AB 224, The Unfair claims practices bill would make insurers liable for damages and attorney’s fees for violating the act. Click here for the bill text.

Yes, I have been in an adjuster’s shoes.  The above picture taken circa early 90′s shows the author working files on the front lines of a claims office. Recently I have been speaking with friends I have within many claims offices nationwide. The economic downturn has forced layoffs in many offices and the morale for many is at an all time low. I have seen comments on some claims industry blogs such as:

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“Stressed to the max at the end of the day and often go home feeling overwhelmed.”

“Mostly everyone I know doesn’t like working here and dreads coming in to work. The environment is high stress.”

“Work life balance is not good. You are expected to work what is given to you and get it done no matter if that takes you 3 hrs or 10 hrs.”

“I used to like coming to work and now I absolutely HATE it. I am looking for another job right now.”

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With many adjusters feeling overwhelmed and stressed,  what is the best and most effective means of managing one’s claims office? As a veteran of the industry I have been privy to observing both methods in action. The confident and more experienced professional usually takes a” Big Picture approach” in which results are measured in managing one’s “people” effectively. They realize that it’s the adjusters at the desk who close the files and drive the results. By focusing on the staff and making work fun, the statistical results take care of themselves. People who feel they are trusted by management enjoy coming to their job and yield better results than those who feel “controlled”

The “Micro Managing” style manager is often indicative of one who is insecure in their position and may lack the expertise to fully handle the job. They motivate with fear and feel they can “control” their staff. These managers focus in on individual claim problems at a micro level. While each claim is definitely important in it’s own right, it is not the “end all be all” of overall performance and trends and need not be the reason for endless emails and meetings.

A “Micro Manager” often scrutinizes each file in an effort to show upper management they are working individual files and “managing” their office, yet in reality, this approach grossly displays the manager’s ineffectiveness to manage the claims operation as a whole. Then how you may ask can a claims manager effectively run a claims office in stressful times yet get the results sought after by corporate executives?

The answer lies in motivating the claims staff through encouragement and the display of true leadership. The “Big Picture’  manager sees the company’s claims goals like an executive. They focus in on the office’s overall results and direction of key performance metrics. They follow monthly trends instead of daily issues. True claims leaders motivate their team by instilling trust and confidence in their adjusters own abilities which allows the office to achieve superior performance. 

What style creates an office full of stressed out adjusters? That is an easy one, the “Micro Manager”. This style breeds resentment within a claims office and causes staff to lose motivation. We in claims all know there will be “problem” files, and the “Micro Managers” who spend their day focusing on each problem fail to see the forest and only see a tree.

Claims is a stressful business but by concentrating on big picture issues from a management perspective and allowing adjusters to actually do their job and  handle their files, the staff will actually flourish. Stepping in and micro managing each file makes adjusters feel less confident in their own decision making abilities and thus less effective in their job. Instead of criticizing and harping on files, a true leader takes the time to train and teach those who need extra attention. Making each problem a mountain only serves to lessen confidence in the claims staff as a whole and is counterproductive. Claims offices can be  much more productive when a manager is confident in their own skills yet does not need to “prove” it to each adjuster every day. Managers will find that with a more relaxed approach and some basic trust, it can go a long way to improving an office’s overall performance.

In the CPI release from the Bureau of Labor and Statistics regarding March data, Auto body repair costs rose while auto insurance rates declined slightly.

Here’s another story chronicling auto insurance fraud in Ohio. The tough economy has led some people to do the most desperate things such as torching their own cars and faking auto thefts. Click here for the story.

The current 2009 average supplement percentage is 33.2%.  This means that out of every 100 vehicle damage appraisals written, 33 will likely have a supplement.

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Data source:  © 2009, AutoClaims Direct, DirectLink

In the central valley town of Porterville, CA and family conspired to commit insurance fraud and were arrested last week. Click here for the story.

The current auto damage average estimate severity is $ 2612.44 for 2009 as of today.

Data source:  © 2009, AutoClaims Direct, DirectLink

In an article we found, an Air Force F-22 Raptor bumped into a F-18 Hornet at an Air Force Base in Florida while parking. The repair bill was 1 million dollars for that collision.  Click here for the article.

I know we are in the midst of tough economic times and repair shops are hungry for work  but I have been hearing recently about some claims solutions in the industry that tout a new program of  ”online bidding” for collision repair jobs. Insurers who sign up for this program get several network shops to bid for the repairs. The insurer appears to post an appraisal and shops who are a member of this service then bid for the job. The shops who get the job then pay a referral fee to the service. 

Hmmm…. something makes me uncomfortable about such a program. You have shops bidding to get a job. Is it the “lowest” bid that gets it?  Is quality and safety compromised at the expense of doing a cheap fast job?

I have not fully investigated this new program in depth but on the surface I am a bit skeptical.