For the past year, LexisNexis Risk Solutions has examined the growing role of attorney involvement in bodily injury claims and the impact on insurers and claimants.
As part of this effort, the company surveyed 1,000 U.S. consumers with a bodily injury claim to uncover the factors that drive claimants toward attorney representation and the opportunities carriers have to improve the customer experience.
Tanner Sheehan, vice president and general manager, U.S. claims, at LexisNexis Risk Solutions spoke with PropertyCasualty360 about key findings from the study and how insurers can utilize data and communication strategies to help reduce attorney involvement.
The bodily injury auto claims process can be overwhelming for both claimants and insurers. Why has attorney involvement become such a growing concern?
Sheehan: Attorney representation rates in bodily injury claims are elevated across the country. This not only increases costs, but it can also create additional complexity and tension in the claims process. Insurers want to deliver a more satisfactory auto claims experience that motivates consumers to work directly with their carriers, but the reality is, more claimants are turning to attorneys.
Your team recently surveyed claimants about this issue. What did you learn?
Sheehan: We surveyed 1,000 U.S. consumers who had a bodily injury auto claim. Seventy percent of respondents hired an attorney to represent them, while 30% went unrepresented. The composition of that 70% is:
- 35% that interacted only with their attorney and never the carrier.
- 20% that always intended to hire an attorney but filed the claim through their insurer first.
- And importantly, 15% that initially planned to settle directly with the carrier but later decided to hire an attorney.
That 15% represents a major area of opportunity for insurers.
Why did those claimants, who initially wanted to work with the third-party carrier, end up hiring an attorney?
Sheehan: Several reasons came through clearly:
- Family and friends encouraged 25% of this group to seek counsel.
- What respondents describe as direct outreach from attorneys swayed 12%
- But the largest portion — 61% — said something happened with the carrier that drove them to hire representation.
When we dug deeper, we categorized the grievances into three buckets: communication, repetition and length of the process.
Let's talk about communication. What role does it play?
Sheehan: Communication breakdowns are a recurring theme. Of those who ultimately hire an attorney, 71% said they had to initiate contact with the other driver's insurer. And of that group, 75% said having to reach out first negatively affected their perception of how the rest of the process would go.
Beyond first contact, 70% of claimants said they had to repeat their story two or more times after filing the claim. That repetition made them 78% more likely to report frustration compared to other respondents.
And what about the length of the process?
Sheehan: Time matters. Fifty-six percent of those who eventually hired an attorney cited dissatisfaction with the length of the claims process as a key driver. While we know these claims are complex, the perception of slowness clearly pushes some claimants toward counsel.
Do these frustrations only apply to that 15% subset?
Sheehan: No. When we analyzed the entire survey population, attorneys actually outperformed carriers across all aspects of customer service: Attorneys earned nearly twice the "completely satisfied" rate compared to carriers. On responsiveness, attorneys scored 74% top marks, compared to 41% for carriers. On empathy and personability, attorneys achieved scores nearly double carriers (65% vs. 33%).
It shows the uphill battle insurers face in matching the customer experience delivered by attorneys.
Attorneys often provide services that carriers can't. What does this mean for insurers?
Sheehan: It's true; different operating models and regulations shape what carriers can provide. For instance, 14% of respondents said their attorney loaned them money. That's not something carriers can offer.
But insurers can optimize other areas, and this is where data becomes a real differentiator.
How can data help level the playing field?
Sheehan: Data solutions can fill gaps in information and accelerate the process. For example, accessing accurate contact and coverage details on third-party drivers can help carriers reach claimants faster and set the right tone from the very first interaction.
Police reports are especially valuable, too. Many carriers are using the data within them to design business rules that route the most complex claims to the most seasoned adjusters, those best equipped to deliver empathy and reassurance.
What's the ultimate takeaway for insurers from this research?
Sheehan: Getting the experience "right" for even 15% of claimants could help mitigate attorney involvement because trust is established with the insurer. Elevated representation rates aren't going away, but if the industry can get smarter about the triggers that push claimants toward attorneys and proactively address them, we can help consumers feel confident working directly with carriers. That's good for insurers and, most importantly, good for consumers.
Photo credit: Arc Archives
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