Archive for October, 2014

10 Things To Do On Every Auto BI Claim

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It’s no secret that average BI severities are rising. While some of this is driven by medical inflation, there are other components that can be controlled. Let’s take a look at ten things that can drive results on auto BI claims.

1- First Notice of Loss- Asking the right questions at the outset of a claim can greatly reduce transfer friction later in the claim process. By effectively triaging potential BI’s, or claims that are likely to emerge as BI’s, insurers can proactively investigate these claims and often push for early resolution. Studying data trends can often provide keen insight into factors that can be proactively used to identify potential BI claims earlier in the claim process.

2- Auto Physical Damage – If a red car hits a white car, there won’t be green paint transfers. While this seems elementary, there are a number of situations in which adjusters are not reviewing the photos of damaged vehicles. It is critical to analyze photos, looking for metal deformation, directional force and evidence of prior damage.

In far too many demands, there are allegations that just aren’t possible. Consider the rear-ender where the attorney alleges that their client was thrown “violently forward.” This would defy the law of physics, as would many other statements that are often presented.

In other situations, there is little to no damage. If there is no damage to the claimant vehicle, then what is the mechanism for injury? While it may be possible, it is highly unlikely. Getting crisp, clear pictures of vehicles from all angles can be invaluable in pushing these types of claims to an early resolution.

3- Police Report- There is often key information provided to police officers responding to the scene of an accident. The report will contain citations, witnesses, scene diagrams and any claimed injuries.

4- Comparative Negligence – Did you know that the average insurance carrier assesses comparative negligence on just 3% of all claims? When compared to jurors, who assess shared liability in more than half of all cases adjudicated, this becomes a glaring opportunity. Many insurers are turning to tools, such as ClaimIQ, resulting in their gaining a significant competitive advantage.

5- Prior Claims History- Claimants should be indexed at the outset of the claim, as well as just before any negotiations are to take place. It is not uncommon to find claimants with an accident history, as well as intervening claims that can have a significant impact on your claim evaluation.

It is also important to gather all of the medical records associated with any prior or intervening claims to ensure that what is being claimed was not caused elsewhere.

6- Claimant Profile – Let’s face it, when it comes to cashing in on an accident, some people will be less than virtuous. The airwaves are full of trial lawyers promising riches to those who seek to be opportunistic. Herein lies the importance of doing due diligence on anyone presenting an injury claim. Most certainly people can be hurt in car crashes, but that isn’t always the case. Understanding the claimant and looking for financial motives can provide keen insight into the veracity of the claimant.

Key items to look for are criminal history, known associates, marital history, professional licensure and assets. This information can often be invaluable when evaluating and negotiating claims. I recall a situation where a claimant was “incapacitated” by an accident. When putting together her profile, there was a prior criminal history for solicitation and an occupational license for exotic dancing. With this information we secured surveillance that contradicted everything being claimed and the attorney very willingly withdrew his representation.

7- Medical Detail – Upon receipt of a letter of representation, I always made it a point to advise the attorney up front as to what would be needed to conduct a BI evaluation. The medical bills are only part of the equation. Equally as important are all of the provider intake questionnaires, SOAP notes and a medical history, including all providers seen. While attorneys generally don’t like to provide information beyond the particular incident in question, it is important to dig as many claimants have a history of complaints. If there is a refusal to provide the requested information, simply remind them that it is discoverable.

8- Medical Bill Review – Approximately 10% of all claims are outright fraud, and another third involve inflated medical specials. Utilizing a bill review tool, such as Mitchell Decision Point, provides adjusters with insight into reasonableness and relatedness, as well as identifying opportunistic fraud, such as upcoding, unbundling and modifier abuse.

9- Venue – Not all venues are created equally. It is fair to say that the same claim in the Bronx will be worth far more than if the accident happened in Amarillo or Des Moines. That said, it is important to not use venue as a crutch. Generally speaking, venues fall into three categories: conservative, moderate or liberal. Of the 3,143 counties or county equivalents in the United States, nearly 85% fall into the first two categories. Of the remaining counties, only a handful would require evaluation consideration beyond liberal consideration.

I recall a situation in which a supervisor requested authority to pay our insured’s $10K policy limits. His rationale was that the claim was in Miami-Dade County. That’s it. Venue was being used as a crutch. To prove a point, I placed a call to the attorney and reviewed the facts of the case, the claimant’s history and excessive treatment that clearly wasn’t warranted or related. The claim settled for $3000 dollars.

10- Negotiation Strategy – One of the biggest obstacles to getting an accurate claim settlement is poor negotiating skills. It is somewhat counter intuitive to think that this happens, but it is a harsh reality in many claims organizations. Negotiation, like any skill, requires constant honing. Far too often, attorney’s gain the upper hand by focusing on dollars. Savvy negotiators don’t fall this trap and focus instead of the characteristics of the claim. For example, utilization of the InjuryIQ T-Chart allows adjusters to prioritize not only their strengths, but those of their adversary. By understanding the other side, they can formulate rebuttals and keep control over the dialogue and direction of the negotiations.

While there may be additional considerations based upon the characteristics of individual claims, these ten items provide a solid foundation to get to the proper outcome.

Christopher Tidball is a casualty claims consulting and the author of multiple claims process improvement books including Re-Adjusted: 20 Essential Rules To Take Your Claims Organization From Ordinary to Extraordinary! He began his career in claims 25 years ago as an adjuster before moving into management and leadership roles at multiple Top 10 P&C carriers.

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October 28, 2014 at 5:22 am Leave a comment

The importance of Chain of Custody and Preservation of Evidence

evidenceWith spoliation of evidence claims on the rise, insurers need to be increasingly aware of steps that must be taken to preserve damaged property. To better understand this, it is important to first recognize and understand the chain of custody.

The inception of the chain of custody is the point in time at which evidence is collected and the chain must be maintained until the evidence is disposed of. Evidence comes in all shapes and sizes, and depending upon the nature of your claim must be cared for in a variety of different ways. This chain ensures continuity in the accountability and is essential as any break in the chain may invalidate admissibility in court.

The chain of custody is a chronological written record of those individuals who have had custody of the evidence from its initial acquisition until its final disposition. These persons in the chain of custody must be identified and any person coming in contact with the evidence must be documented.

Ideally there will be an evidence custodian. It is incumbent upon the custodian to be a steward of the evidence while documenting everything that happens through the lifecycle of the evidence process. Even more critical is an understanding of the various state laws pertaining to evidence and spoliation thereof, which can leave the custodian liable for damages.

It is often advisable to utilize an independent Evidence Custodian as this will minimize charges of tampering with evidence. By securing evidence in an independent location, all parties associated with the claim will have access to the evidence.

Another key part of the process involves the utilization of Evidence Receipts. Evidence Receipts are provided to those who deposit evidence. The Evidence Custodian will always retain the original, a second goes to the person depositing the evidence and a third goes to a case file. Having the ability to electronically retain this documentation and back up in an offsite, secured location is ideal.

The original chain of custody form becomes a voucher and is given a voucher number when it is presented to the evidence custodian. Number evidence vouchers consecutively from inception to the current date. This original voucher should not leave the custodian with the exception of submission to a court of law as evidence.

An Evidence Sub voucher should be utilized to document any changes in the chain of custody that occur when the evidence leaves the evidence room. Consider a situation in which a mold sample leaves the evidence room with the plaintiff attorney and is turned over to a toxicology expert for analysis, in which case a sub voucher would be utilized. The number of the sub voucher should reflect the number of the original.

Disposition of Evidence occurs when the materials in custody are no longer needed at which time the property should be turned over to the proper owner or if unknown to an applicable insurer, state or federal agency.

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Christopher Tidball is a claims consultant and the author of Re-Adjusted: 20 Essential Rules To Take Your Claims Organization From Ordinary to Extraordinary. His career has spanned twenty five years, as an adjuster, manager and executive for multiple Top 10 P&C carriers. To learn more about optimizing your organizational results, please visit http://www.christidball.com or e-mail chris@christidball.com.

October 22, 2014 at 7:14 pm Leave a comment


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Chris Tidball is a claims and revenue management consultant and author of the "20 Essential Rules" series of self and organizational improvement books. You can ask him a question at chris@christidball.com

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