Things Adjusters Say: We've approved $5,000 of treatment
This article is part of a series on insurance company's justifications for paying you less than you deserve. Whether through malice or ignorance insurance adjusters often refer to questionable logic and non-existent laws to award you as little money as possible. A personal injury attorney can ensure that you receive full compensation. The consultation is free.
I have a new client, Ms. Jones. Ms. Jones was badly injured in a car wreck, she missed work, she has medical bills in her mailbox, and she needs help making sure she is properly compensated for her damages. I accepted her case about two weeks ago.
Today I got a phone call from the defendant's insurance company. We exchange hellos, verify contact information, and then the adjuster says the strangest thing:
Adjuster: I just want to let you know that we have completed our assessment of the case and have approved Ms. Jones for $5,000 of treatment.
Attorney: Explain that to me.
Adjuster: Based on our investigation we have determined that $5,000 is a reasonable and customary amount of treatment for Ms. Jones' injuries. I don't want to see any medical bills above that number.
Attorney: How did you come to that conclusion?
Adjuster: We based our determination on the results of our investigation and the use of proprietary database software to determine the reasonable and customary amount of medical treatment.
Let's review what just happened. The insurance adjuster, without speaking to Ms. Jones, without speaking to her doctors, without even waiting for Ms. Jones to heal, has determined that Ms. Jones needs $5,000 of medical treatment, and not a penny over. When asked for a justification the adjuster talked about an "investigation" and "proprietary database software," in an attempt to sound authoritative.
This $5,000 number is baseless. The adjuster made it up. It isn't admissible in court, it isn't relevant to any future negotiation, and it implies that the insurance company gets to ration medical treatment at will.
This is a negotiation tactic called the "Authority Limit." The adjuster will throw out a number, say $5,000, and state early on that she cannot go any higher than that number. Later she will refer back to the $5,000 number, stating that even though she wants to pay out more money she isn't allowed to. She might even scold someone who goes over the $5,000 limit, saying something like, "I tried to help you by telling you how much we approved but you went over the limit." A lot of people, especially those not represented by an attorney, fall for this tactic.
The only practical limit to the amount of money that is available is the policy limit. Don't let an adjuster use a simple negotiation tactic to convince you otherwise. The insurance company will use every trick they know to ensure you receive as little money as possible for the harms you have suffered. An attorney can ensure you receive full and fair compensation. The consultation is free.