The following are state requirements for suspending the driver licenses for those who have caused accidents while not in possession of valid insurance. To effectively prosecute such cases, be sure to utilize your local counsel as well as verifying the specific processes with the individual state Department of Motor Vehicles, Secretary of State or appropriate governing agency. (Click on picture for enlargable image).
Maintaining modest A/Rs is good business throughout the year. With year end right around the corner, there's no better time than the present to ratchet up efforts, collect aged receivables, and clean up your balance sheet. Not that you needed any additional reasons to collect an aged receivable, but obviously your accountants will no doubt expect you to write off bad debt shortly as well.
Here are 4 steps you should be doing today to clean up your receivables by year end.
1) Do an honest assessment your receivables
Every 90+ day receivable has risk. Time is money. Every day reduces the likelihood of collection.
2)Offer incentives to clean up aged receivables.
You believe that 100% of the debt is legitimate. But you have collected 0%, despite promises by the debtor. Offer a discount for payment by year end.
3)Invoice earlier to be sure you are in a strong cash position by year end.
This is good policy regardless throughout the year.
4)Place more troubled accounts in collections-TODAY.
Stop procrastinating. Don't bluster or threaten the debtor. Just place the account and let the professionals handle it from there.
Year end should not be the only time that aged receivables get highlighted. Put tighter policies in place for 2012 and beyond.
When it comes to recovery of property and uninsured motorist subrogation accounts there is some debate about using a collection agency versus a attorney. Greentree has conducted case studies with our clients and the findings may surprise you, keep reading.
- Collection agenies have the tools in place to effect a quick and inexpensive recovery.
- Collection agencies have skip tracing tools in-house to quickly locate claimants.
- Collection agencies can suspend drivers licenses on a state by state basis, this often turns a torte into a contractual debt.
- Once the claimant signs a promissory note, collection agencies can report any late or default payments on an agreement to the credit bureaus.
In most cases you will find that a collection agency is equipped with the tools that will liquidate claims faster and without any out of pocket filing fees.
I am sharing this informative article from Chris Tidball.
hat happens when subrogation demands come in to your organization? If you are like many in the industry, responding is not a high priority amongst adjusters. In the eyes of many handling these types of claims, it is often viewed as being just another carrier on the other end of the demand.
In looking at what carriers are doing, there are various processes in place. While some are effective, others are very time consuming resulting in adjusters putting these off even longer which can result in an increase in arbitration or litigation filings.
While there are no hard and fast rules for subrogation response, there are steps that can be taken to dramatically improve results. As I consult with insurers, it seems that there are three processes that tend to govern how these types of claims are handled.
1. Liability Adjuster Review and Pay- The subrogation demand goes to the liability adjuster who reviews the claim for payment. In many cases, these “low priority” demands are simply rubber stamped.
2. Estimate Rekeying- In some instances, the inbound demands are sent to material damage adjuster to rekey. While this can result in some estimate reduction, it is a time consuming process and often lacks a containment mechanism for excessive rental, diminution of value or administrative fees.
3. Estimate Redlining- Adjusters will review the estimate and redline certain items that stand out. While quicker than rekeying, this solution often has limitations on effectiveness, especially when seeking out alternative parts or identifying included and overlap operations.
In many instances, the savings found through rekeying or redlining aren’t realized when the claim is sent back to the liability adjuster to negotiate. In a recent meeting with an insurer, they conveyed that their material damage team was reducing estimates by nearly 10%, yet when the actual payment detail was reviewed, these found savings were realized less than 1% of the time. As is often the case, the root cause was ineffective negotiations.
Another critical oversight is comparative negligence. When reviewing claims in your organization, does there appear to be a disproportionate number of liability decisions at either 0% or 100%? In my experience the answer has always been yes.
The reality is that far more accidents than most people realize have shared culpability. According to Jury Verdict Research, a national organization that tracks such data, rear end auto accidents accounted for only 45 percent of auto cases adjudicated, with the remainder comprised of intersection collisions, lane changes, chain reactions, and parking lot scenarios. In other words, a lot of claims where there was shared liability.
As an insurer, you certainly shouldn’t expect to set a benchmark that high, as very few claims actually make it to trial. What you can do, however, is bank on the fact that if fewer than 35 percent of your collision claims are closing without comparative fault, then money is being left on the table.
Again, the challenge is to effectively train your staff to not only effectively identify opportunities, but teach them how to negotiate.
When considering subrogation response, there are six key areas where your organization can not only benefit but gain a competitive edge in the marketplace.
1. Estimatics opportunities – While this can be partially accomplished by rekeying or redlining, why not take the next step and utilize automation to identify opportunities?
2. Historical alternative parts identification – Subrogation responses can be significantly impacted by identifying if used or aftermarket parts were available on the date in history when the claimant carrier wrote their estimate.
3. Adjust the fluff- How much are you being billed to tint paint, feather edge, cover cars and dispose of hazardous waste. While not the bulk of the estimate, fluff can really add up.
4. Diminution of Value- There are rarely statutory guidelines that govern how much is owed, if anything, due to diminution of value. After all, is there really any diminished value until the owner sells the car, discloses the accident and suffers diminshed value as a result of the disclosure?
5. Comparative Negligence- This is arguably one of the most overlooked aspects of the subrogation response process. By effectively understanding the principles of shared liability, adjusters can more effectively apply the laws in their given states. This is also an aspect of the claims process that can be measured and continually improved upon.
6. Loss of use- Did the claimant really need their rental vehicle for thirty days when the estimate called for sixteen hours of repair time? The reality in many claims organizations is that rental is not well managed. In some cases, the process of overseeing rental is even outsourced to the rental company who is in the business of increasing their own revenue, not yours. By applying a reasonable standard, such as one day of rental for every few hours of repair, one can effectively reduce what is owed in this regard.
As subrogation demands come in, consider the steps that are being taken to identify opportunities. While there are many aspects of claims that can often benefit from improvement, subrogation response provides an immediate financial gain because those effectively handling this process will gain a competitive edge over those who are not.
Christopher Tidball
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I am so excited to announce that I will have the opportunity to attend the NAWBO Women in Business Conference this year, being held in San Diego. This is so exciting because it means that I will have the opportunity to meet and network with leading women in business from all over the nation, and be able to learn about challanges that are specific to women business owners. This is my first year as a member of NAWBO and I have been continuously impressed with the high quality speakers that lead our meetings, along with the caliber of women who are members of this group. If you too want to get in on the action, head on over to www.nawbosd.org for more information. Hope to see you there!
Information is a wonderful thing, and thanks to the internet we all have access to more and more of it. In our industry this often times means dealing with more educated debtors. If you google debt collection on the internet you will find hundreds of hits on how to avoid paying your debts. It is important that any collection agency that you select have a clear program in place on how to deal with these disputes.
The first step is to determine wether or not the dispute is bogus. There are several ways in which this can be done effectively. Rule number one, any form letter, printed off the internet (they are quite obvious) is a red flag. We can easily tell that at this point the debtor is going through the motions based on internet searches or advice and hoping the collection agency will not respond. Greentree does respond to each and every one of these letters, providing verification of the debt and requesting that the debtor provide proof of payment or validilty of the dispute.
If the dispute is deemed valid, agents should work diligently with clients and the customer to try to come up with an amicalble settlement. This is key in helping client's maintain integrity and reputation.
If the dispute is bogus, collection efforts should continue, it is true that bogus disputes waste time, and cost agencies more money to resolve, but with a comprehensive program in place these disputes can be overcome and the debts can be liquidated.
Generally speaking, collection agencies have a couple of ways that they structure fees for collecting on past due receivables. They will charge a fee up front for their services, this may be a letter series, or just one letter depending on the price point. Or they will charge you on the back end, by a contingency fee. Both of these pricing structures have some pro's and con's. The trick is to determine which service works well for your organization.
Accounts that have not been worked in-house by a credit department, and are of larger balances, definetly can benefit from a pre-collect letter service. If you are using a collection agency now paying contingency rates, and finding that the majority of your accounts are being collected within the first thirty days, it would be a good idea to talk to your repersentative about trying a pre-collect program. This could save hundereds of dollars being spent in contingency fees. You may also try to find a common denominator on the quick paying accounts and enroll them in a pre-collect program.
The benefits of a pre-collect program are as follow:
Cheap, you can pay anywhere from 5-20.00 to get your accounts collected.
Soft collection, a letter, or a letter series of your choosing. No phone interaction between your client and a collection agency.
Control, all monies are directed back to your office, not the agency.
Are you caught in a frusterating cycle of sending out invoices every month, making a phone call requesting payment, and either being ignored or told the proverbial "checks in the mail"? It may be time to look at your options and reach out to get some help.
When you’re dealing with accounts that have lagged on payments, whose checks have bounced, who have totally stopped making their payments and have deemed themselves unreachable and a dozen other scenarios that will surely make your head spin, it may be time to look for help.
Usually, a debt collection agency is called upon when you’ve already tried resolving the issue using your in-house crew and having them initiate non-threatening appeals to your accounts by making phone calls, sending letters and even making personal visits. At this point,hiring a collection agency seems to be the best way to deal with the situation.
When selecting a debt collection agency, you have to consider their technological capacity and equivalent manpower to handle your demands. When you say technological capacity it means that the agency will have the contact center in place to handle any communication between your customers and the agency, with reporting to be done on a regular basis to you as the ‘mother’ company.
Selecting an agency that is willing to work with you to develop a business strategy specific to your needs is of great importance. In today's economy looking for an agency that is operating with integrity and soultion based approach will go a long way towards maintaing goodwill from your customers and in the long run, recovering more dollars.
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A recent trend in the credit and collections industry is using social media sites as a way to track down and contact debtors. As more and more people turn to social media sites to keep friends and family abreast of what is happing in their lives, increasingly other industries are finding ways to make use of this information, wether it be advertising, or collecting an unpaid bill. If you are considering weather or not to add social media to your in-house collection efforts consider the following information often obtained through social media sites,
- New job information
- New home purchase
- If the customer has recently moved
- Are they able to afford vacation or new toys?
It is quick, easy, and best of all free.