Some say that claim manuals are essential tools for managing the adjustment of losses. Others view them as dangerous road maps for bad-faith attorneys who magnify any deviation from written protocols. Let's look at arguments for and against.

In supporting the need for claim manuals, some folks point out that most states require insurers to "adopt and implement reasonable standards for the prompt investigation of claims." California, for example, requires that carriers keep a written claim manual and certify annually that claim personnel have read the document. When an insurance company lacks such procedures, insurance regulators might construe that as unreasonable. Insurers could counter by stating that they have adopted and implemented reasonable standards in a form or medium other than a claim manual.

A challenge arises when outsiders (as in plaintiff attorneys) use manuals to prescribe required bright-line performance standards versus general guidelines that a carrier considers reasonable. So should claim-manual standards function as hard-and-fast rules or merely as general guidelines? Here we find a philosophical fork in the road.