Did You Get The 'Colossus Letter'?
What is Colossus and How Does it Affect My Claim?
Have you received a letter from an ansurance adjuster that goes something like this? The following text comes directly from a letter that Allstate sent to one of our clients.
"I am writing to let you know that I am involved in the handling of the bodily injury claim listed above. One of the tools that our claim personnel may use in evaluating your claim is a computer program known as Colossus, licensed by Computer Services Corporation. Colossus uses a broad range of information about your injury, treatment, and prognosis to determine the severity of your injury. Based on this information, Colossus makes a recommendation as to the value of your injury. The Colossus recommendation is only one factor among many that our adjusters consider in reaching a decision as to the overall evaluation of the claim. It is their goal to reach that decision promptly, fairly, and based on an appropriate investigation of the facts and circumstances of your claim. If you would like to discuss any aspect of this claim, including this letter, please feel free to call me at the number listed below. Thanks you."
Insurance companies frequently send out similar letters.
Colossus: What It Is And What It Does
Colossus is a computer program used by insurance companies to value personal injury claims. At least half of the insurance claims in the United States are evaluated by Colossus. Colossus is probably on your claims adjuster’s computer screen while they are talking with you. Everything you tell them is probably entered into Colossus.
In the 90s insurance companies such as Allstate turned to Colossus because they wanted to standardize how their adjusters evaluated claims and because they wanted to save money by reducing the amount that they pay for injury cases.
Though Colossus companies have also figured out that most plaintiffs' lawyers (Colossus identifies and keeps track of lawyers) will not file a lawsuit in most cases and are willing to settle for the best offer that they can get.
How Colossus 'Calculates Value' Of Injury Claims
Colossus considers a number of factors when determining the 'value' of your case. Some of these factors include: your reported injuries; the type and duration of your medical treatment; and the amount of damage to your vehicle. Colossus then uses this information and a special formula to assign "severity points" to claims.
The system counts up the points and converts them into a dollar value. That dollar value is typically what the insurance company will offer you during negotiations.
The problem with Colossus is the that it cannot take the place of human beings' understanding of human suffering. Colossus will not take into consideration the human factors, such as stress, pain, inconvenience, loss of enjoyment of life, loss of consortium (if injuries from an accident have affected the person's relationship), inability to participate in the things that you enjoy most, or any number of other things that a juries and judges will consider.
A good attorney knows about Colossus and understands the role it plays in the insurance company’s negotiation of your claim. Colossus also tracks which attorneys play hardball, won’t settle the claim for unfair amounts, and are not afraid to take a case to court if the settlement offer is unfair.
What Insurance Companies Send 'Colossus Letter'
Insurance companies send out the 'Colossus Letter' to basically say something like, "we know what your injuries are; how they should be treated; how long it should take to heal; and what it should cost. And we have a fancy computer program from a big software company that helps us calculate it. We know more about this than you you. So when we give you a number of what your bodily injury claim is worth, we know what we are talking about. Start preparing yourself now to accept whatever number we give you."
This letter is a tactic of psychological warfare. The insurance company is usinig this letter to try to set you up to accept an offer that may be far less than your case is really worth.