Anatomy of a poorly handled claim

– J.L.R., Kingston 7.

HELPLINE: The third party’s insurer settled your claim a few weeks after this column wrote to their CEO. It is pleasing to know that I still have some influence even though the insurance industry – my most consistent critic – has now set up its own helpline.

Imitation is the sincerest form of flattery!

I am also very happy that you are satisfied with the offer of settlement, having waited nine months for what was really a very routine incident.

Your claim should have been settled within a few days, not months. The long delay reflects poorly on insurers, the authorities that regulate the industry and the mendacious, (with thanks to K.D. Knight), high-status, zero-integrity professional who drove the SUV. I’ll leave you to decide which party should get most of the blame.

An excerpt from the email that I sent to the third party’s insurer follows. Some details have been excluded. It is intended to give readers more insight into what took place in the parking lot, how the other driver conducted herself and, more importantly, what they can do to help themselves in situations that are similar to yours:

“The vehicle was under the control of J.L.R.’s husband. In his statement (he) reported that: ‘I drove into ‘X’ parking lot and parked approximately eight feet behind a brown sport utility vehicle on the right side of the parking lot. My wife exited the front passenger door and proceeded to the left back door to retrieve her belongings the SUV began to reverse. I immediately pressed and held the horn. The other vehicle continued to reverse and collided with my vehicle while it was still parked.”

“Your staff has been unable to arrange a site visit to recreate the collision due to scheduling conflicts between the other party and yourselves! Frankly, I find the long delay to be very disturbing, especially in light of the powers vested to your company under the provision of the Conduct of Third Party Claims Condition; the delay is not in keeping with the Market Conduct Guidelines on Best Practice for Motor Claims that were issued by the Financial Services Commission.

“The handling of this claim tarnishes your company’s brand. It will also result in an increase in its claims expenses since the estimate of repairs (copy attached with loss adjuster’s report) was prepared a few days after the collision.”

The third party insurer’s CEO wrote to me three days before Christmas. The main points made were that: “much to my chagrin (I) discovered that the claims negotiation process has been very protracted. Unreservedly, we have been tardy in resolving the issue by not being as decisive as we could have been. Our policy is not to offer excuses for sub-par performance but perhaps the reason for the lengthy delay was because our insured strongly refutes the third party’s claim, nevertheless I believe, a decision to either deny or pay the claim should not have taken nine months. Regrettably, we are obliged to make a last contact with our insured for a final bit of clarification before a final decision is made. We will endeavour to have this matter resolved in short order. Again we apologise for any inconvenience caused.”

The CEO has scored many brownie points with the apology. However, I do not agree with the company’s decision to “make a last contact” with their insured for “clarification”.

The first reason is that the loss adjuster, an independent professional, made a written statement on April 13, 2011, after he examined your vehicle. He stated that “the damage sustained to the left front section of the vehicle appears consistent with the accident related in the driver’s accident report statement.” Why were these comments ignored? Was he contacted to find out whether the damage could have occurred from the car striking the SUV?

Additionally, his conclusion lends support to your husband’s statement.

Finally, since your husband’s and the loss adjuster’s statements agree, would it not have been reasonable to infer that the third party was not telling the truth about what happened?

The Conduct of Third Party Claims Condition of motor policies gives insurers the absolute right to pay, refute or negotiate claims. Seeking “clarification” from the third party was a mere courtesy.

The bottom line: your claim was poorly handled.

■ Cedric E. Stephens provides independent information and free advice about the management of risks and insurance.
aegis@cwjamaica.com. SMS/text message to 812-7233