The Vega team supported two experts to produce reports in an arbitration regarding inappropriate claim payments on extended service plans for mobile phones and other devices. The Vega team first supported an expert that used statistical sampling techniques to create a representative stratified sample of the overall claims population. After the sample was selected, the resulting manageable number of claims was audited by a third party to determine which, if any, payments were not valid. Following the audit results, the Vega team supported the expert in extrapolating these findings to the overall population of claims. This process facilitated the creation of rigorously estimated invalid claim rates as well as statistical confidence intervals for the entire population.
The Vega team also supported the damages expert, which involved calculating the harm suffered due to inappropriate claim payments. The damages analysis relied on the extrapolated audit results provided by the sampling expert. The damages expert calculated both the monthly and cumulative harm to the relevant account, using two possible sets of valid claim payments.
Example Analysis: Calculate Harm Per Month to the Relevant Account
The Vega team’s analysis showed the total claims paid in each month, the amount of valid payments, as well as alternative valid claim payment amounts. This analysis was used by the expert in determining the monthly and total harm to the relevant account. The report also provided a cash flow assessment detailing how inappropriate claim payments affect the parties by raising the risk of future damages, in addition to requiring unjustifiable charges in the present.