There are good business reasons why claims and underwriting professionals of casualty insurance carriers don’t talk to each other about claim denials, underwriting executives said last week, with one offering enterprise risk management as part of his explanation.

Executive Summary

A policyholder attorney got an unexpected response to a question about why claims and underwriters don't talk to each other about disputed claims last week, when an underwriter said ERM issues prevent it, instead of responding that "the policy speaks for itself."

“There’s a lot of separation of church and state that supports the credibility of how claims get handled,” said Joseph Cellura, senior vice president, property and casualty, for Allied World.

“How do you keep me [on the underwriting side] from influencing a claims examiner’s loss reserve” if the two sides do talk to each other, he asked. If the claims examiner “puts up a loss reserve, I want it to be low for my P&L,” Cellura said, referring to profit-and-loss summaries of underwriting businesses.

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