How Insurance Companies Calculate Injury Settlements
The vast majority of people come to our office with a sense of reservation. They recognize that they’re injured from an accident but they don’t want to “hurt” anyone by filing a lawsuit. Most of our clients tell us that they just want to be sure their medical bills and lost wages are covered and then a little something for the pain and suffering. The reality is, to an insurance company, your pain and suffering is nothing more than a logarithmic function set up in a computer system. The only way that computer system can calculate a number to give the adjuster is based on the information that is entered into the over ten thousand fields that the programs use to calculate “value”. In order to properly document a claim, a plaintiff needs to give the insurance adjuster the right information to ensure it is properly valued by the company’s computer program. Interestingly enough, most people don’t recognize how the program works and what generates “value” in the program.
The computer programs vary by insurance company. Colossus, the forerunner pioneered by Allstate in the 1990s and still used by the majority of automobile insurance carriers today, takes into consideration a wide assortment of elements when generating its calculation.
First, Colossus will determine the exact injuries complained of by the plaintiff, post-accident, and compare those complaints to the billing codes that doctors use to bill insurance for procedures that they perform. If you go to your physician and you do not disclose the pain in your left arm or the soreness in your shoulder then the computer program will not attribute future complaints to the accident nor account for these injuries in its analysis.
It is incredibly important for car accident victims to explain every pain they feel so that the medical professionals can diagnose all potential injuries resulting from the automobile accident. Many time victims will forget to mention headaches, numbness in fingers and toes, or dull pains. Every one of these pains can trigger potential diagnoses from the examining physician. Every injury is significant in these computer programs in generating a proper “value” for a given case.
Second, the way a physician documents injuries is important. For example, if a patient complains of pain radiating from their shoulder all the way to their hand, that pain exists in their shoulder, upper arm, forearm, wrist, and hand. Failing to document pain in all areas of the upper extremity can cause problems further down the line. Therefore, as important as it is for the patient to explain every pain they are experiencing, it is equally as important for physicians to document it properly and extensively.
Lastly with regards to documenting injuries, a patient’s medical history is absolutely necessary in every case. Many times the history can be beneficial to show that while there may have been injuries prior to the accident, those injuries have worsened or new injuries have appeared. Comparing post-accident MRIs with pre-accident MRIs can show where new herniation or injuries have occurred as a direct result of the accident. Even when the history shows similar injuries, in order to eliminate problems in the future and practice law ethically, the history must be provided to the examining physician and the adjuster on a case.
Many physicians either refuse to, or delay ordering MRIs in automobile accident cases. This can cause a problem in valuing a case. Colossus, and adjusters, need MRIs to value a case properly. Physicians that practice in automobile injury cases should make it a common practice to order MRIs as soon as possible not only for legal reasons, but also to ensure they are properly treating a client. This prevents a waste of a client’s personal injury protection on unneeded treatment which devalues a case in Colossus and in the minds of adjusters. An MRI early on shows that these injuries are causally related to the accident and document in black and white what the injuries are in combination with the victim’s complaints and the physicians documentation.
Benefit of An Attorney
As it turns out, the programs factor into the equation the presence of legal representation in a matter. In fact, the value of claims submitted by individuals are often exponentially less than those submitted through lawyers simply because the program assigns a higher value to a claim propounded by a lawyer. Consequently, the programs also rate individual lawyers and their track records.
Adjustments are made for lawyers who statistically settle cases for below value offers versus lawyers who statistically refuse to settle claims below value and file lawsuits, taking cases to trial if necessary. In other words, lawyers who just churn cases and accept the first offer they receive are discounted by the software program; while lawyers that have a reputation for fighting the good fight, filing lawsuits when necessary, and trying cases when necessary, they add value to a case.