After an injured victim has filed a personal injury claim with an insurance company, the insurer assigns that claim to one of the company’s adjusters. The adjuster must then work on determining the value of the submitted claim.
The adjuster studies the obligations that must be met by the insurance company
• Reimbursing the claimant for the medical expenses
• Payment of the lost income
• Compensation for any permanent disability or disfigurement
• Reimbursement for emotional damages, such as depression, anxiety and stress
• Compensation for loss of family, social or educational experiences
Two possible ways for determining value of injury
Per Diem: That entails assigning a dollar value to each day, starting with the day of the accident, and ending with a total recovery. The chosen value then gets multiplied by the number of days in the recovery period. The per Diem approach has 2 drawbacks.
–It can prove difficult to arrive at the endpoint.
–It can be hard to arrive at a dollar figure.
The second way entails utilization of a multiplier. The figure used as the multiplier should reflect the severity of the claimant’s injury. For a very serious injury, that figure would be 5 or more. For a minor injury it would be 1.5.
The adjuster gets the product when the multiplier is one factor and the total for the medical expenses is the other factor. That offers some guidance, regarding the initial offer, at the start of negotiations. The adjuster adds the lost income to the calculated product. If the result comes to more than the limit on the defendant’s policy, then the adjuster must stay below that limit.
Actions taken if calculated amount falls below the policy limits
The adjuster speaks with a superior, in order to learn what percentage of the calculated value should be used in the opening bid. Adjusters like to give themselves some “wiggle room,” during the negotiations. That is why the opening bid must be below the calculated value. As the negotiations proceed, the adjuster will offer a larger and larger bid.
Adjusters also reduce the size of the bid in accordance with the decisions made by the claimant. If the claimant has failed to hire a lawyer, then the adjuster’s opening offer could be quite low. It would be higher, if the claimant had hired a Personal Injury Lawyer in Barrie.
How should claimant respond to adjuster’s offer?
If that offer comes close to what the claimant had in mind as the lowest acceptable offer, then the figure in the claimant’s mind should be increased. If the adjuster provides sound reason for a low offer, then the figure in the claimant’s mind should be lowered. Of course, it would get raised during the negotiations.