What "Loss of Control / Report" Means In An Auto Accident Case

When I first started in the automobile insurance claims business, there was a key phrase that was integral to every injury claim. That phrase was “Loss of Control.” To the insurance company, that phrase is an ill omen, but not for the injured person. Here is why.

Every injured person is known as a claimant. There are two kinds of claimants, those that are “unrepresented” and those that are “represented.”

Without Representation by an Auto Accident Attorney – Control Is Maintained.

The majority of claimants are unfamiliar with contract law (insurance contracts) and tort law (laws regarding negligence). These claimants are at a disadvantage when dealing with an insurance adjuster. If a claimant remains unrepresented, that claim may be settled in a low range (settlement amount).

Each claim has an estimated reserve set aside to pay that claim. So, these managers pass the word down through the chain of command to the front line adjusters to “control” the claimants. That means, take steps to encourage claimants not to seek attorney representation.

With Representation by an Auto Accident Attorney – Control Is Lost.

If a letter of representation is received in the claim office, then the assigned adjuster had to write an explanation of why he/she lost control of that claimant.

In 1979, that phrase was changed to “Loss of Rapport.” Control sounded too negative. It could be interpreted as somehow preventing an unrepresented claimant from seeking legal counsel. To establish and maintain rapport sounded so much friendlier. Again, once Loss of Rapport occurred, the adjuster still had to explain why it was lost and how it could have been prevented.

Key Take Away

Here is the lesson to take away. It is in the best interest of an insurance company to keep injured persons from seeking attorney representation. It is in the injured person’s best interest to make sure they are being treated fairly and in an even-handed manner. However, each injured person must make up his/her mind as to what works best for them.

If you have been involved in an auto accident, give us a call at (800) 848-6168 to schedule a free consultation with an auto accident attorney.


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