How to select a claims partner for public entity pools
A "pool" is a cooperative insurance and risk management arrangement. They require particular claims expertise.
Managing insurance claims for public entity pools requires a unique skill set.
A public entity’s pool, often referred to as a “pool,” is a cooperative insurance and risk management arrangement in which multiple public-sector groups agree to combine their resources and expertise to handle coverage and liabilities. Members collaborate, make decisions collectively, share specialized expertise and resources, control costs, manage risks and claims efficiently, and generally work toward a safer and more secure public sector.
Pools can include public schools, municipal services and a variety of government agencies that need specialized support to manage the unique and frequently complex nature of their claims. Not every claims partner possesses this expertise, and it’s important to know how to recognize which organizations have it and why.
Keep reading to find out the key aspects that set apart an exceptional public entity claims partner. What follows are five key considerations for evaluating a claims partner that specializes in pools.
No. 1: How much expertise do they have in public domain liabilities?
The nature of public entity pools demands a partner with a deep understanding of public domain liabilities. Unlike a single insurance policyholder, pools serve the needs of dozens or even hundreds of member organizations, each with its own needs and priorities. It’s a complex dynamic that requires a demonstrated level of fundamental expertise in the most common public domain liabilities.
For example, consider the realm of public trails and immunity, especially in a state like California. Here, specialized knowledge of liability statutes is imperative. In these jurisdictions, claims related to injuries sustained on public trails may be subject to what’s known as “trail immunity.” States and counties are complex patchworks of immunities and other laws. Understanding nuances like, say, a six-month statute of limitations related to a particular class of liabilities is essential for a claims partner that wants to serve pools in that jurisdiction.
No. 2: How familiar are they with the types of claims unique to pools?
Public entities can face a wide range of claims, some of which are completely unique to their sectors. The more well versed a partner is in managing these distinct types of claims, the more valuable the partner will be. Consider, for example, sexual abuse and molestation (SAM) claims, which can be very sensitive and involve high financial and reputational stakes. Mitigating exposures and exploring mediation options often are critical to preventing these cases from escalating to trial. An experienced partner understands this, works to keep sensitive claims out of the public eye, and ultimately may save the pool time and money.
Property damage claims, which might involve an object falling and damaging a vehicle or other asset, present their own set of challenges. Other specialized claims span assault, general liability, police-related incidents, or employment and discrimination cases. Understanding the differences and what’s entailed with each is critical for an effective pool claims partner. It’s even more important when you’re dealing with unionized public employees.
No. 3: How well do they know the entities’ municipal, state, and/or federal laws?
Another key consideration is a comprehension of the legal frameworks in which a public pool operates. To a great degree, municipal, state and federal laws affect these entities’ operations and liabilities. It’s important that a claims partner fully grasp the implications of specific governmental tort caps and civil liabilities.
A pool claims partner also should possess expertise in state-specific laws, which vary widely across the nation. It means having experts who are capable of navigating the intricacies of their jurisdictions and training these experts on relevant statutes and immunities.
No. 4: How effectively can they manage the legal ramifications of sensitive claims?
Pool experience also is valuable when handling sensitive claims. Juries can be unpredictable, especially with high-profile incidents that involve police and other first-responders. Investigating these kinds of cases can be a challenge, because law enforcement agencies may be reluctant to release information outside the public record or without a subpoena.
For these claims, it’s often wise to retain defense counsel promptly in order to protect the pool. A good claims partner must be able to differentiate between everyday accidents and those that may involve greater legal peril. In these situations, a claims partner must understand the importance of exercising caution and by engaging counsel and avoid unwittingly inciting grounds for further legal action by potentially compromising privilege.
No. 4: How well can they support a rigorous audit?
When it comes to claims support work, quality is paramount, and audits are designed to ensure that the partner meets internal and pooled client expectations. Additionally, results may be reported to the public, adding another layer of scrutiny and accountability.
An audit may lay bare the quality of, and relationship dynamics between pool members. Managing this means negotiating consensus, fostering healthy relationships, and ensuring that pooled entities are in alignment with one another. It’s not easy to keep multiple organizations all moving productively in the same direction, and competing priorities often arise. Managing relationships between members, claim partners, and public investigations is vastly different from managing consumer general liability clients.
Professionals like Chris Kustra, an experienced ARM-P liability pool claims director specializing in public entities, understands this well.
“Claims against public agencies can be highly emotional and politically sensitive, particularly those involving employment practices and law enforcement,” Kustra says. An action plan must meet all internal stakeholders’ expectations.
‘When the pool, member public agency, defense counsel, and claims professional aren’t all on the same page regarding a case’s direction, it’s extremely important that everyone gets on the same page and does it promptly. When situations like this arise, it’s best to meet with all stakeholders, listen to everyone’s viewpoints, and assemble an agreed-upon action plan to move the case forward with momentum toward a clearly defined and unified goal.’
No. 5: A good claims partner can be a lifesaver for pools.
When choosing a public entity pool claims partner, consider these factors carefully: sector expertise, familiarity with unique pool claims, a knowledge of relevant laws, an ability to manage sensitive claims artfully, and a commitment to navigating rigorous audits. Weighing these five factors can help guide your decision-making process and ensure that your pool claims partner isn’t getting in over its head.
Louis Pippin (lpippin@venbrook.com) is chief claims officer at Venbrook Group. Angelique King (aking@carlwarren.com) is executive vice president, claims, at Carl Warren & Company.
ALM’s 2024 Complex Claims & Litigation Forum, happening in Las Vegas Feb. 26-28, 2024, is designed to help insurers and litigators Prevent, Prepare, and Prevail in complex claims cases and emerging risks. This event boasts a winning mixture of thought-leadership presentations, actionable case-studies, and closed-door peer-sharing. Follow this link to find out more and register.
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