The National Association of Independent Insurers (NAII) outlined five specific recommendations to help victims and insurers expedite the claims process and streamline the financial recovery from terrorist attacks and other catastrophes.
“NAII’s key message is that insurance mechanisms should be allowed to work and, in the unique circumstances of September 11, the mechanism is working well. The New York Insurance Department has been able to effectively deal with this unprecedented situation of handling an enormous number of claims after a terrorist attack and demonstrate that state regulars are exceptionally responsive to the needs of claimants and insurers alike,” said John Eager, NAII senior director of claims services.
Eager explained that the recommendations made were in response to the National Association of Insurance Commissioners’ (NAIC) request for input from insurers on specific claims issues in New York such as proof of loss, destruction of records, documentation of property losses and valuation of destroyed vehicles. NAII said many of its recommendations are already in place in New York, but he added that the claims handling suggestions could be viewed from a wider perspective.
“Our recommendations were compiled from NAII’s Claims and Fraud Committee that have a broad group of companies that were directly affected by the September 11th tragedy. However, NAII believes that its recommendations could be viewed as ones that may be applicable for victims of other disasters of this magnitude,” Eager said.
The NAIC’s National Claims Protocol Adhoc Group’s letter read, “Undoubtedly, your members have already begun to face these and other issues head-on. Therefore, we ask your assistance in identifying all claims-related issues that may arise out of the circumstances at the World Trade Center and the Pentagon tragedies.” The NAII made the following recommendations:
1.Continue the ongoing communication from the New York Disaster Center that is critical to insure coordination and prompt resolution of claims. This communication would include teleconferences and reports from the Insurance Emergency Operation Center regarding claiming patterns, problems in claims payment processes and specific concerns arising our of claim submittals.
2. A standard disaster protocol should include a coordinated effort to identify, investigate and prosecute perpetrators of fraudulent claims. Focus should be placed on the New York Special Investigation Division Fraud and Consumer Services Bureau that handles scams perpetrated on victims.
3. Additional discussion should examine examples meriting a change from normal practices, such as an affidavit for life insurance claims in lieu of a death certificate. This kind of affidavit procedure needs to be reviewed in detail for workers’ compensation claims and would include both state and federal submissions. Protocols that are normally used for proof of loss submissions, destruction of records and documentation of property losses should be part of the review with the goal of establishing a clear protocol to be used in all major disasters.
4. Specific attention needs to be paid in setting up an alternative resolution procedure to handle any disputes arising out of this disaster. This procedure would expedite the resolution of disputes arising from terrorism-related insurance claims and would offer the use of advanced alternative dispute resolution programs such as mediation or arbitration on non-resolved claim submissions.
5. National claims handling protocol should include creation of an Insurance Emergency Operation Center to insure the best coordination of claims information to victims (such as the one created in New York).