The Claim File Documentation Balancing Act

With so many eyes on claims files, it’s no wonder documentation is a touchy subject for adjusters. Claims files are reviewed by auditors, supervisors, bad faith attorneys and others passing judgment often months or years after the fact, according to Kevin Quinley, founder and principal of Quinley Risk Associates.

“It seems like adjusters never have enough documentation and they’re often criticized for inadequate details,” said Quinley.

Adjusters have to prioritize their core job responsibilities on a daily basis.

Time spent documenting a file can undermine other areas of claims handling, said Quinley, who noted that time spent documenting a file can’t be used to investigate, negotiate or settle a claim.

Insurance isn’t the only industry grappling with documentation problems, he said. For example, doctors have charting requirements and this can affect their relationship with patients, as they may be more focused with note taking then talking with patients. Teachers offer another example of the over-documentation conundrum. Data entry and reporting may cut into lesson planning.

According to Quinley, the saying that ‘If it’s not documented in the claim file, it didn’t happen’, is more aspirational than descriptive of the real world. There is typically other evidence to show an adjuster’s claims investigation happened, he said.

“This mantra…I don’t think it is necessarily a standard of care,” said Quinley. “It’s something that is repeated and conveyed to adjusters to underscore the importance of reasonable claim file documentation.”

“It’s an aspirational target,” he said. “While many claim manuals, many guidelines mandate recording every adjuster action, that’s not realistic and I think the authors of these are far removed from the frontline trenches. They don’t do the work.”

Quinley offers suggestions on how detailed adjuster notes should be. He said they shouldn’t be transcripts or diaries, but rather should outline or detail steps taken or future steps necessary to complete the investigation and damage analysis.

There a disconnect between management who typically require thorough documentation and claims handlers mired in heavy workloads. It’s not an either/or proposition, said Quinley. It’s about balance.

“What is more important? Doing or documenting?” he asked.

Quinley offered five tips on how insurers can “up their game” when it comes to claim file documentation: