The Claims Process: The Path of a Personal Injury Claim
How many times in the claims process does anyone besides the insurance adjuster wonder “Okay, now what happens next?” As we’ve written before, each claim is different. However, every third-party claim made against an insurance company does follow a basic logical path or process.
Here it is.
Someone has to call the insurance company and let it know that there has been an accident. A few insurance companies still require that it be their own policy holder who reports the accident, but the better insurance companies will accept a report from any involved party, understanding that the more quickly a report is made, the more quickly the claims process begin. The more quickly a claim can be handled, the less inconvenience and expense there are for all involved. Usually reporting the claim is as simple as calling the company and providing basic information such as the policy number of the insured person, the date of the accident and other details; the basic who, what, when, where and why questions.
Once the insurance company has been notified that an accident has occurred, it will begin its investigation to determine exactly what occurred. This investigation phase of the claims process will include interviewing the involved drivers as well as any witnesses and possibly the passengers. These interviews might be recorded or not, depending upon whether or not all of the drivers agree about how the accident and who was to blame.
The insurance company representative will order a copy of the police report if one was written. There may be traffic enforcement cameras at an intersection to indicate whether one driver or the other ran a red light and failed to yield the right of way to the other. The adjuster may order any other documents he or she needs in order to determine who was at fault. (For example, in the case of a possible sudden medical emergency or alleged intoxication, the adjuster may need to order a driver’s medical records if there are any.) The adjuster may also require photographs of all involved vehicles before making a determination regarding fault. This will be for the purposes of seeing the exact points of impact on the vehicles, as well as the severity of the collision.
The Liability Decision
In this stage of the claims process, the adjuster will review all of the information his or her investigation has turned up and make a decision about who was to blame. If the adjuster finds that his policy holder was not at fault for the accident, then he will send a letter stating such (a denial letter) to all parties asking to make a claim against his policy holder. This denial letter should thoroughly explain the reasons for the denial. It is then up to those denied parties to decide how they want to proceed: do they want to just let it go, or do they want to pursue a lawsuit against the other driver.
If the adjuster finds that his policy holder was to blame for the accident, he should explain this to the policy holder and proceed with handing the claim.
Appraisal of property damages
In this stage of the claims process, if the vehicle is repairable, the adjuster will require a repair estimate. If the vehicle owner decides to have their repairs done through the insurance company’s direct repair program, there should be no need for a second estimate from any other shop. The days of requiring a vehicle owner to obtain three estimates and then paying the lowest one are long gone.
If the vehicle is not repairable, thus considered a total loss (the cost to repair is so close to the total market value of the vehicle as to make it not worth repairing), then the adjuster will do a market analysis to determine its fair settlement value. There should be a thorough explanation of the settlement offer, and both sides will hopefully agree. If not, litigation is an option for the vehicle owner to pursue.
Settlement of property damages
In this stage of the claims process, settlement or payment is made; to the body shop doing the repairs, or to the vehicle owner if the vehicle was a total loss. Any owed rental expenses are paid. There is usually no settlement release required for property damage or rental expense claims.
Gathering documentation for the personal injury or bodily injury claim
If there is a third-party personal injury or bodily injury claim being made, and liability has been accepted, this is the stage in the claims process where the insurance company must obtain or receive all of the documentation necessary which will allow them to place a value on the injury. This will include the medical bills, the supporting medical records, reports and notes, as well as documentation of any lost wages being claimed.
Evaluation of the injury claim
Once all of the documentation needed to support the claimant’s injury claim has been received, the claims adjuster will sort through it to glean the real issues: the injury and its severity, the related treatment, the length of treatment, how the injury impacted the claimant’s employment and life. The adjuster and any superiors involved in the evaluation of the case will place a value range on the claim (obviously management and not the adjuster have the final say) and monetary authority is given to begin settlement negotiations.
Settlement of the injury claim (or not)
The settlement negotiations for the injury claim will commence once authority has been given to the adjuster and the claimant has indicated an interest in settlement. Either the adjuster will make a dollar offer first, or the claimant or his representative will make a demand first; it doesn’t really matter who makes the first move. Rarely does either side ask for what they really want to settle for first; only in cases where a policy limits offer is being made on a case of unquestionable value, or where the adjuster and attorney have worked together so many times that there is no need to play around is the first number really intended to be the last. If the case can be settled during this phase of the claims process, the check will be issued and the appropriate releases requested, and the matter is resolved. Settlement must be reached before the Statute of Limitations on the case expires. If the sides cannot agree upon a settlement amount, then the case may go into litigation.
If a case is not settled amicably, the claimant may decide to take the matter to court by filing a lawsuit. A lawsuit must be filed before the Statute of Limitations on the case expires. The court and/or the attorneys involved then steer the matter towards resolution, so we will not go into those intricate steps here. It is important to remember, however, that even a case in litigation may be negotiated and even settled without a trial.
If the case is never settled or dismissed for lack of evidence, or simply dropped because the claimant/plaintiff no longer is willing or able to pursue the matter, then it will go to trial. Baring a mistrial, whatever the judge or jury awards the plaintiff is what the insurance company must pay him. Appeals in personal injury civil trials are rare, but do occur, and the reasons vary from case to case.
This article is written for informational purposes and is not intended to take the place of competent local legal counsel.
Articles related to the Claims Process:
Claims Adjuster Training
Mediation and Arbitration Explained
Perferred Body Shop Programs
Personal Injury Values Discussed
Personal Injury Claim Settlements
Settlement Releases Explained
The Special Investigative Unit (S.I.U.)
The Statute of Limitations, State by State
What To Do When You Are In An Accident
An Explanation of the Insurance Company's Reservation of Rights (R.O.R.) Letter
A Look at Your Automobile's Black Box
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