ADOT Insurance Recovery Unit recoups millions for highway damage

PHOENIX – When a crash damages the state highway system, the Arizona Department of Transportation’s Insurance Recovery Unit makes sure taxpayers don’t get stuck with the bill unnecessarily.

This operation recovered more than $5 million during the fiscal year that ended June 30, accounting for 98% of crash-related maintenance costs. In all, the Insurance Recovery Unit processed 2,701 claims during fiscal 2020, the most it’s ever handled in a year.

The Insurance Recovery Unit, comprised of professionals with insurance industry backgrounds, reaches out to the responsible parties and their insurance carriers to recover repair costs. The money received goes into the State Highway Fund.

Since its inception in 2012, the unit has recovered around $45 million for damage to the state highway system.

Thanks to process improvements developed using the Arizona Management System championed by Governor Doug Ducey, the Insurance Recovery Unit has dramatically increased the speed with which it resolves claims. Since fiscal 2015, when the unit processed 1,152 claims, its total has increased each year.

The Insurance Recovery Unit reorganized operations to have separate teams tasked with researching responsible parties, sending requests and negotiating the final amounts recovered. Before that, each adjuster in the unit handled all aspects of a claim.

“Another improvement that’s paying big dividends is going totally paperless, which saves time and money,” said Jim Cupp, who leads the Insurance Recovery Unit. “We get our demands out faster and thus are able to handle more claims.”

The recovery process begins when law enforcement responds to an incident in which guardrail, a bridge or some other component of the highway system has been damaged. The officer will mark the damaged item with a sticker that has the incident report number on it. When ADOT is notified of the damage and makes the repair, a member of the Insurance Recovery Unit will contact the responsible party or their insurer to file a claim.

To learn more about how the Arizona Management System helps ADOT deliver value every day for Arizonans, please visit azdot.gov/AMS.