Why Proper Communication Is So Key to Settling Claims

By: | February 4, 2020

Richard Isgard is Senior Vice President of Claims at Rokstone Construction Risk Underwriters LTD. He can be reached at [email protected].

The U.S. construction industry erects approximately $1.3 trillion worth of structures annually, according to the Associated General Contractors of America, with any single project having dozens of workers and millions of dollars in completed work and materials at risk.

Construction sites are not only busy, they can be dangerous, expensive to operate and the projects themselves can take years to complete.

The insurance industry is a key partner to the industry by providing a variety of first-party and third-party products to manage these risks.

I spent the first half of my career on the outside looking in while in private practice representing insurers and sureties. The second half of my career was spent on the inside at an insurer and MGAs. As such, I’ve got strong opinions on how to best manage the claims process.


Effective and clear communication throughout the life of a claim is a key element of quality claims handling and needs to start as early as possible so that as much evidence and information about the claim can be collected before memories and information fade or disappear.

The claims executive’s role is in essence at the center of a wheel, surrounded by  the various parties — insureds, brokers, underwriters, TPAs, field adjusters, defense counsel, risk engineering consultants and other experts and vendors — all working closely together and sharing the information each needs to successfully perform their respective roles.

By ensuring that the many parties involved during the claims process are all communicating effectively with each other and working in the same direction, claims executives can facilitate the common goal of resolving and closing out claims as quickly and efficiently as possible.


TPAs are integral to the claims process.

In addition to handling claim notifications, field inspections and the day to day adjustment of the claims, they also provide brokers and customers with up-to-date information on each claim via a 24-hour access  data base system which allows them to see in real time the status of their claims.

While an experienced TPA is crucial in successfully adjusting a claim from the first notice until final disposition, the claim executive’s role in directing the TPA is essential to support the work they are doing and validate that the actions they are taking follow the agreed upon strategy.


When a liability action is commenced against an insured, each litigation is comprised of a diverse set of facts with different parties and in different jurisdictions, presenting a unique challenge that requires a distinctive and creative strategy.

During the life of a claim litigation, new facts, information and legal precedent continue to evolve which drives the need for continual reevaluation of claims strategies to confirm that each claim is on the right track.

Insureds need to ask themselves or be advised on how the legal process can affect the likelihood of success.

Although litigation can be frustrating and time consuming, it allows the disputing parties to gain the additional information and insights they need to determine the strengths and weaknesses of their respective positions and whether an action should continue to be contested by discovery, motion practice and trial or whether an alternative dispute method should be utilized to try to resolve the matter.

Claims and Underwriting Are Intertwined

It’s a best practice for claims executives to be part of the underwriting process and work closely with underwriters and broker partners, including the review and drafting of endorsement wording to confirm that the expectations of the customer and insurer as to the scope of coverage are being met.

Since ISO policies are standard, endorsements sometimes are needed to ensure that the coverages provided by the insurance policy corresponds with the actual needs of the customer.

This is especially true as it pertains to Controlled Insurance Programs.

Since the ISO Coverage Form was drafted with a contractor’s corporate program in mind, specialized endorsements are necessary to amend the policy language to ensure proper coverage is granted to protect the sponsor and enrolled contractors.

Listening to the concerns of broker partners and customers allows a carrier claims team to turn such questions into action by creating clear endorsements so that, if a claim arises, potential disputes and headaches can be avoided.

Claims executives should also work together with underwriters to assess any newly emerging risks, to determine how they may impact exposure on the policy and the need to issue any relevant endorsements.

When a Claim Arises

Although insurers and insureds would prefer that claims not occur, claims do arise.

By efficiently communicating and reevaluating throughout the life of the claim, the claims executive can have a major impact in ensuring that the claims process is handled professionally and transparently.

They can also make sure the insured is provided with the coverage it is entitled to under the policy.

By providing quality claims services, a claims professional can be crucial in maintaining and growing the insurer’s relationship with its insureds. &

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