The medical authorization form: what it is and why you got one

Posted on April 21, 2010 by Insurance

A Medical Authorization Form is essentially a form asking for permission to obtain your medical records and bills directly from your healthcare providers following a car accident. Whether your claim is a Med Pay claim with your own insurance company or a Bodily Injury claim with the other driver’s insurance company, you will likely be asked to sign one. An authorization letter which accompanies the form (presented below from the other driver’s insurer) may look something like this:
Dear Mr. Jones,

Enclosed you will find an authorization form which you must sign and return to us as quickly as possible. This will allow us to obtain medical records from your treating health care providers and medical bills incurred as a result of your accident with our insured so we may evaluate your claim in a timely fashion. A return envelope is enclosed.

Thank you very much.

Sincerely,

Tom Stine, Adjuster

The adjuster needs to obtain copies of your doctor’s notes, the hospital records, prescriptions you may have been given, bills for treatment, and any other documentation related to your injuries in order to investigate your claim and to determine how much to offer you to settle it. In addition to medical documents, the insurance company may also ask you to sign an authorization allowing them to request your work records from your employer if you are claiming lost wages.

While an authorization saves you from having to collect this documentation from your healthcare providers yourself, keep in mind that insurance companies don’t do this to be helpful; they do it to get information about you!

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When you can’t resolve a dispute with your insurance company

Posted on April 21, 2010 by Insurance

Most insurance policies contain an “appraisal clause” which means that disputes between insurers and policyholders must be arbitrated (where a neutral party decides the outcome of the dispute) and not litigated (decided in a court of law). Basically, each party hires an appraiser to look at the claim and proposed settlement figures. If the appraisers can’t agree on a fair settlement of your claim, they will submit their differences to a neutral third appraiser (commonly known as an umpire), and a decision by any two of the three is usually binding upon the parties.

Costs. Although arbitration is less formal and usually less costly than litigation, it is not free. Each side pays the cost of its appraiser and splits the cost of the third appraiser, if there is one. Obviously, if the appraiser fees are more than what you were looking for from a settlement offer, the process isn’t worth your time. Therefore, consumers should analyze the difference between the settlement amount they are seeking and the amount offered to see if going through the process is financially sensible.

Other important points:
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When your car insurance claim is approved

Posted on April 21, 2010 by Insurance

What can you expect in settlement if your car accident insurance claim is approved? Part of the answer depends on whose insurance you are pursuing. If your claim is with your own insurance company, that is called a first party claim. If your claim is with the other driver’s insurance, it is called a third party claim. (See Auto Accident Insurance Claims: Making a Claim for Personal Injury & Property Damage with Your Own or Another Person’s Insurance Company.)

First Party Claim – A claim with your own insurance company

When you have filed a claim with your own insurance company for physical damage to your vehicle from a car accident (Collision Claim); from vandalism or another type of event under the comprehensive section of your policy (Comprehensive Claim); or for injuries sustained in a crash (Medical Payments Claim, or Med Pay); and if there are no problems with your coverage, your claim should be approved and paid. For collision or comprehensive damage, most insurers will pay the body or glass shop where you have your car repaired directly after they receive an estimate from the shop. Occasionally, although this doesn’t happen much any more, an adjuster will come to your home or work, write an estimate for the damage him or herself, and hand you a check right then and there to cover it.

If you have rental car coverage on your policy and your car must be in the shop for several days or weeks, the insurer will either arrange for a rental car for you with a company with whom they have a relationship, or tell you whom to call. There is usually a daily or weekly dollar limit and the insurer will pay the rental car company directly.

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Subrogation: what it is and how it works

Posted on April 21, 2010 by Insurance

Suppose you’re in a car accident and it is clearly not your fault. Your car is wrecked and your neck and back have been injured. You are covered for both the damage to your car and your personal injuries, and so you call your insurance company and they pay all of your expenses relating to the accident. Later, your insurance company, realizing that the other party at fault also has insurance that will cover the damages, seeks out reimbursement from that insurance company since its insured was actually at fault for the accident. This is called subrogation.

Subrogation refers to an insurance company seeking reimbursement from the person or entity legally responsible for an accident after the insurer has paid out money on behalf of its insured. The general rule is that, after paying your claim, your insurer is “subrogated” to the rights of your policy and can “step into your shoes” to go after or sue the negligent party on your behalf. Not all insurers subrogate for medical bills. If they do, it could be against the other driver’s insurance, but it could also be against your own separate health insurance policy or any other medical insurance that would cover your treatment.

Subrogation may also be employed when your insurer settles your collision claim for damage to your vehicle due to another driver’s negligence. Generally, your insurer will have you sign a subrogation release that assigns your right of recovery against the person responsible for your loss to them. Insurers may not stall settling your claim until they get paid from the person at fault. Subrogation usually occurs some time after the original claim is settled. Some insurers will include the deductible when they subrogate and you will get your deductible back when the other driver or their insurance company pays the subrogation claim.

What if the accident was your fault?

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When your car insurance claim is denied

Posted on April 21, 2010 by Insurance

There are many reasons a car accident claim can be denied, valid or not. If your car insurance claim was denied, take note of the reason(s) given in the insurance company’s denial letter. Then take out your insurance policy and begin reading. The denial could be an error based on a lack of complete information or misinformation. But it could also be a correct determination by the insurance company.

Some common reasons for denial are:

  • No car insurance coverage was purchased for the claim presented. For example, if you drive an older vehicle, you may carry only liability insurance and have no collision coverage because it is expensive. A claim under your policy for damage to your own vehicle will rightfully be denied.
  • You made an Uninsured Motorist Claim under your policy and it turns out the other party to the accident was insured.
  • You do not qualify as a named insured under the policy. For example, you are a teenager and you are specifically excluded under your parents’ policy because your parents do not expect you to drive their vehicle.
  • Your coverage has lapsed because you failed to pay your premium before the end of the grace period.
  • The amount of damage claimed exceeds your policy limits and the insurance company will not cover the excess.
  • You bought a new car and failed to notify the insurance company to add it to the policy within the specified time given in the policy.

If, after reading the insurance company’s reasons and reviewing your policy, you still believe coverage has been wrongfully denied, there are some steps you may take to try to remedy the situation. You have certain rights under your policy and under state law. Your insurance company has a duty to fairly and promptly settle your car accident insurance claim in good faith.

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What your options are when your car is totaled

Posted on April 21, 2010 by Insurance

If you have had an automobile accident, you will likely want to file an auto accident insurance claim with your own car insurance company, the other driver’s insurance company, or both. Once you make a claim, a Claims Adjuster, Insurance Adjuster, or Claims Representative will contact you. These are all different names for the same thing; this is the person who will get all of the information from you about your accident, determine if there is coverage under your policy, gather the facts, do the investigation to determine who was at fault, decide on the value of your auto accident insurance claim, and, if everything goes as planned, pay you. The process isn’t complicated, but if you’ve never gone through it before, there are some important things you need to know.
Whether it is your insurance company’s adjuster or the other driver’s, many of the questions asked and documents requested will be the same. They will want to know what happened, the people and vehicles involved, what was damaged, and if anyone was injured. They’ll want photos taken of your vehicle and an estimate for the damages, a copy of the police report if there is one, and contact information for any witnesses.

Some of the questions both insurance company adjusters will ask are:

  • What happened in the accident?
  • Where did it occur?
  • Who was driving?
  • Any passengers in the vehicle? Names/contact information/ages?
  • Was a policeman called to the scene? Did the officer prepare a report?
  • What vehicles were involved? Makes, models, years, colors, registered owners?
  • Were the vehicles damaged? What parts? Were the cars drivable?
  • Was anyone injured? Did anyone leave by ambulance?
  • Any witnesses? Contact information?
  • Does the other party have insurance? Insurance company name and contact information?

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When the adjuster’s settlement offer is too low

Posted on April 21, 2010 by Insurance

If you are referring to the adjuster’s opening offer, ninety-nine times out of a hundred, it will be too low. An insurance adjuster is given authority by her supervisor to settle a case within a dollar range, say $17,000 to $22,500. Why would she start anywhere but at or near the bottom of the range if her aim is to settle the case as cheaply as possible for her employer? For that reason, it is unwise to accept her first offer whether you think it’s too low or not.

Suppose you have no idea what the value of your case is and the adjuster makes an offer that gets you really excited—sounds like a lot of money! Chances are, it is still on the low end of her authorized range. Don’t jump at it. You can and should make a counter-demand for more.

Note that the lower the amount, the narrower the adjuster’s range is from lowest to highest. For example, if she’s offering you $1,200, it is likely that her range is from about $1,000 to about $2,500. If the offer is $5,000, her likely range is a little wider, say, from $5,000 to about $8,000. As the numbers go up, the range gets wider. A larger case with an offer of $17,000 may go up to $22,000 or so. Larger than that, an offer of $65,000 may go as high as $80,000.

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Settling your car insurance claim: how to write a demand letter

Posted on April 21, 2010 by Insurance

You don’t need to be a great writer to draft a demand letter. Setting out the necessary information to support your demand should be sufficient. CAUTION: If you are not confident that you can write the letter, you may want to consult a personal injury attorney.

Here is a sample demand letter in a fairly simple claim:

Dear Adjuster,

On October 15, 2010, my 2003 Honda Civic was struck by your insured, Joe Smith’s 2002 Volkswagen Jetta, at the corner of Elm and Main in Silver City when Mr. Smith ran a stop sign. His car’s front end hit my driver’s side door and left fender causing $3,500 in property damage, paid by your company. My seatbelt was on. The police report shows Mr. Smith was at fault. He received a ticket for running the stop sign.

An ambulance took me to Town Hospital’s emergency room where I was x-rayed and examined. My injuries were severe bruises to my upper body, left arm and left hip, and soft tissue damage to my neck and back. I was released from the hospital after several hours and sent home with instructions to stay in bed for a few days, use ice, wear a neck brace, and take Vicodin for pain and Flexiril to relax my muscles.

I stayed home from my job as a teacher for one week. I had follow-up treatment with my family physician, Dr. Harvey Stein, six days later. He told me to continue icing three times a day, and referred me to a physical therapist for my neck and back. I saw Julie Lyons, RPT, for 4 weeks, twice a week, and then for 4 more weeks, once a week. I am still doing the stretching and strengthening exercises at home. I’ve gone back to see Dr. Stein twice and have another appointment with him next week. I still have quite a bit of pain in my neck and back.

My medical bills totaled $3,450 as follows (Copies of bills attached):

  • Ambulance: $650;
  • Hospital E.R, x-rays, exam, neck brace: $490;
  • Dr. Stein: $225;
  • Julie Lyons, RPT: $1216;
  • Prescriptions: Flexeril, Vicodin: $219.

I have lost wages in the amount of $1000. (Documentation attached.)

As a result of the accident, I had to cancel reservations for a conference. The nonrefundable fee was $240. (Receipt attached.)

As a result of being hit by Mr. Smith’s car, I couldn’t take my children to school and back for a week. I hired someone to help with that for $75 (Receipt attached.) I also had to hire a cleaning person to take care of the house and I will continue to need someone as long as I have pain in my neck and back. So far, this has cost me $600. (Cancelled checks attached).

My special damages come to $5,365. My future damages may be another $1,500for medical bills and house cleaning.

I have had considerable pain and suffering as a result of this accident and continue to suffer from neck and back pain. I demand settlement of my claim in the amount of $25,000. Please respond to this demand with an offer to settle within 15 days.

Thank you.

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Making a demand or waiting for a car insurance offer

Posted on April 21, 2010 by Insurance

Whether you begin the claims process with a demand letter, or wait for an offer from the insurance company depends on your situation. People often have no idea what their claim is worth unless they consult with an attorney. However, if it’s a small case with minor injuries, low medical bills, no extenuating circumstances, you may not want an attorney to share in your small settlement. If you’re determined to handle it yourself, it’s probably better to allow the adjuster to evaluate it and make you an offer. Although the offer may be low, it will likely be on the low side of a reasonable range. You can always make a counter-demand for a higher figure. Provide the adjuster with all of the information she has requested, along with any other documentation that might affect the value of the claim, so she can make an offer based on your best evidence.

If, however, you have a general idea what your claim is worth, it would be prudent to draft a demand letter including all the relevant information and documentation (medical bills and reports, proof of lost wages, receipts for other expenses, etc.) and close with a demand for settlement and a time limit within which to respond.

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Online insurance policies and settling an auto accident claim

Posted on April 21, 2010 by Insurance

Generally speaking, negotiating settlements with an insurer is the same whether you purchased your policy from an agent or online. The largest insurers offering online policy purchasing , such as Geico, Progressive and esurance.com, have adjusters who will be assigned to you when making a claim and negotiating settlements. Online insurers generally have adjusters all over the country and may use outside adjusters to serve you. If you’re one of the few who still head down to your local insurance agent’s office to do this, buying a policy online might not be.

Buying insurance policies online is still a relatively new concept and admittedly, there are still kinks that need to be ironed out. As such, make sure that your insurance contract specifies how your insurer will handle claims, adjuster issues and settlements. Also, check out the insurer’s customer satisfaction ratings to see what kind of service others have received.

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