What are Liability Demand Reviews in Claims?

Liability claims often arrive with attorney demand packages, including bundles of medical records, billing statements, injury narratives, wage documentation, and a proposed settlement amount the claimant believes the insurer should pay. These packages can be lengthy, complex, and, at times, include treatment or charges that aren’t fully supported by the facts of the claim. At the same time, adjusters are navigating steadily rising medical costs. According to Bureau of Labor Statistics CPI data, medical care costs have increased by roughly 30% over the past 15 years, alongside a growing number of claims involving inflated, unrelated, or unnecessarily prolonged treatment. This makes evaluating demand packages far more challenging without a clear, structured approach. That’s where liability demand reviews come in. They help adjusters confirm what’s accurate before negotiating or settling a claim, bringing clarity to what is reasonable, supported, and directly related to the accident.

What are Liability Demand Reviews?

Liability demand reviews are structured, objective evaluations of an attorney demand package. They look beyond the headline settlement figure and examine the supporting materials, including demand letters, medical records, billing statements, wage documentation, and any additional attachments submitted with the claim.

The goal is straightforward: confirm which treatment was necessary, accident-related, and medically supported, and identify what wasn’t. Rather than accepting every charge at face value, the review tests whether the medical story aligns with the injury, the mechanism of loss, and the documented course of care.

This process is not adversarial. A liability demand review is a fact-checking step designed to protect the integrity of the claim file. Reviews are typically conducted by trained medical professionals or billing specialists who analyze records for internal consistency, clinical support, coding accuracy, and reasonable duration of care. In some cases, technology or data tools may help flag anomalies or patterns, but the conclusions rely on human review and medical judgment, not automated decisions.

The result is a clearer, defensible picture of true exposure. That clarity supports more accurate reserving and ensures adjusters enter negotiations informed by facts rather than volume.

Example:

Consider a demand package that listed total medical specials as $38,000, driven largely by physical therapy and specialty follow-ups. Upon review, the records revealed duplicated therapy sessions, upcoded CPT codes, and several weeks of treatment that were not supported by the clinical notes or injury progression. After removing unsupported and duplicative charges, the medically defensible specials totaled $11,400, providing a more accurate foundation for evaluation and negotiation.

What do Liability Demand Reviews Look at?

A clear, effective liability demand review looks beyond total dollar amounts and focuses on the details that drive claim value. Rather than treating the demand package as a single narrative, the review breaks it down into several core areas to confirm whether the story, treatment, and costs align.

• Medical Causation: Is the treatment directly related to the accident, or does it stem from a pre-existing condition, degenerative findings, or an unrelated event? A demand review examines whether the mechanism of injury supports the care being claimed and whether the timeline makes medical sense.
• Medical Necessity: Does the clinical documentation support the type, frequency, and duration of treatment billed? This includes reviewing progress notes, objective findings, and discharge summaries to determine whether ongoing care was justified, or simply continued without measurable improvement.
• Billing Accuracy: Are the charges themselves accurate? Demand reviews look for duplicate billing, upcoded CPT codes, services billed but not documented, and treatment durations that exceed what is typical for the reported injury. Even small billing issues can significantly inflate overall specials.
• Wage Loss Verification: Do the wage-loss claims match employer records, time-off documentation, and work restrictions? This step confirms whether the income loss claimed in the demand letter aligns with verified employment and disability information.
• Pain-and-Suffering Narrative: Does the claimant’s narrative align with the medical record? A demand review compares subjective complaints to objective findings, work status, restrictions, and functional capacity to determine whether the claimed level of pain and impairment is supported.

Why do Liability Demand Reviews Matter?

Oftentimes, a significant portion of what’s being demanded may never have been medically necessary in the first place.

A RAND analysis found that 34–40% of medical costs in auto injury claims appear to be “excess”, meaning the treatment was unnecessary, exaggerated, or unrelated to the crash itself. That’s not a marginal issue. It means more than a third of the medical costs presented in some demand packages may not be fully supported by the facts of the claim.

For adjusters, this creates a real challenge. Demand packages often arrive polished and persuasive, with stacks of records and bills that make inflated or unrelated treatment harder to spot at a glance. Without a deeper review, unsupported charges can easily be accepted at face value and factored into settlement negotiations.

That’s where a liability demand review becomes critical. It’s designed to identify the gap between what’s demanded and what’s actually supported, separating reasonable, accident-related care from treatment that doesn’t align with the injury, timeline, or mechanism of loss. By bringing clarity to the medical and billing details, demand reviews help ensure settlements are based on facts, not volume.

Want to take a closer look at what’s supported in a demand package? Talk to us today.