Skip to content

My first insurance job – So this is insurance

Amazingly, it did not take time to find a position (the economy was a tad better back in 1998). I answered a New York Time classified advertisement, interviewed with several staff members (welcome to the corporate world) and was offered a position as a claims supervisor at Zurich Insurance Company. While many of my colleagues in the claims department were attorneys, the staff also consisted of traditional career claim handlers. It was my first non-law job and my first experience in a truly multi-national corporation.

The indoctrination into the world of claims came quickly with the help of my new colleagues. I was immediately reminded that I did not have an office and standing and talking on the speakerphone was an unacceptable faux pas in the world of the corporate cubical. Then came the unknown world of evaluating and reserving claims files. I was not in Kansas anymore and more specifically was not in New York alone. My “desk” of claims consisted of matters from across the country. I could no longer worry about the value and laws from one county over another, but had to be concerned with legal issues and valuations from across all 50 states. Suddenly the broken hip of an 80 year old man that I my experience had taught me was worth no more than $100,000 New York could have been valued at ten times that in Florida. I had a lot to learn and learn I did.

Evaluate, reserve, resolve, and then move on. This was claims.

I get that’s a broad oversimplification of claims, but truly at its core, this was my job as a claim professional. The implications, for sure, were larger than that and when one truly understood the meaning of what effect reserves had on the overall organization, those implications were weighty. The fine art of reserving a file can and does affect pricing, performance, the past the future and the very well being of the company. A file reserved too high means the company may not be able to write as many policies (surplus issues). A file reserved to low means the company may not have sufficient funds to pay the loss when it actually gets paid. Additionally, when the insured goes to market to buy new insurance it may appear that the loss is not as significant (or too significant) affecting the pricing. The claims department was more in the middle of underwriting process than many claim professionals realize. To add to all of this, the potential act of bad faith resulting in the dreaded extra contractual payment (paying more than the limits on the policy because of bad claim handling) hung over your head.

Bad faith is committing malpractice as a claim professional. It is taking steps to unfairly deny a claim or expose an insured to personal liability by failing to act in good faith (I know defining a word using the word isn’t the best, but it makes sense here). Part of the claim professional’s job is to ensure that the claimant (who may be your client if it’s a first party claim) is given what is due. Insurance is bought specifically to pay for losses when they occur. As a claim professional, once a determination of fault and has taken place, the claim must be paid in accordance with the terms of the policy. As a litigator I got to argue and keep defending my client until someone else told me to stop. As a claim professional there was more to worry about – from bad faith to reserves to the next claim, defense counsel, the insured, or the claimant. Don’t forget there had to be a clear documentation of everything you did. This job moved at a very quick pace.

No I was not in Kansas and no this was not OZ either.

Posted in My History.

0 Responses

Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.

Some HTML is OK

or, reply to this post via trackback.