In an October 18th press release, Allstate announced that they agreed to a 10 million dollar regulatory settlement over the process in which they handle bodily injury claims.  The National Association of Insurance Commissioners (NAIC) completed an 18-month examination of Allstate's multi-state claims handling system.  Allstate has been using a software program called Colossus to guide them in making settlement offers after motor-vehicle accidents.  While the software has proven to be effective it was not being consistently modified or "tuned" for all of Allstate's regions.  According to the settlement, Allstate has agreed to make many changes, which include:

• Notifying claimants that the Colossus program may be used in adjusting their claims.
• Providing consistent updates in a uniform fashion for all regions including modifications that reflect recently settled claims.
• Consolidating it's bodily injury claims "handling practices" into a single manual.
• Not establishing any rules requiring claims adjusters to settle claims according to the value provided by Colossus
• Not offering incentive programs for adjusters who settle at the value suggested by Colossus.

This $10 million settlement will go into a regulatory fund for the 45 states that signed this agreement.  It will be used to help implement these new guidelines and properly train examiners in reviewing and monitoring software programs in their use of evaluating injury claims.