The multi-purpose audit is a staple of sound claim practice. These days, budgets everywhere are constrained. Claim providers are told to do more with less. Unfortunately, that usually means less of their money and more of yours. The reality of claim handling mandates increased vigilance and oversight of the claim handler. Ineffective or inappropriate claim handling can be the largest cost-driver of claim dollars. Generally, we know the cost of the claim provider's service. What we don't know is the cost of allowing the claim provider to engage in sub-standard claim practices.

The audit process provides the most effective window into the claim office. The multi-purpose audit provides excellent insights into the overall quality of the claim operation. Additionally, it provides an opportunity to provide input with respect to client expectations. On a post-audit basis, the review serves as a starting point for developing an action plan to correct deficiencies, and as a benchmark for subsequent audits. Some of the main areas under scrutiny during a multi-purpose audit are:

• Timeliness and appropriateness of investigation.
  Are investigations being done on a timely, appropriate and effective basis? We go beyond a mere checklist of items done, but review and analyze the quality of investigation in terms of being on target with the issues and sufficiently thorough.
• Appropriate use of outside vendors.
  We review the circumstances and procedures used by the claim handler in retaining outside vendors. Are they being used under appropriate circumstances, or are they being used as an easy way for the handler to avoid work? Are they being given specific tasks under the adjuster's guidance, or are they given free reign to "do their thing"?
• Adherence to claim handling agreements.
  Claim handlers routinely make various service commitments through their contracts or claim service instructions. Are the claim handlers complying with those agreements in key areas?
• Soundness of reserves practice.
  Are reserves being posted on a timely and realistic basis? Do closed cases reflect a pattern of significant reserve adjustment at or near the conclusion of negotiations? Are there lots of "surprise" or "unforeseen" developments?
• Recognition, investigation, and handling of recoveries and third party opportunities.
  Does the investigation adequately seek to address third party and subrogation opportunities, and if so are these opportunities being vigorously explored?
• Settlement negotiation.
  Are settlement opportunities being recognized at an early and appropriate stage? Is the claim handler proactively seeking settlement opportunities, or only initiating offers when forced to do in connection with pre-trail hearings? 

While these are the main areas targeted in the multi-purpose audit, they are not the only areas. We have the flexibility to construct the audit to your specifications, and to include special focus on concerns identified by the client.