How The Insurance Adjuster Arrives At The Initial Offer

After someone has filed a personal injury claim with an insurance company, the insurer gives the claimant’s file to a selected adjuster. The adjuster must prepare to take part in the process of negotiating with the claimant.

First the adjuster reviews the relevant documents

• The claimant’s medical bills
• The proof of earnings received by the claimant before the accident
• The proof of damage to any part of the claimant’s property

The adjuster’s next task involves a consideration of 2 questions:

What chance does the claimant have for winning at a trial?
What is the amount of money that seems likely to be awarded the plaintiff?

Then the adjuster must perform some calculations

• Add up all the costs that have an identifiable figure, such as the medical expenses and the claimant’s lost income.
• Put the calculated sum in a formula, or enter it in a software program. By completing either of those procedures, adjusters obtain a value for a given claimant’s pain and suffering.
• Add to that calculated value the figure that corresponds to the loss of income.
• That procedure should yield the value that can guide the adjuster’s effort to select an initial offer.

What other factors work to determine the amount of that initial offer?

Adjusters tend to increase the offer’s size, if the claimant has retained the services of a Personal Injury Lawyer in Ottawa. When claimants lack a lawyer’s support and guidance, the adjuster’s initial bid could be a low-ball figure. That is used as a way to test the claimant’s eagerness to settle the case.

How should a claimant respond to a low-ball figure at the start of negotiations?

Smart claimants contact the adjuster and ask for an explanation of that low figure. The same claimants listen carefully to the adjuster’s statement, and even take notes. Then, using those notes, the claimant prepares a letter, one that answers each of the points made during the phone call. Ideally, that letter pushes the adjuster to come forward with a more reasonable bid.

If that low-ball figure comes close to the amount that the claimant had viewed as the lowest acceptable offer, then the claimant’s view should change. In other words, he or she ought to increase the size for the amount of money that would be viewed as the lowest acceptable offer.

On the other hand, if the initial offer falls well above the claimant’s lowest acceptable amount, then that fact sends a different message. It indicates that the negotiations would go more smoothly if the claimant chose to see a higher figure as the lowest acceptable bid. Both sides want negotiations to go smoothly. In that way, there is less chance that the accepted process will lead to a roadblock.