How Does Insurance Adjuster Determine Amount To Offer At Start of Negotiations?

Each claimant must decide how to proceed, after learning the size of the adjuster’s initial offer. Consequently, it helps to know how adjusters arrive at the amount to offer, when making that first bid.

Steps taken by adjuster that has been assigned a given claim:

Hear the story from the mouth of the insured policyholder, the person that was alleged to have caused the accident. Study the police report or the accident report. It becomes important for the personal injury lawyer in Wilmette to check the insurance company’s claim database. That would reveal whether or not the same claimant had submitted other claims in the past.

Request documents: the plaintiff’s medical bills, the proof of the plaintiff’s earnings, the past tax return for the plaintiff, and proof of property damage. The adjuster’s failure to receive the requested documents could lead to a delay in negotiation process.

The questions that adjusters consider, after completing the initial steps

What would be the claimant’s chances for winning, if this case were to proceed to the litigation stage?

What sort of damage award might a jury grant to this particular plaintiff?

In order to answer that second question, an adjuster could use one of several methods, for assigning an estimated value to the assigned case.

Some adjusters plug a certain value into a formula. That value is usually a number between 1.5 and 5. That number becomes one factor in a multiplication operation. The product then represents the estimated value.

An adjuster’s approach might entail using a per diem method. In that case, the costs faced daily by the plaintiff would become a factor in a different equation, one where the other factor was the plaintiff’s costs per diem. An alternative approach might call for utilization of a computer program.

How would an adjuster make use of the estimated value, the one obtained by using one of the available formulas?

The adjuster’s supervisor would get a chance to look at that estimated value. Supervisors at insurance companies tend to suggest an initial offer that is well below the case’s estimated value.

Once having obtained the supervisor’s suggested figure, the adjuster would check again, to see whether or not the claimant/future plaintiff had chosen to hire a lawyer. Claimants that do not have an attorney tend to receive a lower offer from the adjuster’s office. Those that do have an attorney tend to get a higher offer.

Adjusters’ experience has taught them how to deal with lawyers, at least during the initial stages of the negotiation process. At the final stage, a lawyer might create a challenge for the insurer. That challenge might consist of a refusal to settle, until the treating doctor had said that the plaintiff had reached the point of maximum medical improvement.

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