Claims Corner: When in Doubt, Report It

Why waiting to report a claim can create problems nobody saw coming.

By Timothy Dillon, MBA, AINS, ARM Senior Vice President of Claims Hartwell Insurance

I've lost count of how many times a conversation has started with:

"Tim, we had a little incident a few weeks ago, but nobody thought it was a big deal."

Whenever I hear that, I know there's usually more to the story.

Maybe a driver bumped another vehicle in a parking lot. There didn't seem to be much damage, nobody reported an injury, and everyone went their separate ways.

Or perhaps an employee slipped, said they were fine, and finished their shift.

At the time, there didn't seem to be any reason to involve the insurance company.

Then a few weeks pass.

The other driver is now reporting an injury. The employee has missed several days of work. Or the customer who initially seemed satisfied is asking for considerably more money than anyone expected.

Suddenly, the situation looks a lot different than it did a few weeks earlier.

And the first question usually becomes, "Why didn't we know about this sooner?"

The Problem With Waiting

In claims, time is rarely your friend.

People forget details. Witnesses become harder to track down. Vehicles get repaired. Security footage gets overwritten. Employees move on.

Information that's easy to gather right after an incident can be difficult, or sometimes impossible, to find a month later.

Sometimes a few photos taken at the scene answer questions that would otherwise take weeks to sort out. Other times, a simple conversation early on can prevent a misunderstanding from turning into a larger dispute.

Most incidents never become major claims.

Nobody knows which ones will and which ones won't.

Reporting a Claim Doesn't Mean You're Admitting Fault

One reason people hesitate to report incidents is the concern that reporting it means admitting fault.

It doesn't.

Reporting an incident simply gives the carrier a chance to gather the facts and understand what happened.

I've had insureds tell me they didn't report something because they believed the other party was clearly at fault.

Responsibility isn't always as clear-cut as it first appears, especially when the people involved remember the event differently.

Early reporting makes it easier to sort through those questions while the facts are still fresh.

I'd much rather hear about something that turns out to be nothing than learn about it months later after the situation has changed.