Could Increasing Car Insurance PIP Costs Lead To Injury Claim Denials?

The roads have seemingly been getting safer over the past few years as car manufacturers build safer vehicles, road/civic design becomes more advanced, and driver education becomes more effective. This has led to a downward trend in car accident and personal injury claims against insurance companies.

The insurance companies love this because this means more profit (god forbid they lower their rates as a result). However, this trend may be changing. New findings from an Insurance Research Council (IRC) study of auto injury claim trends indicate that the costs associated with auto insurance injury claims have begun to inch their way up nationwide.

Any surge, however insignificant, not only could mean an adjustment in rates in order to shore up shareholder growth expectations, but it could mean an increase in tactics used by auto insurance companies to avoid or outright deny personal injury protection (PIP) claims.

Surge in Claims or Costs?

The report called “Trends in Auto Injury Claims, 2011 Edition,” documents automobile personal injury claims by state, using private passenger auto claim data from national and state-level statistical reporting agencies. They then review the data and give both national trends, but also predictive synopsis.

You see, even though the average cost of injury claims has been increasing steadily in the last several years, the number of claims has actually stayed steady. This has produced relatively stable personal injury claim cost projection per insured vehicle. However, the study data shows that on a national basis, the claims show no sign of decreasing like they had been in the past few years.

Still, this has caused the insurance companies to fear higher costs overall. PIP claim costs per insured vehicle increased more than 18% from 2008 to 2010 according to the report. In fact, 2010 marked the first year since 1994 that bodily injury (BI) claim frequency did not decline and this extended into 2011.

“These are not encouraging findings for insurers or drivers,” said Elizabeth Sprinkel, senior vice president of The Institutes. “While we hope these findings represent temporary conditions, we can’t be sure that is the case and can’t afford to ignore the factors driving rising claim costs.”

Methods of Avoidance

Insurance companies are particularly adept to keeping their costs low and their profits high. They do this by influencing legislation through robust political contributions to using marketing tactics to shame consumers into thinking that they are in some way taking advantage of the system by claiming what is rightfully (and contractually) theirs.

Insurance companies often send representatives to hospitals to speak to injured individuals, contact family members, and use other nefarious methods to discourage claims or encourage fast settlements far below what is needed or fair. This is all done in the name of profit. We encourage victims NOT TO SIGN ANYTHING unless legal council is present.

Some methods of claim avoidance that may require you to retain legal council are:

Delayed Claims – This is a method in which the insurance company makes the process so long and tedious that the claimant forgets details, becomes disorganized, and frustrated (perhaps to the point of yelling). This allows the company to further delay or reject the claim on basis that is unrelated to the incident itself.

Long Review Periods – This is part of the delay process, but could result in claims that go to overloaded committees that could have a stockpile of hundreds (or thousands) of cases, yet, these committees have a limited review period and only meet a few times per month.

Police Report Disputes – The company can disagree with the police report and use these disputes to deny a claim. Without experienced legal council on your side this is very hard to reconcile.

Customer Service and Paperwork – Paperwork and the runaround by customer service agents is another way of frustrating claimants into just giving up. Who cares if they lose your business? It saves them money in the long run and the insurance company you threaten to go to may actually be owned by the insurance company you just left.

Many consumers don’t experience these problems for base claims that don’t result in injuries. Once these become PIP claims the costs spike. Injury claims then fall into a whole different category of treatment.

Insurance companies are not in the business of paying out on claims. If they were, the insurance industry in America wouldn’t be one of the largest industries in the world whose annual profits eclipse the GDP of most third world countries.

Puget Sound Personal Injury Attorney

All in all, the answer to the question above is “yes,” the insurance companies could very well use the increased PIP costs to justify denying victims in need from the insurance that is rightly theirs. Though it shouldn’t be required, sometimes an injured party and their loved ones need an experienced legal advocate on their side to expedite the process and circumvent the blatant red tape set in place to discourage victims from seeking compensation they deserve.

If you or someone you know has been injured in a car accident anywhere in Washington state, you need a skilled lawyer to deal with the insurance companies to assure you the best settlement. Call the Seattle car accident attorneys at Phillips Law Firm for a free consultation.

Real People. Real Justice. (800) 708-6000