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La. Insurance Commissioner, ESIS Deny Claims-Hiring Rumor (updated)
Experts attest the BP claims process is going smoothly and with typical levels of adjusters, with ESIS staffing 32 field offices with more than 500 adjusters.
By DAN REYNOLDS, senior editor of Risk & Insurance® Rumors that Philadelphia-based third-party administrator (TPA) ESIS is putting novice claims adjusters to work on the BP oil spill claims in the Gulf Coast don't hold much water, according to Louisiana's insurance regulator, the company and other experts.
"It's the first I've heard of it," James J. Donelon, the insurance commissioner for the state of Louisiana, said when Risk & Insurance® queried him on the rumor on June 16. More experienced claims adjusters were subsequently hired, according to a June 9 post from Dimechimes ClaimSmentor. Over the past two weeks, BP has booked full-page ads in newspapers and television featuring claims representatives to reassure claimants that it is fairly and timely resolving claims. ESIS hired Worley Claims, the Hammond, La.-based claims service, to assist it in adjusting claims related to the BP spill. Donelon said that members of his staff have investigated some BP-related claims centers throughout Louisiana. "We have done some visits to claims centers and found them to be operating smoothly, but that is not all of the claims centers and I do not know how many adjusters there are." he said. A surge of complaints would trigger an examination of the claims operations, Donelon added. Because BP is self-insured, however, an insurance company is often not the ultimate payer of the claim. As a result, Donelon said, it is possible that irate claimants may not be bothered with alerting Louisiana regulators about poor service. A long-time claims adjuster with management experience in processing Exxon Valdez claims called the idea that BP would instruct ESIS not to hire adjusting staff with Exxon Valdez experience "a distorted rumor at best." He also estimated that the reported workload for BP spill adjusters, at around 75 claims per adjuster, was within the "reasonable" range, generally speaking. "We can share that the claims professionals working with or for ESIS are experienced in crisis situations and distributing funds to people affected by catastrophes as quickly as possible," Carla Ferrara, a Philadelphia-based spokeswoman for ESIS parent company ACE USA told Risk & Insurance® in an e-mailed response to questions. ESIS has established 32 field offices throughout Louisiana, Florida, Alabama and Mississippi, Ferrara also said. Those field offices are being staffed by more than 500 adjusters. Donelon said his department has become skilled at knowing when claims are mishandled given the department's experience of settling claims related to hurricanes Katrina and Rita in 2005. "We had a million claims in connection with Rita and Katrina five years ago, so yeah, we do know when things are not being handled as they should be, I believe, and we are knowledgeable and experienced and staffed enough to monitor this situation from an insurance regulatory perspective, no doubt," he said. Dealing with BP-related claims is likely to go on for months as the spill, already the largest in U.S. history by far, will end up spewing hundreds of millions of gallons of oil into the Gulf of Mexico. BP engineers are expected to complete drilling a relief well that will stop the flow by mid-August. June 18, 2010 Copyright 2010© LRP Publications |
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