There have been many claims filed that do not, at first glance, appear to have a large exposure. In the public sector, sometimes the insured’s reputation has been magnified by the media after a detrimental has taken place. When a case is reported that does not appear to have a large exposure, the plaintiff attorney can do research on a town, a school district or a college to see if there is any negative reputation that can be used.
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Communication with Elected Officials
If the media contacts you and, if you do not have information ready to share, do not be surprised if they reach out to your mayor, city council members or other elected officials. Elected officials are not hesitant to talk to the media and, if they have not been advised of anything by the claim handlers about a recent incident, they may offer an opinion that can be a problem. In several large cities, the mayor has generated very negative publicity regarding police related cases that have garnered immediate media attention. It is important to keep your local government updated regarding a case.
There can be a longer list of things that should be evaluated, but this article is designed to help you understand the importance of making sure your claim staff is properly trained to determine what things can create a larger exposure, even if it feels insignificant at first.
It is important to be willing to share things that happen within your group. Several times, I was involved with a case that was an accident that occurred in a different department or group.
When something occurs that does not originally appear to be significant, some departments will not consider reporting it to the risk management department because they feel they did nothing wrong. It could be weeks later that a plaintiff attorney gets involved. An investigation that starts several weeks later can have a restriction on whom to contact regarding the incident, in turn leaving some witnesses off limits. It is important that your risk management group is kept advised of things that have occurred.
If you do have an excess insurance policy, you should develop a good level of communication with their claim staff because they may have dealt with similar cases in many different states and can help you determine those extra areas that should be analyzed.
When a claim is reported, the file handler should begin an investigation quickly and not be hesitant in reaching out to the involved people within 24 hours. There are many times that the media learns of an incident soon after it occurs. Uninvolved people may have witnessed some of the incident and many will use their phones to video and record what they have observed. Even though they may not have witnessed all of the incident, they will share their videos and their opinions with the local news media or decide to post things on social media within minutes, which can stimulate negative publicity that may have an effect on the case. These eyewitnesses may not have seen the whole event, and their opinions are not always 100% positive and correct. Your file handlers need to quickly learn all details about what happened and have good conversation with the employees involved with the incident. It is always good to have your file handlers build a good relationship with your employees before any incidents occur, so the involved parties will not be hesitant to share anything with them when something happens. Another important thing to review is whether or not the incident will be covered under your insurance policy. If you are not totally self-insured, you need to make sure your coverage will apply and will help you know when it is a good time to report this incident to your carrier.
It is just very important to investigate all parts of an accident that could generate the plaintiff attorney’s decision on how to pursue the claim.
*The views and opinions expressed in the Public Risk Management Association (PRIMA) blogs are those of each respective author. The views and opinions do not necessarily reflect the official policy or position of PRIMA.*
By: Richard Spiers, CPCU, ARM, ARe, AIC
Consultant, Spiers Consulting, LLC
Richard has been in the insurance industry since 1980 and was a claim executive in the reinsurance and excess marketplace since 1985. He was with Genesis Management and Insurance Services for over 20 twenty years. He is currently doing claim consulting work. Richard has extensive experience handling the wide array of claims faced by public entities, K-12 school districts and the higher education sector. Based in Chicago, he has also worked for Transamerica Insurance Group, Northbrook Excess and Surplus Insurance, CNA and Allstate Reinsurance. He is a graduate of Northern Illinois University, a member of the Society of CPCU, and holds associate designations in risk management, claims, and reinsurance. Richard has been developing and presenting insurance industry-related training sessions to a variety of client and industry groups for over 25 years.
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