The
Inside Game #2
As I muse through my observations on the inside game, that is inside the
claims department, I have received and read many interesting and thoughtful
comments regarding my musings, and would like to thank all for their kind
comments.
Musing: The fundamental
task of the adjuster is to
investigate.
Now you ask yourself this is a basic thing is it not, our expectation is
that claims people will do just that, and often they do, but in balance the
problem today is that my observation it is not done very well, there is
little direction from front line supervisors, and training in the basics of
this critical task is lacking in many claims operations, but not all claims
operations.
My second observation comes from my role as an expert in bad faith cases, I
have seen all to often of late what I refer to as " Outcome Oriented
Investigation" by this I mean an investigation where the focus in to a
pre-determined outcome. The outcome desired being no liability,
questionable or no coverage, or the damages are such that we will not accept
them as part of the loss. Now one must ask, does this occur often, the
answer is maybe, is it wide spread, most likely not, but does it occur, the
answer is yes, and all too often from my perspective.
Investigation is the lifeblood of the claims process. Without quality in
investigation, the public, the policyholder, stockholders and stake holders
suffer, stockholders being fellow employees. Quality investigation
drives the entire process; without it, we do not pay claims we owe, we pay
claims we do not owe, we fail to uncover fraud, we do not address critical
damage issues and we create litigation in cases where we should create
resolution.
Without quality built into the critical task of investigation you create a
claims process that does not deliver the promise contained in the policy,
that is the fair and equitable delivery of claims service, which at the end
of the day is nothing more than solving the problems of your customer the
insured.
I have observed a lack of investigation planning process from the top down,
so often I see little involvement by the supervisor on file set-up, no
direction, no goal, etc. Lack of good statements, what happened to scene
diagrams and photos, interviews with police officers, witness statements,
consultation with counsel at early stages for assistance with experts and
legal issues. Also a sense of being timely is largely lost in many cases,
but not all.
Let me give you an example, I have a plaintiff case where a critical element
of the case was investigation. There was a fatality, the supervisor
did not give any directions to the adjuster, the adjuster had no plan, the
adjuster did not investigate the damages allowed in the state, adjuster did
not seek the advise of counsel up front, did not think about experts, the
adjuster also failed to treat the insured with any sense of basic fairness,
failed to do any real fact investigation and 18 months later asked the
plaintiff attorney for an extension to a time limit demand to do
investigation that should have been completed in the first 30 days.
Mikes Rule: The primary
function of the adjuster is to investigate; failure to investigate is the
harbinger of bad faith.
Mike Cerf
Expert Witness Insurance Claims
Sherwood, Oregon
503-925-1937
mcerf@teleport.com
