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MOTOR CLAIMS STAKEHOLDERS WORKSHOP

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MOTOR CLAIMS STAKEHOLDERS WORKSHOP Powered By Docstoc
					                 MOTOR CLAIMS STAKEHOLDERS WORKSHOP

The workshop was held on 9th September 2010 at Sarova Panafric Hotel.
One hundred and twenty participants attended the workshop.

The following topics were presented:

1. Overview of Motor Insurance Claims by Mr M Mukoma - Convenor, Motor Technical
   Committee.
2. Motor Claims Malpractices - Motor Assessors’ Perspective by Mr Mirichu Nderitu -
   Motor Assessors Association of Kenya (MAAK).
3. Motor Claims Malpractices - Motor Investigators’ Perspective by Mr Mike Munyoki -
   National Association of Kenya Investigators (NAKI).
4. Motor Claims Malpractices - Motor Repairers’ Perspective by Mr Nasir Karmali -
   Kenya Automobile Repairers Association (KARA).

During the plenary session, participants were asked to list the various malpractices
done by the stakeholders.

Their contributions are below:-

1. INSURERS

 MALPRACTICE                                   COUNTER MEASURE
 1. Poor underwriting practices in risk          Garages should seek dialogue with
     evaluations                                 underwriters on effect of not paying in
 2. Collusion of staff e.g. soliciting           good time. Should seek alternative
     commissions                                 survival
 3. Lack of integrity in creating panels         Proper underwriting
 4. Delayed payments and adjustments of          Adhering to IRA guidelines
     fees without consultations                  Integrity
 5. Backtracking on agreements                   Treat service providers equally
 6. Invoices not paid on time                    Honour agreements
 7. Accepting inflated sums insured              Payment on time to avoid
 8. Windscreen claims on vehicles with           inconveniencing garages who take out
 9. pre-existing cracks                          loans and are charged interest on
 10. Lack of integrity (release letters not      defaulting
     properly worded)                            Valuation should be done
 11. Back dated insurance covers                 Letters should be clear and avoid
 12. Laxity to follow up on documentation        ambiguity on what is clear, payment
 13. Not being strict on claim notification      should be done
     duration                                    Stop giving certificates to intermediaries
 14. Too much involvement in filing claim        Strict underwriting contract
     forms by service providers                  Stop deciding which late notified claims
 15. No explanation of what is on the            unless with proper reason
     proposal form                               Only allow insured to fill in claim form
16. Valuations                                        Education of the insured
17. Intermediaries                                    Insurers should insist on mandatory
18. Motor claims staff colluding with service         valuation for all vehicles
    providers to allocate work selectively            No insurance through a phone call or
19. Hiding/misplacement of files                      logbook
20. Sleeping on cheques                               Should be done by an independent
21. Receiving Kitu Kidogo                             valuer
22. Not taking into account                           Agents and brokers should not play any
    recommendations of assessors                      role in the motor claim process.
23. Pushing service providers to sign SLAs            No filing of claim forms or choosing
    they have not agreed on                           garages for insureds
24. Leaking confidential information to               Staff monitoring have a system of
    parties who should not have it                    allocating work by rotation
25. Deduction of fee without consultation             Senior management should be involved
    with service providers                            and review the process
26. Asking for documents not in the hands             Intentionally to induce the service
    of service providers e.g. DL                      provider to part with something
 27. Delayed payment of service to service            Should implement systems of fees
      providers                                       settlement, not individualized
                                                      The delayed fees should also be reported
                                                      to senior management.

2.        ASSESSORS
     MALPRACTICE                                   COUNTER MEASURE
     1. Incompetent assessors                        Hire qualified assessors
     2. Exaggerated reports                          Assessors should give regular updates on
     3. Unqualified assessors or investigators       jobs they are handling Have NAKI
     4. Assessors compromised by garages or          members on panel
         insured’s to inflate repair costs           They should all be members of MAAK or
     5. The assessors/investigators contacts         NAKI
     6. Rogue/unqualified assessors not able         Reasonable time in settlement of service
         to do proper job - report                   providers fees to empower them
     7. Assessors who do not visit garages           Rogue assessors to be removed from
         but just get photos from garages - do       MAAK register
         report                                      Should not be released to the brokers or
     8. Assessors doing reports which have           insureds
         not been agreed and signed by the           The assessors reports should be
         garages                                     confidential and should not be disclosed
     9. Use of non MAAK members                      to the brokers
     10. Lack of proper i.e. inspection report –     Report cases to Association for
         no photos                                   disciplinary action
     11. Lack of follow up on repairs by             Employees of MAAK members should
         assessors                                   also be vetted
     12. Variations in estimates between pre-        MAAK & KARA to meet and agree on the
         insurers and accident assessment            way forward
     13. Assessors offering inducement to            Use MAAK members
         insurance claims employees                   Not the work of assessor to monitor
     14. Assessors do reports in favour of            repairs unless required
         garages for fear of being locked out         Rotation as much as possible
     15. Delay in submission of report                SLA
     16. Deliberate inflation of repair costs in
         order to write off
     17. Authorizing inclusion of parts that are
         not necessary
     18. Borderline cases: assessors get
         compromised by garage not to write
         off even if necessary
     19. Rare models - lack of guidance on
         how to handle these cases
     20. Divulging information on the
         assessment to the insured before
         work is completed
     21. Allowing parts that will not be
         replaced for the purpose of making
     22. Use of digital photos

3.      INVESTIGATORS
     MALPRACTICE                                   COUNTER MEASURE

     1. Substandard reports                           Need qualified staff/training
     2. Delayed reports                               Improvement of payments
     3. Being compromised on fraudulent               Integrity/payments
        claims                                        Trainings /have NAKI members on panel
     4. Prescribe possible solution                   Appoint investigators in good time
     5. Incompetent investigators                     Vet investigators integrity
     6. Delayed reports                               Look for all available evidence and
     7. Investigators colluding with claimants        submit it
     8. Unsupported conclusions in reports            Work with NAKI members
        that cannot be supported in courts            Report to NAKI for disciplinary action
     1. scenes of accident
     2. Leaking information to third parties
     3. Coming up with information that
        cannot be authenticated for purpose
        of getting work from other companies

4. GARAGES
     MALPRACTICE                                   COUNTER MEASURE
     4. Theft of parts/vandalization                 Proper storage
     5. Delay in completion of repairs –             Cooperation by towing personnel
        underwriters loosing on car hire             Pay cash in lieu
        extensions                                   Advise underwriters immediately
     6. Putting damaged parts and removing           Integrity by parts collectors
      after assessment                            Disciplinary by Associations
  7. Payment of commissions                       Government involvement
  8. Inflated costs.                              The market price should prevail
  9. Competence of garages.                       Only vehicles below 3 years should be
  10. Submitting invoices not fully               repaired at dealers workshops to attract
      supported as required                       higher discounts
  11. Exaggeration of claims/damage/repair        Some are not capable of undertaking
      cost                                        large jobs especially on chassis repairs.
  12. Causing more damage on the vehicle          Vehicles should be towed to garages
      that is not accidental                      with the equipment. KARA to assist
  13. Paying brokers commission                   Fully supported invoices, re-inspection
  14. Garages influencing claims staff to         reports, purchase receipts, parts
      have them as choice repairers               collection notes
  15. Paying inducements to interested            Garages should seek dialogue with
      parties                                     underwriters on effect of not paying in
  16. Panel beating instead of replacing          good time. Should seek alternative
      with new parts.                             survival
                                                  Stop this/garage panel
                                                  Tell brokers to negotiate for higher
                                                  commission with IRA
                                                  Proper control systems by underwriters
                                                  Cut out the brokers
                                                  Timely payment of garages
                                                  Use of KARA members only
                                                  Assessor to monitor and give a report.


A stakeholders meeting will be held to discuss the report.