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Rhode Island bill condemns use of software in claims settlement. (Technology Notes: Technology).

Using computer-generated models to settle bodily injury claims would be an act of bad faith by insurers under a bill under consideration in the Rhode Island Senate.

A similar bill died last year, because the Senate didn't take it up for final passage, said Frank O'Brien, New England regional manager for the Alliance of American Insurers.

This year's version is worse for insurers. Under the bill, if insurers use computer-generated software to settle bodily injury claims, it is an act of bad faith. Last year's bill would have made use of such software an unfair trade practice, said Gerald Zimmerman, senior counsel with the National Association of Independent Insurers.

The new bill also would cause problems for agents using any technology to streamline deals between agents and insurance companies, said Wes Bissett, vice president of state government affairs with the Independent Insurance Agents and Brokers of America. "Companies would probably not be inclined to use any computer software," Bissett said. "I expect few companies would be willing to take that kind of risk."

A substitute bill also has been introduced that would make it an unfair trade practice to "substantially" use the software, he said.

While an unfair-trade bill is better than a bad-faith bill, insurers oppose both, said the alliance's O'Brien.
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Comment:Rhode Island bill condemns use of software in claims settlement. (Technology Notes: Technology).(Brief Article)
Publication:Best's Review
Article Type:Brief Article
Geographic Code:1U1RI
Date:Jul 1, 2002
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