A liability claim occurs when an insured reaches out to an insurance company asking them for help or financial assistance with a third party’s allegation that the insured is responsible for some loss or damage. Today, Cheri and Rex discuss the various types of liability claims and how you should respond in the event of an accident for personal or business use.
Welcome to Insurance Talk with Cheri Martinen and Rex Lesueur. We are the father-daughter insurance team from Bancorp insurance, located in beautiful downtown La Pine, Oregon. Today, it’s a little smoky outside, but we are located inside in the studio and the nice air conditioning. We’ve got fun topics. Yes, we do love to talk about insurance. We get up in the morning and I can’t think of anything I’d rather do, than to talk about insurance. I know in our listeners can’t think of anything better to listen to either. They’ve been waiting for more.
Today, we’re going to talk about what to do in the event of a liability claim. When people think of claims, they probably think of property, like my car got hit, or my house burned down, or my business’s window broke. But, what we’re really talking about is something that’s going to bring a lawsuit to you. The liability, such as someone’s going to your business and your product or service injures them. Or, you injure somebody with a business vehicle during an accident. There are other kinds of liability claims, including employment practice liability and so on. Despite the type of claim, how it’s handled initially is incredibly important to how the claim outcome.
So, we’re going to go over just a couple of principles here that you need to know when something happens so that you don’t damage the chance of having a decent defense in the event the claim goes to court. It’s common to mess up and say the wrong thing. But, it’s even worse when the next thing you know is it’s being used against you in court. It’s human nature, in the event of an accident, to hop out of the car, run over to them and say, “geez, how are you?” And, one of the things that people will often say is, “oh, don’t worry about it.” “I have insurance. They’ll take care of it” or, “geez, I’m sorry I hurt you, this was all my fault.”
First things first, you don’t know if it was your fault. When there’s an accident, things are happening quickly. There’s very few slow-moving accidents when it comes to automobile. Humans are sympathetic and it’s easy to want to say, “geez, we’re sorry, we’ll take care of it.” We’ll take care of it. That is the last thing you want to do. I’m not saying to be rude or anything, but if something like that happens, you get out and just ask the person if they’re okay, make sure that they are okay and if not call for help via an ambulance and/or the police.
A business example. We work with a lot of water utility companies. Sometimes, a pipe will break and the pipe will run water into a surrounding house. Well, the last thing we want our commercial customers to say to the homeowner is, “Geez, we’re sorry. We’ll take care.” This action is called the concept of negligence and negligence needs to be proven in court. Admitting to negligence before you get the court, is hard to unravel.
In the case of negligence where you, as an individual, know that something is dangerous and don’t do something to prevent it from injuring another person. Then something happens, the negligence can be pinpointed to you as you knew it was dangerous, yet did nothing about it. Now someone is injured and you’re responsible. An example is: You go into a restaurant and they just mopped the floor, they always have that big yellow sign out that says, Slippery When Wet, to protect you from something they know is dangerous. However, if they just mopped the floor or left a big old puddle and didn’t put that sign out, they could be negligent as they were aware of the potential hazard. But, if the spill was caused by a customer who picked up a glass of water and walked from one table to another, but spilled some on the floor along the way. Then, 30 seconds later you slip on it is the restaurant negligent? These are all kinds of things that get to be resolved in court.
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As a business, one can’t simply go away. So there could be an instance where they call you a month later and say the issue hasn’t been dealt with. You’re going to have to say, “I’m sorry, the insurance company is entirely responsible for handling this situation from here on out. I believe that they will be fair and take care of you.” Now, not only have you transferred the risk of being sued to someone else, but you have actually transferred the handling of the claim.
The moral of the story is, when the event happens don’t make don’t make any statements that could immediately put you at fault. Let the insurance companies decide that once presented with all the facts of the accident.
When you get home, assuming you are not seriously injured, take a deep breath and write down what you feel happened starting right from the beginning. For example: I was driving or so-and-so came into my office and said… Write down exactly what the person told you, as well as the facts that you recall about the incident. If an employee was involved, let’s say an employee was driving the company vehicle that was involved in the accident. Then, you would ask them to create the same documentation from their perspective. If there was more than one person in the car, they should be asked to do the same thing. This is called a serious incident report, which is the first recollection of what happened at that event from your perspective.
Then, when your in depositions or what have you, you want to be able to say, let me refer to my notes. Now, when you’re doing a serious incident report, it does not have to be in chronological order or in perfect handwriting. As long as you can read it, spelling, punctuation, don’t worry about it. Just get your thoughts down before you talk to an adjuster for either side. The adjuster will call you and ask questions, and you want to provide the same facts to everyone you talk to, so refer to the notes. Our minds do play tricks on us when we have to discuss facts over and over, and an adjuster might even play into that confusion. So, you need notes.
Be sure to keep them for a couple of years after the incident, even if it’s settled. As people can sue you for up to two years after the event. So, anytime something happens, even if you don’t expect it to lead to a lawsuit or even a claim, create the report and save it.
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Disclaimer: This content is provided for general information purposes and is not intended to be used in place of consultation with our agents.