Insurance companies do not evaluate car accident claims the way injured people expect them to. The adjuster is not trying to determine what is fair. The adjuster is trying to determine the minimum amount the carrier needs to pay to close the file. That is not improper — it is how the system works. But understanding how that evaluation works — what the adjuster looks at, what factors drive the reserve, and what moves the settlement number — is essential for anyone pursuing a claim after a car accident in New York. Early in his legal career, Steven worked on the defense side of accident cases. That experience provided a clear view of how insurance companies evaluate claims from the inside — what information drives the reserve, what arguments the carrier prepares, and where the vulnerabilities in the claimant’s case are most likely to be exploited.
The reserve is set early and drives everything that follows
When a claim is reported, the carrier assigns an adjuster and sets a reserve — an internal estimate of what the claim is likely to cost. The reserve is based on the information available at the time: the police report, the initial medical records, the type of accident, and the reported injuries. The reserve is not disclosed to the claimant. But it governs the adjuster’s settlement authority. The adjuster cannot offer more than the reserve without supervisor approval. If the reserve is set too low because the early information is incomplete, every negotiation starts from a depressed baseline.
Reserve-setting is governed by the carrier’s internal policies and actuarial guidelines. An adjuster who sets a reserve too high is subject to questioning from supervisors about whether the case warrants that level of exposure. An adjuster who sets a reserve too low and then faces a large verdict is subject to questioning about whether the case was underevaluated. The institutional pressure on the adjuster favors low initial reserves that can be raised later if the case warrants it — but those increases require justification, and justification requires new information the plaintiff’s side provides.
This is why early documentation matters so much. A claim that arrives on the adjuster’s desk with a police report, scene photographs, a prompt ER visit, and consistent medical follow-up gets a higher reserve than a claim with a bare-bones report and a two-week gap before the first medical visit. The reserve is not permanent — it is adjusted as new information comes in — but the initial impression sets the tone for everything that follows. Strong early documentation forces higher reserves. Weak early documentation produces low reserves that are difficult to dislodge.
The adjuster evaluates liability first
Before the adjuster evaluates damages, the adjuster evaluates liability. Who was at fault? Is liability clear or disputed? What percentage of fault can be attributed to the claimant? New York’s pure comparative negligence standard under CPLR 1411 means the claimant’s recovery is reduced by their percentage of fault. If the adjuster believes the claimant was 40% at fault, the settlement value is reduced by 40% before the damages calculation even begins.
The adjuster reviews the police report, the drivers’ statements, witness statements, traffic camera footage if available, the point of impact on the vehicles, and any other evidence bearing on how the collision occurred. A clear liability case — a rear-end collision, a red light violation documented in the police report — simplifies the evaluation. A disputed liability case — a lane change, an intersection collision with conflicting accounts, a multi-vehicle chain reaction — reduces the settlement value because the carrier discounts for the risk of a contributory negligence finding at trial.
Every piece of evidence that supports the plaintiff’s liability position increases the settlement value. Every piece that supports comparative negligence reduces it. Moving the liability needle is one of the highest-value activities in case preparation. A $300,000 case with 30% comparative negligence is worth $210,000. The same case with zero comparative negligence is worth $300,000. The $90,000 difference is what investment in liability evidence is worth.
The serious injury threshold is the carrier’s first line of defense on damages
In every car accident claim in New York, the carrier’s first question on damages is whether the claimant’s injuries meet the serious injury threshold under Insurance Law Section 5102(d). If they do not, the carrier owes nothing beyond PIP benefits. The carrier will have its own medical experts review the records and, if the case is in litigation, will order an Independent Medical Examination. If the carrier’s medical expert concludes the injuries do not meet the threshold, the carrier will move to dismiss the case on summary judgment.
This is not a formality. Threshold motions are filed routinely in every serious New York car accident case and granted in a meaningful percentage of them. A case that relies solely on the injured person’s subjective complaints without objective medical findings supporting the threshold will be dismissed. The treating physician’s documentation — range of motion measurements in degrees, neurological testing results, imaging findings, functional assessments, causation opinions — must establish the threshold with clinical precision from the first visit. The carrier knows which cases have strong threshold evidence and which do not, and that knowledge is reflected in every settlement offer.
The carrier’s evaluation of the threshold begins the moment the first medical records are reviewed. A case with thorough treating physician documentation including objective findings is evaluated as likely to survive the threshold motion, which means the carrier must value the case on its damages. A case with subjective complaints only is evaluated as unlikely to survive, which means the carrier can offer a nuisance-value settlement knowing the case may be dismissed.
How the adjuster values pain and suffering
Once liability and the threshold are established, the adjuster evaluates non-economic damages. The adjuster uses comparable verdicts and settlements in the same jurisdiction, the severity and permanence of the injuries, the age of the claimant, the impact on daily activities, and the credibility of the claimant as a potential trial witness. There is no formula. The evaluation is a judgment call informed by experience and data. Some carriers use internal software — Colossus is the most well-known — to generate damages estimates based on inputs about the injuries and treatment. These systems are not binding, but they influence the initial reserve and the adjuster’s settlement authority.
The adjuster also considers the litigation risk — the probability that a jury would award more than the settlement offer. A case with strong liability, objective medical evidence, and a sympathetic plaintiff has higher litigation risk for the carrier, which pushes the settlement number higher. A case with weak liability, thin medical evidence, or credibility issues has lower litigation risk, which allows the carrier to offer less. The plaintiff’s attorney’s track record is part of this calculation — a case represented by a firm that tries cases has higher litigation risk than the same case represented by a firm that always settles.
What the carrier will not explain to you
The at-fault driver’s adjuster will not tell you to file your NF-2 application within 30 days. The adjuster will not tell you about your own SUM coverage when the at-fault driver is underinsured. The adjuster will not explain the serious injury threshold or suggest what medical evidence you need to develop. The adjuster will not advise you to wait before settling until your medical condition stabilizes. Each of these omissions benefits the carrier because an uninformed claimant is easier to settle with cheaply. The adjuster is not being deceptive — it is simply not the adjuster’s job to advocate for you. That is your attorney’s job.
Your own carrier’s PIP adjuster operates under different obligations — the no-fault statute requires the carrier to process your PIP claim in good faith and to pay benefits within prescribed timeframes when the claim is supported. But even your own PIP adjuster will not advise you about the serious injury threshold, SUM coverage, or the personal injury claim against the at-fault driver. Those issues are outside the scope of the no-fault claim. The carrier’s duty is to administer the no-fault benefits, not to ensure you maximize your overall recovery.
Coverage limits cap the recovery regardless of damages
The carrier cannot pay more than the policy limits. New York’s minimum liability coverage is $25,000 per person and $50,000 per accident — amounts that are grossly inadequate for any serious injury. If the at-fault driver carries only the minimum, the maximum recovery from that policy is $25,000 even if the damages are worth $500,000. This is why identifying all applicable insurance coverage — the vehicle owner’s policy under VTL Section 388, employer policies under respondeat superior, and the injured person’s own UM and SUM coverage — is critical.
The at-fault driver’s adjuster will not do this coverage investigation for you. The adjuster evaluates the claim against the carrier’s policy. It does not search for additional coverage that benefits the plaintiff. Coverage identification is an affirmative responsibility of the plaintiff’s attorney. Missing a policy means leaving money on the table.
How Schwartzapfel Holbrook builds cases that change the carrier’s evaluation
At Schwartzapfel Holbrook, we build every car accident case to move the carrier’s reserve and settlement authority upward. That means presenting complete medical evidence that establishes the serious injury threshold with objective clinical findings, developing the liability evidence to minimize the comparative negligence argument, identifying every applicable insurance policy to maximize the available coverage, and preparing the case for trial so the carrier’s litigation risk assessment reflects the real possibility of a verdict. The carrier evaluates every claim based on the evidence in the file and the attorney on the other side. We make sure both work in our client’s favor.
Schwartzapfel Holbrook / Fighting For You