Associate in Claims

Workers Compensation—First Report of Injury or Illness form

- ER section - Carrier/Claims Administrator section - EE/wage section - Occurrence/treatment section

Questions to address potential jurisdiction under a Federal Act

- Working on project for federal contract of at a federal installation? - Working on a boat or ship? - Working alongside a coastal or inland body of water or navigable waterway? - Working on/for a railroad? - Working as migrant or farm laborer?

Questions to be answered in coverage analysis

1 - Is ER covered under the WC policy? 2 - Was the worker an EE of the insured? 3 - Did the injury occur during the policy period? 4 - Is the location of the loss covered? 5 - Did the injury occur in the course and scope of employment? 6 - Is there any other insurance that applies to the loss?

Seven part method for taking statements

1 - Permission and introduction 2 - Identification 3 - Setting 4 - Incident 5 - Post incident injuries/damages 6 - Miscellaneous 7 - Conclusion

Four types of notice of injury in WC system

1. Worker to ER 2. Worker to state WC agency 3. ER to State WC agency 4. ER/Insured to insurer

Fraud accounts for what portion of property-casualty insurance industry's incurred losses and loss adjustment expenses?

10%

Allegation

A claim made in a complaint by a plaintiff specifying specifying what the plaintiff expects to prove to obtain a judgment against the defendant.

Motivation Phase of Claim Negotiation Process

A claimant may consider exaggerating the loss.

Requirements to prove intentional misconduct by a claims representative

A complainant must show that the CE intended both the misconduct and the consequences.

Representational document

A diagram, which is used as a visual aid to communicate or clarify an event or claim, which is better than a written report.

Summary Judgment

A judgment granted by the court when it determines that no factual issue exists.

Compensatory Damages

A monetary compensation to a victim for harm actually suffered, including lawyers' fees, court costs, and interest. Can include contractual damages, consequential damages, a/or emotional damages.

Nonwaiver agreement

A signed agreement indicating that during the course of investigation, neither the insurer nor the insured waives rights under the policy.

Statute of Limitations

A statue that requires the plaintiff to file a lawsuit within a specific time period after the cause of action has accrued, which is often when the injury occurred or was discovered.

Reflective Listening

A technique that helps listeners correctly interpret messages.

Qualitative audit factor

Accurate evaluation of insured's liability

Independent Medical Examination (IME)

An IME might resolve an issue concerning the insured's remaining totally disabled.

Derived crediblity

An individual's perceived credibility during interpersonal communication.

Cumulative injury

An injury that occurs as a result of repetitive motion, stress or trauma. These injuries are traceable to a certain time period and to separate incidents, but not to identifiable points in time and place.

Bad Faith

An insurance company's unreasonable and unfounded (though not necessarily fraudulent) refusal to provide coverage in violation of the duties of good faith and fair dealing owed to an insured. Bad faith often involves an insurer's failure to pay the insured's claim or claim brought by a third party.

Reserve adequacy and accuracy

Are important for supporting an insurer's continued solvency and capacity.

Ethical and professional dilemmas faced by CEs

Arise because state laws relating to licensing inside CEs can be ambiguous.

Comparative negligence

Both parties to a loss share the financial burden of the bodily injury or property damage according to their respective degrees of fault.

Lose-win negotiation style

Avoids confrontation. Used when it's likely the other party will hire an attorney.

Paid loss retro plans

Base premiums for current policy period on losses incurred during the current policy period. The insured pays a premium at the beginning of the policy period; then at the close of the policy period, the premium is adjusted to reflect the insured's actual loss experience.

Principle of YES Claim Negotiation Technique

Based on the premise that disagreements should be avoided until all points of agreement are established.

Crisis Phase

Begins when a loss occurs.

Motivation Phase

Begins when the claimant recognizes the financial implications of the loss and starts to think about who will pay for the loss.

Bargaining Phase

Begins when the parties enter into serious settlement discussions. Settlement is part of the bargaining phase.

Good Faith

Broadly defined as consideration given to the insured's interests that is at least equal to that given to the insurer's interests in handling the claim.

Counter claim

Brought by a defendant against the plaintiff, arising out of the same occurrence.

Examination Under Oath (EUO)

Can be necessary to for insured to provide documentation of his or her identity.

U.S. Office of Foreign Assets Control (OFAC) requires reporting to federal government of what?

Certain claim payments and other insurance transactions are reported to the federal government.

What do bad faith claims arise from?

Claim denial, excess liabililty claim, statutory bad-faith, and violations of unfair claims settlement practices act.

Bad Faith Claims - What do they arise from?

Claim denial, excess liability claim, statutory bad faith, and violations of unfair claims settlement practices act.

Bargaining Phase of Claim Negotiation Process

Claimant enters into serious settlement discussions.

Compensatory damages

Compensation to claimsts for their bodily injury or property damages resulting from a covered loss. Includes contractual damages, consequential damages, and/or emotional distress damages.

Elements of good faith claims management

Consistent supervision, thorough training, and manageable caseloads.

Coalition Against Insurance Fraud (CAIF) supports what measure to reduce insurance fraud

Creating state fraud bureaus that have the power to subpoena and fine those involved in insurance fraud.

Phases a claimant goes through during the claims process (3)

Crisis Phase, Motivation Phase, and Bargaining Phase.

Claim Negotiation Process - Phases

Crisis phase, motivation phase, and bargaining phase.

Consequential Damages

Damages awarded by a court to indemnify an injured party for losses that result indirectly from a wrong such as a breach of contract or a tort.

Emotional Damages

Damages for mental suffering without physical injury.

Punitive Damages

Damages imposed in order to punish the wrongdoer. The standard for awarding punitive damages varies by jurisdiction but generally requires proof of insurer behavior that is worse than ordinary wrongdoing, such as malicious, fraudulent, or oppressive behavior.

General damages

Damages that courts award in order to compensate claimants for such things as pain and suffering that do not involve specific measurable expenses.

Equitable Subrogation

Describes a situation in which an excess insurer has the same rights as the insured to bring a suit against the primary insurer.

occupational disease

Disease thought to be caused by work or the work environment.

Burden of Proof

Duty of a party to prove that the facts it claims are true.

Win-lose negotiation style

Each party sees negotiation as a contest between two opposing parties, each seeking to defeat the other. May be used when other avenues of resolution have been exhausted. May be used by CEs in resolving claims that appear to involve fraud.

Loss Event Videos - Why aren't they edited?

Editing would diminish the video's credibility.

Carrier/Claims Administrator section of the ACORD Workers Compensation-First Report of Injury or Illness form

Employers must provide their insurer's phone number and Federal Employer Identification Number (FEIN) in this section.

Fair Credit Reporting Act

Enacted by Congress in 1970 to promote accuracy and privacy of personal information assembled by credit reporting agencies. The act requires reporting agencies to follow "reasonable procedures" to protect the confidentiality and privacy of personal information.

Gramm-Leach-Bliley Act of 1999 (GLB)

Enacted by Congress to protect the security and confidentiality of customers of financial institutions such as banks, securities firms, insurers, etc.

Fair approach to claims evaluation

Evaluate claims as if no coverage limit existed.

Preponderance of evidence

Evidence supporting the jury's decision that is of greater weight than the evidence against it.

Who is required to provide SUO under the ISO form?

Insureds.

Lose-lose negotiation style

Focuses on fast claim resolution. Should be avoided by CEs to avoid any inequity and potential bad faith claims.

Specialty Reporting

Helps deter the theft of high-value property such as mobile equipment.

Liability based on statute

In some states, no-fault laws were enacted to reduce the number of lawsuits resulting from auto accidents.

Loss Ratio

Incurred losses divided by earned premium.

Opportunity fraud

Inflating claim after legitimate loss.

Four major purposes of claim communications

Investigation, evaluation, negotiation and resolution

Appeal after loss in state trial court

Losing party would first appeal the decision to an intermediate state appellate court.

Regulation of insurers' claim settlement practices

Many states base their unfair claims settlement practices laws on Model Act, but not all of them.

Reporting of fire losses

Many states require insurers to report fire losses to their state fire marshals.

Emotional Stress Damages

May be awarded as part of compensatory damages in states that regard bad faith as a tort.

Special Damages

Monetary award for specific, out of pocket expenses incurred because of a loss.

General Damages

Monetary awards to compensate a victim for losses such as pain and suffering that do not involve specific measurable expenses.

What kind of notice is required by WC&EL policy?

Notice from ER/insured to the insurer.

ACORD General Liability Loss Notice

On the ACORD Loss Notice, a type of liability heading is premises.

Representational documents

Photographs, maps, diagrams, and video footage that are useful as a means to document evidence for a file.

Motion in Limine

Pretrial request that certain evidence be excluded from the trial.

Voir Dire

Process of examining jurors

CE physical safety during property inspection

Protective gloves, disposable dust mask, and protective glasses.

What does the litigation process begin with?

Receipt of the summons and complaint

Win-win negotiation style

Requires assertiveness and cooperation. Demonstrates an interest in resolving the claim to the claimant's satisfaction and building rapport with the claimant.

How is payment of interest factored into bad-faith claims?

Some courts have found that insured that pay excess judgments have been deprived of the money, while the insurer has had use of the money to earn interest.

Allegations

Specify what the plaintiff expects to prove to obtain a judgment against the defendant. Cause of action is the set of facts that make up the grounds for the lawsuit.

People who handle claims

Staff claim representatives, independent adjustors, EEs of TPAs, or producers who sell policies to insureds.

What is a defense to bad-faith claim?

Statutes of limitations that apply to a particular lawsuit can vary by state.

Ethical and professional conduct of CEs benefits insurers how?

Such conduct will typically retain customers and attract investors.

Actuary

Supply information required to calculate insurance rates, develop rating plans, and estimate loss reserves.

Contractual Damages

The amount payable under the contract according to the contract's terms.

Crisis Phase of Claim Negotiation Process

The claimant deals with the immediacy of the loss and wants to settle the claim quickly.

Information to include on diagram of accident scene

The date, time, and location, the date of the accident and the person that made the diagram.

Defenses to a bad-faith claim

The defenses include statutes of limitations, lack of right to sue (lack of standing), reliance on lawyers' advice, insured's collusion with the claimant, debatable reasonable basis, statutory defenses, fair dealing and good documentation, comparative bad faith, and contributory negligence.

Venue

The locale in which a lawsuit may be brought.

Stare Decisis

The principle the lower courts should follow precedents set by higher courts.

Decoding

The process by which a receiver interprets a sender's message.

Sarbanes-Oxley Act

This act requires publicly traded companies to meet and certify certain financial disclosure requirements.

Courts hold insurers to higher standard of conduct

To discourage them from abusing their position of power. Insurers create the contract and are in a superior position of knowledge and power.

Recorded Statements

Type of sworn statement available to a CE during the investigation phase of a claim. In workers comp and commercial general liability, recorded statements are sometimes the only type of sworn statement available.

Attorney billable hours daily max

Unless there is a compelling reason, most attorneys should not bill for more than 10 hours per day.

Industry code field

Used by the CE to determine whether the insured misrepresented their business as compared to the business activities indicated in the accident description.

Business rule engines

Used to analyze claims for fraud indicators or coverage issues in order to refer the claim.

Nonwaiver agreements

Used when CE is concerned about investigating a claim, before the insured has substantially complied with policy conditions, or when there appears to be a specific coverage problem or defense. Both parties must sign the agreement.

Comparative bad faith

When an insured is part of the process that delays claim payment, usually due to a lack of cooperation on the insured's part.

False Claim

When an insured pursues a claim for property damage or injury that has not actually occurred.

Cross-claim

When defendant files a lawsuit against other defendants in a claim.

Third-Party Bad Faith Suit

When the insured sues his or her insurer for bad faith in handling a claim brought by another person against the insured.

Why would a court adjust damages awarded by a jury?

When the jury awards an extraordinarily high judgment that is disproportionate to the damages.

Tort

Wrongful act or omission, other than breach of contract, that violates a person's rights and might lead to a civil lawsuit for damages.

coverage analysis

process of examining a policy by reviewing its component parts and applying them to the facts of a claim.