It can take a long time for an injury claim to percolate through the insurance claims handling process. The maze of the insurance claim handling process frustrates injured people waiting for full fair settlements, but also attorneys wanting a satisfied client and a closed file. Why does it take so long?
After documentation of the injury is submitted, insurance company bean counters scrutinize each medical bill to ascertain whether the itemized charges are reasonable, necessary and related specifically to the accident. This may sound obvious. But, insurance companies look for unrelated and inflated bills.
In addition to the bill review, medical records also receive line by line review. Often, adjusters outsource records to a medical records reviewer. A physician or other medical expert paid by the insurance company studies the records and writes a summary. The summary, of course, slants the case the way the insurance company wants the case slanted.
After the reviews, claim highlights are fed into computer review software. One of my other blog articles discusses this in more detail. Suffice to say, the applications slice and dice the data and kick out a settlement range. This is reviewed by a supervisor, before the adjuster is given authority to start negotiations. Some insurance companies still deny that a computer performs the evaluation. However, this started in the early 90′s.
Insurance Claims Office Organization
Different insurance claim offices are set up differently. What they share is an organizational structure adding layers of management and overview, slowing down the process. An adjuster may need to run an evaluation by a supervisor who has a regional manager looking over his or her shoulder. Some adjusters have “blanket authority” up to a particular level. Either way, insurance industry management structure delays the process.
A “lowball” is an offer by an insurance company to settle a claim for far less than full fair value. Lowballs are offered to test the claimant. Knowing that some people will in fact grab the short money and run, insurance companies offer lowballs to sample the resolve of the injured person. The injured person needs to understand that this is part of the process. Patience presents the only antidote.
Cases pursued properly often settle for far more than the initial lowball. But, it takes time. Insurance companies might not budge for long periods of time, testing the determination of the injured person. Insurance companies lowball because, as more than one adjuster has told me “it works”.
Scheduling & Human Factors
While computerization plays a role, human factors still obstruct progress. Individual insurance company employees are inevitably unavailable due to vacations, frequent seminars, meetings, leaves of absence, sickness and many other diversions, stalling the claims process.
It defies logic that one person’s unavailability grinds a massive organization like an insurance entity to a halt. But, remember, one gasket failure caused the Challenger space shuttle to explode. One absence or inefficiency in a hierarchical entity causes the overall process to sputter.
The Long & Winding Claim
Many factors slow the claim process. These are just a few. Having an attorney who knows the process is the only way to push the claim.
Insurance companies have no incentive to speed up the system. The longer the delay between collecting premiums and paying claims, the longer they hold on to our money. The insurance industry is part of the financial sector of the economy. The longer they hold on to money, the more they make through investments, which is their “real” job.