Sunday, August 9, 2009

“Due to an unusually high call volume . . .”

What a bunch of BS!

I’m always skeptical when I call any business number and I get a recording telling me that my wait time is going to be prolonged because of an “unusually high call volume.” Sure!! Call me a skeptic. Especially, when you call in and every time the default mode is a recording talking about “an unusually high call volume.”

(Dude, if you always have a high call volume it’s not unusual!)

Methinks this is simply a way to hold off customers. It’s cheaper to make customers camp on hold that it is to hire adequate staff to man the phones. Just like commercial airlines. It’s easier to tell passengers to show up at the airport 90 minutes ahead of time than it is to hire sufficient customer service people to process tickets, luggage, etc. It’s all about them saving money, not about customer service.

Take a look at your own claim office or operation. Are callers met with a recording? Does the recording set them up for anticipated delays by referring to “an unusually high call volume?”

What message does that send about your commitment to customer service?

Saturday, July 18, 2009

Adjusters are really in the food service business.

My friend and fellow regular columnist for CLAIMS magazine, Ken Brownlee, likes to say that when he was a risk manager, his job specialty was pickles and jams. Very clever! I wish I had thought of that.

If risk managers deal in pickles and jams, that probably goes double for claim professionals. The daily challenges of claim professionals involved working with people who have gotten themselves into pickles and into jams, trying to extricate them from both.

I have often likened claims adjusters to first responders to an accident scene or to the HAZMAT crew that shows up in their special suits to clean up the aftermath of a chemical spill. They may show up to clean up the aftermath of poor risk selection decisions in some cases. They may show up to clean up the aftereffects of poor lost control decisions made by a count. In any event, it often falls to the claims adjuster to be a one-man or woman cleanup crew.

It’s summertime. Regardless of whether or not adjusters attend a county fair, there is a good chance that they are experts in pickles and jams!

7 Ways to Incentivize Adjuster Continuing Education ...

Recently a friend at the Insurance Institute of America contacted me to ask for tips on how claim managers could incentivize claim adjusting staffs to pursue continuing education. The latter would include – but not be limited to – taking courses in the AIC (Associate in Claims) program, leading to the designation.

I don’t claim to have found THE key or solution, but I humbly offer seven tips on motivating adjusters to pursue continuing education:

#1 Make CE one component of annual performance appraisals. If you want it to get done, you have to measure it.

#2 Make CE pursuits one periodic (e.g. “coaching topic/opportunity” with reports). Repetition, repetition, rep .. Well, you get the idea.

#3 Publicly recognize and praise those who pursue AND COMPLETE continuing education.

#4. Enact/support corporate monetary rewards/incentives for CE program completion. $$$ is still a nice carrot, as is footing the bill to attend an annual conferment/convention event for employee and spouse.

#5. Provide a reasonable amount of time and reimbursement support for CE pursuit within the office.

#6. Offer CE classes or briefing sessions in-house, on Company time. Hey boss – roll up your sleeves and dust off those textbooks!

#7. Leadership by example – be involved in CE as a “boss” and make sure your reports know you value the activity!

Sunday, July 12, 2009

One of the Dumbest Things I’ve Ever Heard …

D.C.’s transit system is bracing for liability lawsuits arising from a spectacular head-on crash that occurred in June 2009. The crash killed nine and injured 80. (For recent story, see

None of this surprises me. In fact, being a claims guy, one of the first things I think about when hearing about such an event is the wave of litigation.

What caught my eye was a quote from the transit system’s former CFO and Maryland Board member Peter Benjamin. Deriding the prospect that the transit system would have to pay claims from its own funds, confident that the transit system has adequate coverage to address the flood of claims, Benjamin is quoted as saying, “The probability of having to pay enormous sums of money is relatively low. Our insurance rates will go up.”


Sorry, but the judges and juries doling out awards could care less if your insurance rates go up. Your insurance rates going up is not check on jury awards, settlements or recoveries. It is an after-effect of those events.

It’s like saying,

“If I drive drunk and kill someone, I can’t get a big award against me because GEICO would raise my rates.”

“If my Rottweiler mauls the postman, I’m in the clear because Nationwide would jack up my premium.”

I can only hope that Benjamin was misquoted or that this comment was taken out of context. Otherwise, the Metro transit system may find itself digging into its own coffers if liabilities exceed their insurance layer. One thing is for certain – the prospect of rising insurance costs will not act as any “brake” on settlements or jury awards stemming from the June 2009 crash.

Monday, July 6, 2009

Revisiting CEO Review of High-Dollar Claims

In April, the Claims Coach blogged about Evan Greenberg of ACE adopting the practice of personally reviewing all claims of $1 million or over, posing for discussion whether this was a good idea or a waste of a CEO’s limited time. One anonymous follower of the blog offered the following perspective:

“I could see the claims manager submitting a report to the CEO of a company in regards to claims reserved at or over $1,000,000. but the CEO reviewing these high $ claims? If he has limited or no claims experience himself, the poor adjuster is put in the position of give the CEO a `claims 101’ lesson (not an enviable position) and trying to justify everything he did- his investigation, damage control, evaluation, reserve recommendations. Please, let’s leave this up to the claims professionals!”

“Reviewing” covers a lot of ground. Maybe it’s one thing of a CEO wants to review each million-dollar claim. It’s another thing if the adjuster cannot consummate a settlement because the CEO hasn’t gotten around to reviewing the file.

Can you imagine being the claims rep at a judge-ordered settlement conference trying to get through to the CEO by phone for additional settlement authority while the Big Cheese is at a Board Meeting or on a flight to the coast?

Thursday, July 2, 2009

Ape Liability (Continued)

Now the victim of the enraged chimp “Travis” says she feared the ape due to its size, temperament and its tendency to damage its own cage. Charla Nash was attacked by the animal in February and was disfigured to the point where doctors at The Cleveland Clinic performed a face transplant.

Nash has filed a $50 million liability lawsuit against the chimp’s owner, Sandra Herold of Stamford, CT.

The Claims Coach speculates that Herold’s homeowners insurance coverage is triggered and that there is no way the homeowner’s liability policy limits remotely approach $50 million. The Claims Coach is not a lawyer, but is aware that often strict liability is applied to owners of wild animals, though legal counsel for Herold maintains there was no way for anyone to predict that the ape would inflict injury.

Notwithstanding those comments, it is tough to imagine that the homeowners liability carrier would not – at some point – tender its policy limits to try to get this case settled. The Claims Coach cannot imagine that the defendant would chance such a case to a dice-roll in front of a jury.

Given the horrific nature of the injury, the national publicity the case has garnered , the strict liability for injuries from domestically-kept wild animals – even the most stalwart and hard-nosed adjuster might think twice about trial and make a push to settle such a claim.

Sunday, June 28, 2009

Going Bananas Over Product Liability Fraud

Dole Food apparently is beset by bogus product liability claims filed by Nicaraguan banana farm works who claim they were made sterile by a pesticide, DBCP, last used in the 1970’s. An article in the latest issue of BUSINESS WEEK magazine (7/1/09 p. 16, “A Bunch of Fake Claims Against Dole?”).

Courts in that Central American country have awarded plaintiffs $2.2 billion in damages so far. Dole is not droll in fighting the claims and maintains that a mini-industry has sprung up south of the border to recruit people who never worked on the farms, give them briefings to make then credible and send them to sham medical clinics to goose up the damages.

Where are Bill Lerach or Dickie Scruggs when you need them?)

One upshot from this situation emerges for risk managers. Companies need to fine tune their mechanisms to handling foreign claims, an area that often gets short shrift. The tort lottery is most prominent in America, but other countries are finding it a tasty export from the good old USA.

Further, this vignette is a reminder that insurance fraud is not just an asbestos thing or a domestic U.S. phenomenon. Foreign claims-handling capabilities must include a search for SIU and fraud-fighting tools.

Monday, June 22, 2009

Another great articulation of “What Adjusters Do” …

Few claim adjusters will ever be compared to Mother Theresa, nor do they vie for such an iconic status. Nevertheless, claim adjusters are often among the “first responders” in case of disaster and provided needed aid and succor.

For those adjusters who often wonder, “Why am I doing this?” one of the best explanations I have read comes from Pete Crosa, a claims authority who writes a periodic blog on “An Adjuster is What an Adjuster Does.” Peter hits the nail, on the head once again in his latest post, which I am offering verbatim:

"There is a great army of adjusters that swoop in right after a hurricane or a flood and, outside of a cold bottle of purified water and Red Cross personnel, they are one of the most welcomed sights to a battered and ravaged community.

"This concept of indemnity is as old as mankind. It’s not too difficult to imagine some primitive family losing their lone goat, camel, or other existence threatening asset only to be made whole by the care and generosity of other tribal members.

"Modern society didn’t ditch the concept, they merely packaged it and fashioned a legal contract called an insurance policy. How cool is that? Adjusters get to execute the terms of this insurance policy and we should feel pretty good about that. The terms are clear. Sometimes it makes them whole. Sometimes it just lessens the burden. But it always helps like it was designed to. That’s what an adjuster does."

Amen, Peter!

Friday, June 19, 2009

SIU Adjusters Needed to Fight North Korean Insurance Fraud!!

Previously I didn’t know which was worse – North Korea’s burgeoning nuclear program or its Fearless Leader’s bad haircut. Now we learn that this country is a leader in international insurance fraud. Details and exploits are uncovered in a recent front page issue of The Washington Post (

Apparently Korea National Insurance Company is renowned for procuring reinsurance and then submitting dubious claims. In fact, insurance fraud is a source of much needed hard currency.

Any anti-fraud or SIU adjusters looking for the ultimate career challenge might consider this one. Of course, taking on Kim Jong Ill might involve risking a stint in a North Korean labor camp. (Any adjuster who has flown Northwest will be well-prepared for this eventuality, however.)

Perhaps we should introduce a motion to the United Nations that it create an international SIU???

Saturday, June 6, 2009

Invest in Your Career Through New CLM Lit Management Training Sessions!

Vince Offer, the ShamWow pitchman, has nothing to worry about from me. You know – the scary dude on late night TV with the headset. (Actually, the economy is so bad now, I hear that some folks are knitting together Sham-Wows to fashion their own makeshift Snuggies!) ShamWows, Snuggies and Garden Weasels. We may laugh and snicker, but the pitchmen laugh too . . . all the way to the bank.

The Claims Coach isn’t given much to making product endorsements, but makes an exception now. I heartily recommend the new slate of litigation management training sessions being launched and offered by the Council on Litigation Management (visit ). The CLM is offering courses in 25 states, approximately 250 times from June to November 2009. Many provide adjuster CE credits.

The curriculum includes:

• “Fundamentals of Litigation Management”
• “Case Assessment and Evaluation”
• “Negotiation Strategies”
• “Structured Settlements”
• “Litigation 102: Pleasing and Motion Practice”
• “Litigation 103: Discovery Practice”
• “Litigation 104: Trial Practice”

Sadly, there has been a dearth of easily accessible training for claim professionals in the discipline of litigation management. This is ironic, as for many claim professionals this activity comprises a huge chunk of their jobs. The CLM helps fill this void.

In tight economic times, one of your best investments is to invest in your career – deepening your skill sets or broadening them. Visit the CLM website and consider registering for one of its sessions. Better still, join the CLM.

Caveat: if the session rooms are drafty, you’ve got to bring your own Snuggie….

Saturday, May 16, 2009

Adjusters Have to Guard Kobe Every Day ...

“Defensive specialist.”

In the NBA, a few players are known for taking on the tough assignments of guarding the most prolific scorers and unstoppable hoopsters. If your job is to guard Kobe Bryant or Lebron James, you’re in for a long night and have a thankless task. Despite the challenges, a few players rise to the mission. In current pro basketball circles, Shane Battier of the Houston Rockets is such a defensive specialist, charged with the daunting task of guarding Kobe.

A recent Sports Illustrated profile on Shane Battier (5/18/09, “Guarding Kobe”) and the rare breed of selfless defensive stoppers quoted Michael Cooper, former NBA star, saying that these stoppers are like being a “garbage collector” because “you don’t notice them until they don’t do their job. [They] handle the messes and the stinky stuff.”

“They handle the messes and stinky stuff.”

That quote jumped out at me and made me think of adjusters. You rarely notice adjusters UNTIL they don’t do their job. When they don’t do their jobs, you have irate claimants and policyholders. You have people calling to bitch and complain. You have grievances filed with the Insurance Commission. You have bad faith lawsuits filed against the company.

When claims people do their jobs, you just don’t have this phenomena. I have often said that the best managed claim offices are “boring” – no crises, no fire drills, no hot-to-the-touch complaints, no circling of the wagons due to a client meltdown.
Give me boring any day! If adjusters do their jobs, the function becomes self-effacing and less visible. Maybe that’s why it’s so easy to take it for granted, or assume they aren’t needed.

Yes, and adjusters handle the messes and the stinky stuff. They are at the side of the Interstate at 3:30 AM with the overturned tractor trailer filled to bursting with produce. They go out to investigate the three-car fatality and survey the grisly photos taken by state police. They have to explain to a pushy insured that the policy doesn’t cover all perils or loss. They have to be the lightning rods for the frustrations of consumers who want it done yesterday.

Adjusters handle the messes and the stinky stuff. Like skilled defenders in the NBA, they are the unsung heroes of the insurance world.

Saturday, April 18, 2009

CEO Review of High-Dollar Claims: Best Practice or Pointless Distraction??

I just read an article in Business Week (4/20/09, “One Greenberg’s Pain is Another’s Gain”) about Evan Greenberg, one of the sons of industry titan and former AIG potentate “Hank” Greenberg. Evan is CEO of ACE Insurance Company. What caught my eye was a sentence in the article that states that ACE’s Evan Greenberg still reviews every claim of more than $1 million.

This stopped me in my tracks. I’m not quite sure what to make of this.

On the one hand, it paints a picture of the fully engaged CEO. I’m not sure what kind of claim valuation background, if any, Evan Greenberg possesses. I would imagine that it is extremely rare for an insurance company CEO to exhibit this level of engagement with high ticket claims.

On the other hand, part of me thinks that a CEO is likely under-qualified to make reasoned assessments of claim liability and evaluation. Is this truly the best use of a CEO’s limited time and attention? Can you imagine being the claims adjuster at a mediation 1000 miles away, needing settlement authority above $1 million in having to call back to the Home Office and try to get the CEO of the company on the line?

Good luck!

So there you have the ACE template: the CEO reviews all claims above $1 million.

Is this a best practice or is it a distracting and pointless drain on the time of a chief executive officer who should be more engaged in managing the forest than the individual trees?

Wednesday, April 15, 2009

IKEA Gets no Discount on This Jury Award

“You know what the word `IKEA’ really means when translated from Swedish?” asked comedian Jay Leno recently.

The answer: “Cheap particle board.”

Though the audience laughed, it is likely that few IKEA personnel are laughing over a recent jury hit that the retailer just took in the Washington D.C. area.

A Fairfax County (VA) woman was just awarded $3.2 million in damages for injuries she suffered in 2006 when a 350-lb. stack of countertops fell on her in one of IKEA’s Woodbridge, VA stores. The plaintiff, Xiaolie Zeng, suffered four fractures of her pelvis and alleged permanent injuries.

Fairfax County, VA -- which happens to be my home – is not known for having excessively liberal juries. From a defendant’s point of view, it is considered a fairly favorable jurisdiction. If you have a choice locally to be a defendant in Washington D.C. or Fairfax County, you definitely want your case in Fairfax County. This is no Robin Hood, “rob the rich to pay the poor” area.

It sounds as though liability here was pretty clear. The customer had been looking for a table, but did not find one that she liked Near the Exit, she stopped at the “As Is” section of leftover or bargain items but did not touch any of them. A stack of four particle-board counter tops and inside door collapsed on Ms. Zeng.

Given the clear liability, it is hard to see why IKEA did not settle the case and let it go to a jury. The article says the special damages were about $150,000. We do not know the plaintiff’s pretrial demand. Perhaps it was so high that IKEA felt that, even with a finding of liability, it stood a good chance of doing better than paying the demand.

That demand may be looking better now.

Monday, April 13, 2009

I Guess She Couldn’t Sue God

“Michigan Church Faces Second Trial Over Fall at Altar” reads the headline from the Associated Press. (For the full story, Apparently Judith Dadd of Lansing, MI is suing her place of worship, Mount Hope Church. The suit flows from a July 2002 accident when she was overcome by the holy spirit, fell backwards and hit her head on the floor.

Her theory of liability: the church should have had an usher positioned there to catch her fall. That leads to an interesting idea, where churches might engage one “spotter” for each celebrant who is overcome with the holy spirit. The pews and aisles might be packed that way.

As a footnote, Ms. Dadd has added a defamation claim, saying her pastor has been wrongful stating that her injury was faked. Imagine that!

If you are the adjuster assigned to this claim, maybe one red flag would be the list of itemized special damages including a hefty bill from a faith healer …

Sunday, April 5, 2009

“Michael Clayton” and the Tao of Claim Defense

OK, so I'll confess don’t get to the movie theaters much.

($11 a ticket PLUS $8 popcorn? Are you kidding?!) But the wife and I watch plenty of movies on DVD, courtesy of Netflix. I know that time-wise I’m behind the curve here but last night I finally got around to watching and enjoying “Michael Clayton.” I had not realized that the movie centered on a product liability case, a class action involving a weed-killer and a mythical Nebraska-based company called U-North.

Some highlights of the plotline which may interest those in the claims realm:

• Bad documents can sink your defense (though how did these stay suppressed and secret so long?)
• Lead defense counsel strips down to his underwear during one plaintiff’s deposition (lending a whole new meaning to the phrase, “legal briefs”). Also, why did the lead defense counsel in this role have to be played by Tom Wilkinson instead of, say, Charleze Theron, just to pick a name at random.
• Defense firm of Kenner, Bach & Ledeen dances a jig when it hits 30,000 billable hours on the defense of the carcinogenic weed-killer. Yippee!
• Product defendant plays hardball on a whole new level.

OK, it’s Hollywood. I get it.

Nevertheless, if you work in the vineyard of liability claims, you may get a hoot out of “Michael Clayton.”

Monday, March 30, 2009

Claim-Handling woes are prominent in Consumer Insurance Gripes

According to a recent study by the National Association of Insurance Commissioners, claim disputes and problems figure prominently among the reasons for consumer complaints. The top five reasons behind insurance complaints in 2008:

Claim delays 19.1%
Claim denials 18.4%
Unsatisfactory settlement/offer 14.2%
Premium & rating 4.7%
Cancellation 4%

What types of insurance generate the most claims?

Accident & Health 36.9%
Auto 36.7%
Homeowners 11.8%
Life & Annuity 9.5%
Commercial Multi-Peril 1.9%

Monday, March 2, 2009

Why Adjusters Matter!

Peter Crosa is the President of his own independent adjusting company and private investigation firm based in the Tampa, Florida area. Among other things, he writes a periodic blog titled, “An Adjuster is What an Adjuster Does.” Lots of good stuff in there! There are very few people in the industry that I read and then kick myself, saying, “Boy, I wish I had thought of that!”

Peter falls into that skill category.

Recently, Peter’s missive discussed why claims adjusters fulfill a positive societal role. It is one of the best -- perhaps THE best – “Big Picture” perspective I have ever read on why claims people have reason to be proud and to hold their heads up high with regard to their chosen profession.

Too many times claims people have a permanent inferiority complex. I confess that I have often referred to claims as the Rodney Dangerfield’s of the insurance industry. I say that more as a description rather than legitimizing that sad state of affairs. Nobody entered the claims business for its prestige, high pay or cache during cocktail party introductions.

If as a claims adjuster you ever wonder whether you are making a difference by doing your job, please consider and ponder the following excellent articulation as to why adjusters matter. The following segment is reprinted with permission from Peter Crosa:


What have you given back to society? Is your community better off because you’re in it? If you’re an adjuster, the answer is yes. Here’s why.

You are given the responsibility to investigate and adjudicate contractual obligations and torts between citizens. Every claim you resolve before a law suit is filed, saves the cost of a trial. The cost of a trial includes the cost of the courtroom facilities and utilities, salaries of the courtroom staff, attorneys, jurors, witnesses and experts. It saves the time, sometimes several days, of the lives of countless people that would have participated in the trial.

So, just in case you ever feel embittered, embattled and unappreciated; just in case you get the feeling your supervisor is ready to throw you under the bus at any moment; and just in case you feel like adjusters are the un-loved step-child of the insurance industry, remember what an adjuster does.

And don’t forget to pat yourself on the back every now and then for a job well done; for being equitable and ethical. You do make a difference in this world and so does the adjuster sitting next to you. Pat them on the back too. That’s what an adjuster does.


Well said, Peter and Amen!

Monday, February 23, 2009

Two Insurers Make Business Week List of “Top 25 Service Champions”

Business Week just featured its annual ranking of the nation’s top 25 “Customer Service Champs.” (Number One: What caught my eye though was that two insurance companies made the list.

Weighing in at #2 -- in hot pursuit of Amazon, was USAA.

Coming in at #15 – Amica Insurance Company.

It is hard to tell how much claim service entered into these rankings. The commentary on USAA was that it handled 150,000 “cat” claims in 2008, twice its average. It enjoys a 96% retention rate, so it must be doing something good in the claims area.

Amica is lauded for investing in new technology to speed claim processing. It also notes Amica’s investment in staff and its employee turnover rate which is a measly 7% per year.

Claim service appears to be one path toward becoming a service champion!

Tuesday, February 17, 2009

Flo and Progressive’s Concierge Service Raises the Bar for Claims-Handling

“Flo” is the irrepressible salesgirl with the tricked-out name badge in Progressive’s TV commercials. I was struck recently by one that touts Progressive’s “concierge” claim service. Many insurance commercials spout vagaries and platitudes but not too many spotlight claim service as a competitive differentiator. I am happy to see this. It comes down to more than saving 15% in 15 minutes or less.

In Progressive’s commercial, the insured brings in his damaged car, rings a call bell and a team of attendants rush out to get him a new replacement loaner. Concierge service indeed!

Apparently Progressive has even patented the process of “concierge claim service.” That process involves the policyholder reporting a claim and then,
• Dropping the damaged car off at a Progressive concierge claim center
• Driving off in a rental car
• Progressive writes a repair estimate and engages a repair vendor to come get the car, fix it and return it
• The insured is notified to come back and pick up the repaired car, which has by then been quality inspected by Progressive

Disclosure: I am not a Progressive customer or shareholder. In fact, my car coverage is with one its direct-writing competitors. I also doubt that the process always works to inspire rave reviews by policyholders.

Nevertheless, I applaud any carrier’s effort to compete on something other than price, to compete on service – namely claim service! Maybe it can inspire other insurers to raise the bar to develop their own functional equivalents of concierge claim service.

Now, if only Progressive could get Flo to use a bit less eye-makeup!

Friday, January 30, 2009

Might Super Bowl Sunday Bring Super Claims to Adjusters?

WARNING: Football Helmet and Pads Could Make You Hot!!

In late January, the widow of NFL player Korey Stringer settled her liability claim and lawsuit with the NFL following her husband’s heatstroke death at the Minnesota Vikings training camp in the Summer of 2007. Stringer’s wrongful death lawsuit alleged that the NFL had not done enough to ensure that the equipment used by players protected them from heat-related injuries and deaths.

Strnger’s string of lawsuits included an earlier medical malpractice suit against the hospital that treated the lineman after e collapsed in the 100+degree heat. That lawsuit had already been settled.

But the lawsuits are not over. Still open is a claim and product liability lawsuit against Riddell Inc., the maker of the football helmet and pad. Apparently these products were defective because they lacked warnings to the effect that wearing helmets and pads in hot temperatures could be dangerous. Incredible!

Come to think of it, this could open the way to further litigation. Examples:
• Suits against General Motors for not putting written warnings on accelerator pedals.
• Litigation against Harley Davidson, for not designing motorcycles with roll-bars.
• A potential class action against Sarah Lee for irresponsibly baking with BUTTER for the last 30 years.

As Super Bowl Sunday approaches, hazards abound. That’s the bad news.

The good news: there are deep pockets to sue!

Recent studies show that Super Bowl Sunday brings a spike in drunk driving accidents and stomach ailments due to the mix of booze and bar food.

Further, doctors report that people who drink too much during the game and fail to go to the bathroom develop urinary retention, possibly warranting later catheterization. Come to think of it, most of the target audience for those Flomax commercials may be off making a head call at the very moment the ads air!

Other Super Bowl mishaps include:

• A guy getting so drunk he broke his teeth trying to open a beer bottle
• Fans who strained their backs while jumping up to cheer
• An upset fan so ticked off with his team’s performance, he tossed his TV set out the window of his third-floor window.

And we haven’t even gotten to the scourge of wardrobe malfunctions!

All these folks might form a class action lawsuit against the NFL, alleging that the League failed to warn them of the various hazards attendant with watching the game.

I just hope my cardiologist has adequate medical malpractice limits in case my ticker goes haywire while I’m watching that sexy PETA commercial …

Tuesday, January 27, 2009

Safe US Airways Landing May not Avert Claims Splash and Courthouse Dash

When I first heard of the miraculous landing of the US Airways Flight 1549 jet in the Hudson River two weeks ago, my first reaction was, “Oh boy – here come the lawsuits.” True confessions from a hard boiled cynical claims person. Even though each passenger survived the landing due to pilot “Sully” Sullenberger’s heroics, I assumed lawsuits would be filed. Grounds might include soft tissue injuries from the bumpy maritime landing, to mental anguish from fearing a crash to exposure to cold during the rescue process.

Now it looks like I may have been premature in my suit-happy assumptions. (See, “Savvy US Airways Pilot May Have Grounded Lawsuits,”

Some say that the pilot may have not only averted a tragedy, he may have averted lawsuits. Moreover, flying into a flock of geese might be termed an “Act of God.” Still, I figured lawyers would find some theory of liability, like a different jet engine design would be more impervious to bird strikes, or that the aircraft lacked equipment to detect bird flocks or that the airport authority knew of the bird peril but failed to alert the airline. God forbid that there be no deep pocket to sue! This is, well, un-American!

Pundits are having fun with the splash, though, some suggesting that . . .
• US Airways’ new marketing slogan should be, “One if By Land – Two if By Sea!”
• Each flight will now have an on-board cruise director as well.
• To generate revenue for the cash-starved airline, US Airways might consider charging $25 apiece for each personal flotation devices used.
• All on-board music courtesy of the group, “Flock of Seagulls.”

Since all passengers and crew survived, we can now chuckle . . . at least until the Summons and Complaints are served.

Too bad the aviation lawyers cannot sue the geese, especially since it is rumored that the birds were distracted in flight by text-messaging each other … Alas, no liability coverage on the geese. (This coverage gap may be an issue befitting the Loyal Order of the Blue Goose, come to think of it.)

Other aviation lawyers are having none of the “Act of God” spiel. By golly, there has got to be someone to blame! (Better still if they have liability insurance coverage.) I often quote the anonymous sage who once said, “Death is not the end; there remains … the litigation.”

When it comes to aviation mishaps, perhaps we can say the same about safe landings.

Saturday, January 17, 2009

Practice Checklists: If Surgeons Can Benefit, Why not Adjusters?

This week a number of articles emerged about how simple surgery checklists improve patient care, save lives and reduce adverse patient outcomes. (For starters, see,8599,1871759,00.html)

The idea is that before surgery, the surgical team as a group completes a checklist that includes
• Verifying the patient’s identity
• Confirming the site and type of surgery to be performed
• Confirming availability of backup blood supply “just in case”
• Post-surgery – accounting for ALL sponges used during the procedure

A recent study published by the New England Journal of medicine shows that the use of such checklists can cut patient mortality rates nearly in half and complications by over one third.

This has implications not only for medical malpractice risk management and claim defense, but may have broader implications for claims handling and management across the board.

For example, if surgeons can improve their own risk management practices by using checklists, perhaps a claim offices can as well. Does your claim office have as resources checklists readily available for of the claim staff, checklists that are customized to handling all of the various types of claims that come across you were desks?

Yes, I can anticipate retorts that good claims handling amounts to much more than just working from a punch list were a checklist. I also anticipate surgeons arguing that good medicine involves much more than simply working one's way down a punch list or a checklist.

Fair enough. Nevertheless, as a framework for surgical practice or adjusting practice, perhaps there is a kernel if not more than just a kernel of a sound idea here.

How many client lapses were botched assignments might have been averted had the adjuster had access to and used a thorough checklist that encompassed all of the major contours of claim handling?

If it works for surgeons, why not for claims adjusters?