Guarding the details before claims become lawsuits
A thorough claims investigation early in the process can capture vital details and information before they are lost or forgotten.
Claims professionals are asked to wear many different hats during the claims handling process. From gathering information, communicating with claimants and evaluating risk to attempting early resolution, there are several critical tasks during the early stages of any claim.
It is logical that to evaluate a claim and its possible value, the professional will need relevant information, not limited to the theory of liability and the extent of any damages. While this information is generally obtained to facilitate the initial evaluation, claims professionals should remember that any early investigation also paves the way for the discovery process should the claim develop into a lawsuit. While it is difficult to predict which claims may find their way into the court system, professionals need to understand that the investigator’s hat may be the most important aspect, and defending claims in litigation becomes much easier when more information is gathered early in the process.
Following an incident, a claimant may immediately retain an attorney to begin working on the case. By the time a claim is established by the carrier or claims administrator, treatment may be well underway. Investigators may have visited the scene to take photographs, interviewed witnesses, and products may have been tested or inspected. In some instances, a claimant’s attorney may do all of this before the incident is even reported, giving the claimant a slight advantage.
Failing to conduct a thorough investigation immediately could put the claims professional, and later, defense counsel, well behind the eight ball. It is easy to review a preservation or spoliation letter to identify what items may be requested by the claimant’s attorney and what should specifically be requested and preserved.
Most often, preservation letters are vague, generic documents, with little specificity as it relates to each claim’s facts and circumstances. Being able to identify information, relevant documents and tangible items outside of what was requested by the claimant’s attorney, and being proactive, places you and your defense counsel in a better position for a successful outcome.
What should be gathered?
Items like surveillance footage and witness statements may be obvious when gathering relevant materials, but keep in mind that the statutes of limitations across each state vary from two to six years. Because relevant information may become difficult to obtain later on, an early investigation is critical. It is vital to complete and record witness statements; obtain telephone, e-mail and address contact information for witnesses; conduct scene inspections; locate and test products or vehicles, and collect relevant written records.
Some records, such as time clock reports, current policies and procedures, dash camera videos, and cell phone records may remain available, but the ability to obtain these later may become time-consuming and difficult. For example, a company’s policies and procedures may change or be updated over time. Or the entity may not save or be able to retrieve prior versions of those that were in place as of the date of loss. In fact, that is very often the case. By the time the issue arises in the discovery process, there may not be anyone available with knowledge about the relevant timeframe.
Taking the time and perhaps spending a little money to complete the investigation may ultimately save far more time and expense in the end. Even if a claims professional does not yet wish to retain counsel, reaching out to experts who can assist with gathering information can prove invaluable. Experts can assist in downloading vehicle information, collecting data from a cell phone or personal device, or conducting a three-dimensional scan of an accident scene for use if it becomes essential. Clients should also be instructed to place a litigation hold on any potentially relevant materials that cannot be specifically gathered.
How a claims professional can assist
Claims professionals are in the best position to complete thorough investigations, as they spend many months, or even years, serving as the liaison between the insured and the claimant. Not only can the claims professional identify how a claim is shaping up and what may become critical to defend the claim in the future, he or she is also in the best position to help guide the insured through the process.
Some clients may be sophisticated and have a thorough risk management department that is well-versed in handling claims, and others may be unfamiliar with the process. Being able to facilitate the investigation early on will not only help the claims professional evaluate the case for early resolution but will ensure that the client does not face unnecessary spoliation issues later. By taking possession of all relevant information from the client and compiling a comprehensive claims file upfront, the claims professional will be helping him or herself and defense counsel.
Nothing is more frustrating in litigation than facing an issue that could have been avoided had a proper investigation been completed. Too often, relevant information is lost, resulting in an otherwise ancillary issue turning a claim upside down. It is the experience and knowledge of claims professionals that will ultimately help both carriers and parties avoid these unnecessary and costly issues and will enable a claim to be evaluated and defended on its merits, rather than a mistake or technicality.
Amanda J. Podlucky (ajpodlucky@mdwcg.com) is a shareholder and co-chair of the Premises and Retail Liability Practice Group in the Orlando office of Marshall Dennehey Warner Coleman & Goggin.
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