Rights and Obligations - Yours
and Theirs
If we were to go into details and subtleties here you would probably
lose all interest in proceeding further, so let's try to keep this
simple. To begin with, you have the obligation to prove who is
responsible for your personal injury. Because this is a "comparative
negligence" state, YOU also have to prove that YOU were NOT guilty of
any negligence that may have contributed to you having sustained a
personal injury. Then YOU have the obligation to "mitigate" (minimize)
your damages and YOU have to prove your damages. Are you beginning to
see a pattern here?
Just within the scope of what is discussed here, there are a few
questions that could arise:
- What constitutes "comparative negligence"?
- How is negligence apportioned?
- What is "reasonable mitigation"?
- What constitutes proof of my damages?
These details and subtleties will not be discussed here. Remember . .
. we're trying to keep this simple. Suffice it to say, if any of these
questions become a part of your claim, GET PROFESSIONAL HELP!
If liability is clear (other party struck you from the rear while you
were legally stopped in traffic AND there is a police report to verify
these circumstances AND the other driver was cited AND you received no
citation AND you were wearing your seat belt at the time of the
accident) . . . if your injuries were obvious at the accident scene AND
the police accident report notes that you were injured . . . if the
insurance company for the other party quickly commits to paying for your
damaged vehicle AND puts you into a rental vehicle at no cost to you AND
acknowledges they may have to pay you for any reduction in resale value
of your vehicle after it has been repaired . . . if the adjuster advises
you of the insurance policy coverage limits up-front . . . if those
limits are sufficient to cover your expected damages (vehicle damage +
diminished resale + rental car costs + medical expenses + lost wages +
projected future medical expenses + "pain & sufferance" compensation
with NO expected residual disability) . . . AND you are comfortable
dealing with the insurance adjuster yourself, then you will PROBABLY not
need professional help. After all, some Personal Injury Claims
actually are simple and some insurance companies will actually
step-up, treat you with respect and pay what they owe. However, if your
situation does not meet ALL of the criteria specified above, we
suggest you consider talking with an Attorney.
Now that we have discussed your obligations, let us review the
obligations of the insurance company. This part is simple. Once you have
proven their insured is 100% liable for you damages and you have proven
your damages, then the other party's insurance company has an obligation
to protect the interests of THEIR INSURED by paying for your damages.
Did you notice that? THE OTHER PARTY'S INSURANCE COMPANY HAS NO
OBLIGATION TO YOU! Their obligation is to their own insured.
Go back to the top.
Understanding Adjusting
Techniques
In the opening text we touched on a form of "perverted logic" that
occasionally seems to be an underlying factor when consumers are
involved in dealings with the other party's insurance company. That
perverted logic manifests itself when the other party's insurance
company is rude and indifferent to you . . . almost as though they are
trying to drive you to an attorney. Well guess what . . . THEY
ARE! Let me take a stab at trying to explain why. First of all, if you
take this abuse you will wind up settling cheap and the insurance
company saves money. If you go to an unqualified attorney, there is a
better than average chance they will be able to force a cheap settlement
on you through that attorney. Again, the insurance company saves money.
If you get a qualified attorney they will have to pay full value to
settle your claim. Even then, there is benefit for the insurance company
AND the insurance industry in general. Every couple of years the
insurance industry tries to push some type of Insurance Reform Bill
through the Legislature. When they do, they point out how many consumers
hire attorneys to help them resolve their claims and it is these
"greedy" attorneys that are driving up the cost of auto insurance. The
insurance industry points their collective finger at personal injury
attorneys as being the reason why insurance companies keep raising their
auto insurance premium rates. Have you ever noticed that when you are
pointing your finger (your index finger) at somebody else . . . you have
at least three (3) more fingers pointing right back at YOU! Well, the
same rule holds true when insurance companies try to blame rising auto
insurance premiums on personal injury attorneys.
When insurance industry lobbyists fund campaigns, vacations and
employment opportunities, they can usually find legislators with
attentive EARS! Then, when the insurance industry tells their story, Bills start getting submitted to the Legislature. That's when
consumers, YOU and I, have a problem! When the insurance industry is
pushing for Insurance Reform Legislation, you can bet they're not doing
it to benefit consumers.
Now, do you see the logic in having insurance companies "drive"
consumers to seek the help of an attorney? We could go on and on
discussing the uncontrolled and unwarranted increases in auto insurance
premiums and the ways in which the auto insurance industry manipulates
the truth in an effort to deprive consumers of their rights, but then,
that is a separate matter that we will be addressing later on as this
web site grows and expands.
The recorded statement: Most insurance companies have now
gone to the practice of having their adjusters tape record their phone
conversations with you. By rights, the adjuster should let you know when
your conversation is being recorded. There are multiple reasons for
recording these conversations:
- The Adjuster needs to make a record of the facts related to how
the loss occurred. This will become a permanent part of their claim
file. You will be asked to provide self-identifying information,
such as your full name, date-of-birth, place of birth, Driver's
License # and Social Security #. With this information, the
insurance company will probably order a C.L.U.E. (Claims Loss
Underwriting Experience) Report and/or an Index Report. The C.L.U.E.
Report will tell the insurance company of any claims you may have
submitted to your own insurance company(s) in the past. The Index
Report will reveal any prior claims you may have submitted for a
Personal Injury Claim. The insurance company wants to know about
your prior insurance claims experiences which could impugn your
honesty.
- By asking key questions about the circumstances of the loss, you
may admit to something that would allow the insurance company to
either deny your claim or substantially reduce the benefits you
receive.
- The insurance company will want you to be as detailed as
possible in the recorded statement. Months later, when your memory
may have faded, you may be called upon to once again answer the same
set of questions. If you do not answer these questions exactly as
you did in the recorded statement, the insurance company may try to
make you look dishonest.
It is simply not practical to assume you will be able to avoid
providing a statement to the insurance company. If you are dealing with
your own insurance company, your cooperation is required by the policy.
If you are dealing with the other party's insurance company, the Rules
of Civil Procedure give them the right to interview and Examine you.
Since you are probably not going to be able to avoid giving a
statement, the next best thing is to be prepared for the statement. If
you are dealing with the other party's insurance company, as with a
Personal Injury Claim, we strongly suggest to provide your statement in
the company of (and with the guidance of) your own attorney. If you are
providing your statement without counsel, we suggest you review the
following guidelines:
- Answer the questions asked as briefly as possible without going
into extemporaneous detail.
- Unless you are 100% sure of the exactness of your answer,
qualify you answer(s) with terms like "about", "approximately", or
"as best as I can recall", etc. Or, if you do not know the answer to
a questions . . . simply say so!
- Avoid being specific as it relates to speed, time and distance.
It is a simple matter of mathematics to take two of these factors
and calculate the third. If you are specific in any of these two
factors and you are wrong, then a wrong conclusion could be reached
which could work against you.
Believe me, insurance companies have
"helped" other people shoot themselves in their own foot before. You
would not be the first. Even honest people can become entrapped into
a compromising position. If your insurance claim involves a
"significant loss" - SEEK PROFESSIONAL COUNSEL BEFORE GIVING A
STATEMENT !
The Wage and Medical Authorization: If you have a Personal
Injury Claim pending with either the other party's insurance company or
your own insurance company (Uninsured Motorist, Underinsured Motorist or
Med-Pay Coverage), you will probably be asked to sign a "Wage and
Medical Authorization" form. As nobody is supposed to be able to access
your medical and/or employment records without your permission, it seems
reasonable to sign this form. WARNING: By signing this form, you
are usually allowing the insurance company to go on a "fishing
expedition" in search of any reason to not pay all or any part of your
claim. If your claim is with your own insurance company you have an
"obligation to cooperate", as specified in your Insurance Policy
Contract. However, cooperation can be achieved without giving carte
blanche to your insurance company. It is usually better to provide an
authorization with limitations as to scope of access. A good Personal
Injury Attorney will know how to limit this authorization, so as to
protect your rights and limit what records your insurance company can
access. If your claim is against the other party's insurance company,
you have no obligation to provide a wage and medical authorization to
them. You will have to provide them with legitimate information upon
which they can base their evaluation of your Personal Injury Claim.
However, by having that information come through you or your Personal
Injury Attorney, you are able to address any potential problems before
they can be distorted and used against you. It is always best to be able
to work with the insurance company. It is never prudent to surrender
control of your claim to the insurance company. As is often the case, we
recommend that you SEEK PROFESSIONAL COUNSEL BEFORE GIVING AN
AUTHORIZATION!
This portion of "Understanding Adjusting Techniques" primarily
addresses Personal Injury Claims. After all, that is the topic of
this page. Other adjusting techniques involving Auto Damage, Rental
Reimbursement and Medical Claims are also discussed within this page and
within other pages of this Web site. We suggest you take the time to
read ALL of the text in ALL the Consumer Tips / FAQs pages. Only good
things can come from being an informed consumer!
Go back to the top.
Resolving Your Auto Damage
Claim
Most of what you need to know about this subject has already been
posted in the Auto Insurance Claims page. We suggest you review that text. Information that we feel is
important enough to be repeated here has to do with the Post-Repair
Reduction in Resale Value of your damaged vehicle (Diminished Resale).
It is usually in your best interests if you have your own Auto Insurance
Collision Coverage cover the repairs and/or total loss settlement of
your damaged vehicle. We say this for two (2) primary reasons:
- In the event your vehicle is a Total Loss, your own policy
provides you the right to challenge the settlement proposed by your
insurance company in a timely and cost effective manner. This
procedure is outlined in the Appraisal Clause of your own policy and
discussed in further detail in the Auto
Insurance Claims page in paragraphs #10 & #11. In most states,
your auto insurance premiums can not be increased for claims which
do not involve your own negligence, so you don't have to worry about
preserving your future auto insurance premium rates.
- If your vehicle damage is economically reparable, the other
insurance company may well pay you for that expense with a draft (or
check) which includes "release" verbiage which could compromise your
right to pursue a Post-Repair Diminished Resale Claim. Also, if the
other insurance company has low limits of coverage available for
your Auto Damage Claim, payment for the repair of your damaged
vehicle may exhaust those coverage limits leaving nothing left to
cover your Post-Repair Diminished Resale Claim.
Regardless of your will be paying to repair your auto damage, you may
have to deal with some adjusting techniques that we will Link you to
here. Insurance companies in general seem to like saving money by
requiring the repair shop to use either used parts or after-market parts
(non-factory imitation [non-OEM] parts). While the insurance company
does have the right to use LKQ Parts (Like Kind & Quality), there are
reasonable limitations to that right. Those limitations are discussed in
paragraph #4 of the Auto Insurance Claims page. We suggest you review that text. While you are there, we suggest
you take a few minutes to review the entire text of that page.
Go back to the top.
Resolving Your Rental Car Claim
If your vehicle is rendered inoperable because of the accident, your
first concern (after the health and well- being of you and your
passengers) will probably be finding substitute transportation.
Unfortunately, most insurance companies are not going to step up
immediately and put you into a rental vehicle. You will probably have to
use your own credit card to secure a rental vehicle until such time as
the other party's insurance company decides to accept responsibility for
this expense.
Hopefully you will have Rental Reimbursement Coverage on your own
auto insurance policy which will be available to you as a backup to what
the other party's insurance company is going to try to pay you. The
adjusting technique we will be discussing here is probably about the
most often employed by most insurance companies. The other party's
insurance company is going to try to limit what they reimburse you in
daily rental charges and will refuse to reimburse you any CDW (Collision
Damage Waiver) expense you may have incurred. It would not be unusual
for the other party's insurance adjuster to tell you "We only pay $15.00
per day (or some other arbitrary amount) for daily rental charges and we
do not pay CDW at all". That is so wrong and yet is so common. The insurance industry as a whole probably saves billions of
dollars annually with this one abusive adjusting technique. By case law
precedence, you are entitled to be reimbursed for reasonable costs
incurred in renting a temporary substitute vehicle that is comparable to
your damaged vehicle. If your damaged vehicle is a Buick Park Avenue,
you should not be reimbursed based upon the cost to rent a Geo Metro.
Yet, there will be insurance companies that will attempt to resolve your
rental reimbursement claim based upon their own ridiculous standards.
The other party's insurance company will also attempt to deny
reimbursement for CDW charges, saying that your own Collision Coverage
should transfer to the rental vehicle. Often times this is true, which
makes denial of coverage a non-issue. However, when your Collision
Coverage does not transfer, or when you do not have Collision Coverage
on your own vehicle, this denial of coverage needs to be challenged. You
should not have to assume a financial risk greater than that of driving
your own vehicle. If you accept less than full reimbursement for all
costs incurred in renting a temporary substitute vehicle, you can submit
your un-reimbursed expenses to your own insurance company for add'l
reimbursement under your own Rental Reimbursement coverage. However, if
the other party's insurance company is not going to reimburse you fully
for your rental expenses, you should consider this as a sample of how
you are going to be treated on the rest of your claim and SEEK
PROFESSIONAL HELP from a good attorney. You should consider your
treatment on your Rental Vehicle Claim as an early warning of how you
are going to be treated later on.
Go back to the top.
Resolving Your Lost Income
Claim
Once you have cleared the hurdles of proving liability and proving
your injuries, you must then prove those injuries kept you from earning
your living and for how long. A statement from a knowledgeable attending
physician is usually sufficient to document your inability to work and
for what period of time. If you can provide such documentation to the
other party's insurance adjuster, you would then be entitled to
reimbursement of your lost wages. You would then have to prove how much
income you have lost. A statement from your employer should do the job.
However, if you are self-employed, you may be required to submit
documentation much the same as you would if you were applying for a
loan. You are owed reimbursement of your net income (after taxes). Under
IRS code, the monies you receive from the insurance company are
classified as an indemnification and are not subject to income tax.
Go back to the top.
Selecting Your Health Care
Provider
The selection of a health care provider may well be even more
important than your selection of an attorney. A personal injury attorney
will be critical to your financial well being. But then, that's only
money. Your health care provider will impact your physical well being.
We happen to subscribe to the old adage that good health is worth more
than money!
If you have confidence in your primary care physician, they would
probably be a good place to start for a referral to a specialist to
address your specific injury for your post-emergency room care. If you
are in an HMO, you may wish to consider going outside their contracted
doctors for your specialized treatment, as your HMO will probably
complicate the handling of (and compromise the settlement you receive
for) your Personal Injury Claim.
If your injuries include internal injuries, broken bones, head
injuries and/or cosmetic reconstruction, you will need to be treated by
mainstream physicians such as MD's or osteopaths that are specialists in
their respective disciplines. However, once your injuries have been
isolated to soft tissue strain, we suggest you consider chiropractic or
physical therapy by a registered physical therapist under the
supervision of your attending M.D. or D.O. We have seen wonders achieved
by chiropractic and/or physical therapy in relieving pain, rebuilding
strength and restoring range of motion. The unfortunate part about
receiving chiropractic treatment without mainstream supervision is that
most insurance companies will not give full weight to the treatment
charges when they attempt to calculate your pain & suffering settlement.
We are not saying that is right. In fact, we are saying that is wrong.
However, that is the way it is.
In the selection of a health care provider, expertise and results
should always be your primary consideration. However, there is also a
secondary consideration. When it comes time to resolve your claim for
personal injury, you will want your health care provider to be able to
compose a narrative (a "medical legal") about your injury and treatment
that will leave no room for challenge by the insurance company. Just as
your treatment is critical to your physical well being, a good medical
legal is critical to your post-treatment financial well being.
Another important aspect of selecting a health care provider is that
provider's willingness to await payment until your claim is settled.
Health care providers who regularly work with accident victims are used
to awaiting payment. One thing you do not want to happen is to receive
relief in the back office, only to be aggravated by the front office. A
good, experienced health care provider will never allow this to become a
problem. Like most of us, your health care provider will want some
assurance that they will be paid for their services. This assurance
usually comes in the form of a settlement lien. This means that either
your attorney (if you have one) or the other party's insurance adjuster
will promise to pay the health care provider. Personally, I would rather
have my attorney dealing with my financial consequences than the
insurance adjuster for the other party's insurance company.
If you have a good attorney, follow their advice as to selection of a
health care provider. Even if you do not have an attorney, it would be a
good idea to contact one to get a referral to a good health care
provider. A good personal injury attorney will be happy to provide a
free consultation and point you in the right direction even if you
prefer to handle the claim yourself.
A final consideration (as discussed here) has to do with the scope of
treatment and the fees charged by your health care provider. More and
more insurance companies are implementing a procedure known as "peer
review". This is where a health care provider, employed by the insurance
company, reviews your treatment and charges. It is not unusual for the
in-house doctor at the insurance company to take exception to the scope
of your treatment and the charges there for. In fact, that is the whole
point of the Peer Review program. If the in-house doctor did not find
fault with your treatment or charges, there would soon be a new in-house
doctor. The whole Peer Review program is designed to imply you have
failed to meet your obligation to mitigate (minimize) your damages. FOR EXAMPLE: You actually incurred $5,000.00 in treatment expenses,
but the Peer Review says you should only have had $3,500.00 in
treatment. The insurance company will attempt to reduce your medical
expense reimbursement by $1,500.00 AND reduce your pain & suffering
settlement proportionately. It is important that your health care
provider be able to justify both the scope of your treatment AND the
charges incidental thereto. A good medical legal (as discussed above)
will help minimize the effects of a Peer Review evaluation. If you are
going to handle the Personal Injury Claim yourself, be prepared to deal
with the Peer Review obstacle that will be placed in front of you!
Remember, if you do not have an attorney representing you, the health
care provider will probably have a lien on your settlement for the full
amount of their bill. If you are unable to overcome the Peer Review
obstacle, your health care provider will be paid the full amount of
their bill, but the amount you collect will be substantially reduced.
You will better understand the true meaning of "substantially reduced"
when you read the Resolving your "pain & suffering" claim section coming up.
Go back to the top.
Resolving Your Medical Expense
Claim
As a consumer, this is where you may find some good news for a
change. In many states, you are allowed to submit your claim for medical
expenses to BOTH the other party's insurance company AND your own auto
insurance company (if you have "Auto Med-Pay" coverage on your policy).
This is euphemistically referred to as "double dipping". This means that
if you incurred $5,000.00 in treatment expense (for your auto accident
related injuries) and you have at least $5,000.00 of Med-Pay coverage on
your own auto policy, you can potentially collect that $5,000.00 from
your own insurance company AND the other party's insurance company. The
days of double dipping are numbered. Gradually, the auto insurance
companies are rewriting their policy verbiage to make their own Med-Pay
coverage subordinate (secondary) to ANY OTHER valid and collectible
insurance and/or are incorporating subrogation rights into the Med-Pay
coverage. This will effectively eliminate your right to collect twice
for the treatment expenses incurred. You need to review your auto
insurance policy (or have it reviewed by an expert) to determine whether
you have the right to double dip. Remember, your auto insurance company
cannot increase your premium rates for claims submitted which do not
involve negligence on your part. So, if you can collect twice, we
encourage you to do so.
Your own auto Med-Pay coverage notwithstanding, you are entitled to
recover from the other party's insurance company for all "reasonable"
expenses incurred for "reasonable" treatment of the injuries you
sustained in the auto accident. Again, this is assuming you have already
proven liability, proven injuries, proven expenses, and overcome the
Peer Review challenge. The amount you can recover is limited only by the
extent of coverage afforded by the other party's insurance policy.
If the insurance for the other party is not sufficient to cover your
medical expense AND an appropriate amount to cover your Pain & Suffering
settlement, you may have to turn to the Underinsured Motorist Coverage
of your own auto insurance policy and/or your own health insurance
coverage. If the other party were at fault in your accident, but had no
insurance, you would have to turn to the Uninsured Motorist Coverage of
your own auto insurance policy and/or your own health insurance
coverage. The difficulties of coordinating benefits from multiple
policies, ESPECIALLY HEALTH INSURANCE COVERAGE, can drive you nuts. If
your claim involves coordinating benefits from multiple policies, we
strongly encourage you to talk with a Personal Injury Attorney!
Go back to the top.
Resolving Your "Pain and
Suffering" Claim
Of all the subjects discussed in this page, this will probably be the
most popular. Of all the E-mail we receive from consumers around the
country, the overwhelming majority are asking "What is my claim worth?".
As you can see by what you have read above, there is no easy or standard
answer, only generalities. The major portion of most Personal Injury
Claims has to do with the Pain and Suffering Settlement, which is
directly related to the type of injury, the medical expenses incurred,
the add'l medical expenses projected, the extent of your recovery, and
the physical pain and suffering that is directly related thereto. There
is also the credibility of your injury and the expenses incurred to
address those injuries. To be perfectly blunt, there is no way we can be
specific in answering these questions over the Internet. In addition to
us knowing the actual expenses and/or financial damages you may have
incurred, we would also have to be familiar with the credibility of
those who have charged you for their services, as well as your own
credibility. This does not usually happen unless we can speak directly
with you . . . face-to-face is always best. However, you did not come to
this portion of this page to be told only the reasons why we could not
help you. You came here in search of some guidance.
Following is a general formula that could be used and could,
just as easily, be departed from based upon individual circumstances.
| |
Auto Damage Claim (100%) |
| |
Auto Diminished Resale Claim (repaired vehicles only) |
| |
Misc. property damage (personal property other than
vehicle) |
| |
Rental vehicle expenses (reasonable) |
| |
Medical expenses (reasonable) |
| |
Lost wages (reasonable) |
| + |
Pain & suffering allowance (1-3 times the medical
expense if fully recovered) |
| |
----------------------------------------------------------------------------- |
| |
Full value of claim |
REMEMBER: The above formula is simply a general rule of thumb
for most typical circumstances. The value of having a good personal
injury attorney is realized in defining what is "reasonable", as
referenced above and in the negotiation of your pain & suffering
allowance. By retaining a good Personal Injury Attorney, you can also
avoid the mistakes, pitfalls and stress of having to deal with the
insurance company yourself. How's that for a segway into the next
section of this page?
Go back to the top.
How and When to Select an
Attorney
If you believe the advertising attorneys you see on TV and/or in the
TV Guide, you'll want to call them on your cell phone from the accident
scene. However, as a general rule, I avoid dealing with any individual
that spends $1,000,000.00 a year to advertise on television (that is NOT
an exaggeration). We personally know of law firms that spend 2-3 times
that annually just to advertise on television.
I'm inclined to believe that anybody good does not have to spend a
lot of money to advertise. Their reputation brings in enough referrals
to keep them busy. However, there is an unfortunate side-effect of
having some law firms with massive advertising budgets. Some really good
personal injury attorneys are losing potential referrals to these large
advertising law firms. Consumers are going to advertising law firms
where their claim is actually handled by some clerk instead of an
attorney. If I'm going to pay to have an Attorney represent me . . . I
want an attorney to represent me!
If you believe the insurance adjuster, you don't need an attorney.
They will probably ask you something to the affect of "Why give away
part of your settlement if an attorney is not going to collect any more
than we are already willing to pay?". The unfortunate part of that
statement is that it is sometimes true. If you have your claim handled
by a clerk, the adjuster is probably right. Later on, when the claim
becomes difficult (after they have already gotten what they want out of
you), they will probably expect you to go to an advertising attorney and
the insurance company will expect to settle your claim for what they
were willing to pay all along. Remember when we discussed why an
insurance company may DRIVE you to an attorney in the understanding adjusting techniques portion of this page?
As for the "how" and "when" to select an attorney, let us address
these in reverse order. When? The sooner the better. If you have read
all the above text you'll understand why we make this recommendation. IF
you are going to get an attorney at all . . . THE SOONER THE BETTER! As
for the "how" . . . GET REFERRALS FROM SOURCES YOU CAN TRUST. You can
contact your State Bar Association for referrals. You can contact your
State Trial Lawyers Association for referrals. You can check with the
Better Business Bureau and the Bar Association for any records of
complaints on an attorney you may be considering. You can ask for
references from an attorney you may be considering have represent you.
Ask your potential attorney who will actually be handling your file, the
attorney or a clerk.
Go back to the top.
Conclusion
In this page we have attempted to make you more aware of what you may
be facing if you are involved in a Personal Injury Claim. If you choose
to represent yourself in the handling of your claim, we suggest you
print this text and keep a permanent record of what was discussed
herein. This could help in your dealings with the insurance company(s).
Even if you choose to have an attorney represent you, keep a copy of
this text to refer to when you are asking questions. After all, the more
intelligent questions you ask, the more you are going to understand
about the process in which you are involved. We hope the information on
this page helps you understand the process and avoid the problems!
