Saturday, September 13, 2014

There is a Difference

Most attorneys who represent injured persons are attempting to build life rafts for the injured persons and his/her family.

Most attorneys who represent defendants against claims brought on behalf of injured persons are attempting to blow up the life raft.

It is important to recognize that the term "most" applies because these statements are only true  99.9% of the time.

It is also important to recognize that in 99.9% of the personal injury cases the reality is that-- defendants = insurance companies.  The 'named' defendant, the negligent person and/or corporation who caused the injury, is nothing more than a bystander whose interests are literally of no concern to the insurance companies. The insurance companies only, literally only, interest is money...saving money. For example, some insurance companies actually pay the persons who determine how much money to pay an injured person a bonus. These persons are called 'claims adjusters'.  A bonus could make sense until it is recognized  where the bonus comes from. The bonus comes from a percentage of the amount of money that the claims adjuster doesn't pay the injured person. For example:
1. Claims adjuster evaluates the person's injuries and determines a 'value' to place on the claim. For our purposes, lets say $100,000 is the value of the claim. The accountant then moves this amount from the general fund and, on paper, puts it in what is called a 'reserve account'.
2. Claim adjuster 'negotiates' with the injured person and gets him/her to agree that the claim is really only worth $50,000 and the claim settles.
3. There is $50,000 left in the 'reserve account'.
4. The insurance company has a set bonus percentage. For our purposes lets say it is 10%.
5. The accountant moves $45,000 from the 'reserve account' back to the general fund and then moves $5,000 into the claims adjuster's bonus account. The bonus is disbursed to the specific claims adjuster at regularly scheduled intervals or as a 'Christmas Bonus'.  To me, naming the disbursement of the bonus as the 'Christmas Bonus' is, well lets just say, inappropriate.

1 comment:

Cedar Street Kid said...

This is the truth, and a very sobering one at that!

Here is a funny episode on Burns and Allen about Gracie falling in a department store, and the store tries to settle the claim.