Do Insurance Companies Talk to Each Other?
The market for car insurance is a competitive place with a limited number of customers. Each year, insurance companies battle back and forth for their share of the market. While these companies are fierce competitors, that does not mean they do not share information about your claims history.
Insurance companies share a variety of information about their drivers. Despite competing for the same customer base, these companies exchange information in an effort to provide each other with a complete view of a driver’s history. The purpose of sharing this information is to guarantee insurers base their decisions on accurate information. A problem can arise when bad information is shared. In some accident claims, an insurance company could rely on bad information regarding liability for an accident when negotiating a claim. When this happens, a car accident lawyer might be able to help.
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Why insurance companies share info
Insurance companies primarily work together in an effort to control policy pricing. By ensuring every insurance company has the best information available, they can prevent one insurer from offering a policy at premiums that are too low. This prevents insurance companies from entering into bidding wars based on bad information.
What information is shared
Insurance companies do not contact each other directly and go over your claim history or driving record. They do, however, have access to a variety of information through a database known as the Claims Loss Underwriting Exchange (CLUE). Insurance companies that are members submit data to this database and have access to these reports from other insurers.
An entry is made into CLUE when claims are initially filed, resolved, and closed. These reports can outline your driving history and the record you have of auto insurance claims. These claims cover your history across every carrier that is a member of CLUE.
There are important pieces of information that these insurance companies frequently share. They include:
- At-fault vehicle collisions not voluntarily reported by a driver
- Non-fault collisions that did not result in a police report
- Accident claims from members of the insured’s household
- Lapses in coverage
- Length of time with previous insurers
For the most part, this information has more to do with the application process than it does with responding to a claim. In some cases, Los Angeles car accident attorneys might be needed to clear up the facts regarding the accident and obtain fair compensation for the driver.
How information sharing could impact an injury claim
One problem with the CLUE system is that the information in these claims is not always accurate. This information could dramatically increase the premiums an insurance company could charge you for a new policy.
Inaccurate CLUE reports can also have a detrimental effect on a personal injury claim. Many insurance carriers rely on these reports when negotiating claims or making coverage decisions. If the CLUE report is inaccurate, it could result in compensation below the amount you deserve.
How an attorney could help
If an insurance company has denied your claim or is refusing to negotiate due to bad information, it can be challenging to get them to change their mind. Many adjusters treat the information obtained by other companies as gospel. This can complicate your personal injury claim.
A personal injury attorney from Ellis Injury Law could help you pursue compensation in these cases. While insurance companies might rely on bad information, our firm is dedicated to establishing that you are entitled to compensation. We will work tirelessly to build the strongest case possible for your claim. If you have questions about how insurance companies trading information might impact your car accident claim, schedule your free case evaluation with Ellis Injury Law right away.