How Insurance Companies Settle Cases

The Insurance Claim File

When an insurance company is notified of an accident, the first step it takes is to set up a claim file, and assign a claim number to that file.

In the usual accident case, after a claim file is set up it is assigned to an adjuster. The adjuster is responsible for monitoring the claim and has substantial authority in making a settlement on both the property damage (P.D.) and the bodily injury (B.I.) part of the claim. In auto accident cases, some insurance companies may have one adjuster handle the bodily injury claim and another handle the property damage claim.

Personal Injury Insurance Claims

If you have been injured as a result of an automobile accident, a slip and fall accident, or another person's negligence, you have the right to receive compensation. The amount of money that is paid varies from case to case. Each personal injury case is evaluated on its own set of facts. If you have further questions after reading this article, Attorney John LaCava, provides free consultations and evaluations of personal injury cases.

Most bodily injury claims are not settled or resolved until all medical treatment has been completed and the extent of the injury, including any permanency rating, is known and documented. A person who has been injured should receive compensation for 1) out of pocket medical expenses; 2) loss of earnings for time lost from work; 3) lost future earnings, if the injury will cause a loss of income in the future; and 4) the value of the bodily injury claim, which includes pain and suffering, loss of life's enjoyment, mental suffering, and the effect that the injury has on one's life, etc. The hardest part of a personal injury case is the proper evaluation of the bodily injury part of the claim.

In evaluating the value of the bodily injury part of the claim, the three most important considerations are: the nature of the injury, the length and type of treatment, and the permanency of the injury. For this reason, it is important to get prompt medical attention for any injuries received in an accident. If you are referred to physical therapy, or chiropractic treatment, it is important to keep all appointments. Insurance companies take into account the number of physical therapy or chiropractic treatments, and the amount of all medical bills.

The permanency of any injury is a very important factor. Your treating physician will give an opinion as to whether your bodily injury is likely to be permanent in nature. It usually takes a minimum of six months before a doctor can determine whether a particular injury will result in a permanent impairment. A doctor usually will use published guideline in rendering such a opinion, such as the American Medical Association's Guide to the Evaluation of Permanent Impairment. This book lists various types of injuries, and provides estimates of impairments to specific body parts. For example, a disk herniation in the neck (cervical herniation) with radiculopathy (radiating pain) would provide a permanent partial disability rating of approximately 11% of the whole person according to the Guidelines.

Property Damage Claims in Auto Accidents

Property damage claims relate to the damage to the automobile or other personal property as a result of an automobile accident. These claims are usually resolved within a short period of time based upon an appraisal of the car by an insurance company appraiser. The appraiser sends a report of vehicular damage to the adjuster, who will then negotiate with you regarding a settlement of the property damage claim. Property damage claims should be resolved quickly (usually within 30 days) while bodily injury claims take much longer, usually six months to one year.

  • If the accident is clearly the other party's fault, you have the right to submit your claim for property damage (P.D.) to your vehicle directly to that person's insurance company. You may also request other benefits, such as a rental car while your vehicle is being repaired. If the question of fault is disputed, the other party's carrier may only offer you a percentage of the fair market value of the car or the cost of repair.
  • If the other party's insurance company delays in processing the claim, you can submit the claim to your own carrier if you have collision coverage. Your insurance carrier will then make a claim for reimbursement against the other insurance carrier. If successful, your company will reimburse all or part of your deductible to you. That process is called "subrogation."
  • If the accident is not your fault, your insurance carrier cannot "rate your policy" for fault. Be aware, however, that you can be rated on a "frequency of claims" basis and, therefore, even if not your fault, a property damage claim can have rating consequences. Also be aware that the allocation of fault is a business judgment the insurance company makes, sometimes in the context of a negotiated subrogation process. If is very difficult, if not impossible, to contest the carrier's assessment of fault.
  • You will only be able to get reimbursement for a car rental from your own carrier if you purchased rental coverage.
  • Fair market value of your vehicle is determined by industry book values, less offsets for poor condition, high mileage, etc. Most insurance adjusters use the Kelley Blue Book or the National Auto Dealers Association (NADA) Official Used Car Guide. If you disagree with your carrier's valuation, you have the right to get other estimates. Your insurance policy contains instructions on resolution of disputes as to value.
  • Be aware that storage fees for "totaled" vehicles are very expensive and the insurance company that is paying your claim may not pay for excessive storage fees. The insurance company that pays you for a totaled vehicle has the right to take possession of the vehicle and vehicle title papers so that it can promptly remove the vehicle from storage and "salvage" it. If you chose not to turn over a totaled vehicle, the insurance company will deduct the salvage value from the fair market value.
  • If you settle your property damage claim, be sure that the release is for property damage only and that you are not releasing other claims, i.e. a bodily injury claim.
  • In serious accidents, accident reconstruction experts may need to examine the entire vehicle and accident scene and conduct interviews. It is therefore important to obtain representation as soon as possible after a serious accident so that the evidence can be preserved before vehicles are salvaged and transferred.

Medical Bills From Auto Accidents

  • If you have purchased Medical Payments Coverage (as part of your automobile insurance coverage) to cover medical bills following an auto accident, you should be able to submit your accident related medical bills to your auto insurance carrier, depending on the type of coverage and your policy requirements. Be aware that medical payments coverage is no longer mandatory in Connecticut, you must have purchased it separately. It is optional. Some HMO's and health insurance plans will not pay for medical treatment resulting from an automobile accident until you provide a letter from your auto insurance company that you do not have medical payment coverage.

What to Do If The Person Who Hit You Has No Insurance - Uninsured Motorist Coverage

  • If the person who caused the accident does not have insurance or does not have enough liability insurance, you may make a claim under the uninsured motorists/underinsured motorists (UM/UIM) provision of your own insurance policy. You may also make a claim against your own insurance company if you were injured by a "hit and run" driver.
  • Your own insurance company will then "stand in the shoes" of the other driver and insurance company. The law requires that every automobile insurance policy sold in Connecticut must include Uninsured and Underinsured Motorist Protection, but the amount of coverage may vary according to what you chose to buy.

Statute of Limitations and Other Deadlines

  • In general, victims of accidents occurring in Connecticut due to negligent conduct have two (2) years to bring a claim. If the conduct involved is intentional, victims have three (3) years. Determining the appropriate limitations period depends on the application of facts to law and usually needs to be analyzed by a lawyer.
  • If a highway defect is the cause of the accident, or if a government entity (city, town or the State) is involved, other notices may have to be filed within a very short period of time, and you should consult an attorney as soon as possible.
  • The time period and manner in which a Uninsured or Underinsured Motorists claim can be brought against your insurance company is contained in the policy provisions. Some policies require arbitration, and others require that notice or a lawsuit be filed within specified time periods.

We can help you, too.

Our main offices are located in Stamford, Connecticut, but you can reach us at any of our three convenient Fairfield County locations by calling 877-293-6717 or by contacting us online with a brief description of your situation. You can speak with a lawyer directly about your case. Initial consultations are always provided free of charge and appointments can be made for evenings, weekends, and off-site locations.

You will pay no fees or costs unless we recover compensation in your case.