Personal Injury Law

Allstate Colossus Settlement

Allstate has agreed to pay New York $1.2 million as part of a $10 million regulatory settlement involving Colossus, its infamous computer software that values personal injury auto accident claims.

Under attack was Allstate's use of Colossus, a software program Allstate and many other insurance companies use to value the value of injuries in auto accident claims. The claim against Colossus would not shock a single accident lawyer in Maryland: there are inconsistencies in Allstate?s management and oversight of the Colossus software program. Specifically, Allstate filed to modify or ?tune? the software in a uniform and consistent
manner for personal injury accident claims.

Under the settlement agreement, Allstate will make substantial changes to how Colossus is used:

• Providing notice to claimants that the Colossus software program may be used in the adjustment of their bodily injury claims
• Enhancing its management oversight of Colossus to ensure that it adheres to established criteria and a uniform methodology in selecting claims to be used to ?tune? or modifythe software to reflect recently settled claims
• Strengthening its internal auditing of Colossus and bodily injury claims handling to ensure adherence to written guidelines and procedures
• Consolidating its bodily injury claims handling practices into a single claims handling manual
• Not establishing a policy or rule requiring claims adjusters to settle bodily injury claims solely on the value recommended by Colossus and not providing incentives for claims adjusters to settle claims at or near the value recommended by Colossus.

Full post as published by Maryland Injury Lawyer Blog on October 19, 2010 (boomark / email).