Steps to Getting the Most Out of Your Liability Insurers When You Receive a Claim (3)
If you are in business you are likely to think that having a claim brought against you is bad news. Firstly, it can cost a lot of money, either directly or through increased insurance premiums. But perhaps, the thing you hate, as much as the cost, is the stress and confusion the claims-handling process can bring, where you can begin with a feeling of a loss of control and end with a feeling of uncertainty as to whether you have got the right result. These seven steps should help put you back in control and should get you good value for money from your premiums.
1. Clarify the arrangements. Be sure you know what to expect. In particular, be clear about the decision-making process. Do you have any say in it? Do you want to? Wrong expectations cause a lot of stress and unnecessary conflict. The following points should all be agreed from the start:
· The appointment of solicitors.
· The appointment of investigators.
· Making admissions of liability.
· Making offers.
· Payments, including any uninsured costs you may have to pay.
· Feedback, including lessons to be learned.
It would be really good if you sorted this out before you received a claim, so everyone knew what to expect.
2. Ask to be kept informed about the "Reserve", that is the amount the insurers believe the claim could cost in the event of its being paid. There should be a separate reserve for legal costs. The reserve(s) should be reviewed regularly as more information comes to light. Being informed of this helps prepare you for the worst and should reduce the shock in the end.
3. Always respond as soon as possible, or within timescales set out, to all correspondence from the insurers or their agents.
4. If you do not understand a question, or do not know how to answer it, contact them and get clarification. Never leave it unanswered. If the answer is "I do not know and cannot find out" tell them that. It is their job to explain themselves, not yours to guess, especially when they use jargon.
5. Monitor progress. Claims have been lost because each side was waiting to hear from the other. Insurance company employees are human: they can forget to do things, or think they have done them when they have not, like anyone else.
6. Challenge opinions or decisions. If something seems wrong to you, ask for an explanation. If you are still not happy, ask for a second opinion from within the company.
7. Always be sure to get feedback as to lessons to be learned. Why did the accident happen? Why were you to blame? What could you do to prevent it happening again? Even if the claim was successfully defended, there might still be things you could do better in future.
Above all remember it is your claim, and you have paid your premium (I hope!) so get your money's worth. Your insurers should be glad to help you and should not mind taking the trouble, as in the long run everyone benefits if you take a real interest, so as to manage your risks, and your business, better. If you are unlucky enough to have one who wants only a quiet life, free from inquisitive clients, do them a favour, by taking your business elsewhere.
If you and your staff do not have the time to get involved to the extent required, think about using an independent claims handler to do most of this on your behalf, in accordance with your instructions. I say "most" because it is your business, and you need to be aware of its risks, claims, and how they are managed, but you do not have to make every 'phonecall or handle every piece of correspondence yourself. Take charge.
John Harvey Murray is the owner/manager of JHM Claims, providing a personal service of liability claims handling and risk management to businesses,other bodies and individuals in the North West of England, helping them save time, money and stress