When an accident occurs and it's time to report an insurance claim, the speed at which to submit the claim should rival Road Runner's swiftness when escaping from Coyote's shenanigans.
Time is a powerful influence on an insurance company's ability to minimize accident-related costs, control a business' liability and, more importantly, to promptly pay claims. To receive quality service, the insured must report occurrences accurately and swiftly.
The claims process is triggered when an accident or loss report is given to its claim administrators. If an incident is not reported quickly, a lot can happen in the time between when the mishap occurred and the start of the claims process. All accidents should be reported immediately — no matter how minimal the claim.
Giving immediate notice to your insurance company allows an adjuster to investigate and preserve facts, and examine physical evidence. This also provides an opportunity to identify witnesses and secure statements. Early reporting controls damage because there are advanced opportunities to mitigate losses, which reduces the risk of inflated costs and unnecessary litigation.
Also, it's important to understand contractual provisions when reporting claims. For example, first-party insurance policies require immediate written notice of a company's loss. The term “immediate” has been interpreted by many courts as giving notice as soon as possible, depending on the circumstances. Most liability and automobile liability policies require claim notice be given “as soon as practicable,” which carries equal significance as first-party language policies. Delayed reporting could lead to future insurance coverage denial.
Quick and accurate claim reporting particularly is important when dealing with vehicular accidents, which typically are the most common company losses. As an employer, be sure to communicate to employees about what information needs to be gathered if they are involved in an accident while on the clock.
For example, parties involved in accidents should exchange names, addresses, license numbers and operator license numbers, as well as obtain a full description of the vehicles involved and gather witnesses' names. All of this information needs to be passed on to the company's insurance agents or brokers. This is necessary to ensure legal rights later in the claims process.
Even if a driver leaves an accident feeling confident that no liability could arise, within hours, an insured could be served legal papers. Consequently, businesses should cooperate immediately and completely with their insurance company, just in case the insurer needs to prepare a defense on the company's behalf.
Lastly, as an employer, be sure that any notices or legal documents brought to your attention are given to the insurance agent, broker or carrier.
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