Conquering the Claims Dilemma

Car Smart Program ensures long term payout reductions, enhances value to policyholders and provides the support tools to adjusters for easier settlement

In 2001, Andrew bought a new vehicle.
Unfortunately, in early 2002, it was involved
in an accident due to bad weather. Thank
goodness Andrew was not injured, but the
vehicle was a write-off. Andrew�s auto policy
had a 43R, Waiver of Depreciation
Endorsement on it, so Andrew believed the
cost of replacing the vehicle was covered.
The adjuster called a few dealers local to
Andrew to determine the cost of replacing
the vehicle with a new one. The dealers
simply quoted MSRP. Therefore, Andrew
was paid what he had paid for the vehicle
minus his deductible. When Andrew went
back to his dealership to replace the vehicle
with a new one, he found that the price had
gone up by several hundred dollars for
which he was then out of pocket. He called
his adjuster who explained that the 43R
endorsement entitled Andrew to the lower
of: 1) MSRP when he bought the car, 2)
what he paid for the car, or 3) the cost of
replacing the car with a new car, same make
and model, similarly equipped. Because the
adjuster was not able to find a cooperative
dealer, Andrew was paid out based on the
second option of the endorsement. Andrew
accepted the settlement, but was not totally
satisfied with being out of pocket.

Although Andrew is a fictitious
policyholder, this scenario is typical of the
traditional claims settlement process. Had
Andrew�s accident happened in 2003, the
adjuster could have used AutoMallNetwork�s Car Smart Program to
settle for much less than what Andrew paid,
while still offering fair market value, and
most importantly, keeping Andrew satisfied.

Adding Value

AutoMallNetwork is a car broker, a
matchmaker with established car dealer
relationships that allows them to negotiate
aggressive prices on new and used vehicles.
Their Car Smart Program uses a Total
Solution approach to claims settlement �
valuation, adjuster support and policyholder
assistance on their next vehicle, regardless
of make.

Insurers base their settlement on the
valuation supplied by AutoMallNetwork,
who guarantees the price submitted. Unlike
other similar services, AutoMallNetwork
does not just provide valuations. They also
take care of the policyholder after settlement
to ensure they get a good deal on their next
vehicle. This Total Solution approach not
only softens the blow of a lower payout, but
adds tremendous value to the policy.

Car Buying Experts

�Our experience has shown that if the
policyholder�s expectations are managed
from the first point of contact, through the
settlement process and into post-settlement
support and fulfillment, the policyholder is
more likely to be satisfied, even with a lower
payout� says Viraf Baliwalla, President of
AutoMallNetwork. �This also makes the
adjuster�s job a lot easier because there is
less conflict and confusion about justifying
the settlement amount�. Any time technical
questions or resistance arise, the
policyholders and leasing companies are
simply directed to AutoMallNetwork for
explanation and support. This frees up the
adjuster to focus on settling more claims
versus fighting fires on existing claims. It
also allows the adjuster to settle faster, thus
reducing the cost of rentals and storage.
For adjusters, it�s like having car buying
experts at their disposal, as part of their
team. �Adjusters have a lot to think about
and many claims to process each day,� adds

Baliwalla. �They also don�t know all the in�s
and out�s of the car business. Our Car Smart
Program brings that insider knowledge into
the insurance company without having to
hire any additional experts, plus provides
independent, objective assistance to the
policyholders. Since we have no vested
interest in what someone buys or where
they buy it, we can truly work in the
policyholder�s best interests. They certainly
won�t find that by going into a dealership�.

Innovative Alternatives

One of the biggest points of contention
happens when the insurer pays out based
on the cash price versus the finance or lease
price. Depending on the manufacturer�s
incentives at that time, this could represent
up to $3,000 difference, which
policyholders perceive as coming out of
their pocket. After settlement, insurers
utilizing the Car Smart program can refer
the policyholder to AutoMallNetwork to
determine the best financing strategy to get
them back into a similar position as prior to
the loss. In some cases, it may be best to
close out the old contract and start a new
one, and in others it may be best to work
with the original selling dealer to substitute
a new vehicle at the cash price into the old
contract. Surprisingly, many dealers are not
even aware that this is possible.

AutoMallNetwork works with the selling
dealer and policyholder to show how this
can be done.

�My experience with AutoMallNetwork
has been very positive, both for myself and
the customers we are serving� says Ian
Smith, Claims Representative of Allstate�s
Toronto office. �Having this outside
expertise at our disposal has been able to
reduce my settlement times and provides a
great service to my insured�s for buying
their replacement vehicle. Policyholders
tend to look to the adjuster to solve their
problems anyway. Now we have a resource
that lets us do that. I have had nothing but
good feedback from those customers who

have taken advantage of AutoMallNetwork�s
service after we have settled their claim�.

Smoothing The Problems

Policyholders also appreciate the assistance
and the benefits at an already traumatic
time. Car shopping is one of the most
dreaded experiences people have. Having to
do it under pressure after going through one
of the scariest ordeals of one�s life makes it
that much worse.

�My wife was involved in a car accident
which totaled our vehicle, an undeniably
stressful ordeal,� says Eric Maheux of
Ottawa. � The thought of having to once
again shop for a new vehicle while caring for
my wife seemed like quite a daunting task.
The process of finding a new vehicle was
made much easier with the help of
AutoMallNetwork. They were able to secure
a new vehicle at a lower cost, while allowing
me to care for what really mattered, my

To the policyholder, the Car Smart
Program is a direct reflection on the level of
customer service provided by their insurer
when it is needed most. Who can argue with
the results? Policyholders seem to like it,
and AutoMallNetwork boasts they are
seeing a 74% success rate on reducing
Waiver of Depreciation claim costs, at an
average amount of $1,500 per claim.

Advertorial, by Viraf Baliwalla, President, AutoMallNetwork. Viraf can be reached at (416) 249-4049