C111 Advanced Loss Adjusting Chapter 4 Automobile Injury Claims
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9) Who mandates automobile insurance policy wordings?
Automobile policy wordings are mandated by provincial law. In each province a different regime exists, but within that province the policy wording is standard.
10) Why are accident benefits referred to as "no-fault"?
No-Fault: accident benefits are payable to policyholders regardless of who is at fault.
11) What medical knowledge does a policy adjuster have to possess in order to assess automobile injury claims?
adjusters must understand associated medical terminology, the optimum course of treatment, the kind of limitations such injuries are likely to impose, and how long a person is likely to be affected by the injury under the circumstances. Adjusters must also be familiar with the basic schedule of coverage limits provided in the applicable province.
12) How are automobile injury victims compensated in your province? Who sells and administers automobile insurance policies? what does the basic coverage include? What rights does the injured party have?
Mandatory accident benefits coverage provides for medical payments for the insured and includes rehabilitation costs. Funeral expense benefits, disability income benefits including allowances for housekeeping costs, and death benefits are included in the basic coverage.
Automobile insurance in Manitoba is administered by the government. Private insurers compete for optional and excess coverages.
Injured parties do not have a right to sue for pain and suffering, and an insured does not have the right to sue for economic loss in excess of no-fault benefits.
13) Define "commuted value"
Commuted Value: is the amount that it would take today to pay off an accrued benefit that is due in the future.
14) When automobile accidents occur out of province, what arrangements must the adjuster determine?
When accidents happen out of province, the loss adjuster must determine what arrangements have been provided for the claim settlement. Between provinces reciprocal agreements outlining how claims are to be handled in place.
15) Why is it important for the adjuster to meet with the injured part as soon as possible after the claim has been filed?
The claim process for loss adjusters does not vary for automobile injury claims. It is once again very important to meet with the claimant as soon as possible to get details of the accident, of the injury, and of the claimant's activities and employment history. Once a 3rd party retains a lawyer it will be difficult to get any more information and the opportunity to reserve properly for the file will be lost.
16) For claims involving rehabilitation, what expenses will the insurance adjuster have to review? What are the steps in the rehabilitation process?
The adjuster may have to review original invoices for physiotherapy, medical aids, prosthetic devices, prescription drugs, chiropractic expenses, and dental treatments, to mention a few. The incurred expenses must be reasonable and necessary. Only expenses related to the accident injury are covered. Some treatments or drugs may be questionable and need an explanation as to why they should be included. It is useful to have a compendium of drug information.
The rehabilitation process generally needs a plan of action that may involve assessments, goal setting, planning, training, placement, and follow-up. Counseling and guidance might be needed. Any factors that may inhibit or slow recovery must be identified. Realistic goals should be set for the claimant's progress. Specific services and training may have to be arranged and special equipment may be required. In more serious cases the insured may need training to perform daily living activities. Some adjusters specialize in the delivery of accident benefits.
17) For claims of wage loss, what expenses will the insurance adjuster have to review?
For claims of lost wages(often referred to as weekly indemnity or weekly income payments) adjusters must confirm that the claimant was employed or falls within the definition of "employed" in the policy. Salary and wage details can be verified with the employer, as long as the claimant has provided the appropriate permission forms. Details of any other disability plans the insured is entitled to collect from should be noted.
18) What are the general criteria for collecting wage loss? What circumstances might the adjuster come across, and what are the rights of the insurers?
The criteria for collecting lost wages from the accident benefits coverage varies from province to province. The test generally states that the insured must be unable to perform the duties of their usual occupation or employment. After a set period of time, the test changes to stipulate an inability to do any occupation or employment for which the insured is reasonably suited. The adjuster needs the insured's family physician to provide documentation for the disability period in order to support claim for the time taken off work.
Adjusters may come across claimants whose disability periods are longer than those of claimants who have experienced comparable injuries. Insurers have the right to request an independent medical examination by a doctor of their choice. An adjuster may visit the injured party to assess their daily activity and the progress of the recovery. In extreme cases, a private investigator might be hired to do surveillance of the injured party, in order to validate the legitimacy of the disability.
19) How is the death benefit usually calculated? What documentation does the adjuster need and who should they rely on for obtaining a medical opinion regarding the death?
When an insured dies as a result of injuries received in an automobile accident, a death benefit is paid. The amount paid is usually based on the status of the insured in his or her household. Proof is needed in the form of a death certificate and reasonable documentation that death resulted from injuries received in the accident. A marriage certificate could be required, depending on conditions that existed in the insured's household. Funeral costs will be reimbursed up to the limit insured.
Usually the adjuster meets with the claimant to explain the benefits available and provide the necessary claims forms. The claimant needs to sign a medical authorization form to enable the adjuster to obtain reports from the doctor. The number of authorizations needed will depend on the seriousness of the accident. In some instances a medical report form could be left with the insured to be completed by the doctor.
20) How are damage amounts usually calculated?
Injury evaluation forms are used to calculate damage amounts.
21) Define insurance fraud and describe how governments discourage it.
Insurance Fraud: is a serious criminal offense under federal law punishable, upon conviction, for up to 10 years in prison.
Certain provincial insurance acts also include specific consequences for certain types of fraud.
Ex: Ontario, it is an offense under the Act to knowingly make a false misleading statement or representation to an insurer in connection with a person's entitlement to a benefit under a contract of insurance, or to willfully fail to inform the insurer of a material chance in circumstances within 14 days. The maximum fine upon conviction for such a crime is $100,000 for the first offense and up to $200,000 for any subsequent conviction. The Act also makes it a crime to make or use a false document with the intent that it be acted upon as a genuine. Insureds who submit documents in support of claims must be careful to ensure that the documents are legitimate. These laws offer some protection to insurers against accident benefits fraud.
22) Under what circumstances are outside experts brought in to evaluate, produce, and preserve evidence of cause and fault?
When a serious accident happens the possibility of subrogation is closely examined. Often, an expert is hired to produce and preserve evidence of cause and fault. The greater the value of a claim, the greater the justification for hiring an appropriate expert.
23) What information is included in a loss report?
a) Name and address of the insured
b) Driver's License
c) Policy Number
d) Date, time and place of the accident
e) Brief Description of the accident
f) Damage sustained by insured
g) Identification of the 3rd party
h) Names of witnesses, if any
i) Names of all parties who sustained injuries; which vehicle were they traveling in, if any.
j) Description of the accident
24) What type of benefits could be deducted from an automobile settlement in your province?
Insurers are entitled to deduct disability payments made under separate disability policies for claims made under uninsured motorist policy limits.
25) What is the effect of signing a settlement release?
Signing a settlement release signifies that the claimant is giving up rights they have now or may have in the future to make any further claim for the injury, whether or not their condition changes. However, accident benefit payments will not be affected if a claimant chooses not to sign a release.
26) What should the loss adjuster advise the claimant before signing the release?
In Ontario, when insurers have made lump-sum settlements, certain procedures must be followed in order to make the settlement final. A standard disclosure statement must be filed. The claimant is entitled to a 2-day cooling off period after a settlement release has been signed, and the claimant must be made aware of their rights to dispute the settlement. Insurers, having followed such procedures, are not required to provide a commuted value calculation to determine what the value is now of what would have been future benefits.
27) What is uninsured motorist coverage?
Uninsured Motorist Coverage allows insured's own policy to provide compensation if an injury is caused by an uninsured or unidentified vehicle. Physical damage to the vehicle, however, is only recovered if the other party is identified.
An insured is entitled to claim the amount legally recoverable from the uninsured or unidentified motorist. It may be that the unidentified vehicle did not make physical contact with the insured vehicle. In some cases corroboration from the other party involved in the accident is not possible, making it difficult to assess liability.
When the uninsured motorist is known, the adjuster must verify that insurance did not exist on vehicle. Coverage is limited to the minimum 3rd party liability policy requirements in each jurisdiction.
28) What coverage does a non-owned automobile policy provide?
The non-owned automobile policy is sold as an endorsement to the Commercial General Liability policy. The insuring agreement covers the liability imposed by law upon an insured arising from the use or operation of any automobile, that is not owned or licensed in the name of the insured, in the course of the insured's business. The coverage protects the insured when an at-fault vehicle is uninsured or when an at-fault vehicle is insured and the owner's policy carries a limit of liability that is insufficient to pay the loss. Defense costs for the insured are also covered.
The policy will respond to personal or vicarious liability imposed by law upon the insured. The typical exposure consists of drivers using their own vehicles on company business.
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