Feature Article - October 2004
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The Claim Game

Make your facility as safe as possible by establishing solid incident-response procedures

By Allen F. Wetzel


HIDDEN TRICKS

Provide early advisory to your counsel following an incident. For example, after a significant evening incident at a particular facility, not only did the managers call their claims administrator, but the managers also phoned their legal counsel at home. From that time, the action plan was channeled though their attorney's office, creating an attorney-client privilege on the event follow-up. When it came time for the managers' deposition by plaintiff counsel, most of the manager's activities were privileged.

So keep your attorney in the loop even before a claim turns serious. Since your lawyer will oversee lawsuits that your administrators can't resolve, it's advantageous to have your counsel working in harmony with your claims staff as cases progress. It costs a few dollars more upfront, but you'll value the long-term reduction in claims count and costs.

Claims staff should know the statute of limitations for claims filing in your region and work to resolve differences before a guest can file a lawsuit. In some jurisdictions, minors are not liable for their own actions, so following up on incidents involving minors is a must. Practice prompt and thorough incident investigation involving pregnant women, an often overlooked dual-claim potential.


HANDLING DOCUMENTS

When setting up your program, have your general liability (GL) team (insurance carrier and broker, claims administrator and legal counsel) help establish what records need to be created and maintained to reduce claims and keep you out of court.

Meet with your financial and legal experts to establish a company Document Retention Program, listing how long records are kept, especially incident and claim files. The program should illustrate what kind of messages and reports to save. It should address the retention of all generated or received business documents and when documents should be purged. Assign one employee to verify that purging is regularly completed.

Some insurance carriers reward, with lower premiums, those companies that maintain a Document Retention Program. If you are a small facility and unable to hire a lawyer to create this program, ask your insurance company for tips on maintaining your document paper trail, which will protect your insurance carrier and you.

When managing your claims paperwork, the 80/20 rule applies: 80 percent of all the incident data you gather will never be used; only 20 percent of the incidents that occur will turn into claims. The trouble is no one knows which 20 percent will be needed, so you must investigate and retain data on all incidents.

Maintain documents that are required by OSHA, the IRS and other governmental agencies. Some laws require the documentation of inspections and their abatement. If you are concerned that internal documents might put you in the courtroom spotlight, then copy your legal counsel on documentation during the handling process. Keep employee-training records for the same time period you keep incident files. Don't purge employee-training files after three years and incident records after five years, only to find you needed those employee records for a late filed lawsuit.

Never set up programs that you cannot maintain. If internal documents indicate that your company practices a specific procedure, make sure that procedure is done and the follow-up is documented. Documentation should be clear, never confusing. Avoid documents that allude to noncompliance of legal requirements. You can seldom have too much good documentation.


FOLLOW-UP NUANCES

Continue to gather investigation data until your claims expert feels all necessary information is captured. Remember, employees and witnesses disappear quickly, so work to procure photos and witness statements within hours of the incident. If the lawsuit filing statute of limitations is two years, employees working the day of the incident could be long gone by the first court date. Save all records that pertain to that day's operation. Retain copies of maintenance records of the equipment that might be associated with the incident. Attention to detail and preventive maintenance records will show due diligence within your operation. Preserve physical evidence. Consider the use of closed-circuit TV cameras in high-incident occurrence areas.

EMPLOYEE PERSPECTIVE

On the employee side of the fence, these same procedures can assist with Worker's Comp or discrimination claims. Set up your program in advance with your legal team, Worker's Comp or claims experts. All employee injuries must be reported to the appropriate supervisor, who must investigate the incident, regardless of the injury significance. Require EWS following any event. You cannot recapture evidence or eyewitness accounts if you don't gather them quickly. Set up a system where employees can confidentially report events that seem questionable to them. Investigate all such reports.