Zalma on Insurance
A community created by Barry Zalma, Esq., CFE and ClaimSchool, Inc. to help create a community of insurance professionals dedicated to excellence in claims handling.
Zalma on Insurancewill provide materials on insurance, insurance claims, insurance law and insurance fraud. Some material presented will be free and there will be special publications for subscribers.
A source for the insurance claims person to become an insurance claims professional who can provide excellence in claims handling to the insurance buying public.
The Professional Claims Handler
In search of profit, insurers have decimated their professional claims staff. They laid off experienced personnel and replaced them with young, untrained, unprepared people. A virtual clerk replaced the old professional claims handler. Process and computers replaced hands-on human skill and judgment. Money was saved by paying lower salaries. Within three months of firing the experienced claims people gross profit increased.The promises made by an insurance policy are kept by the professional claims person. Keeping a professional claims staff dedicated to excellence in claims handling is cost-effective over long periods of time. A professional and experienced adjuster will save the insurer millions by resolving disputes, paying claims owed promptly and fairly, and by so doing avoiding litigation.
The professional claims person is an important part of the insurer’s defense against litigation by insureds against insurers for breach of contract and the tort of bad faith. Claims professionals resolve more claims for less money without the need for either party to involve counsel. A happy claimant satisfied with the results of his or her claim will never sue the insurer.
Incompetent or inadequate claims personnel force insureds and claimants to public insurance adjusters and lawyers. Every study performed on claims establishes that claims with an insured or claimant represented by counsel cost more to resolve than those where counsel is not involved. Prompt, effective, professional claims handling saves money for both the insured and the insurer and fulfills the promises made when the insurer sold the policy.
Insurers who believe they can handle first or third party claims with young, inexpensive, inexperienced and untrained claims handlers should be accosted by angry stockholders whose dividends have plummeted or will plummet as a result. When an insurer compromises on staff, profits, thin as they may have been previously, will move rapidly into negative territory. Tort and punitive damages will deplete reserves. Insurers will quickly question why they are writing insurance. Those who stay in the business of insurance will either adopt a program requiring excellence in claims handling from every member of their claims staff, or they will fail.
Insurance is a business. It must change—this time for the better—if it is to survive. It must rethink the firing of experienced claims staff and reductions in training to save “expense.” Insurers should, if they wish to succeed, adopt a program to promote excellence in claims handling that can help insurers keep the promises made by the insurance policy and avoid charges of breach of contract and the tort bad faith in both first and third party claims.
Insurers must understand that they cannot adequately fulfill the promises they make to their insureds and their obligations under fair claims practices acts without a professional, well trained and experienced claims staff. An insurer must work vigorously and intelligently to create a professional claims department or recognize it will lose its market and any hope of profit.
Insurance claims professionals are people who:
- can read and understand the insurance policies issued by the insurer.
- understand the promises made by the policy and their obligation, as an insurer’s claims staff, to fulfill the promises made.
- are competent investigators.
- have empathy, and recognize the difference between empathy and sympathy.
- understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
- understand how to repair damage to real and personal property and the value of the repairs or the property.
An insurer whose claims staff is made up of people who are less than professional will find itself the subject of multiple instances of expensive, counterproductive litigation.
Please respect the following community guidelines to maintain an enjoyable environment:
- Keep conversation respectful, without personal attacks
- Don’t blow up other members’ feeds. If someone isn’t responding to you, let it be
- No pornography
- Keep out behavior that could be seen as trolling/spamming
- Relax, be yourself, and enjoy