The Importance of Timely Incident Reporting

Insurance policies are legal contracts which create obligations for both the Named Insured and the Insurer. One of the Named Insured’s most vital responsibilities is to promptly report to the Insurer any incidents that may lead to a claim or lawsuit.

The timely reporting of incidents is important because the core function of a Claims Adjuster – whether they are handling Automobile or General Liability claims – is to collect information as quickly as possible and to make the most appropriate judgements based on the facts gathered during their investigation. The greater the amount of time between the incident and the investigation, the less likely a Claims Adjuster will be able to obtain quality information: eye-witnesses forget the details, physical evidence & other information deteriorate or are lost, and surveillance footage from local businesses are often recorded over after 30 days. These impediments negatively impact the adjuster’s ability to do their job, and legal counsel as well, which can result in larger settlements.  

Should you be involved in a not-at-fault accident, timely reporting of an incident is equally important. Many Insureds feel there is no true reason to report the incident as they were “not-at-fault”; however, this cannot be further from the truth. You want to make sure you report any not-at-fault accidents right away, in an effort to provide proof that your company was not the primary cause of the incident and allow ample time for them to begin their processes to document your innocence.

Many insureds are reluctant to report claims because they are under the misguided belief that:

  • Over time, the claim will be forgotten or go away on its own;
  • If the claim is reported, the Insurance company will just pay a settlement to close a claim, sticking the Insured with a higher premium rate at renewal; or
  • If a claim is reported, the Claims Adjuster’s attempt to contact the Claimant will result in a lawsuit or claim that would not have normally become escalated to that level.

It is important to understand that insurance companies have an obligation to conduct thorough investigations on all claims and pay what is justly owed.  Delaying to report a claim to the Insurer is not only a violation of the Policy Terms & Conditions but could actually have the exact opposite effect than was initially intended: it could result in a higher settlement due to Claims Adjuster’s investigation becoming prejudiced. 

Be sure to reach out to your agent if you have any doubt or questions about your current coverages, and Apply Today to see how NEMT Insurance can better fit your needs!

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