By: Corey M. Meaux
I’ve received this call and/or email hundreds of times. An adjuster is sitting on the fence about accepting or denying an accident or body part, but they don’t know which way to go. They have looked at all of the facts and scenarios, but they still cannot pull the trigger on acceptance because something doesn’t quite add up. What do you do in this situation? Well, first, please do not read this email to be my suggestion that you deny every claim because that is not what I’m telling you to do. However, if you’re ever caught in the situation where you simply cannot decide one way or the other, I’m going to go over the risks and rewards of denying versus accepting.
If, for instance, you are faced with an unwitnessed accident and the emergency records don’t quite match the reporting of the incident to your employer, obviously there is still some investigating to do on the claim. While you’re investigating, you may even receive a letter of representation from an attorney threatening to file a lawsuit and seek penalties and attorney’s fees. Do not let that stop you from completing your investigation. If an LWC-WC-1008 is filed, you face a maximum of $6,000.00 in penalties – $2,000.00 in penalties for not paying wage benefits, $2,000.00 in penalties for not approving medical treatment, and $2,000.00 in penalties for not approving the claimant’s choice of physician. However, remember that these penalties are not guaranteed. If you properly indicate in your claim notes that there are inconsistencies and other factors that need to be investigated, and you continued to update your investigation, the trial judge may very well rule that you were reasonable in your investigation techniques and not award penalties and attorney’s fees, even though they may ultimately rule in favor of the claimant.
On the other hand, if you accept the claim and begin paying, but you find out information that leads you to no longer believe the claimant, you’ll likely want to terminate benefits once this new information is discovered. If you terminate benefits, you may face $8,000.00 in penalties for the termination of benefits being paid to the claimant. Again, the trial judge may rule that you were reasonable in your investigation and not award these penalties. But, by initially accepting the claim versus not accepting the claim, you’ve already added an extra $2,000.00 toward penalty and attorney’s fee exposure before discovery even begins.
Never be afraid of a lawsuit. Not only is it sometimes in your best interest to deny versus accept based on penalty exposure, but this now opens the door to discovery for your attorney. This means that he or she can now forward interrogatories to the claimant and schedule his or her deposition. Furthermore, your attorney can subpoena medical records to fully investigate the claimant’s medical history. This is why I always recommend denying whenever you’re in a 50/50 type of situation. There is nothing wrong with fully investigating your claims, and if you ever have questions regarding an acceptance or denial, never hesitate to reach out to us for help.