Judge Balks at 36-Hour Rule for Maine Claims Handlers

BANGOR, Maine (CN) – Maine trampled the First Amendment with a decades-old law that seeks to curb some ambulance-chasing practices, a federal judge ruled Tuesday.

Known as the 36-hour rule, the law adopted in 1997 requires all public insurance adjusters to wait a day and a half after a claimable event such as a car accident before contacting a potential client.

Though the ban is intended to protect customers who might still be panicked from a terrible event, adjusters for insurance companies are free to begin contact right away.

Public adjusters typically charge a fee and work to obtain the maximum insurance payout, but Maine’s law essentially give insurance companies a three-day head start on claims.

Siding with the National Fire Adjustment Co. Inc., U.S. District Judge Lance Walker ruled Tuesday that the statute violates adjusters’ free-speech rights.

“Based on my reading of the 36-Hour Rule, the ban on ‘solicitation’ is exceedingly broad and acts as a powerful deterrent to even educational outreach activity within the 36-hour window,” the 17-page opinion states. “In my view, it is extremely unlikely that the average property owner through an exercise of common sense would regard educational outreach activity as anything other than solicitation.”

The actual regulation specifies that public insurance adjusters “may not solicit or offer an adjustment services contract.”

Walker determined that use of two separate clauses meant that the law recognized solicitation and an offer for a contract as two separate actions, and that banning solicitation was unconstitutional.

The National Fire Adjustment Company brought the underlying suit roughly a year ago exactly, taking aim at the Maine Bureau of Insurance in the U.S. District Court for the District of Maine.

Under Walker’s ruling, public insurance adjusters will no longer have to wait to contact potential customers, but the time limit on offering a contract will remain.

“It is not necessary to ban all solicitation as well. Permitting lawful solicitation that is not inherently misleading, while prohibiting conduct that involves closing a contract, in my view achieves the balance commanded by the Free Speech Clause,” Walker wrote.

Representatives for both the state and National Fire have not responded to emails seeking comment. 

%d bloggers like this: