RECORDS OF MEETING
CLAIMS ADVISORY COMMITTEE
A meeting of the Claims Advisory Committee was held at the offices of Commonwealth Automobile Reinsurers, 100 Summer Street, Boston on –
WEDNESDAY, JANUARY 13, 1999 AT 9:30 A.M.
The following members were present –
Mr. Robert Kerton – Vice Chairman
Safety Insurance Company
Ms. Nancy BenderNancy Z. Bender Insurance Agency
Mr. Donald CannMetropolitan Property & Casualty
Mr. Fran DelageHanover Insurance Company
Mr. James DohertyDoherty Insurance Agency
Mr. Ciro FeiSentry Insurance Company
Mr. Erik JepsenPeoples Service Insurance Company
Mr. Dana MarchantCGU Insurance Company
Mr. James MutschlerLiberty Mutual Insurance Company
Mr. Robert PuopoloAmica Mutual Insurance Company
Mr. Thomas RaherNational Grange Mutual Insurance Company
Mr. Arthur Remillard, III.Commerce Insurance Company
Mr. Jerry RemillardTrust Insurance Company
Ms. Joyce SmithCommonwealth Mutual Insurance Company
Mr. Edward Thompson *Arbella Mutual Insurance Company
Ms. Maria WalshPlymouth Rock Assurance Corporation
Mr. Robert Woods, Jr.CNA Insurance Company
*Substitution for Mr. Douglas Jones
Also present were –
Commonwealth Automobile Reinsurers
Mr. Joseph MaherVice President & General Counsel
Ms. Valerie GedziunVice President - Claims
Mr. Robert W. BellClaims Manager
Ms. Susie Almonte WintersClaims Analyst
Records of Meeting1January 13, 1999
Claims Advisory Committee
Also present were –
Commonwealth Automobile Reinsurers
Mr. Richard DaltonSenior Claims Examiner
Mr. Jean LaprimeSenior Claims Examiner
Mr. Robert McNamaraClaims Examiner
Also present were –
Ms. Diana GormanPilgrim Insurance Company
Mr. Joseph HaswellNorfolk & Dedham
Mr. David KrupaSafety Insurance Company
Mr. John LaceyPilgrim Insurance Company
Mr. Glen TonnessenUSAA
Mr. Stephen VeigaADALB - DOI
Claims Advisory Committee Vice Chairman Mr. Robert Kerton called the meeting to order at 9:30 A.M..
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99.01Records of Previous Meeting
Mr. Doherty made a motion to accept the records of the Claims Advisory Committee meeting of November 12, 1998, the Automobile Damage Appraisers Licensing Board Subcommittee meeting of December 2, 1998, and the Educational Subcommittee meeting of December 3, 1998. Mr. Marchant seconded and the motion passed unanimously.
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99.02Automobile Damage Appraisers Licensing Board Subcommittee
Mr. Woods reported that on December 2, 1999 the subcommittee met to discuss fraud in glass claims. This topic was addressed in response to a letter from the ADALB asking the subcommittee to consider glass fraud at its next meeting.
Mr. Woods said all interested parties had an opportunity to speak on the subject. Among those speaking were David Krupa, a member of the Attorney Generals Task Force on Body Shop Fraud, Richard Derrig of the Automobile Insurers Bureau, members of the Automobile Damage Appraisers Licensing Board, James Torney, legal counsel for the Massachusetts Glass Dealers Association, and members of the subcommittee.
The conclusion was that appraising glass claims would not have a significant impact on fraud as the degree of fraud is not sufficient to justify the dollars that would be spent on appraisals. At this point the issue was considered closed and the meeting was adjourned.
Records of Meeting1January 13, 1999
Claims Advisory Committee
Mr. Bell reported on the ADALB meeting of December 16, 1998. He reported that while the usual licensing updates and complaints were heard by the Board, there was nothing that occurred at the meeting that would warrant the subcommittee’s attention. Mr. Bell did say that Mr. Valarioti did acknowledge the fact that the subcommittee discussed fraud in glass claims but no further discussion ensued.
Mr. Woods said the Automobile Damage Appraisers Licensing Board was holding a seminar on writing a proper auto damage appraisal at 6:30 PM on Wednesday, January 27, 1999 in the lecture hall of Assabet Valley Regional High School and all members of the insurance industry are welcome to attend.
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99.03Performance Standards
Mr. Bell reviewed the 1998 Annual Report of Compliance. He noted two significant changes were made to the Performance Standards in 1998. The first was changing Appendix A to read, “An SIU must have at least one full time employee whose responsibility is principally directed towards the recognition and investigation of fraud”. The second change involved increasing the financial penalties for non compliance.
Mr. Bell noted the compliance rates increased in all of the areas measured. In addition the number of warnings for non compliance decreased from 12 in 1997 to 2 in 1998.
Mr. Bell said in 1999 compliance with the requirement that appraisals be transmitted within 5 business days of the date of assignment would be measured. Compliance will also be measured with the standard requiring that the tort carrier be notified immediately by the PIP carrier in cases serious enough to exceed the tort threshold.
Finally Mr. Bell reviewed the CAR Cost Containment activities which included the Cost Containment Seminar, the Automobile Damage Appraisers Licensing Board Subcommittee, the Glass Claim Review, and work on a new Average Cost Per Claim Report.
Mr. Marchant asked about access to the information on the Average Cost Per Claim Report. Mr. Bell said each company would have access to both their own results and the composite results of the industry. CAR has security measures in place to maintain the propriety of the on-line information.
Mr. Doherty made a motion to accept the report. Mr. Delage seconded and the motion passed unanimously.
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99.04Educational Subcommittee
Mr. Raher, chairman of the subcommittee, reported two meetings have been held and after reviewing suggestions from last year potential speakers are being contacted. The seminar dates and locations are May 20th at Lantana in Randolph and May 25th at the Holiday Inn in Marlborough. The fee has been increased from $25 to $27 with a $30 late fee.
Mr. Doherty moved for acceptance of the report. Mr. Fei seconded and the motion passed unanimously.
Records of Meeting1January 13, 1999
Claims Advisory Committee
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99.05SDIP
Ms. Gedziun reported that she had asked Attorney Chaves of the Board of Appeals about the status of the documentary review process. Ms. Gedziun reported that Mr. Chaves indicated that for the past several months only weather related accidents have been reviewed.
Mr. Woods said Mr. Chaves had told him that only CNA and Hanover had been using the process. Mr. Woods added that the Boards in the satellite offices did not seem to know the documentary review process was in place and comments had been made about companies not showing up at the hearings.
Following further discussion Mr. Woods suggested the original subcommittee meet with Mr. Chaves to discuss the review process.
Mr. Maher suggested CAR look into the situation and report to the committee at its next meeting. He said obtaining statistics on the breakdown of the fault codes, learning the Board’s utilization of the system, and reviewing the results of appeals would be advisable as the committee could formulate one recommendation rather than treating issues piecemeal.
Mr. Delage suggested seeking clarification on partial payments and reimbursement of deductibles. Mr. Remillard said Almeida provides the necessary guidance on the issue of deductibles.
The committee concurred with counsels suggestion that CAR review the matter and report to the committee at its next meeting.
There being no further business Mr. Doherty made a motion to adjourn. Mr. Marchant seconded and the motion passed unanimously.
The next meeting is scheduled for March 31, 1999 at 9:30 AM.
The meeting adjourned at 11:00 A.M..
ROBERT W. BELL, CPCU
Claims Manager
Boston, Massachusetts
January 29, 1999
Note:These Records have not been approved. They will be considered for approval at the next Claims Advisory Committee meeting.