Product Update

Casualty Claims Management Discussion Updated in Risk Financing

This release of Risk Financing updates the discussion on casualty (liability and workers compensation) claims management.

While the best way to control losses is to avoid claims altogether, that is an unrealistic hurdle for most insureds. Instead, insureds can adopt strategies that promote the most favorable claims outcomes. The discussion on "Casualty Claims Management" addresses a number of the aspects of effective and efficient liability and workers compensation claims management. It is based on a discussion initially authored by Martin McGavin and Amy Pechacek. The discussion outlines some basic concepts, provides insight and advice for working with claims adjusters and outside defense counsel, and describes some important components of good claims handling including the following.

• Investigating incidents
• Determining compensability
• Managing litigation
• Communicating with claimants
• Controlling medical costs
• Claims settlement strategies
• Contesting claims

For a typical insured, as few as 5 percent of its claims may account for 80 percent or more of its total losses. The vast majority of the number of claims involve minor injuries or damage. However, when ineffectively managed, claims from seemingly minor incidents can result in significant losses. Accordingly, good claims management practices can have a major impact on an organization's overall costs.