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Remote Work Adjuster's Tax Reduction Approved by Alabama Court, Yet Uncertainties Persist

Remote and traveling claims adjusters gain relief from a recent Alabama court decision, as it may exempt them from settling in the state for business purposes.

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Remote Work Adjuster's Tax Reduction Upheld by Alabama Court, Yet Questions persist
Remote Work Adjuster's Tax Reduction Upheld by Alabama Court, Yet Questions persist

Remote Work Adjuster's Tax Reduction Approved by Alabama Court, Yet Uncertainties Persist

Alabama Tax Tribunal Ruling Overturns Department of Revenue's Decision on Claims Adjuster

In a recent ruling, the Alabama Tax Tribunal has determined that claims adjuster Candace Corley did not transact business in Alabama in 2021, overturning the Alabama Department of Revenue's (ADOR) decision and eliminating Corley's $900 Alabama tax bill.

The ruling, which has raised questions in Florida about whether Slide Insurance Co., the company for which Corley worked, had begun selling policies or handling claims before it was licensed, came as a relief to Corley. She had initially been assessed the tax bill due to her work as a desk adjuster for Tampa-based Slide Insurance Co. from her home in Florida.

Corley, who was employed by EP Claims Service based in Mobile, Alabama, at the beginning of 2022, had been unaware that she was not actually working for Slide Insurance Co. until June 2022. The company's initial rate and form filings were not made with the Florida Office of Insurance Regulation until February 2022, and it did not receive its certificate of authority from Florida regulators until the same month.

Slide Insurance Co. has stated that it is not the case that they handled claims before February 2022, and that they did not write or control policies at the time when Corley was reviewing claims for them.

The tribunal Chief Judge Jeff Patterson, who previously worked as an attorney for ADOR for 13 years, wrote that Corley handled claims for some policyholders insured by Slide Insurance as a 'desk adjuster.' However, he declared the final assessment void, ruling that the income earned by Corley in 2021 was not the result of 'business transacted in Alabama.'

The ADOR has 30 days to appeal the tribunal's decision to a circuit court. The attorney for the ADOR declined to comment on potential actions in response to the decision.

The ruling comes at a time when the insurance industry in Florida is under scrutiny, with the year 2021 being known for a significant hurricane, Hurricane Ida, which contributed to the demise of FedNat and another carrier, Lighthouse Property Insurance Co. Corley suggested she may have done work for FedNat Insurance and Allstate Insurance in 2021, but not in Alabama.

Candace Corley worked for Geico at the beginning of 2022, before her employment with EP Claims Service and Slide Insurance Co. It remains to be seen how this ruling will impact the insurance industry in both Alabama and Florida.

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