Handling Insurance Claims Through Email

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Insurance Claims EmailAs millions sit at home and are able to continue working somewhat effectively thanks to the Internet, email, VPN’s, and other miracles of internet and computer science, many of us still recall the “good ole’ days” of conducting business with the help of an IBM Selectric typewriter, dictating or typing letters, buying stamps, and licking envelopes.

We also may recall the glacial pace at which communication and official correspondence—coverage denials, communicating with an insured, settlement demands, etc.—were sent and received. The mail arrived at 10:30 a.m. Some of it got lost. Claims and litigation evolved at a snail’s pace. I would dictate over my secretary’s shoulder and if she made a mistake typing a pleading, she ripped the letter out of the typewriter and had to start over because the courts did not accept “white-out.” Letter writing became a lost art as more and more of us became gradually exposed to a strange new electronic communication vehicle for conducting business.

Email actually predates the Internet. It was conceived as a means for computers to talk to one another and it was the U.S. Department of Defense who developed a system of email transfers that relied on the now familiar “@” symbol. Ray Tomlinson was a pioneering American computer programmer who implemented the first email program on the ARPANET system, the precursor to the Internet, in 1971. He is internationally known and credited as the inventor of email and he picked the “@” symbol because it does not appear in names so there would be no ambiguity about where the separation between login name and hostname occurred.

Seemingly overnight, we put down our pen and paper, unplugged our IBM Selectrics, and honed our skills at this new medium we call “email.” Note that according to grammarians “E-mail” and “email” are both correct ways to spell the same word, and the issue of the hyphen is still far from being settled. However, in U.S. English publications, “email” beats “e-mail” by a wide margin. According to Stanford University Professor Emeritus Donald Knuth, when a nonce word becomes commonly used, it loses its hyphen, so the proper form of the word is most likely “email.”

As businesses evolved and the world’s attention span began to dwindle, our words, letters, and documents began to flow across the world at nearly half the speed of light. The process loses its magic if you look at it too closely, but a lot happens when you hit “Send.” Email messages are composed using an email program (an email client). The email program assembles the email by combining the message content (the body) with the recipient, subject plus the date and time (the header). To get where it is going relies on a set of protocols to arrive at the correct destination. The commonly used protocols are IMAP, POP3, SMTP, and Exchange. The email program (the email client) comes in two forms, a web-based version like “Gmail”, a free email service developed by Google where users must login through their browser to access their emails, or a client-based version such as Microsoft Outlook where users install software to access emails from their local computer. The moment an email is sent, a message is routed from server to server via the Simple Mail Transfer Protocol (SMTP) until it makes its way to from the client to the email recipient’s email server.

The important thing about the U.S. Mail is that settlement checks still come and go in white envelopes. Venmo, Square Cash, QuickPay, and other digital payment software works great between friends, but for business, and throughout the insurance industry, sending checks still relies on snail mail. The U.S. Postal Service grew from handling 15 billion pieces of mail in 1926 to a peak of 103 billion pieces in the year 2000. From there it began to dwindle down to its present 54 billion level, which is about where it was in 1976. Today, the Postal Service delivers much more junk mail than it does first-class mail. Rural post offices are closing and Saturday delivery—when it only delivers Priority Mail and Priority Mail Express items which guarantee 1 to 3 days delivery time for $6.65—is threatened. On Sundays, the Postal Service delivers only Priority Mail Express and certain Amazon packages. Half of all Amazon deliveries rely on the U.S. Postal Service.

Email CommunicationToday, because of its ease of use and low cost, the insurance industry relies almost exclusively on email for conducting business and handling claims. Gone are the days where it takes a hard copy of a contract signed in ink with a pen to be the only way for a contract to be formed. It goes without saying that a series of emails and letters between two parties can create a binding written contract. Email can and often does provide the key evidence in a bad faith claim. Much is riding on what a claims professional puts in an email and stories about the absence of even a simple comma costing a company hundreds of thousands of dollars grow daily.

Something happens, however, when communicating becomes so easy and instant. The amount of time we spend thinking about exactly what it is we are going to say begins to shrink. Words we would never write on paper seem to fly from our fingertips, loose stuff, funny stuff, clever stuff. We love hitting “Reply All” to let everybody know how clever we are. We can hardly contain ourselves. Psychologists call this the “online disinhibition effect”. It’s similar to wearing a mask at Mardi Gras, which seemingly frees us to do things we otherwise would think twice about. It feels more like chatting than communicating in writing.

A 2010 study found that “participants lied 50% more when they negotiated over email compared with pen-and-paper.” One of the reasons was the mistaken feeling that emails are less permanent. Most people also overestimate their ability to communicate effectively with email. If you’re thinking it, it must be coming out just as clearly on the computer screen.

For insurance claims professionals, things are even worse. Emails become part of an electronic claim file that is one of the first things subpoenaed or requested in any insurance litigation. If the issue is the permanency of a claimant and comments suggestive of permanency are made, that email will become Exhibit 1. Intra-office “water-cooler” type emails, even those thought to be deleted, can reveal prejudicial, careless, and even politically incorrect moments which can haunt insurance companies in litigation.

In bad faith litigation, it is the claim file that is on trial. With every character and punctuation mark you type, think about how those words will look blown up on a 32” x 40” poster board in front of a jury. In a first-party bad faith lawsuit, the jury must consider the following:

  1. The nature, permanency, and severity of the plaintiff’s injuries which contribute to the likelihood of a verdict in excess of the policy limits.
  2. Lack of prompt, proper, and adequate investigation.
  3. Failure to keep the insured fully advised of claim status and settlement negotiations.
  4. Actions that demonstrate a greater concern for the company’s bottom line than the financial devastation the insured is suffering as a result of an injury.

Therefore, use words which express an urgent and exigent concern for the well-being of the insured. Couch things in terms of reasonableness and diligence in attending to the claims needs of the insured and a desire to get them back on their feet. Use good spelling, grammar, and complete sentences and despite the temptation to save two seconds using incoherent abbreviations, speak as though you are speaking to a future potential juror whose job it is to judge not only your compassion, but your intelligence and qualifications to have the insured’s life in your hands – sometimes literally.

The collapse of Enron is a good example of how devastating a hastily written email can be. It was internal emails that brought down that company. Experts point to Enron emails which revealed biases in favor of making money over following federal regulations. Lawyers today are trained to ask where the email bodies are buried, and they usually find them.

Work Product Privilege. The Federal Rules of Civil Procedure protect as “work product privilege” any intra-office insurance company communication and documentation which is “prepared in anticipation of litigation or for trial by or for another party or its representative (including the other party’s attorney, consultant, surety, indemnitor, insurer, or agent.” It is fairly easy to establish that something is a document or tangible thing. The most difficult matter to prove for non-attorney work product privilege is that it was prepared in anticipation of litigation. Here, the only clues the court has to go on are the words used by the claim’s examiner and the order in which they are used. Think ahead. If subrogation litigation is anticipated (and it should be if the facts lend themselves to any third-party liability whatsoever), be sure to take a little extra time and indicate how your time and energy are now focused on investigating third-party liability after which you plan on referring the file to subrogation counsel. Do it early in the life of a claim. You are “anticipating” subrogation litigation. These simple words might protect significant portions of a claim file which contains things harmful to third-party liability from being produced for the world to see. The privilege requires more than a remote possibility of litigation when an email or document is created. There is no work product protection for documents prepared in the ordinary course of business rather than for the purpose of litigation. Diversified Industries, Inc. v. Meredith, 572 F.2d 596 (8th Cir. 1977).

Don’t Take Sides. Do not appear to take the insurance company’s side when writing emails. For example, in one case the claims handler wrote to her supervisor, “Fortunately, there’s a neighbor who says that John was not permitted to drive the car.” A proper and adequate investigation is an objective investigation. Objective investigations do not perceive information adverse to the insured as good fortune. They do not reflect circle-the-wagons attitude as is often apparent in emails or log notes. Do not write, “We can only hope that the plaintiff’s condition continues to deteriorate as reserves for round-the-clock nursing care are astronomical.”

Be Objective. Comments such as “This is insane!” when referring to an IME or other developments in a claim file can reveal the precise nature of subjectivity which a jury will be looking for. Even comments such as, “The place is a dump” when referring to an insured’s inner-city home may be perceived by one or more members of a jury as pompous or worse. Don’t declare the employee in a workers’ compensation claim to be a “malingerer” or “faker.” Rather, if functional overlay or other suggestions of malingering are suspected in a medical report, make note of the fact that the report says there may be malingering.

Annoying Claimants. If a claimant calls non-stop, do not leave instructions in the file for other handlers to not take the call. Resist putting insureds or beneficiaries of a policy in a bad light.

Measure Twice; Cut Once. Before you click “Send”, double and triple check who the email is going to. Use spell check. It takes five seconds but lends itself to a much more professional-looking email. Remember that the first and hopefully only impression a potential trial lawyer or juror will have of you is through your claim file communications. Without my having to recount one or more of the most horrific mistaken reply-to-all moments within the insurance industry, make it a point to check and double check who your email is going to—especially if you are replying or replying to all. With Outlook’s AutoComplete, another hazard is having the wrong name fill in and not catching it. In one instance, my client’s email to me advising that they had accidentally thrown away the key piece of evidence which the plaintiff’s attorney had advised them to keep, was accidentally directed to the plaintiff’s attorney, whose name also happened to be Gary. To make sure you have time to proof your emails you may want to set up your Outlook to not automatically send emails immediately. Try reading your message out loud to help you catch any mistakes or awkward phrasing that you might otherwise miss.

Don’t Tattle. The claim file is a big sandbox where many different types of professionals—from claims adjusters to claims supervisors to nurse consultants, etc.—have to get along. If you disagree, take it up outside of the claim file. It’s easy to email somebody with a complaint about how something is being handled. But, if your complaint later becomes the very thing a bad faith or liability claim is based on, you have harmed your company’s interests. In one case a subrogation supervisor wrote, “I am shocked at how this claim is being handled”, referring to the underlying workers’ compensation claim.

Don’t Judge. In all emails, try to avoid using comments having to do with someone’s motives, religion, race, or intelligence. Try to comment only on the facts as they relate to the issues of the claim (permanency, course and scope, maximum medical improvement, etc.) or coverage under the policy. You are not paid by the word. Make each one count.

Be Succinct. More isn’t always better. Someone once said, “Wise men speak because they have something to say; fools because they have to say something.” Make your point in an email, spell check it, verify the recipient, and click “send.” If you are asking someone for something, try to ask only one thing per email—even if it means sending more than one email. Multiple requests slow things down. When you only have one topic in an email, the individual can reply to that email with the information you need. When you make multiple requests in one email, the recipient may need to keep that email longer in their inbox so they can answer each of the requests you have made. Keep your email as brief as possible. That often means a quicker response.

Subject Line. This is the chance for you to shine. Craft a subject line that will reflect the nature of the email as well as how important it is. The real world of insurance claims comes hand-in-hand with a full Inbox. Professionals often peruse their inbox subject lines to see which email needs to be triaged next. If a matter is not an emergency, but you type URGENT in the subject line anyway, well, we all know the story of the boy who cried “Wolf.”

Be Direct. We are professionals and as much as we’d like to tell co-workers or a vender about our Christmas card photo with our cat wearing a Grinch costume, get right to the point. Time is money and people are drawn to efficiency. The first sentence in your email should be a clear explanation of the request you are making. Any explanation for the reason for the request should be included in subsequent paragraphs.

Emotion and Tone Are Difficult to Judge. While email is a blessing in this modern age, it has its shortcomings. Reflect on the tone of your message. When you are communicating via email, your words are not supported by gestures, voice inflections, or other cues, so it may be easier for someone to misread your tone. For example, sarcasm and jokes are often misinterpreted and may offend your audience. If you like being funny, consider trying stand-up comedy.

Organize Your Message. Format your email in such a way that it is easy to read. Use white (double) space to visually separate paragraphs into distinct blocks of text when called for. Italicize quotes or important language. Bullet important details so that they are easy to pick out. Use bold face type or capital letters to highlight critical information, such as due dates. Use capital letters and bold type sparingly, however. For example, if there are three things you are asking for in the email and cannot send three separate emails, type those three things in bold.

Ask Whether a Phone Call Is Better. One of our attorneys practice law almost solely by telephone. The personalizing is part of his style and he believes the charm of a personal phone call can avoid the danger of just being throw into the Deleted Items folder. When he is done with the call, he makes a written record of the call in the file.

Always Use a Signature Block. Don’t assume that people know your affiliation or contact information. An effective signature with your name, company, email address, and phone number will help streamline future communication through other channels. Do this even with people you work with on a daily basis outside of your company because they might have to forward the email on to somebody who doesn’t know you or how to get a hold of you.

Create a Work of Art. Make each email frameable. Proofread before sending and focus on formatting. How an email looks effects how it is received and perceived. Double check to make sure you are using the same fonts/sizes/colors throughout. If you avoid punctuation/spacing/paragraphs your points will not be clear. Make use of bullet points when ideas or requests are numerous.

Avoid Long Emails. Try to keep emails to four paragraphs or less. This isn’t always possible, but it is desirable because when someone gets a long email, they either miss points contained in it or worse, they will ignore it. Long emails connote work. The longer the email, the longer it will take to deal with it.

Email is a blessing and a curse. But it is here to stay and those who learn to use it effectively—just like those who communicate orally more effectively—will achieve better results, settle more cases, and win more friends.

If you should have questions regarding this article or subrogation in general, please contact Gary Wickert at [email protected].

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Gary L. Wickert
Partner

Gary L. Wickert is an insurance trial lawyer and partner with the law firm of Matthiesen, Wickert & Lehrer, S.C. Gary has nearly four decades of litigation experience and is regarded as one of the world’s leading experts on insurance subrogation. He is the author of several subrogation books and legal treatises and a national and international speaker and lecturer on subrogation and motivational topics.