An “occurrence” is an event which gives rise to a claim for payment of insurance proceeds to either the first party (the insured), such as with renter’s or home insurance, or a third party (someone other than the insured), such as with payment to a person injured as a result of the insured’s actions.
This post will address third party insurance. The difference between the two is that first party insurance includes a contract between the insured and the insurer, and therefore various duties and obligations flow from each party to the other by law and by contract. In third party insurance, one would be dealing with the insurance company of the injury producing party, and therefore the only duties owed by the insurer to the third party would be those necessitated by law which are different from laws governing first party duties.
After an occurrence, the claimant (third party), should be aware that insurers use adjusters to evaluate claims. While this may seem obvious, not all adjusters are created equal. Some understand their job as being required to pay valid claims and weed out the fraudulent ones, and some believe their job is to deny as many claims as possible; these types of adjusters rarely last because their reversal or lawsuit rate will be above the acceptable rate for their employer.
First off, the claimant should not be the one to call an adjuster. There are numerous reasons for this. If the insurer contacts the claimant, he/she should first ask if the call is being recorded, if so, refuse to speak until the recording is shut off. Most states require disclosure of call recording prior to the conversation. If the recording is not shut off, the claimant should refuse to make any statements or provide any facts regarding the occurrence, and state that he/she is in the process of retaining legal counsel or if not, then state that he/she is not ready to make a statement at that time. The claimant should then listen to the adjuster, and request all offers to be put in writing. No counter-offer should be made at this time, particularly if physical injuries are involved. If only property damage occurred, then the claimant may obtain an evaluation of the damages from a reputable source, and may make a counter-offer on the phone if the damages are certain.
No recorded statement or deposition should be given by the claimant without legal counsel present. Remember, the adjusters are looking for inconsistencies and admissions of fault. Even if a statement is not construed as an admission or inconsistency by the claimant while it is being given, it may be open to interpretation or used later to contradict future statements. If such statements are made, it becomes far more difficult to obtain proper relief for the claimant’s damages, and increases the likelihood of litigation being necessary. It also increases the burden of evidence on the claimant to that which may be sufficient to overcome the evidentiary value of the statements made against his/her own interest.