So you think you are dealing with a staged accident; now what?

November 3, 2015 at 9:03 am Leave a comment

staged accidentStaged accidents come in all shapes and sizes; the “drive-down”, the “sideswipe” and the “swoop & squat” being a few examples. They key to successfully uncovering these, and other types of scams is a prompt and thorough investigation.

As adjusters, our primary duty is that of a fiduciary for our insured. We owe them the obligation to protect and defend, which includes identifying potential fraud. We have a general duty to pay what is owed.   Not what the attorney demands, but what is reasonably owed for the claim that is being presented.

There are three main components that determine this amount.   Liability, specials and general damages. We must determine who is at fault and to what degree.   We must review the medical specials and other economic damages to determine what was reasonably related to the claim being presented. We must also make a consideration for generals, or pain and suffering.

As we have discussed in prior articles, there are a number of tools to assist adjusters on this front, ranging from Mitchell ClaimIQ for liability and generals to DecisionPoint for both pricing and identification of deceptive billing practices.

But there are times when a case lands on a claim professional’s desk and they just scratch there head. Something just seems amiss.   Generally speaking, if something doesn’t seem right, it probably isn’t.   The key to resolving such types of claims is to dig for answers. After all, that is what adjusters do.

The first step is to speak with all parties to the accident. This includes the insured, the claimant, the guest passengers and witnesses.   Look for inconsistencies in their statements.   When meeting claimants in person, look for evidence of a “script”.   This is a document that a “capper” will provide when orchestrating the loss. Often notes written on a piece of paper, it will tell the claim parties what they are to say to the insurance company.   Typically, when a script is taken away, the claim parties will not be able to answer even the most rudimentary questions about a claim, such as the location or the description of the vehicles involved.

Under most insurance policies, the insured has an obligation to submit to an Examination Under Oath.   It is tougher to get claimants who are attorney represented to submit to statements, although they would be compelled during the discovery process in the event of litigation.

Talking to each of the claimants is critical to making a final determination about the veracity of suspected staged accidents.   They should be asked not only about the location and the description of the vehicles, but about their medical treatment. I always found it helpful to ask them to describe the clinic, the doctor and to provide directions to the medical facility from their home or office.   These are very basic questions that a person legitimately involved in a car crash is able to answer without hesitation.

We must also look at, and document, the damages.   In some staged accidents, the vehicles are actually rammed together.   The capper will pick a location, such as a vacant parking lot, and the insured and claimant will ram the cars together to create the appearance of a legitimate accident.   In such cases the damage will match, but will be rather insignificant so as to not actually inflict injuries.   In other cars, two previously damaged cars will make the claim. In these situations, the damage often does not match.   Look for telltale clues such as inconsistent paint transfers.   A red car hitting a white car will not leave a blue paint transfer. Also look for evidence of old damage, such as rust.  Take measurements and document them with clear pictures of the damage.  Of course, when these suspicions are confirmed, it is best to refer to SIU or defense counsel for assistance with proper resolution of the claim.

In many instances proving a staged accident may be difficult.   In those situations where the accident cannot be refuted, a BI evaluation will have to be completed.   When reviewing the demand from the attorney, it is very important that all medical records are provided.   I always like to ask for a medical authorization up front, which attorneys may or may not provide.   The key is to asking, as it shows an aggressive good faith willingness to assist in the investigation of the claim and the gathering of documents.

When the medical records come in, it is highly beneficial to run them through proven bill review software, such as DecisionPoint or Smart Advisor, which can identify not only reasonable benchmark pricing for the jurisdiction, and duration based upon the diagnosis, but can provide flags for deceptive billing practices, such as upcoding, unbundling and modifier abuse.

It is always critical to look for prior claims, or prior medical treatment.   While injuries can happen in car crashes, there must be a mechanism for the claimed injury.   It is estimated that more than 85% of Americans will suffer from back problems at some point in their life.   Often this is simply part of the aging process, and there will be evidence of degenerative disk issues that aren’t related to the accident in question.

The medical lien must also be factored in.   Don’t lose site of the common practice of plaintiff attorney’s contacting the provider after settling with the insurance carrier to negotiate down the medical bills.   This should be factored into the negotiations, as only amounts reasonably related to the accident are owed.

When negotiating with the attorney, it is important to focus on the facts.   Who was at fault, and to what degree.   Improving comparative negligence recognition is low hanging fruit that can have a profound impact on the bottom line.   What specials are owed?   What the duration reasonable and the treatment necessary? Is pain and suffering owed, and how much.   Focusing on these aspects of the claim and evaluating each independently can provide an improved framework for negotiations, resulting in better outcomes that gives carriers a competitive advantage in the marketplace.


Christopher Tidball is an author, speaker and casualty claims consultant. He has spent more than twenty five years in the P&C industry, starting as an adjuster and eventually moving into management and executive roles.   He is the author of multiple books including the recently released insurance fraud thriller Swoop & Squat and the ever popular claims improvement book Re-Adjusted: 20 Essential Rules to Take Your Claims Organization from Ordinary to Extraordinary! To learn more, please visit


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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

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