With the public bombardment of attorney advertisements, it is becoming harder for the claims adjuster to work directly with an injured employee. The plaintiff attorney advertising is designed to get the public to think that they need attorneys for everything. However, with proper claims handling, the claims adjuster can still control the workers’ compensation claim.
Once Attorney Hired, No Further Contact with Employee
Once the employee has retained counsel the adjuster can have no further direct contact with the employee. The adjuster cannot advise the employee to terminate a relationship with their legal counsel. The adjuster cannot tell an employee not to retain legal counsel. While some employees can be very difficult to deal with and extremely demanding, the adjuster can never tell an employee to get an attorney. If asked about getting an attorney, the adjuster should tell the employee it is their decision on whether or not they hire an attorney. The adjuster should request a letter of representation from the employee’s attorney as soon as notified of their existence.
The adjuster may reevaluate the claim when an attorney appears, but the adjuster should not be stampeded into an excessive change of opinion. Claims have been settled for less with attorneys than they might have been settled with the employee direct.
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The adjuster will price the settlement values of the workers’ compensation claim based on the facts and exposures regardless of legal representation. The injured employee will determine after the disposition of the claim whether or not the attorney was worth it and needed.
Adjuster to Maintain Positive Contact with Employee Before Attorney Representation
Prior to an attorney representation, the adjuster should maintain a direct dialogue and interface with the claimant. This is accomplished by showing empathy and concern for the person and injury. The adjuster should not allow sympathy to overrule the facts and necessities of the loss.
The adjuster can maintain control of the claim by prompt contact, kept promises, returned telephone calls, and questions answered with fact, law, and honesty. Explanation of all steps as to what will happen, when it will happen and how it will happen, builds confidence of the employee in the adjuster’s professionalism.
All of these steps may not keep the employee away from an attorney. Nor may it prohibit a request for a hearing, even if the adjuster works in the same professional manner with the claimant’s attorney. Many attorneys receiving such consideration will usually delay filing for a hearing and are more apt to be receptive to a prehearing resolution of the claim. (Some jurisdictions have hearings in front of an official from the work comp board, while others will have an industrial commission, and others used the court system of their state).
First Notice of Claim Could Be Request for Hearing
On the other hand the first notice of a claim may be by a request for a hearing.
Regardless of when or how a hearing request arrives, the adjuster is under the gun to process the legal papers as fast as possible. Most hearing requests must be answered in a specific time frame, often 30 days, but some jurisdictions have a shorter time frame of 20 days from the date the employer is notified. If the answer period is going to expire before an answer can be given due to investigation needs, the adjuster should request an extension of time from the employee’s attorney. The adjuster should attempt any disposition that might be possible before referring to defense counsel.
The hearing request should be sent to defense counsel at once by the adjuster. The adjuster will need to keep the claim file on a daily diary until the employee’s attorney agrees to an extension of time, or until the adjuster has employed defense counsel to respond to the hearing request.
The adjuster should send defense counsel a copy of the file with a covering letter outlining legal steps to take, and the adjuster’s summary assessment of the file. The adjuster should provide written litigation management guidelines to the defense attorneys. The adjuster should request a litigation plan and a litigation budget. The adjuster should set a legal reserve for the defense cost. The legal plan should be the guide for setting the legal reserve. However, until a litigation plan arrives from defense counsel, the adjuster can use an average of past legal costs for similar losses to set the legal reserve.
Stay with File Before and After Referral is Made to Defense Counsel
The adjuster should keep the file on a daily diary until the claim referral is acknowledged by defense counsel and an answer has been filed.
The adjuster should not abandon the file handling and management to defense counsel. The adjuster is responsible for gathering the facts for the defense counsel. If the file has recorded statements from the injured employee and other employees as witnesses, the adjuster should defer expensive depositions until absolutely necessary. The adjuster should prevent needless litigation steps and not allow the defense attorney to use outside investigation without prior approval and need.
All specialist investigation or experts needs the adjuster’s approval. They are to be coordinated with the adjuster, the employer and the defense counsel. The adjuster should control cost by the pre-agreement of fees and cost. The adjuster should audit the billing by outside investigators or experts to be sure it is in keeping with the agreements.
If defense counsel needs information from the employer, the adjuster should obtain it. When a meeting or conference is necessary, the adjuster should be present with defense counsel and the employer. If the self-insured employer needs to be contacted for disposition authority, it should be done through the adjuster.
Good adjusters know the value of the claim, can negotiate the settlement themselves, and should try to keep defense counsel out of settlement negotiations to limit legal fees. However, when a case is in a hearing, arbitration, or statutory judgment the attorney may have to settle on the spot. The adjuster should provide defense counsel with the necessary settlement authority. Telephone discussions for additional authority can prevail in these situations. If the self-insured employer input is required, the adjuster should comply.
The adjuster should control defense counsel reporting. It is not necessary for the attorney to parrot back factual information already in the file. All that is necessary for the attorney to do is state how the facts will be used in the litigation process. The attorney’s report should contain an opinion as to disposition. A request for any additional investigation is necessary. A time frame and necessary legal steps should be in the report.
Adjuster Critical in Management of Attorney Costs
Once the initial assessment report is completed by defense counsel, it is necessary for the adjuster to receive supplemental reports for current activities and opinions. If legal research is necessary the attorney must discuss and get the adjuster’s approval. Limitations must be set to avoid runaway costs.
The adjuster should have defense counsel eliminate from their reports all, or at least surplus copies of interrogatories, pleadings, depositions, and other legal information. The attorney generally reports on the contents of these items and their impacts, so it is seldom, if ever, necessary for copies to come to the adjuster’s file. Not only will this save attorney copy cost, it will reduce a cumbersome file. If a need arises for these actual documents, the adjuster can always request them.
All defense counsel legal billings should be reviewed and approved by the adjuster. The adjuster should check the defense counsel bill line by line to be certain there is no duplicity, overlap, or non-authorized handling.
The adjuster should be cognizant of excessive telephone and other uses. The adjuster should supply photocopies of documents to counsel when possible so they do not have to copy. The adjuster should before sending any file to defense counsel go through the file page by page and eliminate any duplicates or needless paper.
When a case goes to a hearing and an adverse decision gives grounds for appeal, the adjuster should handle the appeal response period on a daily diary until the defense counsel has filed the appeal.
Multiple Defense Relationships Should be Engaged
The adjuster should develop relationships with several defense counsel firms. It is recommended that different firms be used simultaneously. This generates competition between the firms, allows for spreading work, and keeps the assignments on a fresh approach for service and thinking.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.
