February 2017 E-Bulletin for Arbitrators

This month's E-Bulletin topics include:

  1. System Maintenance, March 2017
  2. Damages Proven? Damages Disputed?
  3. Revised E-Subro Hub Guidelines and Arbitration
  4. Damage Disputes from Both Perspectives
  5. New Arbitrator Training Courses Offered!
  6. Member Feedback... Thank You, Arbitrators!

System Maintenance, March 2017

Image of a laptop with tools on it

AF is scheduled to perform system maintenance and upgrades. As a result, AF's website will be unavailable from 10 PM Eastern on Friday, March 10, 2017, to 6 PM Eastern on Sunday, March 12, 2017.

We apologize for any inconvenience this may cause our members. AF is committed to continuously enhancing our products and services. We thank you for your continued support.

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Damages Proven? Damages Disputed?

Image of a damaged car

Assuming the Applicant has proven its liability position, as the arbitrator, you also need to verify that the amounts sought are supported. For example, if the Applicant is seeking $2,000 for repairs and $200 for rental, the Applicant will need to validate these amounts with some form of evidence, such as an estimate or rental bill. The Respondent might not have specifically disputed the damages sought, but the Applicant still needs to support or validate the amount. If, for example, no proof is submitted to support the rental amount, you may award "Reduced Damages," subtracting the rental amount, and explain the reduction (no rental proof submitted).

If the Respondent has specifically disputed damages, e.g., the repair amount and/or the rental amount, as the arbitrator, you must resolve the damage dispute and reduce the amount sought, if the Respondent proves its position. Read more on hearing cases with disputed damages, specifically where damages must be disputed for arbitrator consideration, and does the damage dispute provide sufficient information.

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Revised E-Subro Hub Guidelines and Arbitration

Revised E-Subro Hub Guidelines went into effect in February 2016. The revised guidelines include the following:

Counter Offer Acceptance
Using the "Accept" action within E-Subro Hub to accept the last offer made by the Responder should be considered a final settlement.

When the "Accept" action is being used to accept the Responder's last offer as a partial acceptance, and there is intent to file arbitration for the remaining balance, it should be clearly noted in the message field that the counter offer is being accepted as a partial agreement and that arbitration will be filed.

As an Auto Arbitrator, you may be assigned a case wherein the Applicant is seeking the balance of the claim from the Respondent. Hopefully, per the Guideline, the Applicant includes information from the E-Subro Hub negotiations to support that it partially accepted the Respondent's last offer and advised the Respondent of its intent to file arbitration. These Guidelines are not Rules, however. As such, even if the Applicant has not followed the Guidelines and did not include this message, there is nothing that bars the Applicant from filing arbitration to recover the balance of the claim. Your job as the Arbitrator will be to decide whether the Applicant has proven that the Respondent owes more than the previously negotiated amount.

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Damage Disputes from Both Perspectives

We recently offered a webinar covering damage disputes from both the Applicant and Respondent perspectives. Interest was high, and it was our pleasure to accommodate the demand with additional sessions! Attendees spanned those who work on the Applicant side, the Respondent side, and some who work on both sides. While the webinar was primarily designed for filers and responders, we were pleased to see some member arbitrators in attendance too!

We want to share a few key takeaways for those who could not attend. First, there is a difference between the obligation that a first-party carrier has to its policyholder and that of a liability carrier to a claimant. First-party coverage is a contractual relationship generally designed to indemnify, or to return the insured to pre-accident state, unless special coverage is purchased that provides for betterment, such as New Car Replacement Coverage. The obligation of a liability carrier to a claimant is also based on indemnification, but differs in that it is based on its insured's legal liability for damages. An awareness of this difference is critical to both the Applicant and Respondent when arguing damages.

Image of a man inspecting damage to a car and completing a report

Next, it is important to remember that in arbitration, proven damages are not at issue unless disputed by the Respondent. Rule 2-5 specifies how Respondents must present a damages dispute: "If a responding company disputes damages, it must present all damages arguments and disputed dollar amounts, if known, in the Dispute Damages section." It is important to remember the arbitrator is not allowed to investigate or to introduce arguments; the arbitrator must objectively evaluate the arguments and evidence presented to decide the dispute.

The best chance of proving your case is including specific arguments and linking them to submitted evidence. For example, if arguing the Applicant's duration of rental storage was too lengthy, do you have evidence such as an estimate or rental bill that would support a shorter duration? If arguing the Applicant's chosen repair parts constituted betterment due to the age of the vehicle, what evidence do you have to support this theory?

Finally, if an Applicant anticipates a damage dispute, it can argue its rationale for the damages paid in the contentions. If arguing the circumstances of a claim support the payment, explain why and link the arguments to submitted evidence. For example, if arguing a reasonable parts search was conducted and LKQ parts were not readily available, include proof to document the search. If arguing a 30-day rental on a total loss is owed by the Respondent, explain and support the extenuating circumstances of the claim, such as serious injury to the owner, vehicle under police hold, or the accident occurred before a lengthy holiday weekend. While companies understandably have handling guidelines, there is no industry standard to pay a particular amount for a feature on claim. Each claim must be handled based on its own unique merits.

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New Arbitrator Training Courses Offered!

Online Learning

AF 101: An Introductory Course for New Arbitrators
Have you been asked to serve as a member arbitrator and have little or no experience with AF and inter-company arbitration? Or do you simply want to broaden your knowledge of inter-company arbitration and the process? If yes, then our new course is for you!

Our AF 101 course for new arbitrators reviews the Agreements (who can participate, what types of disputes are resolved and excluded) and provides an overview of a case path and some of the common actions by filers and responders, including affirmative pleadings and defenses, deferments, and disputing damages. Enroll in a session on our website.

AF 201: Intermediate Arbitration for Arbitrators
Our AF 201 course was designed for arbitrators who want to increase their knowledge of arbitration from basic to intermediate. Learn practical handling tips and considerations for specific case scenarios, including Affirmative Pleadings and Affirmative Defenses, liability admissions, and awards that involve an adjustment. Enroll in a session on our website.

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Member Feedback... Thank You, Arbitrators!

Thank You

The following is recent member feedback on decisions. Kudos to all on providing the high-quality decisions our membership values and appreciates.

"The arbitrator took a look at all the evidence available and made a good decision based on what was provided."
Thank you, Arbitrator Karen Cegielski!

"The quality of the decision was excellent. It was a comprehensive answer. He covered all the points that were made in the contentions."
Thank you, Arbitrator David Swann!

"The arbitrator went into detail on why they made their judgment the way that they did. I appreciate that they looked at the evidence and addressed it."
Thank you, Arbitrator Luan Ngo!

"I felt that he took the information on both sides and evaluated it. There wasn't a police report, so I feel that he used the information that was submitted appropriately."
Thank you, Arbitrator Evan McMullen!

"It was clear why she made her decision and identified what she based the decision on."
Thank you, Arbitrator Jessica Cox!

"I felt that all the evidence was reviewed accurately and that the decision reflected the case that was proven."
Thank you, Arbitrator Jill Roper!

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