How Insurance Companies are Using AI to Cheat Accident Victims

Over the years, insurance companies have become very skilled at minimizing the amount they pay on accident claims. Now they have a new tool at their disposal, and they’re using it to become even more adept at preventing accident victims from receiving a fair recovery.

Artificial intelligence can process claims faster than human agents, which is the justification insurance companies use to have claims evaluated by computers rather than people. But there are benefits that they aren’t publicizing. Accident victims and other insurance claimants need to be aware of how AI is being used to cheat them by undervaluing their claims.

Software That Was Once Experimental Is Now Being Used Routinely

AI-driven software programs such as Colossus, Insurance Suite, Xactimate, and Guidewire are used by insurance companies to evaluate personal injury claims, particularly those involving car accidents. Basic information is entered into the system for consideration. This includes data about the victim’s medical diagnosis, the duration of treatment, and wages lost due to time off work. Using thousands of factors, the programs rank the severity of the victim’s injuries and assign a value to the claim.

While some companies still rely primarily on human claims adjusters, surveys by the National Association of Insurance Commissioners reveal that over 80% of auto insurers use some form of AI in their claims operations. Since the survey, the market for AI programs in the industry has grown substantially, reflecting increased use of AI in claims evaluation and processing.

Uneven Evaluation by AI

While thousands of factors may be evaluated in the AI decision-making process, many more are left out. Moreover, the way the systems are programmed undervalues many aspects of injuries, particularly those that are catastrophic in nature. These programs often provide a reasonable evaluation of objective factors that can be readily observed and measured, such as medical expenses. However, the programs are set up to undervalue noneconomic, intangible effects of accident injuries.

A conversation with any accident victim will reveal that the intangible effects impact their lives the most. Many would trade everything they own for the chance to live without constant pain or the opportunity to enjoy the activities that were once a key part of their lives. Traditionally, intangible effects such as pain, suffering, and loss of enjoyment were the components of claims with the greatest value. When human judges and juries consider the true impact on the quality of life, they understand that it is only fair to provide full compensation for what the victim has lost.

AI programs, by contrast, don’t assign much value to these factors. They don’t understand pain. They don’t understand the anguish of watching life pass you by while you sit in a hospital bed or wheelchair. They assign a minimal value to pain and suffering and seem to expect victims to be grateful that they get anything at all.

Different Ways that Automation Can Devalue Your Claim

The AI programs used by insurance companies use a variety of different tactics that ultimately reduce the value of claims for accident victims. These include:

• Speed processing. AI programs conduct rapid evaluations to prepare quick, low-settlement offers issued to accident victims while they are still in the early stages of shock and recovery. The insurance companies pressure victims to decide on an offer before they’ve had time to understand the implications of their injuries or to talk to an attorney about their legal rights. While this tactic has been used by insurance companies for quite a while, AI processing allows them to do it much faster, putting even more pressure on overwhelmed accident victims.
• Automatic denials. When evaluations and decisions are made by artificial intelligence, the logic is not always logical by human standards. The program might look at a few criteria to make a snap decision while missing the big picture. AI programs might deny a workers’ compensation claim based on criteria A and B without considering criteria C-Z.
• Data mining. Insurance companies use AI programs to analyze large amounts of data collected from social media, smart watches, and other tech to look for any reason to deny the existence or severity of injuries. The program might flag an injured worker’s claim as fraudulent because of a photo of the worker engaged in outdoor activities, even though the photo was 10 years old. Or the program might review evidence of high heart rate as a sign that a truck accident victim is well enough to exercise, when, in fact, it was the stress of a doctor’s visit that caused a spike in blood pressure.
• Predictive litigation modeling. In addition to analyzing the accident victim, AI programs can also analyze their attorneys. They often assign scores to personal injury attorneys to assess how likely they are to take a case to trial. Attorneys known for settling early or accepting low offers are scored as less of a “threat” to see a case through in court, so the program determines that there is no need to make a full settlement offer.

When accident victims accept an early settlement, they reinforce the success of these AI programs. Hiring an attorney who is prepared to litigate to obtain full compensation for every aspect of an injury is the best way to overcome the robotic suppression of your claim.

Work with an Attorney Who is Always Prepared to Litigate

It has never been easy for accident victims to recover full compensation for their tangible and intangible losses. Insurance companies work very hard to fight claims using a wide array of tactics. The industry acceptance and usage of AI just make it that much easier for them to succeed.

To obtain what you deserve after an accident, it is necessary to work with an attorney who is willing and able to establish liability and justify your damage award in court. When an attorney is prepared to win before a judge, the insurance company will often concede and propose a fair settlement. But if they believe that an attorney is willing to settle for less to end the case quickly, they won’t offer the full amount. Choosing the right attorney can make all the difference in the outcome of your claim. At the Law Offices of Benjamin Arsenian, PC, we view litigation as our chance to shine. We are always laying the groundwork to succeed in court. To find out what may be possible in your case, contact us today for a free, confidential consultation.