The History of Public Adjusting—Samuel Milch v. Westchester Fire Insurance Company

What is the history of public insurance adjusting? When did it first begin? Where is that history? These questions are raised every so often. The answers given are usually with no research and simply wrong. 

A search of the words “public adjuster” provides the oldest case reported in Westlaw. It dates from an 1895 case, Milch v Westchester Fire Insurance Company.1 The case facts explain that Samuel Milch was a public adjuster with an assignment of policy proceeds that the insurance company refused to honor.  

This New York appellate decision reported: 

The plaintiff…was a public adjuster of claims for losses arising by the destruction by fire of buildings and contents covered by insurance policies. The defendant, on or about July 5, 1893, issued its policy to one Adolph Stern, insuring his furniture, etc., against loss by fire for one year from July 23, 1893. A fire having occurred on December 27, 1893, said Stern employed the plaintiff to obtain the amount of his loss, and by an instrument in writing, dated January 2, 1894, “in consideration of the valuable services rendered and to be rendered” by the plaintiff, assigned to the latter the said policy and the amount due thereunder to the amount of plaintiff’s fees for services as such adjuster and of advances of money by him for expenses. The plaintiff claimed that on January 3, 1894, he mailed the said assignment to the [defendant] {sic}, together with notice of the damage by fire; but the latter, while admitting the receipt of such letter, denied, through its special adjuster, the receipt of said assignment. After the filing by plaintiff of proof of loss with the defendant, the latter, on March 6, 1894, settled the loss with said Stern by paying to him a certain sum; and the company received from him the return of the policy of insurance, and a receipt in full accord and satisfaction of all claims and demands against the defendant for loss and damage by reason of the said fire. The defendant having refused to pay plaintiff’s claim, the latter then brought this action. The pleadings were oral. The complaint originally was for ‘money due by reason of lien contract between plaintiff and defendant, money advanced’; and the answer was a general denial.

Upon the trial the defendant’s counsel moved to dismiss the complaint on plaintiff’s opening, which was denied. After putting in some testimony, plaintiff’s counsel moved to amend the complaint by alleging the cause of action to be money due the plaintiff under an assignment from one Adolph Stern of an interest in a policy issued by the defendant to the said Stern, which amendment was allowed….

After a careful reading of the evidence, we are unable to say that the judgment is against the weight of the evidence. There is a direct conflict upon the point whether the plaintiff inclosed the assignment in his letter of January 3d, but we are inclined to the belief that the weight of evidence is in his favor. We think that the decision of the justice as to the facts was in all respects correct, and we see no reason for disturbing it, in the absence of the elements which are requisite to review such determination….

The bottom line is that the oldest reported case in the computerized Westlaw system with the words “public adjuster” is about a New York public adjuster successfully suing an insurance company who paid the policyholder but not the public adjuster who held an assignment for his fees.  

For those interested in the history of public adjusting, I would suggest that you also read Public Adjusters Entitled to Fee Even After Claim Settles in Litigation. Litigation.  

There is certainly a non-litigation history of public adjusting in the United States, which pre-dates this case. For anybody who has any documented history, I would greatly appreciate you sharing it. 

Samuel Milch has a history beyond this reported case. But that story is for another post. 

Thought For The Day

I like the dreams of the future better than the history of the past.

—Thomas Jefferson

1 Milch v Westchester Fire Ins. Co., 13 Misc. 231, 67 N.Y.St.Rep. 870, 34 N.Y.S. 15 (NY App 1895).