Step 9 – Set recovery reserves

The coverage reserve is the estimated cost of a loss. The recovery reserve is the anticipated amount that will be recovered and will offset the amount of the loss. Recoveries can occur due to reinsurance, subrogation, or salvage.

To set recovery reserves, open the desired claim and:

  1. Select Accounting in the Claims menu.
  2. Navigate to and select the Overview collapsible box. The Overview box will open.
  3. Navigate to the Recovery table at the bottom of the Overview box.
    Figure 1: View of the Recovery table.
  4. Type the amounts of recovery reserves in the appropriate reserve boxes, based on the following explanations:
    • Reinsurance recovery occurs when a portion of an insurer’s claim losses are recovered from reinsurance companies. Based on the policy, if an insurance company loss retention is up to $1 million, if losses exceed $1 million, any amount over $1 million paid by the insurer is reimbursable by the reinsurance company.
    • Subrogation recovery occurs when the insurer recovers costs associated to the loss from a third party. When a loss occurs, there are times when a third party is at fault and has fiduciary responsibility. For example, if a house fire is caused by a faulty toaster, the toaster manufacturer may be at fault and potentially holds fiduciary responsibility.
    • Salvage recovery occurs when money is recovered from the sale of undamaged parts from a loss. When a loss occurs, it is possible that not all property is destroyed. For example, if there is a house fire that damages part of the property, but not all of it, the parts that remain undamaged can be sold.
  1. BriteCore will automatically calculate the Subtotal of recovery reserves based on the amounts you type in the Reserve column.