The
Inside Game #1
I have been silent for a time on my musings and thought
I would start again, since from time to time members of
the list have found them helpful and at times they have
encouraged debate on critical claims issues we all face.
One further note, one of the reasons I have been
somewhat silent is that my expert witness practice in
the bad faith area has been growing.
Observation: Claims representatives, are the people
responsible for fulfilling the insurance company's promise.
Definition: The inside game is simply how the claims
process works inside the claims operation.
So many
have little knowledge of it, that conflict is
assured in the long run if the claims representative
does not act in a manner that is consistent with professional claims handling.
This observation is not mine alone but clearly stated
in a text book for the adjuster in industry sponsored
courses. I would start by offering the musing that in
my practice as an expert witness both for the defense and plaintiff, I have often observed that the
role of the representative is not to fulfill the promise
made in the policy, be it to provide benefits in a first party claim or defense in a third party claim.
What I have observed is that the responsibility of the
claims representative is to maintain a set average
settlement size, that being keeping what you pay
down as the primary focus. Now the first thing one
must observe is that role in and of itself is not
inherently bad, after all the representative does owe
a duty to other policyholders and stockholders not
to deplete the assets of the company. My
observation is that the focus is not on being there
in the time of need of the policyholder or the
claimant, but the focus is how do we not pay this
claim, how do we reduce benefits, how do we
control average settlement size though cost
reduction programs such as medical reviews.
The delivery of the promise inherent in the policy,
that being a promise made for payment of premium
for an uncertain event is something that the public
at large relies upon, they do not understand the
claims process, all they know is that when they
have a claim they want the promise they believe is
there to be acted upon and acted upon fairly.
Today's claims process in balance does not in
most cases ensure that occurs. That is not to say
it does not occur, it does, but it does not
occur in a frequent or consistent manner. Rather,
what occurs is adversity in the process, when adversity is not required; rather what is required is
the simple delivery of the promise in a manner
and method that provides peace of mind to those
seeking benefits.
Mikes concluding rule: The adjusters role is to
solve the problems of the insured through the
delivery of the promise contained in the policy in
a manner that ensures both the insured and third
parties ( in those cases where owed) receive
benefits without built in adversity.
Mike Cerf
Expert Witness Insurance Claims
Sherwood, Oregon
503-925-1937
mcerf@teleport.com
