One of the biggest complaints your clients have is feeling powerless during the claims process. The carrier makes decisions, which are sometimes costly ones. And your client just has to live with it.
Your client pays the premiums, but they don’t get a say.
At Captive Coalition, we work with independent agents who want to help their clients move from frustration to control. Whether through smarter structures in the traditional market or alternative models like captives, we help agents show clients they can influence how claims are handled.
In this article, you’ll learn:
- Why clients feel powerless in the traditional market
- How claim decisions actually get made
- And how you can guide them toward strategies that give them more say (and often lower costs)
Why Your Clients Feel Like They Have No Control Over Claims
In the traditional market, most small to mid-sized businesses have little to no say in how claims are handled. The policy is written by the carrier. The claims decisions are made by the carrier. Your client’s opinion? Unfortunately, not part of the contract.
Even in cases where the client believes a claim is fraudulent or exaggerated, the carrier may settle just to avoid litigation. That might save the carrier time, but it sticks your client with the long-term cost.
And what if your client doesn’t consent to settle? They may be forced to pay part of the claim themselves. That’s not control.
The harsh truth is this: Unless your client has financial skin in the game, most carriers aren’t obligated to take their input seriously. That’s why the structure of the policy matters just as much as the coverage.
Do Carriers Deny Claims? What Happens When They Do?
Yes, carriers do deny claims. But they usually take a slower, more cautious approach. They’re not looking to deny claims right off the bat.
It often starts with a reservation of rights letter, which is the carrier saying, “We’re not denying this claim… but we’re not confirming coverage either.” It gives them room to investigate without committing.
From there, an independent adjuster steps in. But here’s what your client may not realize: that adjuster doesn’t work for them. There’s no duty to advocate for your client. They’re applying the policy—written by the carrier—to the facts of the loss. That’s it.
And because it’s a contract of adhesion, your client only has two choices: accept the terms or walk away.
One high-profile example? COVID-19 business interruption claims. Carriers denied them across the board unless a policy had a very specific (and rare) pandemic endorsement.
Your client can do everything right and still get stuck in a gray zone. Power in claims decisions doesn’t belong to the insured in the traditional market.
How Can Your Clients Gain Control Over Claims?
The simple answer? Don’t have claims.
The practical answer? Invest in prevention and containment strategies that reduce both the frequency and severity of losses.
Here’s where you, as their agent, can guide them:
- Improve risk management
Help your clients assess how they’re preventing accidents in the first place. Better training, equipment, oversight, and policies can go a long way toward reducing claims. - Contain losses when they happen
Even with strong prevention, claims will still happen. The goal is to reduce the cost and duration of those events. That’s where return-to-work programs, clear incident protocols, and rapid response matter.
As the saying goes, “An ounce of prevention is worth a pound of cure.”
Your clients don’t need perfect safety records. They just need to consistently do the right things that help lower claims, control costs, and build a stronger risk profile.
They need to be active with safety and risk management in their business.
Why Return-to-Work Programs Matter for Workers’ Comp
One of the most overlooked tools for controlling claims is a robust return-to-work program. It helps so much with workers’ comp.
Here’s how it works:
When an injured employee stays at home, the carrier pays both medical and indemnity (lost wages). But if the employee is cleared for light duty and your client brings them back, the carrier only pays medical.
These are basic tasks like filing paperwork, answering phones, and handling reception. These qualify as return-to-work opportunities. This small shift drastically reduces the financial impact of the claim and often shortens recovery time.
As their agent, encouraging your client to implement this kind of program is about taking back control from the carrier.
Fewer indemnity payouts mean better mod scores, fewer rate hikes, and long-term savings. And the carrier takes notice.
For more strategies like this, send your clients to our article on Six Ways to Reduce Workers' Comp Premiums.
How to Get More Control Within the Traditional Market
The fastest way for your client to get more influence over claims? Take on more risk.
Here’s how it works:
- High Deductibles: By agreeing to cover the “frequency layer” (smaller, more common claims), your client earns more attention and more say in how those claims are managed.
- Self-Insured Retention (SIR): Like a deductible, but your client pays claims directly. This structure usually triggers a special claims-handling agreement that gives them real input during settlement discussions.
Why does this matter? Because when your client’s dollars are on the line, the carrier listens (or so you hope). With more skin in the game, your client becomes part of the decision-making process. It’s not total control, but it’s a major step up from the guaranteed-cost model.
Give Your Clients More Control and Better Outcomes
If your client’s frustrated with how claims are handled, they’re not alone. But frustration isn’t a strategy. As their agent, you can help them shift from powerless to proactive.
Start by walking them through smarter structures in the traditional market, like higher deductibles and SIRs.
Then, when they’re ready, introduce them to captives, an insurance model that gives business owners real claims control, financial transparency, and the potential to profit from managing risk well.
For a full breakdown, read Insurance Strategies for Business Owners in a Bad Market to help your client evaluate their options. Both inside and outside the system.
Have any insurance-related questions, but need a real human to answer? Schedule a call with Captive Coalition to talk to one of our consultants.
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