Sedgwick: Accident Claims and Settlements

Dealing with This Third Party Administrator in Accident Cases

Sedgwick (formerly Sedgwick CMS) is not an insurance company, but it provides some services like an insurance company.  They call themselves a “third-party administrator” (TPA) which basically means that they are insurance adjusters for self-insured companies and smaller insurance companies that have a small claims department (or have no clams department). This means Sedgwick handles the claims process for them. Our lawyers have seen Sedgwick representing companies like Target, LabCorp, Home Depot, Walgreens, Sears, General Electric and Kroger.  For those and other clients, Sedgwick will handle the claims process for automobile accidents, workers’ compensation cases, premises liability (including slip and falls), other injuries, disability, FMLA, and professional liability (including medical malpractice).

Background

After about 40 years, the company has 10,000 employees and 190 offices in the United States and Canada.  They do many of the things that traditional insurance companies do:  field investigations after report of an accident, setting reserves for claims, coordinating with lawyers defending their clients’ claims, and working towards settlement.  The main difference between TPAs like Sedgwick and a typical insurance company is that Sedgwick competes for its clients’ business, so it has an extra incentive to save money in settlements, perhaps more incentive than the average insurance agent.   

For liability claims like automobile accidents, the company notes on its website that it follows these “best practices”:

to make immediate contact with injured third party claimants to ascertain the facts and claimed damages. Statements are taken as appropriate from the claimant and witnesses; police reports are obtained when available and relevant; photographs may also be obtained.

As you might expect, we tell our clients that they refer all requests for dialogue from insurance companies or third-party administrators to us—there is typically no good reason for an automobile accident claimant to speak with the opposing side’s insurance representatives. 

Competition

Sedgwick is one of the top third-party administrators in revenue.  According to Business Insurance, the following third-party insurance companies were ranked by revenue for claims handled for self-insured clients:

  1. Sedgwick Claims Management Services, Inc.:           $808,152,678
  2. Gallagher Bassett Services Inc. :                              $401,900,000
  3. UMR, Inc.:                                                                  $393,949,776
  4. Broadspire Services, Inc.:                                          $236,467,690
  5. ESIS, Inc.:                                                                  $195,400,000
  6. Meritain Health:                                                          $193,000,000
  7. CoreSource, Inc.:                                                       $  86,619,141
  8. York Risk Services Group Inc.:                                   $  86,000,000
  9. Wells Fargo:                                                               $  74,512,426
  10. Canon Cochran Management Services:                     $  67,500,000

In 2010, Sedgwick was also the largest third-party administrator for workers’ compensation claims (calculated by revenue paid for claims), with Gallagher Bassett just underneath it. 

Technology

Sedgwick uses a software program known as Juris as a central repository for all of its client information.  Juris maintains data on medical bills (“including information such as payment details, service descriptions, procedure codes, methods for calculating fees, provider and vendor contacts, and reasons for review”), and time tracking (for workers’ compensation and disability cases, “to monitor the work statuses of individual claimants while off work or on restricted duty. This function helps users track a claimant’s progress and get the claimant back to work quickly”).

Trying to Reach a Settlement with Sedgwick Without a Lawsuit

Sedgwick is a bit harder to predict because they are following their clients instructions. Some clients ask Sedgwick to take a tough position and give them little authority to evaluate and settle claims for fair value. Other Sedgwick clients are looking to get cases resolved and take a very different view. In car accident and slip and fall cases, which is where we generally see Sedgwick, it is difficult to resolve cases before filing suit just because a lawsuit seems to get Sedgwick's clients to focus on the case. But Sedgwick appears to be a little more realistic in valuing cases than its main competitor in third part adjusting, Gallagher Bassett.

Dealing with Sedgwick on Injury Settlement Claims After a Lawsuit is Filed

Like almost all insurance companies and third party administrators, Sedgwick gets more reasonable after a personal injury lawsuit is filed. Companies using Sedgwick typically do not have in-house counsel to defend their cases. So attorneys' fees become an issue after a lawsuit has been filed. This reality allows Sedgwick's clients to get serious about evaluating the case before it goes to the next level. Again, this is a broad generalization that varies by company and by the advice and evaluation Sedgwick is giving with respect to the settlement value of the claim. Among other things.

Hiring a Lawyer to Take on Sedgwick

If you have been injured in an accident in Maryland where the at-fault company is self-insured and uses Sedgwick, call us at 800-553-8082 or click here for a free consultation.

More Information on Dealing with Sedgwick in Injury Cases