Colossus is a computer program that was designed to streamline, modernize and control personal injury case assessments. It is a program that accumulates some of the insurance companies data and uses it to “evaluate” a personal injury claim.
The program has been very controversial in that the company, to reach a result that is desired by the company, can apparently manipulate the numbers. In short, the employee for the insurance company inputs data and answers questions on Colossus and gets feedback on a personal injury settlement “range”.
While the owners of Colossus suggest that the software minimizes payout variance, the practical effect is that many insurers who have used the program have reduced what they payout in claims.
Effects of Colossus
The truth of the matter is that regardless of the stated purpose, since Colossus has been utilized, the settlement value of personal injury claims across the board has been reduced.
It is noteworthy that many insurance carriers include information regarding the attorneys representing the victims as part of their evaluation process. Colossus reportedly provides data regarding attorneys who frequently represent personal injury victims. This is another reason for injury victims to research the lawyer they are considering.
The weakness of Colossus is that the human body is unique and no two cases are identical in every aspect. Pain-and-suffering, which is usually the largest component of a personal injury claim, is hard to value on a computer program.
Likewise a notation on a medical record that there are limitations of the injured is very difficult to put into numbers. Nevertheless, a jury of their peers can more readily understand that a mother cannot pick up her child and assess the reasonable value for that limitation. That value can easily exceed the computer’s assessment.
While the concept of a computer program to evaluate claims is a reasonable concept, how the software fares in real life is questionable.
Some authors suggest that insurance carriers selectively provide data by omitting some specific claims, or “devaluing” some data, which can skewer the results of the program. In other words, the carrier is reportedly able to change the parameters in order for the software to come up with what is most likely a lower value.
About 50% of all the major automobile insurance companies use some form of Colossus or a similar program. The real dilemma for Texas families is that the insurance commissioners for the state of Texas in our view, has in the past been looking out for the benefit of the insurance industry and not so much the individual Texas family.
Defenders of the program cite multiple benefits, however it is even been reported that adjusters utilizing the program receive bonuses based upon how little they actually pay out on claims.
So while defenders of the software program may contend that the program is all about fairness and consistency, the truth of the matter is, since the computer program has been utilized, insurance companies have valued claims in consistently smaller amounts.