Auto liability claims are a great way to get additional work and deployments as an independent adjuster.
In this article, I’d like to walk you through how to complete an auto liability claim as an independent adjuster step by step.
You can listen to an audio podcast on how to complete liability claims at the top of this article or read on.
What are Auto Liability Claims?
Most of us don’t understand liability claims. As a result we miss out on great work opportunities as independent adjusters. We understand auto damage, a car has damage, or property claims, a tree lands on a house, but what is a liability claim?
Even after 10+ years as an independent auto adjuster and auto damage appraiser I wasn’t sure what handling liability claims meant until I went through Tinecia Johnson’s Desk Auto Liability Certification course.
So let’s get down to the basic definition of liability.
Liability is the process of determining who is at fault or “liable” in an accident.
Example of an Auto Liability Claim
Think of it like this, two cars hit each other in the grocery store parking lot, now someone must determine who is at fault or liable.
Insurance adjusters at each insurance company must determine liability. This is where independent adjusters are utilized to assist with the investigation or hired to make the liability decision.
The steps of how to conduct a liability investigation is what we’ll walk you through in this article.
We’ll be addressing it from the aspect of you handling a claim as a desk/remote independent adjuster, but these steps are the same if you were doing it in the field.
The only difference would be if you had to go track down a lot of this information yourself rather than having it digitally delivered to yourself.
The Steps to Complete an Auto Liability Claim
At IA Path, we’ve created a roadmap, a path, that shows an independent adjuster the steps to complete an auto liability claim.
We call it the Liability Adjuster’s Path.
The 12 steps to complete an auto liability claim as an independent adjuster are,
- Review the Claim & Coverages
- Review/Obtain Statements
- Obtain & Review Police Report
- Review Damage Estimate & Photos
- Determine What Duty Was Owed By Each Driver
- Determine What Duty Was Breached By Each Driver
- Determine Who Had the Right of Way
- Determine Who Had Possession of the Roadway
- Write Up Your Liability Decision/Report
- Complete the Exchange of Information With Other Party
- Bargain and Negotiate Final Decision/Settlement
- Close the File and Settle the Claim
Let’s review each step in a little bit of detail.
Phase 1 of an Auto Liability Claim: Gather Documents
Step 1: Review Coverages
An important job for an adjuster in any claim is to review the insurance policy and determine if the claim is even covered.
This is where you’ll start. You don’t want to get far into an investigation to find out later it isn’t even a covered loss.
Step 2: Review/Obtain Statements
Having a conversation with the drivers of the vehicle often uncover key details that you will use to determine and justify your liability decision.
You’ll need to get a statement from each person involved for your investigation.
Step 3: Obtain & Review Police Report
If a police report was made at the time of the loss it can be a key piece of evidence in your investigation.
Just because a police officer gives someone a ticket doesn’t mean they are liable! Knowing how to interpret the information and use it in your investigation is critical.
Step 4: Review Damage Estimate & Photos
When a vehicle is damaged an estimate is written based on the damages and inform the insurance company of the cost to repair.
This informs the liability adjuster on where the damages occurred and provides further evidence in the investigation.
MILESTONE: Prepped for determining liability!
This wraps up the Gather Documents phase so you can go through the process of determining who is liable on the claim.
Phase 2 of an Auto Liability Claim: Determine Liability
Step 5: Determine What Duty is Owed By Each Driver
When you are driving a vehicle you have a duty to drive safe and according to the written and unwritten laws of the roadway.
As a liability adjuster you must understand how to research these laws and determine what each driver owned the other at the time of the loss.
Step 6: Determine What Duty Was Breached By Each Driver
When an accident occurs there is at least one way that the duty that was owed and the trust given each other was breached or broken.
A liability adjuster must figure that out and unwrap the ball of yarn to determine what driver(s) breached that trust.,
Step 7: Determine Who Had the Right of Way
All this he said, she said, they did, they didn’t gets confusing, but a way to clear up the confusion is to determine who had the right of way on the road.
Figuring this out is a key step in the liability decision.
Step 8: Determine Who Had Possession of the Roadway
Who was established in the lane or had possession of the roadway is another factor in the liability decision.
Did someone just turn or were they on the road for the past 4 miles? It all matters!
Step 9: Write Up Your Liability Decision/Report
This is the hardest part, making a decision and justifying that decision based on the evidence you’ve gathered and information you’ve learned.
You had to stand behind your decision with confidence.
MILESTONE: Made a Liability Decision!
It is at this point in a complex liability investigation that you’ll need to determine who is liability and to what degree!
Did you know more than one person can be at fault? If so, to what percentages?
You’ve decided all that and that is your liability decision!
For many adjusters the liability claim process ends there, for others the claim continues on.
Phase #3 of an Auto Liability Claim: Pre-subrogation
Step 10: Complete the Exchange of Information With Other Party
When another insurance company is involved and there is a split liability decision there are conversations that must take place.
Explaining why the decision was made and providing that information.
Step 11: Bargain and Negotiate Final Decision/Settlement
There are times when pushback will happen and you’ll be required to negotiate and settle a decision based on your discussion with the other carriers adjuster.
Step 12: Close the File and Settle the Claim
When everything is agreed upon it is your job to properly close the claim and issue a final decision/payment.
MILESTONE: Settlement
You’ve completed the claim and finished the settlement!
Phase 4 of an Auto Liability Claim: Subrogation
As independent adjusters we typically don’t go into full subrogation. (also known as subro)
Subrogation is where one insurance company pursues payment from another insurance company on a liability claim.
This is typically handled by a specialty team.
Online Training for Auto Liability Claims
Alright, now you know the steps to complete an auto liability claim.
Question is, do you want to handle those types of claims?
Do you want to know more about how to complete each of these steps?
Do you wish you could offer being an independent liability adjuster as a service to your customers, the IA Firms?
IA Path’s Desk Auto Liability Adjuster Certification teaches you how to handle the first three phases of an auto liability claim.
When you earn the IA Path Desk Auto Liability Certification we connect you with IA Firms that deploy independent adjusters on virtual and office positions.
We only do this certification a handful of times a year, so click HERE if interested.
