Insurance Claims

Insurance Claims
From Wikipedia

Finally,

insurance claims and loss handling is the materialized utility of insurance; it is the actual "product" paid for, though one hopes it will never need to be used. Insurance claims may be filed by insureds directly with the insurer or through brokers or agents. The insurer may require that the insurance claim be filed on its own proprietary forms, or may accept insurance claims on a standard industry form such as those produced by ACORD.

Insurance company claim departments employ a large number of insurance claims adjusters supported by a staff of records management and data entry clerks. Incoming insurance claims are classified based on severity and are assigned to adjusters whose settlement authority varies with their knowledge and experience. The adjuster undertakes a thorough investigation of each insurance claim, usually in close cooperation with the insured, determines its reasonable monetary value, and authorizes payment. Adjusting liability insurance claims is particularly difficult because there is a third party involved (the plaintiff who is suing the insured) who is under no contractual obligation to cooperate with the insurer and in fact may regard the insurer as a deep pocket. The adjuster must obtain legal counsel for the insured (either inside "house" counsel or outside "panel" counsel), monitor litigation that may take years to complete, and appear in person or over the telephone with settlement authority at a mandatory settlement conference when requested by the judge.

In managing the claims handling function, insurers seek to balance the elements of customer satisfaction, administrative handling expenses, and insurance claims overpayment leakages. As part of this balancing act, fraudulent

insurance practices are a major business risk that must be managed and overcome. Disputes between insurers and insureds over the validity of insurance claims or insurance claims handling practices occasionally escalate into litigation.