Communication and Teamwork Results in $374,409 Reserve Reduction

$374,409 reserve reduction achieved with ESM recommendation for early settlement.

An injured worker sustained a back injury that resulted in a 20-day hospital stay. He obtained an attorney and filed an Application for Adjudication of Claim for this specific injury claim and a Cumulative Trauma claim.

The combined reserve on both claims was $437,914.

Less than 2 months before renewal, the employer provided information that led us to believe that the employee was not nearly as injured as everyone previously thought. Furthermore, that he was very open to a settlement even though he was not close to reaching Maximum Medical Improvement (MMI).

This critical information was learned a week prior to his previously scheduled deposition. ESM immediately scheduled a conference call with the insurance carrier adjuster, the defense attorney, and the broker.

I facilitated the call and discussion of how best to use the recent information to develop a settlement strategy. Settlement authority was then obtained and would be presented at the employee’s upcoming deposition.

Not only was the claim settled at the deposition for $40,000 with a voluntary resignation, but we worked directly with the insurance carrier to ensure they paid this settlement off the claim for the specific injury since there was no medical evidence to support the alleged Cumulative Trauma claim. This allowed for the least amount of impact on the next X-Mod.

In addition, ESM worked with the carrier to ensure the claims were closed in time so the resulting $374,409 reserve decrease was reflected in the loss runs used for the renewal discussions. This put the insurance broker in the best possible position when it came time to negotiate the premium for the client.

The employer’s information when shared with the carrier led to the most optimal outcome for the resolution of this claim. Communication and teamwork led to early claim closure and a significant cost reduction!