You clean up the damage. Coverage handles the rest.

Negotiating the owner's claim is adjusting

Restoration work sits next to the insurance claim, and California draws a firm line. Insurance Code 15007 defines a public insurance adjuster as anyone who, for compensation, acts for or aids an insured in negotiating or settling a claim under a policy covering real or personal property, or who advertises, solicits business or holds themselves out to the public as an adjuster of those claims. Section 15006 says no one may engage in that business, or act as a licensee, without a license under that chapter. Neither section carves out contractors working on their own jobs.

Under 15006, an insured who contracts for adjusting services with an unlicensed person may void the contract and then owes nothing for past or future services under it. The Insurance Commissioner can seek civil penalties of up to $10,000, or $25,000 if willful.

Other states differ:

• Texas: Insurance Code 4102.163 says a contractor may not act as a public adjuster, or advertise to adjust claims, for any property where it is providing or may provide contracting services, even if it holds a public adjuster license or has a power of attorney or other agreement from the insured.
• Florida: Statute 627.7152(13) says a policyholder may not assign any post-loss benefit under a residential or commercial property policy issued on or after January 1, 2023. An attempted assignment is void. Subsection (11) excludes a later buyer of the property, certain powers of attorney and liability coverage.

Keep your paperwork to scope, estimate and invoice for your own work, and leave negotiation to the owner or the owner's public adjuster. If you sell estimating, ask how a contractors professional liability form treats that work.

Disaster rebuilds run on home improvement contract rules

In California, reconstruction, restoration or rebuilding of a residential property damaged or destroyed by a natural disaster is "home improvement" under Business and Professions Code 7151 when the Governor proclaims a state of emergency under Government Code 8625 or the President declares an emergency or major disaster. Section 7159 sets the contract rules for home improvement contracts with an aggregate price over $500.

• Written and signed first: the contract and any change orders must be in writing and signed by the parties before the covered work starts.
• Down payment: if you charge one, the contract must state in at least 12-point boldface that the down payment may not exceed $1,000 or 10 percent of the contract price, whichever is less.
• No billing ahead of the work: the progress payment section must state that it is against the law to collect payment for work not yet completed or materials not yet delivered.
• Liability notice: Section 7159(e)(1) requires a notice headed "Commercial General Liability Insurance (CGL)" stating whichever is correct: you do not carry it, you carry it with a named insurer and a phone number the owner can call to check, you are self-insured, or, for an LLC, you carry liability insurance or other security required by law.
• Workers' comp notice: Section 7159(e)(2) requires a notice stating either that you have no employees and are exempt, or that you carry workers' compensation for all employees.

Both notices put your general liability and workers' comp status in writing. Update the form when your insurer changes.

Crews in respirators need a written program

Where respirators are necessary to protect workers' health, or whenever the employer requires them, Cal/OSHA's Title 8, Section 5144 requires a written respiratory protection program with worksite-specific procedures. Subsection (c)(1) lists its elements, as applicable, from respirator selection and medical evaluations to fit testing, maintenance, training and program evaluation.

• Administrator: designate a program administrator qualified by training or experience (c)(3).
• No cost to workers: respirators, training and medical evaluations are provided at no cost to the employee (c)(4).
• Medical evaluation first: before an employee is fit tested or required to use a respirator (e).
• Fit testing: before first use of a tight-fitting respirator, whenever a different facepiece is used, and at least annually after that (f)(2).
• Training: before required use, with retraining annually (k).

Employees whose only respirator use is voluntary use of filtering facepieces (dust masks) need not be in the written program (c)(2)(B). Rules vary by state.

Keep the program, fit-test records and training dates ready for any workers' comp submission, and see workers' comp by trade.

Official sources

• California Insurance Code 15007 (public insurance adjuster defined)
• California Insurance Code 15006 (unlicensed adjusting, voidable contracts, penalties)
• California Penal Code 551 (deductible offsets and referral fees)
• California Business and Professions Code 7151 (home improvement defined)
• California Business and Professions Code 7159 (home improvement contracts)
• California Civil Code 1689.6 (right to cancel)
• California Civil Code 1689.7 (cancellation notice requirements)
• Cal/OSHA Title 8, Section 5144 Respiratory Protection
• Texas Insurance Code 4102.163
• Florida Statutes 627.7152