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Maine's "36-Hour Rule" Deemed Unconstitutional | Property Insurance Coverage Law Blog



One of the strongest tools in an insured's arsenal is a good public adjuster. If lucky, most will only suffer a property loss once or twice in a lifetime. Not dealing with claims handling on a day to day basis, navigating the claims process can not only be confused and tedious, but costly if the insured does not know when they are being treated unfairly.

Some states have laws in place that limit when licensed public adjusters can contact an insured with a potential need for the public adjuster's services. Termed "solicitation," Maine's 36-hour rule in the Insurance Code provided:

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. Solicitation. An adjuster seeking to provide adjusting services to and insured for payment by the insured may not solicit or offer an adjustment services to any person at least 36 hours after an accident or occurrence as a result of which the person might a potential claim

The National Fire Adjustment Company, Inc. ("NFA") provides licensed public adjuster services in Maine. NFA sued the superintendent of the Maine Bureau of Insurance, arguing the rule violates the First Amendment of the U.S. Constitution. The NFA argued the rule was "a content and speaker based restriction of speech" that was "presumptively unconstitutional viewpoint discrimination." In the alternative, it was argued that the Rule imposed burdens that neither advanced the State's interests, nor its stated interest, if it swaps more broadly than necessary. It was asserted that public adjusters' adherence to the Rule was causing NFA's public adjusters to lose business on an ongoing basis. (If any public adjuster works in a state with similar restrictions, it only stops public adjusters that follow the rule, which are unlicensed or unscrupulous will often swoop in, regardless of the Rule.) [TheFederalDistrictCourtinitsdecisionappliedthe"intermediatescrutinytest"whichfirstdetermineswhethertheexpressionisprotectedspeechbytheFirstAmendment(forcommercialspeechitmustconcernlawfulactivityandnotbemisleading);nextitlooksatwhetherthegovernmentalinterestis"substantial";andifyestobothitmustbedeterminedwhethertheregulationisdirectlyadvisedbythegovernmentinterestandifitismorethannecessarytoservethatinterest

broad "and acted as" a powerful deterrent to even educational outreach activity within the 36-hour window ", and that the ban on all solicitation activity, temporary as it might be, was" an excessively paternalistic prior restraint on speech "and, as The case is National Fire Adjustment Co., Inc. v. Cioppa no. 1: 18-cv-00008 (D. Ms Jan. 8, 2019).


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