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Get to know the insurance claims process

When filing an insurance claim related to an auto accident, medical bill, damage to your home or another situation, knowing about the claims process can help you receive the best settlement and protect your privacy.

mark-romanoMark Romano, a longtime executive for insurance companies including Allstate and an expert on insurance claims’ practices, now is director of insurance claims projects for the nonprofit Consumer Federation of America. Romano shares with how consumers can better understand and navigate the claims process.

What should people do when starting off the claims process?

Let’s assume it is a typical automobile accident claim. One thing they obviously have to do is to make sure that they keep excellent records. Take down everyone’s name, phone number and contact information. When you get to the point where the insurance company is making you an offer for the repair or total loss of your vehicle, don’t assume that you have to take that amount of money. You should do your own research. The more informed you are, the better off you are.

What are some ways to get educated?

If you need your car repaired, ask around and find out the best body shop. Don’t necessarily go wherever the insurance company is recommending you have it fixed. It might turn out that it’s a perfectly good repair shop. But on the other hand, if they’re recommending it, it’s probably a shop they’ve got some type of financial arrangement with that is going to save them some money. (If your car is totaled) do your research. Go to used car lots and a CarMax in your area. Determine the fair market value and don’t just take (the insurance carrier’s) word.

What privacy concerns do you have about the claims process?

I’ve got major privacy concerns. Say you get in an auto accident and you’ve got a bunch of medical bills. The insurance adjuster says to mail your medical bills and doctor’s reports. You mail all this stuff to a P.O. box, thinking that your private information is going to the insurance company. Well, it’s not.

Who is the information going to?

It’s going to a third-party vendor the insurance company has hired. … This goes on with several insurance carriers.

What happens to personal information?

The information is transmitted over to the insurance carrier (from the third-party vendor). Say the adjuster looks at your medical records and has some questions about the treatment. It is very possible the adjuster will send your medical records to a medical review service company. A lot of times, your medical bills are transmitted electronically to a foreign country (such as India, Jamaica and Mexico) to run through the system and determine whether the bills can be reduced. That’s just a sample of what goes on behind the scenes.

Have you noticed any changes in the time it takes to process a claim and the quality of how it’s handled?

Just about across the board, insurance carriers are all focused on trying to get out there immediately and make contact with the customer. Unfortunately, what I see happening is that after the initial contact occurs, it starts to go downhill. The process insurance carriers have developed has become so complicated.

If you have an auto accident claim, you very easily have three or more adjusters on the claim – one handling the damage to your vehicle, one handling your medical bills, one handling a car rental. Because of the economy over the last several years, these carriers have not been hiring a lot of employees. From what I have seen, caseloads have gone up. A lot of the adjusters are, frankly, overwhelmed with work.