Study: Auto Insurers Underpay Claims

After studying auto crash data, two university researchers have concluded that insurers routinely underpay soft tissue and lost wage claims as an anti-fraud deterrent. An insurer organization, when asked for comment, denied that carriers made a conscious effort of the sort reported. For researcher Keith J. Crocker, the fact that insurance companies would not endorse his findings is no surprise. "I didn't think any insurance company would come out and say they are purposely underpaying claims, even though from an economic and realistic standpoint they do," he said. Mr. Crocker, a professor of business economics and public policy at University of Michigan Business School in Ann Arbor, Mich., worked on the study with Sharon Tennyson, associate professor of policy analysis and management at Cornell University in Ithaca, N.Y.