Cedric Stephens | Savvy claimant proves case, but compensation still delayed

QUESTION: My nightmare began on April 14, 2021. A vehicle driven by a young woman ran off the road on to the sidewalk and crashed into my vehicle, which was parked in front of my house. Her brother, who was summoned, asked me not to report the accident to the police. His sister would pay to fix my car. I reported the incident to the police the next day. Five days later, I had two repair estimates. The other driver decided to file a claim when she learned about the costs. By then, I had reported the accident to my insurers. I discovered afterwards that both vehicles were covered by the same company.

On April 20, my insurers confirmed receipt of my claim. On April 30, another rep told me that the third party had submitted her claim. However, she had not accepted liability. I submitted a video clip that showed how the collision occurred. Shortly afterwards, I got word that the third party had accepted liability. A private investigator found on May 11 that my statements about the cause of the accident were accurate. It is now August, and my claim remains unsettled. I am very frustrated and get the feeling that the company is trying to manipulate me and capitalise on my ignorance of the claims process.

– CW

RISKS & INSURANCE: The author of the email, which originally was nearly 1,000 words long and accompanied by 11 files, has earned many ‘big ups’ for the way she painstakingly presented her case. Had she included a copy of the video clip that recorded how the accident occurred, a copy of her policy and the receipt showing that the premium was paid, that information could have been used by an attorney to sue the insurer.

Most persons who have disputes with local insurers do not follow this example. As a result, they often find themselves at a disadvantage.

On August 7, I wrote to the president and CEO of the insurance company as follows: “CW has authorised me to share the contents of the email that she wrote me. I have carefully reviewed the documents that she sent me and can think of no-good reason why her claim has remained unsettled after such a long time, especially in a situation where Advantage General is the insurer of both vehicles and liability is not in question.

“I am sure that you are aware that the actions of your company, as described, violate the intent and spirit of the Financial Services Commission’s 2019 Market Conduct Guidelines, the foundational principles on which all insurance contracts are based, the doctrine of uberrima fides, and the company’s motto: ‘Our reliability is your peace of mind’.

“I plan to use my next Sunday Gleaner column, Risks & Insurance, to share CW’s experience with other insurance buyers generally and prospective customers of yours and would like to include your written response and comments to this complaint by Wednesday, August 11, to include in my proposed article.”

Insurer conduct

The FSC market conduct rules represent the minimum standards by which business must be conducted.

Insurers must:

1. Display high standards of integrity and fair dealing in the conduct of their business;

2. Act with due care, skill, and diligence when dealing with customers;

3. Have policies and processes in place to handle complaints in a timely, fair, and effective manner;

4. Have policies and processes in place to handle claims in a timely and fair manner;

5. Develop, execute, and maintain appropriate and up-to-date employee training policies, procedures, and training manuals that are approved by the board of directors;

6. Avoid any conflict of interest that may arise in their dealings;

7. Pay claims within 30 days when the following conditions have been satisfied: the insured event has been proved, the liability under the policy has been agreed, the amount payable by the insurer has been agreed, and the entitlement of the claimant to receive payment has been established;

8. Set out procedures for the handling of complaints.

On August 11, I received a response from Mark Thompson, president & CEO of Advantage General Insurance, which is reproduced in full, as follows:

“Upon a review of the history of Ms Williams’ claim, I am in total agreement that there was every reason for her claim to have been settled much earlier given the conclusion of our investigations following the third party’s acceptance of liability.

“We will therefore be issuing a full apology to Ms Williams to include an expression of our gratitude to her for allowing us to serve her and the opportunity to do better by her and our pool of customers. The apology will also include an offer of a 10 per cent discount on her unaffected premium should she renew with us as a measure of our commitment to improving our service to her. Her settlement has already been prepared for dispatch, and we will update you as soon as possible thereafter.

“We will in addition to the above, invite her to share her experience in person with the team and ensure that the learning from this experience forms a part of:

1. Disciplinary action for the members of the team who did not follow established protocols;

2. Refresher training for all staff; and

3. A review of our processes to identify any gaps that require urgent remediation.”

There is only one point of disagreement between Mr Thompson and me. The wording used in the third-party liability section of local motor policies does not require an insured or a third party (in this case, the policyholder and third party are insured by the same company) to admit liability as a pre-condition before making a claim payment. Such authority resides solely and exclusively with the insurer.

Payment to Ms Williams should have been made immediately the company’s representatives saw the video clip or no later than mid-May when the investigator visited Ms Williams. That said, well done, Mr Thompson.

Cedric E. Stephens provides independent information and advice about the management of risks and insurance. For free information or counsel, write to: aegis@flowja.com