells him that he will not get a larger settlement, since the public adjuster he hires will keep a portion of the settlement to cover his fees.

The claims adjuster should not have advised the insured against consulting another adjuster. She should have let the insured obtain a second opinion.


Division II Duties and Obligations towards the Public

In the firm where he is employed, a claims adjuster who was certified less than two years ago deals with claims files under $40,000. He is assigned to settle a claim resulting from an explosion in a commercial space. After investigation, damages are estimated at over $75,000.

According to the employer’s procedure, in cases such as this he must notify his supervisor who will team him up with an experienced claims adjuster to assist with the file. The adjuster neglects to do so and takes care of the claim himself.

The adjuster should not have disregarded this measure, which the insurer instituted to protect the public by ensuring that an experienced adjuster would be there to provide support on certain files.

A claims adjuster with over 25 years of experience is acting as a training supervisor. Feeling confident, he gives his trainee free rein to deal with the file of an insured whose kitchen suffered major water damage.

Due to the complexity of the file, the trainee feels extremely stressed and peppers his supervisor with questions. However, the supervisor gives him little support: he is often not available and provides only cursory answers to the trainee’s questions. This causes significant harm to the insured, in particular since it results in unreasonable delays in processing the claim.

The claims adjuster should have properly supervised the trainee and been involved throughout the claims settlement process. As a certified professional, the training supervisor is responsible for ensuring that all actions taken while processing the file comply with professional standards.

Resource : Review the Supervising Employees page.

An insured feels that the work of the claims adjuster assigned to her file caused her harm. She considers filing a complaint against him. The insured knows very little about damage insurance and is not particularly web savvy. She does not know who to turn to for help.

She asks the claims adjuster some general questions about finding resources that explain how damage insurance is regulated. The claims adjuster responds that he has too many files to manage, and it is not his responsibility to give her this type of information.

The claims adjuster’s response did nothing to promote measures that educate and inform. He should have directed the insured to resources that could help with her concerns such as the firm’s or the insurer’s complaints department, the ChAD or the Autorité des marchés financiers, or provide her with helpful information found in documents such as the Claimant’s Handbook or the checklist of organizations in the damage insurance ecosystem.

The owner of an apartment building suffers major damage to his property. In order to speed up the claims settlement process and start renovating the damaged apartments as quickly as possible, the owner frequently contacts the claims adjuster assigned to his file.

Feeling that the insured is breathing down her neck, the claims adjuster loses her temper and writes him a long email accusing him of being pushy and demanding. She also posts a message on social media in a private group for claims adjusters where she identifies the insured and complains about his attitude.

The claims adjuster should have been more tactful in explaining to the insured that pressuring her to speed up the claims settlement process was useless. Furthermore, the adjuster should have always acted objectively, professionally and with dignity, even on social media. Moreover, one should never post rants, written in the heat of the moment to blow off steam. Lastly, she should have acted with discretion and made sure to not disclose confidential information, including the insured’s name, on social media.

An insured’s garage is damaged by fire. The claims adjuster employed by the insurer sends him an estimate of $10,000 for the repairs. The insured informs the claims adjuster that he intends to get a second estimate from the contractor who built the garage, since he doubts that this amount is sufficient to repair the damages.

The adjuster tells the insured that he must agree to the insurer’s supplier if he wants speedy payment and a guarantee on the work.

The adjuster has misled the insured with this false representation. The claims adjuster should have advised him of his right to obtain estimates from suppliers of his choice so that he could make an informed decision regarding his claim.

An insured’s house is vandalized, and valuable objects are stolen. Her insurer mandates an independent claims adjuster to manage the claim. The insured tells this adjuster that she feels anxious, having never made a claim before, and that she does not understand how the process works.

The claims adjuster reassures her, saying, “Don’t worry, I’m working for you, and I’ll do everything to make sure the insurer gives you the best compensation possible.”

This statement is incorrect. The claims adjuster is not working for the insured; his mandatory is actually the insurer. The claims adjuster should have reassured his client by explaining his role to her, which includes supporting her and always keeping her up to date on how the claim is proceeding.

Resources :

An insured couple suffers major damage to their home due to their neighbour’s negligence. It takes two years to settle the claim since the claims adjuster assigned to the file has trouble obtaining the neighbour’s side of the story. When the adjuster final closes the file, her discussion with the insureds is very short; they are exhausted with the process. 

The claims adjuster ends the discussion by mentioning, “Oh, by the way, don’t forget that you can claim reimbursement for your deductible from your neighbour.” However, she does not fully explain to them how to proceed, nor does she mention that they only have a year to do so. Lacking this crucial information, the insureds keep putting it off.

After a number of months, the insureds begin the process of claiming reimbursement for the deductible from their neighbour. However, the neighbour’s insurer refuses their request, explaining that they missed the deadline.

The claims adjuster should have explained to the insureds that there was a deadline.

An insured is preparing to go camping with his new fifth-wheel trailer. The day before he leaves, the trailer and all its contents are stolen. He declares the theft to his insurer.

The claims adjuster assigned to the file learns that the insured had not used the special lock required by the insurer to secure the trailer. Furthermore, he notes a number of inconsistencies in the information the insured provided. He therefore decides to transfer the file to the insurer’s special investigations unit, since the insured’s claim may not be allowable. However, the claims adjuster does not immediately notify the insured, nor does he give him a reservation of rights letter explaining the situation. The insured only learns of this a few days later when he receives a call from the investigator the insurer mandated to take his detailed statement of events.

The claims adjuster should have notified the insured of the steps the insurer intended to take with his file, in other words, that it would be investigating further to determine the admissibility of his claim.

An insured notices that the door of his vehicle has been smashed in and that items in the car were stolen, including hockey equipment, a golf bag and designer sunglasses.

The insured declares the theft to his insurer. The claims adjuster assigned to the file informs the insured that he must send him receipts for the stolen goods in order to receive compensation. The insured no longer has any proofs of purchase, but he has pictures proving that these items exist. The adjuster refuses to submit this evidence to the insurer.

The claims adjuster misled the insured by leading him to believe these receipts were mandatory. When a theft claim is made, insurers can agree to compensate the insured on the basis of other types of proof such as pictures. The adjuster should have submitted the pictures and let the insurer decide whether or not to compensate the insured.

The basement of an insured’s home suffers major water damage. She calls her insurer immediately. The floor and certain items are damaged. A claims adjuster collects the necessary information and takes the insured’s statement to put in the client-file.

Without explaining to the insured what will happen next, the adjuster mandates a disaster cleanup team and an estimator to assess the damages. The service providers arrive at her home although she has no idea what role they play in the claim settlement; they leave with certain items to clean. She also does not know what she should do or what to expect next in the claim settlement process.

The claims adjuster should have given the insured the explanations she needed to understand the services the various suppliers would provide. He should have also explained what the insured would have to do to try and save her belongings and the basic emergency measures needed to avoid aggravating the damage.

A claims adjuster mandated by an insurer is investigating a loss involving significant fire damage to a home. He meets the insured to collect his personal information and asks him to sign the  Consent for the collection and communication of personal information when making a claim. The insured consents to the collection of information, but limits his consent to only communicating with third parties connected to the adjuster’s investigation.

As a result, the adjuster cannot give the insured’s personal information to contacts such as a building contractor, to whom the adjuster would like to refer this potential client. 

There are, however, exceptions to the obligation to respect confidentiality, in particular if a police officer with a court order asks the claims adjuster for information on the insured as part of a police investigation, or if the Syndic’s Office requests information.


A tenant declares the theft of a number of valuable items, including several electronic devices, to his insurer. The claims adjuster assigned to the file takes the insured’s statement and has him sign the consent form to authorize the collection and communication of personal information to the insurance company and the police department.

During her investigation, the adjuster learns that the thieves were tourists who had rented the apartment on a short-term apartment rental platform. The neighbours confirm that this apartment is often rented out for short-term stays, and that they have complained to the landlord about tourists constantly coming and going. Since the lease prohibits this kind of rental, the landlord wants to sue his tenant. To prepare his case, he would like access to certain information that the adjuster collected during her investigation. He requests that she provide the file.

The adjuster cannot give him this information since the tenant did not authorize the communication of his personal information to the owner of the building. The adjuster will first have to obtain the tenant’s consent before disclosing confidential information for purposes other than those for which he had consented, or else disclose this information during legal proceedings after receiving court authorization to do so.

Resource : Review the consent procedure  when settling a claim.

Water damage in a condominium building causes considerable damage to one unit as well as to the building itself. The two insurers involved—that of the co-owner of the damaged unit, and that of the syndicate of co-ownership—mandate the same claims adjustment firm.

The firm’s director assigns one adjuster to the co-owner’s file and another one to the syndicate’s file. He asks them to co-operate with each other and share information in order to ensure that the claim is settled smoothly.

The two adjusters cannot accept this mandate as presented by their director since it involves disclosing confidential information and documents to another claimant. That said, they can accept the mandate if the claimants and the parties involved consent to the two adjusters sharing information.

A fire damages a seniors residence. The claims adjuster mandated by the insurer visits the site and meets with the owner, who asks him if he is familiar with building standards and understands the unique features of seniors residences.

The adjuster responds that he has frequently worked on mandates involving this type of building and he is sure that the claim will be settled in less than a month. However, even though the adjuster has experience with residential claims, this is his first file involving a seniors residence.

The adjuster has misrepresented his level of competence and the effectiveness of his services. He should have admitted that this was his first seniors residence file, that there might be some delays in processing the file and that restoring the building might take longer than it would for other types of commercial properties.


Division III Duties and Obligations towards Clients

An independent claims adjuster receives a mandate to settle a claim for a major loss in a commercial building. Since a number of hazardous products were stored in one section of the building, there is a risk of pollution.

Despite the fact that the adjuster has never managed a file involving an environmental risk, he accepts the mandate.

Section 26 does not prohibit an adjuster from processing a type of claim with which he is not familiar, however he must take into account his limits, abilities and knowledge before accepting a file. He must thus choose to either refuse the file or have an experienced claims adjuster assist him with it.

Resource : Review the tip sheet on environmental risks.

A claims adjuster takes the statement of an insured who was robbed.
She is convinced that the insured is lying about the value of the stolen property, which he claims is worth over $15,000. She expresses her doubts to the insurer and continues working on the claim file.

However, the investigation does not conclusively prove that the insured is lying and after analyzing the file, the insurer authorizes compensation. The adjuster nevertheless remains sceptical about the stolen property and asks the insured for additional proof that the insurer had not requested.

Since the investigation did not conclude that a false statement had been made, the adjuster should have acted fairly towards the insured and complied with the instructions she received; in other words, she should have informed the insured that the insurer had authorized compensation. She should therefore not have asked for any additional proof above and beyond what had already been provided.

A claims adjuster mandated by an insurer is processing the claim of an insured whose fence was damaged when his neighbour’s truck slammed into it.

The investigation shows that the neighbour is deemed liable for the damage. The adjuster therefore writes a letter to the neighbour, asking him to send a cheque directly to the insured to reimburse him for the deductible.

The adjuster cannot act as the insured’s mandatary while being the mandatary of the insurer. Furthermore, since this is a legal act, the claims adjuster exposes himself to charges of illegally practicing law. The claims adjuster should have explained the procedure to the insured, and even given him a model letter so he could make this request himself.

Resource : Adjusters have two options when a third party is deemed liable for damages. To find out more, read Reimbursing the Insured for the Deductible and Limits on the Claims Adjuster’s Actions.

A fire breaks out in a tenant’s apartment after he forgets to turn off a stove burner. His insurer mandates an independent claims adjuster to settle the claim. The owner of the building also declares the loss to his insurer. Without realizing it, the owner’s insurer mandates the same independent claims adjuster.

The claims adjuster accepts both mandates, thinking that he will kill two birds with one stone by dealing with two files related to the same loss.

A claims adjuster cannot represent the interests of two opposing parties, except if the two insurers agree to work with the same adjuster. Since he had already accepted the mandate from the tenant’s insurer, the adjuster should have obtained the consent of the two insurers and the two insureds before agreeing to take on the building owner’s claim file.

An independent claims adjuster notices that a shed belonging to the municipality where he lives has been destroyed by fire. The adjuster is usually mandated by the municipality’s insurer to deal with its claims files.

He therefore does not wait to receive an official mandate to start his investigation and proceeds to question witnesses, contact the fire safety department, etc.

Even though he was sure that he would be assigned the file, the claims adjuster should not have started working on it without first receiving a clear mandate from the insurer.


A claims adjuster mandated by the insurer is talking to an insured about his kitchen, which was partially damaged by fire. The insured is going through a bad patch: he has lost his job and his wife has left him. The claims adjuster empathizes deeply with the problems he faces.

The insured’s list of damaged property includes the fridge and its contents, a microwave oven, and an espresso machine. The claims adjuster visits the site and sees that these appliances were not damaged by the fire. She nevertheless decides to send the list as is to the insurer since she believes that it will lift the insured’s spirits during this difficult time.

The adjuster should have given the insurer information that could have affected its decision regarding the claim settlement. Asking to be compensated for property that was not damaged is misrepresentation on the part of the insured and the adjuster must notify the insurer, since it could affect the insured’s right to compensation.

A claims adjuster employed by an insurer is working on the file of a moving company that owns a truck involved in an accident. Many of the valuable items the moving truck was carrying were destroyed.

Before granting compensation, the insurer needs to verify whether any limits or exclusions apply with respect to reimbursing these items. It asks the claims adjuster to have the company owner sign a non-waiver agreement. The adjuster neither follows up on these instructions nor has the insured sign the document.

The adjuster did not comply with the insurer’s request. The insured was therefore not informed that the insurer wished to further analyze the file. The adjuster should have followed the insurer’s instructions to make sure that the insured actually understood how its claim was being processed.

Resource : Review the procedure regarding the reservation of rights letter, which explains the difference between this letter and the non-waiver agreement.  

An independent claims adjuster is mandated by an insurer to settle a civil liability claim. The insured is accused of not having cleaned his icy walkway properly, which resulted in a deliveryman suffering serious injury.

The insurer asks the claims adjuster to immediately go and photograph the scene of the accident as well as obtain a second opinion on the deliveryman’s medical condition in order to verify whether his injuries were a result of the insured’s negligence. However, several days go by before the adjuster visits the site of the accident, asks for the second opinion, and prepares her report. This delay prejudices both the insurer and the insured: the condition of the walkway in front of the house has changed due to a subsequent snowfall that covered everything, and the claim settlement is therefore delayed.

The claims adjuster should have shown diligence in carrying out the insurer’s instructions. She should have presented her report and the medical second opinion to the insurer within a reasonable period of time.

The structure of an apartment building is seriously damaged during a severe windstorm. The independent claims adjuster mandated by the insurer has a supplier assess the cost of repairs and presents a $125,000 offer of compensation to the building’s owner.

The owner believes the offer is too low and asks for an estimate from another contractor, who estimates it will cost $200,000 since much more significant repairs are needed. The owner presents this second estimate to the adjuster and asks him to review the insurer’s offer of compensation. The adjuster neglects to send this offer to the insurer and the file and the settlement process come to a halt.

The claims adjuster should have submitted the insured’s offer to his mandatory, the insurer, as soon as possible.

An independent claims adjuster is mandated to deal with a house fire claim.

In order to estimate the damages, the adjuster asks for quotes from a number of different specialists. Rather than deciding on the best proposal, she spends countless hours reviewing each quote, which significantly delays the settlement.

The adjuster must manage her file with diligence: she should not have unreasonably multiplied her professional acts. Her actions harmed the insured by unnecessarily delaying the claim settlement.

A claims adjuster is working on a case she finds unpleasant. The insured makes misogynistic comments and criticizes her work.

Uncomfortable with the situation and realizing that she does not have to put up with the insured’s disrespectful attitude, she decides to terminate the mandate. She therefore quickly contacts the insurer that mandated her to notify it of her decision and asks that the file be given to another claims adjuster.

The insured’s disrespectful comments are reasonable grounds for deciding to cease acting for a mandatory. The adjuster took the necessary steps to prevent prejudicing the insured and the insurer by notifying the insurer within a reasonable timeframe. The insurer thus had enough time to give the file to another claims adjuster to finish settling the claim.

Resource : To terminate a mandate correctly, please refer to articles 2175 to 2185 of the Civil Code of Québec.

A commercial lines claims adjuster is assigned to a complicated file involving a hazardous waste spill. Although he has almost finished processing the claim, his supervisor takes him off the file and assigns it to another claims adjuster who has experience with losses involving environmental risks. 

Upset with the situation, the claims adjuster continues to remain in contact with the company owner and leads him to believe that he is still mandated to deal with the claim.

The claims adjuster should have complied with his supervisor’s instructions and stopped working on the file as soon as his mandate was revoked. Furthermore, he should have taken the necessary steps to ensure a smooth transition of the file to his colleague.

Resource : Review the tip sheet on Environmental risks – pollution

For the first time in her career, a claims adjuster is assigned to settle a potentially fraudulent claim. The preliminary investigation seems to show that the insured could have been involved in the theft of property from his own vehicle, including sunglasses and his golf bag. The insured denies any involvement and states that while the theft was taking place, he was at a restaurant bar and that he has the bill to prove it. The claims adjuster obtains the bill and concludes that the date and time stamps do not correspond to the time when the theft occurred. Based on the adjuster’s investigation, the insurer concludes that the claim is fraudulent and refuses to compensate the insured.

A few weeks later, after the insured contacted the bar himself, the claims adjuster receives an email with the bill in question, along with an explanation. She realizes that she had not checked the bill properly and that the date and time shown actually confirm what the insured had said. She deletes the email and decides to not re-open the file.

The claims adjuster cannot, through fraud, trickery or other deceitful means, attempt to avoid her professional liability. The adjuster should have acted with transparency and admitted her mistake to the insurer, and thus should have re-opened her investigation in the wake of the new information she had received.

Resource :  To learn more about the rules of conduct for claims adjusters who suspect that a claim is fraudulent, read  Fraude à l’assurance et bonne foi [Insurance fraud and good faith, in French only]

Please note: The percentage of compensation used in this example is arbitrary and for illustrative purposes only. The ChAD considers this amount neither appropriate nor inappropriate, since a variety of factors must be taken into consideration when determining fair and reasonable compensation. 

An insured whose house has been damaged in a serious fire contacts a public claims adjuster. The insured is still in shock and feels intimidated by everything involved in understanding and processing his claim. He asks the adjuster how his compensation will be determined.

The public claims adjuster explains that compensation may vary according to the circumstances and can be calculated on an hourly basis or on a percentage. Given his extensive experience, as well as the probable extent and complexity of the file, his fees would be 25% of the total amount of compensation. He explains that this percentage would be lower for easier files that are more straightforward or require less time.

The insured takes a few days to think about it and arranges to meet the adjuster five days later at the scene of the fire.

During their on-site meeting, the public claims adjuster realizes that the claim will not be particularly complicated, as he had suggested to the insured during their first discussion. In fact, the insured informs him that he has sufficient coverage and that the insurer’s claims adjuster quickly confirmed that the claim was allowable. In addition, the foundation remains intact, and the insured wants to rebuild his residence using the same footprint. However, the public claims adjuster does not re-evaluate his compensation and the insured signs the contract mandating the adjuster to deal with his claim.

During the claim process, the public claims adjuster demands a very high amount to cover the damages in order to obtain higher compensation for his client; this results in longer, unnecessarily difficult negotiations with the insurer. In the end, they agree on an appropriate amount for rebuilding and for the contents, and the file is settled.

The public claims adjuster should have charged fair and reasonable fees that were justifiable under the circumstances, and in proportion to the services rendered. In the above case, even though the public claims adjuster had extensive experience, and the case was very important to the insured, the file itself was actually not particularly complicated, and would not have required so much time to settle had the public adjuster not initially demanded such a high amount of compensation. In light of these circumstances, the percentage of compensation that the claims adjuster had originally set was unreasonable given the services that he actually rendered.

Resource :  

Read the procédure pour le contrat type de l’expert en sinistre mandaté par un sinistré [Procedure: Standard contract for claims adjusters mandated by the insurer, in French only].

An insured retains the services of a claims adjuster to assist her in making a claim for fire damage to her home. The claims settlement goes smoothly, and the insured learns that the insurer will pay her in $250,000 in compensation to rebuild her home. The insured is satisfied.

However, her claims adjuster notifies her that she will only receive $200,000 since he is charging 20% of the total compensation in fees. The insured is surprised and upset; she was unaware that the cost of his services would be so high. The claims adjuster had mentioned that his fees depended on the final amount of compensation. However, he did not specify the percentage when the contract was signed.

The claims adjuster should have clearly informed the insured of the estimated cost of his services, in compliance with the Act respecting the distribution of financial products and services . Before the contract was signed, he should have given the necessary explanations regarding the calculation and payment of his fees.

Resource : Review the procédure pour le contrat type de l’expert en sinistre mandaté par un sinistré [Procedure: Standard contract for claims adjusters mandated by the insurer, in French only].

An insurer mandates an independent claims adjuster to process a claim file in a remote region. The claims adjuster sends the insurer his invoice along with his final report.

However, the invoice only shows the total fees for his work on the case, whereas the insurer needs an itemized breakdown of the adjuster’s professional acts while  carrying out his mandate.

The claims adjuster should have provided the insurer with all the explanations required to understand his statement of compensation and the terms and conditions of payment, including giving the insurer a breakdown of his billing showing each of the tasks he carried out while settling the claim.

An insurer frequently mandates the same independent claims adjuster to settle water-damage claim files. The agreement between the two parties stipulates that the claims adjuster’s fees will be paid within 30 days of receiving the invoice, otherwise interest will be charged.

After completing a particularly complicated file, the adjuster realizes that he has not been paid within the usual period. He therefore sends the insurer a new invoice, requiring 2% interest for each late payment day.

This interest rate is deemed unreasonable. The adjuster should have charged a rate equal to or less than that found in section 28 of the Tax Administration Act. For example, this rate was 5% annually in April 2021.

A claims adjuster is mandated by an insurer to adjust a claim for a roof that collapsed under the weight of snow. The contract between the two parties stipulates that the claims adjuster will receive an advance of $1,000 to cover disbursements. The following week, the claims adjuster has to cancel the mandate for health reasons. She has not yet begun working on the claim.

Believing that she will be able to take on other files for this insurer in the future, the adjuster does not repay the insurer the $1,000.

The claims adjuster has a duty to repay any advance on compensation for which no work was performed. Since she ended her mandate before it had even begun, the claims adjuster should have remitted the entire sum of the advance to the insurer.


Division IV Duties and Obligations towards the Claimant

A claims adjuster receives a mandate from the owner of an apartment building that suffered serious fire damage. The adjuster devotes significant time and energy to the file and succeeds in obtaining an excellent settlement for his client, the insured. The insurer sends the compensation cheque directly to the claims adjuster’s firm for it to then remit the money to the building owner. 

Before remitting the cheque to the insured, the adjuster asks the insured to immediately pay him his fees, although they had no prior agreement to this effect. The insured refuses, creating friction between the two parties. The claims adjuster therefore holds back the cheque, preventing the owner from paying for major work that needs to be done on her building.

The claims adjuster should not have held back money that was intended for the insured, even though the insured had not yet paid him his fees. He should have sent her the money as soon as possible.

An insured suffers major water damage to his home. The claims adjuster visits the home to estimate the damages. Given the extent of the damages—and with the homeowner’s consent—she mandates a team to collect the wet clothing and a mover to take out the damaged furniture and send it to a cabinetmaker for evaluation.    

However, she neglects to ensure that a detailed list of the clothing and furniture is drawn up and fails to instruct the transport company and the cabinetmaker to ensure the items are dried as soon as possible to avoid mould developing.

After three weeks of inaction, the clothing and furniture have continued to deteriorate and must now be declared a total loss. 

The claims adjuster should have been more careful with the property she was responsible for when carrying out her mandate. She should have continuously monitored how the claim was progressing and better managed both the emergency and the restoration work.

A claims adjuster is mandated by the owner of a restaurant to settle a claim for fire damage. After completing his mandate, the insurer sends him a compensation cheque made out to both the adjuster and insured.

Since he is having some financial difficulties, the adjuster asks the client to loan him the money until the repairs begin. The insured trusts him and agrees to the request. The adjuster then deposits the cheque in his personal account, intending to reimburse the insured by the agreed upon date once he has put his finances in order.

The claims adjuster should not have borrowed money intended for an insured who is his mandatory. He should have deposited the cheque in a separate account.


Division V Duties and Obligations towards Insurers

The home of an insured is damaged by fire. The claims adjuster mandated to settle the file discovers that the fire occurred just after renovations on the property were finished. Since the insured refused to pay the contractor who did the work, the contractor registered a legal mortgage on the house.

The adjuster decides to withhold this information from the insurer to avoid the insured being penalized with respect to the amount of compensation, and also to avoid any delay in the claim settlement.

The claims adjuster should have revealed the crucial fact that a third party held a lien on the property that was the subject of a claim. The insurer should have received this information since it had to reimburse the contractor before compensating the insured for damages, pursuant to section 2497 of the Civil Code of Québec.


A claims adjuster feels he is underpaid and would like to find a way to supplement his income.

He creates six bogus invoices from fake—though seemingly credible—suppliers and enters them into the billing system of the insurer for which he works. He then cashes a total of $10,000 in cheques issued.

The adjuster should not have committed these dishonest acts. Defrauding the insurer is an unfair practice and constitutes a criminal offence.

An independent claims adjuster receives a call from an insurer that is considering mandating him to settle a claim for water damage to a commercial building. The loss was apparently due to the negligence of a commercial tenant in the building. At the end of their discussion, the insurer tells the adjuster that he will receive confirmation of the mandate within 24 hours.

Taking for granted that he will obtain the mandate, the adjuster decides to get a head start on the file by contacting the insurer of the commercial tenant deemed liable for the damages. He tells this insurer that he has been mandated by the building owner’s insurer to manage the file.

The claims adjuster should not have said that he had been mandated to settle the claim; he should have waited to obtain a clear mandate from the building’s insurer before contacting the insurer of the business deemed liable for the damages.


Division VI Duties and Obligation towards Representatives

A claims adjuster employed by a firm takes over from a colleague who is away for a few weeks on paternity leave. The adjuster discovers her colleague has made several errors.

During a social event at the firm, she shares with colleagues her opinion that this colleague is incompetent and always cuts corners on his files.

The claims adjuster should not have made denigrating or disparaging remarks about another representative, regardless of the means of communication, be it in person or online

A fire damages an apartment building as well as the contents of one apartment. The tenant’s claims adjuster mandates a specialist to determine the cause of the fire. The report concludes that the fire was caused by the tenant’s negligence while he was doing unauthorized renovations.

The landlord’s claims adjuster hears about the specialist’s visit and asks the tenant’s claims adjuster for a copy of the report to find out the cause of the fire. Given the conclusions of this report, the tenant’s insurer forbids the adjuster from sharing the document. The adjuster therefore drags his feet about calling back the landlord’s adjuster and then lies, saying the report was inconclusive and that he will not provide it. In the meantime, physical evidence on the potential cause of the fire disappears.

The tenant’s claims adjuster should not have lied and misled the landlord’s adjuster. As soon as he received instructions from the insurer, he should have notified the other claims adjuster that he could not provide him with the requested document since his mandatory forbade him from doing so. This answer would have allowed the landlord’s adjuster to mandate his own specialist to determine the cause of the fire.

A truck carrying hazardous materials is involved in a pile-up on a provincial road and spills its cargo. The case involves a number of claims adjusters representing various parties including the company that owns the truck, the driver, the municipality, and the Ministry of Transport and the Environment.

One of the adjusters refuses to coordinate his investigation and the site cleanup with the others. In addition, he does not share any of the non-confidential information that the other adjusters have requested.

The claims adjuster has been uncooperative with the other adjusters involved in the file. Even though his first duty is to his mandatory, to whom he must not cause any harm, he should have cooperated with the other claims adjusters involved in the claim in order to ensure they were apprised of the facts and avoid causing them any harm.

A claims adjuster employed by an insurer is at loggerheads with the claims adjuster mandated by the insured—an adjuster who regularly works on extremely complex claims files. The insurer’s adjuster feels the insured’s adjuster has gone overboard with his requests for information and the settlement proposals he makes; all this eats into his time and slows down his work, even though the requests turn out to be well-founded.

In retaliation, he files a complaint with the Syndic’s Office of the ChAD.

The claims adjuster employed by the insurer should not have filed an unfounded, malicious complaint. Furthermore, if the Syndic’s Office determines that the complaint is malicious, it may investigate the claims adjuster who made the complaint in order to verify whether he violated this section of the Code.


Division VII Duties and Obligations towards the Autorité des marchés financiers and the Chambre de l'assurance de dommages

An insured feels wronged by the claims adjuster who dealt with her claim. In her opinion, the amount of compensation she has received to replace her vehicle does not correspond to the coverages provided for in her contract. And despite her questions, the adjuster refuses to give her any clear explanations. She therefore files a complaint with the Syndic’s Office of the ChAD.

An investigator contacts the claims adjuster to hear his side of the story. Despite leaving several voicemail messages, the adjuster fails to call the investigator back. He believes the complaint is unfounded, that the insured was properly compensated, and that the explanations he gave her were quite clear.

The claims adjuster should have responded to the investigator’s requests as soon as possible. By refusing to do so, he impeded the work of the Syndic’s Office and undermined the protection of the public.

A complaint against a claims adjuster is lodged with the Syndic’s Office. She is summoned to attend a telephone meeting with an investigator to give her side of the story. She agrees to the suggested time and date.

On the day of the meeting, the claims adjuster feels very anxious and decides not to answer the phone.

The adjuster must honour her promise to the Syndic’s Office. She should have answered the phone and cooperated with the investigation into her actions.

A claims adjuster from an independent firm receives a letter from the Syndic’s Office notifying him that a complaint has been made against him. As part of the pre-investigation, he must provide several documents at the request of the investigator.

In an attempt to hide certain facts, the adjuster tries to lead the Syndic’s Office astray. He claims that during a break-in at his firm’s offices, the files requested were ripped up.

The claims adjuster should not have hindered the work of the Syndic’s Office. He should have acted in good faith and voluntarily handed over the documents requested to allow the investigator to do his work.

A claims adjuster wraps up a claim file that he found particularly trying: the insured asked a lot of questions and did not seem to understand the steps in the claims adjustment process. She also complained to his superior about him while he was working on her claim.

A few weeks later, he receives a letter from the Syndic’s Office notifying him that a complaint for negligence has been lodged against him. He strongly suspects that it was this insured who made the complaint and calls her to express his dissatisfaction and ask that she withdraw the complaint. According to him, he was not negligent since he spent many hours on the phone explaining to her how the claim was proceeding.

The claims adjuster should not have contacted the insured who filed the complaint against him. He should have let the investigation take its course and cooperated with the Syndic’s Office.


Division VIII Breaches of the Code of Ethics

This section refers to the claims adjuster’s obligation to protect, through his good conduct, the image of the profession and the public’s opinion of this image. It lists a number of situations where the claims adjuster is considered to have acted contrary to the honour and dignity of the profession. The honour and dignity of the profession may be defined as its respectability.

The word “including” means that the list of breaches is not exhaustive. A complaint concerning acts that are contrary to the honour and dignity of the profession can be lodged against a claims adjuster even if such acts are not listed in this section.

An independent claims adjuster mandated by an insurer is dealing with a claim for water damage. She contacts the insured a number of times but does not note the details of their discussions in the client-file. The insured sends her an initial list of damaged items. A few days later, he sends her a new, significantly longer list of items, some of which are of greater value than those on the initial list.
The claims adjuster does not verify anything and simply sends the file to the insurer without explaining why there is a new list that includes more damaged property.
The claims adjuster acted negligently: she should have noted in the client-file all her interactions with the insured and investigated the “new and improved” list of damaged goods.

A claims adjuster enjoys using cannabis on weekends now that this substance is legally available.

During a particularly stressful period, he uses it much more frequently and this additional use affects his mental acuity while working on claims files.

Claims adjusters must always be in full possession of their mental faculties when at work. Any situation likely to negatively affect one’s ability to properly provide professional services must be avoided. Although cannabis is now sold legally, its use may affect an individual’s mental state and have a negative impact on their mental faculties. It should not be used within a professional context.

A young tenant suffers a loss. After investigating, the claims adjuster sends her a $5,000 offer of compensation to replace her damaged belongings and furniture. The insured discusses the offer with her father, a retired claims adjuster.

The father is unhappy with this offer; he believes that the items to be replaced are worth considerably more. He calls the claims adjuster and negotiates better compensation. The adjuster notes the father’s arguments and sends a request for review to the insurer.

A claims adjuster cannot allow his actions to be dictated by a third party—in this case, the father—who has become involved in settling an insured’s (the tenant’s) claim. The adjuster should have explained to the father that he had to settle the claim directly with the daughter since she was the named insured on the home insurance contract.

A claims adjuster is working on a file involving a burglary at an insured’s home. The list of stolen items includes three laptops. The adjuster doubts that the insured actually owned these devices and decides to ask him some questions. The insured admits that he added these items to help his children with their homework.

The adjuster offers the insured a deal: she will turn a blind eye to the falsely declared items if he gives her one of the three computers.

The adjuster should neither have encouraged insurance fraud nor benefitted from false evidence.

A claims adjuster is dealing with a claim stemming from an apartment building fire. Due to the loss, the tenants have been temporarily relocated and the building owner stands to lose significant rental income during rebuilding. Fortunately, his contract includes coverage for this situation, and he has a right to receive $10,000 in compensation.

The insured waits for his cheque for several weeks. When he asks the claims adjuster about it, she falsely tells him that she is waiting for the cheque from the accounting department; in fact, she actually completely forgot to enter an order to issue the cheque into the insurer’s system.

The claims adjuster should not have made a false statement to the insured to cover up her mistake. She should have been honest with the insured and admitted that she had forgotten to order that the cheque be issued.

An insured suffers water damage to his garage, which houses a huge freezer. The insured sends the claims adjuster the list of damaged items, including the freezer. The insured estimates that he lost $3,000 worth of frozen food.

Given the size of the freezer, the price of the food, and the number of people living in the home, the adjuster concludes that it is highly unlikely that the freezer contained $3,000 worth of food and says so to the insured.

The insured comes back with bills to prove the $3,000 loss. The adjuster immediately sees that these bills are bogus but decides not to challenge the insured and includes them in the claim file.

The claims adjuster should not have been party to using evidence he knew to be false. If the adjuster concludes beyond a reasonable doubt that the bills are false, he cannot include them in the claim file.

The luxury residence of a well-known businessman is engulfed in flames. A few weeks before the fire, the entertainment mogul had been accused of sexual assault on social media in the wake of the #metoo movement. The claims adjuster assigned to the claim thinks the man’s behaviour is disgusting.

Even though the insured tells the adjuster that the fire may have been started by the work being done on the house, the adjuster leans towards arson, aided and abetted by the insured himself. A neighbour tells her that he saw a suspicious person talking with the insured a week before the fire and saw this person again a few hours before the fire began. The adjuster tells the neighbour that he could be paid if he testifies that he saw this person set fire to the home. In so doing, she believes that the insurer will refuse to compensate the businessman.

The adjuster should not have offered financial compensation to sway his testimony to fit her hypothesis. She should have shown professionalism and obtained reports on the probable cause of the fire before coming to the conclusion that the insured was party to arson.

A fire destroys a house. The claims adjuster mandated by the insured visits the site to review the damages and meet with a restoration specialist. The claims adjuster is convinced the fire was caused by the insured’s faulty BBQ. The restoration specialist, however, believes that smoking was the cause.

The adjuster does not listen to the specialist and continues analyzing the site. He finds a smouldering cigarette butt. He destroys the butt before anyone else sees it to avoid any doubts regarding the insured’s liability for the fire.

The adjuster should not have destroyed a piece of evidence that was useful in settling the claim. He should have informed the insurer that he had discovered a cigarette butt so that the insurer could conduct its own investigation in full knowledge of the facts.

An insured is sued for civil liability for injuries suffered by a neighbour who had dropped by to visit. The insured had not cleared the ice off his driveway properly, and the neighbour fell and fractured his right leg. The claims adjuster takes note of the insured’s and the injured neighbour’s version of events.

The insured tells him that he has a security camera monitoring the driveway. The adjuster decides not to use this evidence in his file since it incriminates the insured and might complicate his work.

The adjuster should not have ignored evidence such as the security camera footage, which was discovered during his investigation. He should have kept this evidence and used it when processing the claim.

An insured’s oil tank spills accidentally on his property.

The claims adjuster assigned to the claim file recommends to the insured that he not notify the Ministry of the Environment in order to avoid complicating the file.

The adjuster failed to act with professionalism. She should not have suggested to the insured that he refrain from notifying the Ministry: this obligation is enshrined in the Environment Quality Act. On the contrary, she should have made sure that the insured did indeed contact the appropriate authorities.

An insured is a victim of burglary. The thief stole a television and some computer equipment. The insured declares the theft to his insurer and gives his version of events to the claims adjuster.

The adjuster verifies the insurance contract and mentions to the insured that since his deductible is high, he should use this opportunity to declare other items stolen, such as cash and small kitchen appliances. The insured takes the adjuster’s advice to heart and lengthens his list of stolen items.

The claims adjuster should not have encouraged the insured to commit fraud by lying about the stolen goods. This is completely contrary to the honour and dignity of his profession.

While settling a claim for water damage in a duplex, a claims adjuster neglects to properly follow up with the suppliers; as a result, the repairs do not proceed as planned, costs rise and there are scheduling delays. The insurer relieves him of his mandate and sends the case to the litigation department.

The adjuster believes he is no longer responsible for the claim and withdraws completely from the file without notifying the insured or any of the other parties.

The adjuster should have informed the duplex owner as well as the tenants that his mandate was terminated and that the file had been transferred to the insurer’s litigation department.

An insured suffers a serious fire in her home. Completely overwhelmed by the claims process, she considers the possibility of mandating a claims adjuster to represent her in her dealings with the insurer.

She meets a public claims adjuster the day after the loss. The adjuster insists that she immediately sign a contract mandating him to represent her in her claim. He contends that she must act quickly with the insurer—otherwise, the loss cleanup will not be done properly, and she will have trouble obtaining enough compensation to have the repairs done.

The claims adjuster should not have pushed the insured to use his professional services. He should have taken the time to explain his services to the insured so that she could give him truly informed consent. Although he has a right to build his client-base, prospecting must be conducted in a moderate and dignified manner, and without undue pressure.

The certified director of an independent firm assigns commercial-lines claims files to a claims adjuster who is certified in personal-lines damage insurance.

The director should not have used the services of an adjuster who did not have the certification required to settle a commercial lines claim. He should have made sure to assign files to adjusters certified to act in the applicable sector.


An independent claims adjuster is mandated by an insurer to settle a claim of water damage to a commercial building.

The file requires 30 hours of work, but she decides to bill for 40 hours to top up her income. She lies about the tasks she performed to justify the 10 hours she overbilled.

The claims adjuster acted contrary to the honour and dignity of the profession; she should not have illegally padded her invoice. She should have billed accurate fees for the tasks she actually performed and explained the statement of compensation to her mandatory.

A claims adjuster is working on a home insurance claim. During the repairs, the house is uninhabitable, and the insureds must be temporarily relocated.

The insurer issues a first cheque to reimburse them for living expenses. The claims adjuster is short of money and decides to misappropriate this money, convincing himself that he will be able to reimburse the insureds within a few days.

The claims adjuster should not have acted contrary to the honour and dignity of the profession: under no circumstances may he use or appropriate, for personal purposes, money entrusted to him in the performance of his mandate. He should have remitted the insurer’s reimbursement to the insureds.