The debate: Can loss assessors and insurance brokers be independent

The debate rages on and is not likely to be settled anytime soon. Can a loss assessor who is appointed and paid by an insurer be truly independent? Is his report impartial or is it influenced by the party who controls the pay cheque? If indeed the pay

This article aims to briefly outline the equally important roles played by two participants in the motor insurance claims supply chain – one an insurance intermediary and the other a motor claims assessor. The roles are examined in the harsh light of the commercial environment in which they both operate. It then seeks to uncover incentives for behavior, and aims to propose a possible solution to negative speculation and perceptions held and uttered by the consumer.

The role of the motor assessor

The role of the motor assessor is determined according to the mandate given by the insurer. The simple parameters may be to assess the extent of damage against the quote obtained from the panel beater, to ensure that appropriate indemnity is achieved. A more comprehensive mandate may apply where the assessor,

· Engages with the insured to establish the cause of the incident,
· Provides advice to prevent recurrence of the event leading to the loss,
· Determines the cause and accordingly investigates factors such as,
o Driver abuse,
o Driver fatigue,
o Vehicle maintenance,
o Road hazards,
o Other accidental causes.

His professional opinion is then presented to the insurer for consideration and guidance.

Whatever the extent of his mandate, the assessor acts for and on behalf of the assessor. It is not his primary source of revenue that should be questioned but rather the integrity of his pursuits.
The assessor’s remuneration should not under any circumstances be determined on the success by which he reduces the insurer’s liability. It should at all times be based on the efficiency with which he finalises the settlement payment. This should be conducted in a fair manner to yield satisfactory resolution subject to contractual mandates that are determined within the parameters of legislation. It is not the relationship between the insurer and the assessor that is cause for concern, but rather isolated cases of lapsed ethics amongst rogue individuals.

The role of the insurance broker

The same may be said for the short-term insurance broker.

The broker who does not collect a premium on behalf of the insurer, acts in all cases as an agent of the insured, despite the fact that his income is in many cases solely earned by the commissions paid from the insurer. Does this mean that his conduct is unduly influenced by his payer? To the contrary, the prudent broker acts in the interests of his client motivated to reach the most favourable solution or settlement for his client within the parameters of his intermediary obligations. His performance will determine or at least influence his success in retaining his client’s business. And his reputation will ultimately determine the sustainability of his profession.

The majority of brokers like the majority of assessors, act in accordance with their professional obligations.

Brokers are governed by a well-considered piece of legislation designed to regulate fair and proper practice. Although there is no similar legislation for motor assessors, it may well be an item on the agenda of one of the industry associations. Members could investigate the benefits of professionalising a body of assessors and compelling independent motor assessors to be governed by an industry council. Sanction for deviant behavior would be given, rogues expelled and credibility hopefully achieved and sustained.