Big insurance companies like Allstate and MetLife seem to think so. They’ve been using a claims adjustment program called “Colossus” for years, and as a result, crucial information that could be used to give a more accurate and fair estimation of damages is being left out of thousands of settlements every year.
“Colossus” is a program that takes most of the available information about your claim, including property damage and the nature and severity of any injuries that you might have suffered, and compares that information to an average of already settled claims of similar type. For instance, if you are in a car accident and suffer a broken leg, the adjuster simply types in the scenario and sees what the average settlement is for legs broken in car accidents in your region. “Colossus” then calculates a settlement based on that average, and this is what the adjuster offers the victim.
This might seem perfectly reasonable on the surface. If the insurer offered a certain average amount for accident victims of a similar type, why wouldn’t they offer the same amount to a victim who fell into that category?
There are two glaring problems with this theory. The first problem is that nobody except the insurance companies knows what data they using to “average” your claim, and the second is the very simple proposition that no two accidents, and therefore no two accident victims, are ever alike.
Fuzzy Math
The accidents and settlements listed in Colossus are the private and confidential information of the insurance companies that use the software. There is no assurance in place to make sure that the database of settlements is constructed on an impartial basis, and there is no way to make sure that ALL of the accidents and settlements that the insurer covered are listed. Who is to say that they aren’t leaving out the more expensive settlements? If an accident victim requires expensive back surgery and extensive physical therapy, are they placing this data in Colossus as well, or are they simply entering the cost of the property damage? This is a very simple (and very cost-effective) way of keeping settlements artificially low. It’s very similar to someone winning the lottery and not informing the IRS about the vast new stream of income.
One Accident Is NOT the Same as Another
Colossus uses extremely narrow parameters when it comes to categorizing your accident. While it is very specific in terms of type of property damage and medical costs, there are several crucial factors that are not considered at all. For instance, Colossus accepts only medical data to determine a settlement. That might seem reasonable at first glance, but accident liability cases are rarely something that can be condensed into equations and run through a computer program.
Consider a case where a professional piano player gets into an automobile accident and has his hands irreparably damaged. If this accident victim simply accepted the settlement that Colossus offered him, his medical bills and property damage would be paid for, as well as a “pain and suffering” settlement that is based on accidents of a similar type. But there are many aspects that Colossus does not consider. What is the piano player supposed to do now? How can he make a living? It’s all well and good that Colossus compensated him for PHYSICAL pain and suffering, but if you consider that the practice to which this man dedicated his entire life was suddenly taken away from him, the medical coverage and “averaged” pain and suffering settlement seems hardly adequate. There is nothing “average” about emotional pain caused by someone else.
There is something fundamentally wrong with the idea that your trauma and emotional pain can simply be turned into little bits of ones and zeroes and run through a computer program in order to determine its value. But considering the insurance business as a whole, the use of this software is hardly surprising. Despite clever advertising and heartwarming jingles to the contrary, the primary business of insurance companies is to make money. To them, automating the claims process is simply another way to increase their profit margins, regardless of whether or not the process is based in reality.
At the Dover Law Firm, we make it a point to let the insurance companies know that they are dealing with actual people with real needs and concerns. If we feel that they have left out crucial information about your settlement offer in the name of financial convenience, we'll let them know.
If you or a loved one has been injured in an accident and you feel that your needs are not being properly addressed by an insurance company, contact our offices for a free legal consulation today.