This varies from company to company.
In any insurance company, the person assigned to negotiate with injured people is usually referred to as an adjuster. He or she usually has some responsibility for evaluating the lawsuit – that is, for determining how much the company will pay – as well.
The adjuster’s superior is usually either a claims supervisor or an examiner. That person may – or may not – report to a claims superintendent.
The levels of supervision vary from company to company. Typically each position carries with it a certain level of “authority” – that is, the amount the person is authorized to pay for any given lawsuit.
For instance, adjusters might have authority to pay up to $25,000 in Insurance Company “A” on any one lawsuit; examiners $100,000.00; claims superintendents, $500,000.00. It varies from company to company, and sometimes from employee to employee.
Some companies will have a “claims committee” of adjusters and supervisors review claims at a meeting, and come to an agreement on how much to offer.
And sometimes, the insurance company contracts out the evaluation and negotiation of lawsuits to an independent adjustment firm – which might be one person, or might be a national company with local offices.
There are some services that evaluate cases depending on a number of variables. The service’s evaluation then may – or may not be – binding on the individual adjuster.
For example, “Colossus” is a software program that some insurance companies use to give their adjusters guidelines for settling cases.
Regardless, whether the evaluation is done by a software program or by a claims superintendent, the same factors come into play. Some of them are:
• age and sex of the victim,
• age and sex of the person who caused the accident,
• total of medical bills,
• total medical bills actually paid by the health insurer,
• total lost wages and other economic losses,
• how the accident happened,
• identity of the defendant (Is it a person or a corporation? What type of corporation is it?),
• the existence – or nonexistence – of a permanent disability resulting from the accident
• the validity of any defenses to liability (Were you speeding? Is there a legitimate argument over whether you ran the red light?)
But a lot of different things can also enter into the company’s evaluation of how much it will pay, and when.
Timing is a factor. The cost of prosecuting the lawsuit is a factor. If it will cost you $15,000 in expert and other expenses to try the case, the insurance company usually will pay less before you pay the spend the $15,000 to develop the case than after.
If suit is filed, the company will typically – but not necessarily – ask its lawyer for an evaluation. The lawyer’s evaluation may occur in a one minute phone conversation or a 7 page standardized form.
If the insurance company thinks they can get out of the case on a motion, you probably won’t get a decent offer until after the judge denies the motion.
Another timing issue is whether you think your case is getting better or worse. Some claims examiners are bothered by any unresolved injury – if it’s not all the way better, there is the possibility of more surgery, which will make the case worth more.
You are a factor. Will you “sell” well to a jury? Some people are just more appealing to a jury than others.
This usually turns into a question of what the other lawyer – who is usually the only person from the insurance company who gets to talk with you before trial – thinks of you.
Certain types of cases have a bigger potential than others. Most professionals will concede that a dog attack can have a greater potential jury award than a low impact rear-ender which results in the same injuries.
A visible scar is worth more than one that is usually concealed by clothing.
I personally think that a lawsuit by a pedestrian against the driver of a car is worth more than the lawsuit of a person who suffers identical injuries in a car-to-car crash.
No one knows exactly what the insurance company is thinking. But at the end of the day, the most important thing in maximizing your recovery – getting all the money you should – is emphasizing your willingness not to accept less than a fair settlement.
I have been a lawyer over 30 years. I am proud to say that I represent people, not insurance programs – but it helps to know why the insurance companies come to the evaluations they do. If you want to talk about how the insurance company values your lawsuit, speak with an experienced Injury Attorney – call me at 513-621-4775.
Because all situations are different, and because there may be other facts pertaining to your case that I don’t know about, you should not rely on this answer for legal advice. I am not your attorney, and no lawyer client relationship has been formed.