Closed File Review

Companies looking to increase net income turn to Praxis to uncover overlooked or hidden subrogation potential, and retrieve these assets from closed files. Through our “Subro Closed File Review,” Praxis has built a reputation based on the ability to find and recover these assets, therefore increasing the company’s profitability.

Why outsource closed file reviews? Our claims department can handle it.

Adjusters have many responsibilities during the claims cycle — from determining coverage to calculating damages — and subrogation can sometimes take a backseat to these important functions. Also, when carriers don’t establish subrogation objectives for their claims adjusters, the adjusters will, understandably, tend to focus on more heavily-weighted competencies.

Many claims departments also lack the adequate technological resources necessary to fully develop claims. The most visible evidence of this decline is premature claim closure and the gap it creates between actual and projected subrogation recovery amounts.

The bottom line is that you’re missing an opportunity to increase your bottom line.

What does the process look like for the client?

The process is simple.

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The company provides Praxis with a list of closed files. Data requirements are minimal, and provided by Praxis, based on an initial consultation. Read-only access to your claims system is provided to Praxis to allow file reviews. This is the extent of your IT department’s involvement. Praxis limits the need for its clients’ IT department because we know IT is a scarce resource.

The Praxis audit team reviews the closed file list and identifies claims with recovery potential. We then enter those claims into the Praxis Subrogation System, where they are managed until conclusion.

Praxis’s investigation team then reviews the claim in detail, completes the necessary investigation to perfect the subrogation claim, and places the responsible party on notice.

Once on notice, the Praxis subrogation specialist takes over and pursues the recovery of the subrogation claim. Once recovered, Praxis remits the net proceeds to the insurance company. The company then enters the recovery proceeds into its system and issues the deductible (if applicable).

Should the responsible party fully or partially deny payment, the Praxis subrogation specialist will seek recovery through alternative means, including arbitration and litigation.

In a nutshell...

The most frequent missed opportunities are due to missed referrals by the original claim handler, not pursuing supplemental payments, not identifying certain qualifiers, incomplete liability investigations, and accepting denials when at least a portion of the claim can be recovered.

Closed file reviews can be conducted on any line of business, but collision, no-fault, medical payments, homeowners and worker’s compensation present the best opportunities. Overall, opportunities for increased recovery are identified by comparing company results to industry benchmarks.