What do these two animals have in common and what has that got to do with Risk Management?(Answer on page 2)
Myths About Risk Management: No.1.
“RM is nothing more than Common Sense”
If only it were!
I certainly do encourage managers to use common sense, but regrettably not all have it. Even if you do have it, you should create a system so that those around you, or those who follow, who may not think like you, have something to guide them. You may also need sometime to provide evidence of how you established the procedures and policies you have. It is also unfortunately true that most of us do not make our best decisions when we are under stress. So when things go wrong it is best to have a written Plan B to turn to rather than having to think on your feet. The emergency services have lots of plans and procedures to fall back on when things do not go the way they expected. They know the limitations of even the best of common sense. Let us follow this example of best practice.
Why We All Need to Review Our Claims Handling Procedures.
Some of the most important of the Jackson Reforms to the Civil Justice System have now come into effect and we must all take them into account if we are to succeed in keeping the cost of claims down. For most of us, the two changes we need to take into account are:
- Response times cut from 90 days down to 40. Defendants now have to respond with an admission or a detailed defence within 40 working days of the receipt of a public liability claim, or 30 for an employer’s liability claim. This can be achieved only if your systems are efficient and effective. You have to hit the ground running: it is no use starting to draw up a plan or discuss who is going to do what after the claim has been received.
- You will not get all your costs back even if you win. (If you are a defendant that is!) If you successfully defend a public liability or employers liability claim you will no longer be able to recover your legal costs from the claimant except in certain unusual circumstances. So you need to think carefully as to your reasons for defending a claim and to be prepared for having to meet some of your costs. You may consider it worthwhile if it puts off other claimants with doubtful claims, but do so with your eyes open. And insist on clear estimates of costs from your solicitors.
These are two major changes to the world of claims and we all need to change with them.
Tip of the Month.
Always insist on feedback from your insurers, solicitors, or whoever handles your claims. Have your money’s worth. Whether you win or lose there are always lessons to be learnt. Find out what you could have done differently to have prevented the claim or to have achieved a better outcome. There is always something. Then act upon it. Do not be caught out again.
Although frauds always seem to be getting more sophisticated and hi-tech, some of the simple old ones are still around. And still work.
I know of a recent case of “ghosts” on the payroll, where a payroll assistant paid large salaries to members of her family who did not even work for the company. It was eventually discovered by a routine audit, but it cost the employers a lot of money before it was stopped.
Are your systems protecting your business?
Spotlight on Cyber-Risk.
Can you be held responsible for what others write on your social media site?
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 start checking your sites regularly and removing even favourable comments which might get you into trouble, even if not with the Law.
Answer to Picture Question
These two animals photographed by me on a recent trip to Chester Zoo are an Asian Lion and an Asian Rhino, so that’s three things in common, but the most important is that they are both endangered species. For all their size and strength they are not surviving well in the wild. So how is your business? What could make you “extinct”? What are you doing about it? Do you need a consultation?