For a claimant, the claims process begins at the scene of the accident. And while the obligations of the insurance company may begin at the same time, the company will be playing catch up since they are not even aware of the incident until they are provided with a notice of loss and can begin their investigation. As a result, the company is at a disadvantage because they are not at the scene of the accident and have to gather their information after the fact and second hand from the parties involved and any witnesses.
It is the insureds responsibility to contact their insurance company and provide the “first notice of loss” which is essentially some basic facts about the incident: dates, times, vehicles involved, vehicle damages, drivers involved, passengers, injuries, and witnesses. Once the company has this information, they will immediately provide it to their coverage verification adjuster.
The coverage verification adjuster will review the facts of the loss and evaluate that information as it relates to the insureds policy. The adjuster will determine the following:
1) Was the policy in force on the date of loss (e.g. premium payments current)
2) Was the vehicle involved in the loss listed on or covered by the policy
3) Was the driver involved in the loss listed on or covered by the policy
4) Are there any coverage exclusions or other issues that might affect coverage.
It is important to note that the coverage adjuster is tasked to find coverage. For example, if a policy has lapsed (no longer active), they may contact the underwriter, the insured and/or the broker to determine if there are payments or endorsements that have not been processed that may affect coverage. If the adjuster can’t find coverage, the claims investigation is discontinued and a denial of coverage will be issued to the claimant.
Conversely and far more frequently, once coverage is verified the claim will be assigned to a liability adjuster and if appropriate, an appraiser will be assigned to write an estimate of vehicle damages and take photos. In most cases the coverage verification process is routine and quick. When there are no issues, coverage verification and assignment to the liability adjuster happen the same day the claim is reported. With insured cooperation and access to the vehicle involved, the appraisal should be done in less than a week. When the claim and coverage is verified, the insured issent a letter confirming the available coverage.
The liability adjuster is given the basic facts of loss as reported and information on the coverage verification. The adjuster’s responsibility is to determine liability, identify damages and resolve the claim. The adjuster may contact all of the parties involved in the loss including witnesses. He will usually take more detailed statements within 10 days of the
claim report from the parties involved and may record these statements. If the insured was the one who originally reported the claim, this may seem redundant and unnecessary, but the adjuster is likely to need additional information such as weather conditions, estimated speeds of vehicles, traffic patterns and what each person observed immediately before and after the accident.
The adjuster also utilizes any available police reports, vehicle photos and estimates to help with the liability determination and resolution. Cooperation from all parties is necessary to resolve all issues in a timely manner. A vehicle damages claim can often be resolved within 20 days whereas a bodily injury claim can range from several days to several years. It is important to remember that the resolution of any claim reflects both the nature of the claim and the cooperation of all parties involved. There is no short cut around elusive claimants.
If there are injuries, the claim is usually more involved and often takes longer to resolve as the adjuster will need copies of medical reports to evaluate and resolve the claim. If the damages, either BI or PD are at or near the policy limits, a signed release letter may be required before payment can be issued. The release is sent to protect a company’s insured. If a claim is at or near the policy limit, the release is sent to the other party for their signature acknowledging that they will accept the company’s settlement as payment in full and releases the company’s insured from any further liability. If the damages are above the policy limits, the adjuster will try to get the other party to accept our insured’s limits as full payment. If the other party does not accept our insured’s limits, they will ask for additional payment from the insured to settle the claim. If the other party will not settle at or below the policy limits, a company usually has a duty to represent the insured until the claim is settled.