Category Archives: Claims Handling

Is mediation a threat to claims handlers?

There is an increasing pressure from the Courts and the Ministry of Justice for parties to use Alternative Dispute Resolution, or Mediation rather than taking their disputes to trial. This trend predates the Jackson Report, but was certainly encouraged by it.
Personally, I am studying mediation so as to be able to offer clients a complete service to meet their needs. However, some claims-handlers regard the spread of mediation as a threat to their trade.
I can see that there are advantages, not just in saving costs, which is a desirable aim, but not one that I am convinced will be achieved: I can see mediation becoming more professionalised and more expensive. We can only wait and see.
The other benefit of mediation is that it can lead to a win-win result rather than the win-lose which can be the only outcome of a traditional trial. Indeed the trial process tends to polarise feelings, often leaving the loser feeling cheated, and even the winner less than satisfied if he has not got as much compensation as he had expected, or if his position was not fully vindicated by the judge’s remarks.
It is claimed that mediation is more likely than a trial to lead to a resolution of the underlying conflict, by helping both parties to see different points of view, to acknowledge their own failings, to learn from the experience and to consider the way forward to the future rather than dwelling on the past.
I do not disagree with any of the aims of the mediation approach, nor am I totally pessimistic about its chances of achieving them in some cases. I am, however, concerned that parties, and the Courts, may be tempted to go down this route where it is not truly appropriate.
Mediation is based on the assumption that there is no absolute “Right” and “Wrong” but that both parties need to be prepared to “give” to some extent. This is probably true a lot of the time. There are however many cases where this is not so, as I have seen in many years of handling liability claims.
• There are many claims which are totally fraudulent, and many more where there has been a considerable amount of exaggeration or distortion of the truth. I would not want to reward, even to a limited extent, claimants who practice such deception.
• There are also many cases where, although no fraud is involved, the defendant has done nothing wrong: the claimant simply assumes that whatever misfortune you may encounter, there is always somebody else who will have to compensate you. I do not wish to encourage this attitude, or to penalise innocent employers or other potential compensators.
On the other hand, I am also aware of claims I have dealt with where mediation would have been a far better way than that which was actually chosen at the time.
These come into two categories:
1. Those where the claimant was not primarily seeking compensation, but had found a claim was the only way to be heard or to obtain the fact or a sensible explanation for what had happened. I can think of cases where parents wanted to know how their children had come to be injured in school, and had been met with either silence or unacceptable explanations.
2. Those where there is an ongoing problem which needs to be addresses. This could be anything from flooding, to bullying. Paying the claim might be an incentive for the defendant to prevent a recurrence, but it is uncertain.
I do not feel threatened by mediation, and will welcome the chance to help clients find real and effective solutions to their problems – where this is the appropriate way.
But I hope the concept of Right and Wrong does not disappear from our system of justice altogether.

Are Claims Handling Services Cost Effective?

People sometimes think they are saving money by relying on their insurers or, if uninsured, waiting until they get a claim and then going to a solicitor.

How much does a claim cost without the services of a claims handler?

Most claims for injuries cost over £1000, even for minor injuries.  The claimant’s solicitors costs are likely to be somewhere in the same region, so if your insurers deal with it without needing to use solicitors to defend it, you will be lucky if it costs less than £2000.

But your insurers will be paying – won’t they?

If you have an excess on your policy, you will have to pay everything up to that agreed amount. However, it does not end there. Your premium next year, and beyond, will very likely be “reviewed” in the light of the cost to your insurers. If you have more than one claim in a few years, the “review” could be serious!

How can an independent claims-handler help?

They might be able to find a way of defeating a claim so it costs you nothing, when your insurers might have been thinking of paying it.  Or they might be able to negotiate a better deal, reducing the cost to you.  Sometimes, when there was no defence, I have saved clients money by encouraging a quicker settlement, so keeping the solicitors’ fees down.

The fees are usually in the hundreds, not thousands of pounds. And the initial consultation is usually free, or always in my case.

Find out more: e-mail john@jhmriskmanagementservices.co.uk

or go to www.jhmriskmanagementservices.co.uk/services

Why Might You Need a Claims Handling Service? And When?

People sometimes ask whether my services are necessary or cost effective. Here are answers to some of the more specific questions you might be thinking about.

What if you are not be insured?

  • Employers Liability Insurance is a legal requirement if you employ anyone, but you might not have it.
  • Public Liability Insurance is only desirable and many people think they do not need it.
  • If someone brings a claim against you, you cannot just ignore it.
  • Unless you are experienced in this yourself, you will need someone to handle the claim for you.

Are my services necessary if you do have liability insurance cover?

  •  Perhaps! You may have an insurer who gives first class personalised service, making anything else superfluous, but many people find they need someone to act as go-between, to chase up their insurer, to interpret some of the letters their insurer writes to them, or to hold their insurer to account, so as to get better value for money for their premiums.
  • Most of my best work has been done working in conjunction with insurers. Cooperation rather than conflict has been my main experience.
  • Some insurers find it helpful to have someone with relevant knowledge and experience whom they can deal with on behalf of their client, especially where the client does not have the time or ability to deal with all their questions as promptly as is needed.
  • You may find some or all aspects of your claim are not covered and so your insurer is unable to help resolve it.

 Do you need a solicitor?

  • Sometimes! For certain legal processes a solicitor or barrister is required but many claims can be settled, one way or the other without a solicitor.
  • If it is necessary to engage solicitors, it will help them, and thus keep costs down, if the matter has been properly investigated and a file with all relevant information and documentation can be provided.

Why wait until you get a claim?

  • Things are likely to go much better when you get a claim if we have had at least some previous meetings where I can advise you on your procedures and agree our arrangements so we can hit the ground running: time is money when dealing with claims.
  • Also, since 2013, you have only 60 days to deal with a liability claim.  You must either have set out your defence in detail and sent it to the claimant’s solicitors, or have agreed to pay it: after that time you cannot submit any new evidence. You don’t want to lose just because you did not meet the deadline!

Why not contact me for a chat? It won’t cost anything.

tel.01925 445215

e-mail john@jhmriskmanagementservices.co.uk

or go to www.jhmriskmanagementservices.co.uk

Tip of The Month: Property Owners, Know Your Limits

If a claim arises you will need  to be sure whether the place where accident happened was your responsibility or that of your neighbour, tenant or other party. And accidents often happen in entrances, on boundary fences or on forecourts. Knowing the boundaries and the terms of any leases or contracts is usually essential.  You also need to be able to produce proof of these limits whenever needed. So be prepared. Do not let searching the records eat into the 40 days allowed for handling a claim, and make sure you are sure! Do not waste time and legal costs trying to deny what is in the end undeniable.

Types of Motor Fraud

In some recent years the number of motor claims went up although the number of accidents went down! This is probably because more people were claiming for injuries even in minor accidents. Some of these claims could have been genuine!  A motor fraudster may target an insurance company or another motorist or both.
Common types are:

  1. Accidents which never happened
  2. Exaggerated damage or injuries from a real accident.
  3. Staged accidents involving an innocent victim
  4. Staged Accidents between two fraudsters
  5. False or exaggerated claims for hired replacement vehicles.

Pro or Am? Some fraudsters are “amateurs” – ordinary people who see an opportunity for a quick profit – but types 2 and 3 are usually committed by “professionals”, who are organised gangs and often involved in other crimes. When accidents are staged they usually pick a victim travelling alone so there  will be no witnesses and so they can intimidate him or her into agreeing to what they say, or to not taking photos. Challenging them can be dangerous and any suspicions should be taken to the police and/or your insurers or official investigators.
A recent example of a series of type 4 and 5 scams involved a broker who used to add items to genuine claims and get the insurers to pay him before he paid the motorists for what they had actually claimed. A doctor was also involved, writing medical reports on people he had never seen, who were usually unhurt. They always dropped the claim if it was to be investigated, and usually kept the amounts low enough to be paid without question. And they knew which insurers were the easy targets. The police investigation was started as a result of a claimant’s suspicions being aroused when he contacted his insurers direct and learnt about all the payments they had made to the broker for things he had not claimed.
National trends? Type 2 is more common in the USA whilst type 3 is more common in the UK.
What can you do? Always keep a camera in the car. The one on your mobile will do. If you are involved in a motor accident (or any other kind now I think about it) take lots of photos.

  • Take both/all the vehicles and take the number plates.
  • Take the other driver(s) and any passengers or others involved so they cannot say they were not there and so nobody else can take the blame for them.  And the claim may be made by someone who was not there but did have some injuries caused in another way).
  • Take the overall scene to identify where it happened.
  • Take the scene showing the position of the vehicles in relation to each other to give some evidence of how it happened.
  • Try to make notes as soon as possible while you still remember everything.
  • You may want to just be left alone and get home as quickly as you can, but that is probably what the other driver is counting on if they are dishonest.

Cyber-risk: can you be held responsible for something someone else writes on your blog?

This question has not yet come before the UK Courts, but it probably will some day.

Meanwhile, there have recently been two complaints to the Australian Advertising Standards Board based on misleading and illegal statements which were put on companies’ Facebook pages by sites users.  One was upheld, the other not, but in both cases the Board said the companies had a duty to monitor their sites and remove offensive or misleading material.

How does this affect us?

Whilst the Board has no direct control of the Australian, let alone UK, Courts, it shows how things are going and it is probably wise to set up a system for checking your sites regularly and removing things which might get you into trouble, even if not with the Law.

Yes, even favourable comments put on by strangers can get you into trouble!

What should you do if someone brings a Public Liability Claim against you?

Follow these 12 Steps if Someone Brings a Public Liability or Employer’s Liability Claim Against You.

Big businesses, local authorities and other large organisations receive claims from their employees and the public regularly and have people and systems to deal with them.  You may not be so lucky, and receiving a claim when you are not used to it can be confusing and stressful.  If it is a motor claim you can probably rely on your motor insurers to deal with it, but if it is a liability claim here are some tips on what to do.

If you want to avoid paying a claim you did not need to, or paying more than you should, follow each of these steps and keep a record of everything you do at each stage:

  1. Acknowledge the letter, without commenting on the contents.
  2. Ensure it is a claim, i.e. a demand for money (“compensation” or “damages”) and not just a complaint or request.
  3. Check whether you are covered by any of your insurances.  This may be a specific Employers Liability, Public Liability or Combined Liability policy or it may be included as part of a Household or Business policy, so do check.
  4. Certain kinds of claim may not be covered, or may be on a separate policy, such as:
  • Libel and slander
  • Environmental Pollution
  • Cyber Risk (claims arising from the use of computers)
  1. If you are covered, or if you are not sure, inform your insurers or brokers.
  2. Always comply with any instructions they give, otherwise you may invalidate your policy.
  3. Always give your insurers promptly any information or documents they ask for, OR let them know you do not have them.
  4. Let your insurers know of any suspicions you have that the claim may be fraudulent, but remember suspicions are not the same as proof, frustrating as that may be!
    1. If you are not insured, you may be able to investigate and deal with the claim yourself, or you may wish to seek help from a professional.  They should be able to give you some initial advice to enable you to decide whether to engage their services.
    2. Whether insured or not, you may be able to get some help from any trade or professional association you belong to.
    3. Whether insured or not you may be able to save time, money and stress by employing a claims-handler to advise you and manage the process.

 

Finally, deal with the claim promptly: it will probably not go away, and there are time-limits set by Law.  Then keep the process moving: time really is money as far as the claimant’s solicitors are concerned.  If you have not got the time to deal with it properly, make sure somebody does so for you, whether an employee, friend or someone you are paying to look after your interests.

 

Why do I not use checklists?

Why do I not use checklists? One of the things I like about being self-employed is not only not having a boss, but also not having any set procedures or checklists to follow slavishly. I know some claims handlers find them useful. Checklists that is, not bosses. The trouble is that you can never include everything, and you just know that the one thing you leave out is going to be the crucial item in your biggest/most important claim!
Anyway, to try to include everything you could think of would mean a very long list. Lets be honest, the longer the list the less it gets looked at and the more tempting it is to skip down it ticking all the boxes without thinking. (Now thinking is the one thing you do need in claims handling). If the list is pretty comprehensive, some boxes are probably irrelevant for 99% of claims and so end up getting ticked every time, but when they are relevant they still get ticked automatically.

So what do I do instead? There are two questions I know I need to keep asking myself whenever I look at a claim:
1. Do I believe there is legal liability here?
2. Is there enough evidence to convince the Court as to my answer to (1) ?
All other questions should be aimed at getting me to the answers to these two. And there is usually no point in continuing down a checklist once you have the answers to these two questions, but I have known people to carry on working through all the outstanding points on their checklist when they could see from the start there was no possible defence. The best thing to do would have been to make an admission then an offer and then a payment, as quickly as possible.
Which reminds me – there is perhaps a third question to keep in mind:
3.What can I do now to move this claim on to its conclusion? Time is money when lawyers are involved. The difference between a liability claim and malt whiskey is that one improves with age and the other does not.

Standards.One argument for checklists is that they maintain consistent standards within the office. Unfortunately this may mean consistently mediocre. Being on my own means I have only myself to be consistent with, and I always aim to attain the highest possible standards