Claims Auditing

Service Overview

Investing in claim auditing services is a proactive and cost-effective way for a carrier to positively impact its bottom line. Providing services on an international level, the Claims Auditing practice covers virtually all lines of Property & Casualty Insurance, including environmental, mass tort, products liability, auto, construction defect, workers’ compensation, health care, professional liability, and commercial property. Our auditors average over twenty-five years of experience, and many have held senior management positions at major Property & Casualty carriers. This experience gives us a complete understanding of the issues and problems that our clients are faced with.

Services Performed

Claims Handling Best Practices
Due Diligence review for potential acquisitions
Third Party Administrator (TPA) audits to ensure compliance with Best Practices in the industry and/or with specific service agreements
Review of underlying coverage or Self Insured Retention (SIR) to confirm proper exhaustion
Claim operation reviews to increase productivity
Arbitration and litigation support, including expert witness testimony
Property claims, subrogation, and business interruption

Additional materials

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Sample Engagements

Global Client Operational Audit

An operational audit of an international client’s claim department resulted in a complete reorganization of staffing levels and procedures. Reserve reductions totaling over $25,000,000 were realized based on Alan Gray LLC’s file audit, and the open file inventory was reduced by 35%.

Complex Reinsurance Contract (Healthcare)

A client requested an audit of claims under a complex reinsurance contract involving a large hospital group and multiple years of medical malpractice coverage. The audit identified a significant claim with serious coverage issues under the client’s contract, resulting in savings of $1,000,000 for the client.

Audit Identifies Significant Percentage of Claims as Non-Products

A global insurer requested a comprehensive audit and analysis of an insured’s claim files and related jobsites to develop a model for non-product asbestos allegations. The insured was a distributor/contractor but was billing all losses as asbestos products losses. The audit identified a significant percentage of the audited claims as non-products asbestos claims. The client was able to utilize this information to negotiate a favorable settlement with the insured that resulted savings of over $10 million.