Hapi's Reserve Practice: A Case Study

HAPI’s reserve practice has remained unchanged since my last review, reserving each claim based on several critical factors; compliance with the medical standard level of care, proper consent, negligence, damages, jurisdiction and whether the insured will make a favorable witness. All these factor will influence the overall value of the claim.

Initial reserves are posted within 10 to 15 business days from the initial report of loss. Thereafter, the claim financials are adjusted as the claim develops taking into account the aforementioned critical factors.

Due to the complex medical and litigation issues, these claims are not fully reserved until sixteen months from the date reported to CAP. Most of these claims require a detailed claim investigation followed by an extensive litigation process. As a matter of course, many of these claims require multiple medical experts to determine whether HAPI’s insured member breached the standard level of care during their course of treatment and or surgery for the patient. Moreover, depending on the type of alleged injuries and or subsequent disabilities, additional experts (economist, nurses, &
Slaustas has settlement authority. All settlement authority requests are referred to HAPI’s Claim Review Committee panel (CRC panel) with in the HAPI organization. The CRC panel consists of five elected HAPI physician members (Chair, Vice Chair & three physician members). The CRC panel will examine the record and provide their opinion as to whether their insured’s treatment fell within an acceptable level of Standard of Care. The CRC panel will than review the claim with the assigned defense counsel, discussing defense strategies and the expected litigation outcome. The CRC panel will than communicate their overall findings to the insured providing the recommendation whether it is a claim to defend or settle. However, the final settlement decision rests with the insured