Valuation of Personal Injury Claims Not Always Strictly About the Numbers
A claimant bringing a personal injury claim on his own behalf typically has no idea what to expect. In most cases, it is the claimant‘s first experience with attempting to get payment from an insurer for injuries and other damages that the person has suffered due to the negligence of its insured.
Some claimants are surprised that the insurance adjuster doesn‘t believe that they are truly injured and accept their word as to the damages incurred and the negative impact that the injury has had on their lives. The reality of the case is that the insurance adjuster is trained to be skeptical and to question every fact.
Adjusters receive bonuses based on their level of skepticism and low payments that generally follow their evaluation and negotiation of a claim. Quite frankly, after defending every aspect of his or her treatment, time off work, inability to perform household tasks, the usual claimant tires and just wants to end the process, accepting whatever the adjuster‘s “final offer” may be.
Many insurance companies utilize a computer program known as “Collosus” that evaluates claims and determines the range of value for a particular claim. The computer program arrives at values for claims by comparing the data input by the adjuster with information relating to similar claims contained in its database. The information contained in the database is largely a summary of settlements and judgments for similar cases in the locale of the claim. It contains information regarding the impact that particular injuries have on an average person taking into consideration the severity of the injury, length of time of the usual recovery and usual cost of medical treatment for the particular injury. The adjusters attempt to resolve claims within the range of value determined by Collosus, preferably at the lower end. If the adjuster wants to exceed the value, most must get approval.
In theory, a program that calculates claims‘ values based on a significant amount of relevant information for the location in which the claimant resides could be helpful to adjusters. Similarly, both defense and plaintiff attorneys perform research regarding verdicts or settlements involving similar cases, preferably within their state, so as to assist in their own valuation of claims. An essential duty for an attorney is to provide his clients with a realistic outcome so that the client can make an informed decision regarding their case when faced with the question of acceptance or rejection of a settlement offer and whether to proceed to trial or not.
The difficulty with a program such as Collosus is that it does not take into consideration the impact that an injury has on an individual. Injuries affect people differently. One person may be particularly impacted by constant back pain and the limitations placed on their activities, while another person may not be seriously impacted. Some have a higher threshold for pain and some may not care that he or she has restrictions on what he can do physically. However, a person who exercised daily prior to an accident but can no longer go to the gym can be particularly affected, especially when exercise was a source of stress relief and enjoyment. A new mother with a baby is particularly impacted when she can no longer lift or carry her baby because of the aggravation of pain caused in her back.
When faced with an insurer that employs Collosus to value claims, it is extremely important for the claimant or his attorney, to provide information to the insurance adjuster that differentiates his claim from the “norm” and average value. By providing information that adds real value to a claim based on an individual‘s particular situation, Collosus can‘t be followed because the claim should no longer fit in the rubric of average. If the adjuster refuses to consider facts that distinguish the claim, the claimant then can choose to move forward with litigation knowing that a judge or jury will consider personal factors that impact an individual.
Every case, every insurer, and every adjuster are different. In all but the simplest and smallest cases, it is important to seek the guidance of an experienced personal injury attorney.
