by Attorney Mark Wolfe

Most people who have a personal injury claim from a car accident or a slip and fall have no idea how the insurance company analyzes that claim to determine how much money it should pay as compensation. Regrettably, many attorneys do not know this information either. This lack of knowledge often results in settlements that are not reflective of the full value of the claim.

There are two primary areas for evaluation and assessment of the value of a personal injury claim. These are liability and the injuries that are claimed to have been suffered. But before the adjuster begins the analysis of these two areas, the first thing to be determined is coverage. That is, was the at-fault party’s coverage in effect at the time of the incident and/or is the claim a “covered loss” under the policy.

If the claim is determined to be covered under the policy, the next step is to determine liability. That is was the insurance company’s customer responsible for the accident or the incident and are there any viable defenses to the liability claim such as contributory negligence by the claimant. If the claim can not be denied based upon the liability analysis then the next question for the insurance company to answer is “how much money should we pay on this claim?” This is where understanding the personal injury claim “valuation” process is critical for claimants and their attorneys!.

Every major insurance company that provides liability coverage to its customers now uses a Computer Assisted Claim Evaluation (CACE) program to assess and determine the “value” of a personal injury claim. Understanding how these programs work is critical in assuring full value for a claim. These programs have been around for over 30 years and are always being refined and “improved.” Data and information is input into the program and the program establishes a “value” for the claim. Every company has rules and guidelines for their adjusters on how much they can deviate from the CACE valuation. These programs can analyze and assess hundreds of data points. These data points are commonly called “value drivers” and they can either be positive, meaning higher value, or negative, meaning lower value. These value drivers are applied to pre-set parameters or concepts and can include hundreds of data points for consideration.

The most common and fundamental value drivers for a personal injury claim are the treating doctor’s diagnostic code(ICD) and treatment code (CPT). See: for a more detailed explanation of these codes. But these codes only establish a “baseline” for evaluation and many other value drivers are analyzed by CACE programs to arrive at a final evaluation. The following example will clarify how these value drivers work and how insurance companies are constantly refining these programs.

Medications are a common value driver that are factored into the value of an injury claim. The CACE program will have a standard or anticipated “normal” medication level and duration for the CPT codes for an injury. The “value” of pain medication for the CACE program works under the pre-set parameter that the stronger the medication and the longer it was taken the more pain the claimant must have experienced. Therefore “pain and suffering” values are often correlated to the medication and usage data input by the adjuster with the ICD and CPT codes. Recently more and more insurance companies have “disconnected” the automatic pain medication value driver for certain injuries nor are they giving credit for medication simply because a medication or prescription is referenced in the medical records. Many CACE programs now require an actual receipt for the medication before the adjuster can input the medication into the CACE program for pain and suffering consideration. The insurance company’s logic is that just because a pain medication was prescribed does not mean it was taken. And if there is no proof the prescription was filled then the program defaults to an assumption it was not taken and then the computer assumes the claimant was not hurt bad enough to need the medication and therefore no enhancement for “pain and suffering” in the final evaluation. Also for example, if a pain medication had two refills but there is no proof of a refill the CACE program assumes the claimant was no longer having significant pain complaints so as to require the refills. Therefore the valuation is reflective of this assumption.

There are many other value drivers that can positively or negatively effect the insurance company’s evaluation of a personal injury claim. Issues such as a delay in care or inconsistency of care are “red flag” value drivers that quickly push down the insurance company’s evaluation. Yet often these negative value drivers can be nullified or eliminated with simple documentation or information. Some value drivers are subjective and require an adjuster to input his or her opinion about the claimant. One such value driver is “Claimant Veracity.” Insurance companies have many different ways to input this information but many use a simple numerical rating scale. “On a sale of one to five, rate the claimant’s honesty.” A strong veracity rating is important especially since many adjusters are trained to believe most injury claimants are faking or exaggerating their injury for monetary gain. Therefore they are often quick to assign a lower veracity rating to a claimant. Again, there are several simple things a claimant can do to insure a high veracity rating for the adjuster and the CACE program.

These simple examples show how complex the proper presentation of an injury claim can be. These programs are often the reason legitimate injury victims are under compensated when they try to handle their claim without a lawyer. Even if the claimant has a lawyer, he or she can still be under compensated if the attorney is not aware of how these programs and the “value drivers” can effect the settlement amount.

If you’ve been injured because of someone else’s carelessness or negligence, you deserve to get full compensation for your injuries. Yet the reality today is that the insurance companies use of Computer Assisted Claim Evaluation programs has made it difficult for victims to get full compensation on their own or with an attorney who does not fully understand the complexity of these programs. If you have a personal injury matter and would like a free consultation with Mark Wolfe or any of the BRW lawyers, please call Mark today at 251 410-7761 or text him at 251 533-9548. Consultations are free and our lawyers are licensed to practice in Alabama, Mississippi, Florida and Georgia.


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