Casualty insurers are facing a more difficult claims settlement environment as the number of claims with questionable factors is increasing. The National Insurance Crime Bureau is reporting that 2012 saw an increase of 26% in questionable claims. “Suspicious theft/loss (not vehicle)” had the highest increase in volume to 10,680 in 2012 from 7,152 reached in 2011. In 2012, the top five states generating the most questionable claims were: California (21,935), Florida (10,693), Texas (10,368), New York (9,059) and Maryland (4,296).
Our property title search report analysis has seen an increase in the percentage of subject properties with liens, judgments, or other distress factors. This may be leading to insureds creating claims or inflating legitimate claims. We are also discovering that properties with claims submitted are turning out to be not the parcel actually insured on the policy, once the legal description is identified.
In more favorable news, a court in New Jersey ruled that an insured is not entitled to reimbursement for fees paid to a public adjuster to negotiate a more favorable claims outcome. The insured moved to recover attorneys fees and the public adjuster fees, but the court denied the request. “Perley-Halladay’s motion for summary judgment is denied, and its motion for attorney’s fees and costs is denied.”
In the video which follows there are some suggestions on defending settlements from frivolous claims from private adjusters.