Tuesday, April 29, 2014, 1:45-3:45 David Goodwin Tracy Jurusik Barbara Miller Why Won’t They Pay My Claim? (CLM 018)
Introduction • Meet the panelists • What we’re going to discuss • Identifying and presenting a claim • What happens after the claim arrives at the insurance company • What happens if the insurer disputes the claim • A case study
What is a claim? • Ordinary meaning – demand for money • Common definitions of “claim” • Lawsuit • Written demand for money • Tolling agreement request? • Investigation? • Subpoena?
Identifying and Presenting a Claim • Set up process with law department to receive threats/lawsuits (prior to claims being presented) • Review threat/lawsuit for potential coverage • Review reporting requirements for every potential policy • Report threat/lawsuit to broker(s)
Identifying and Presenting a Claim • Ensure broker follows reporting guidelines outlined in policy and timely reports claim • Form of reporting (letter; email; bordereaux) • Content of notice • Follow up for acknowledgments from insurers • Notify law department of potential involvement of insurers and consent provisions
What happens after the claim reaches the broker • Review the materials received from the Insured – from the perspective of a claim adjuster • Does the information appear to be related to anything that was previously reported? • Do we have a “Claim” as defined in the Policy?
What happens after the claim reaches the broker • If we have a “Claim” what is the date the “Claim” was first made? • Which type of policy is triggered based on the alleged wrongful acts in the “Claim”? • Which policy period is implicated and do we have any late notice issues? • Do the allegations in the “Claim” trigger more than one Policy?
What happens after the claim reaches the broker • If more than one Policy is implicated – how do the “other insurance” clauses in each Policy operate? • Are there any applicable exclusions in the Policy that may come into play? • Once we know which Policy and policy period, report the matter to the entire applicable tower
What happens after the claim reaches the broker • What are the choice of counsel provisions in the Policy? • Does the insurer or the insured have the “duty to defend”? • Does the applicable Policy have a panel counsel requirement? • Does the Insured’s choice of counsel comply with the Policy’s counsel requirements?
What happens after the claim reaches the broker • If we don’t have a “Claim” should we consider reporting a “notice of circumstances” if allowed under the Policy? • Factors to consider in a submitting a “notice of circumstances” • Once a “Claim” or “circumstances” reported, review acknowledgment and reservation of rights letters for accuracy and response
What happens after the claim reaches the broker • Understand the Policy’s consent provisions and confirm compliance • Insurer responses to claim • Acknowledgement of coverage • Reservation of rights/request for information • Denial • Silence
What happens after the claim reaches the broker • Broker response to reservation of rights • Broker response to silence • Broker response to coverage denial • Typical process following denial • What you can and cannot do • What your broker can and cannot do
What happens after the claim reaches the broker • Facilitate the flow of information between Insured’s counsel and the Insurers • How to communicate with insurers • Confidentiality issues/will agreements help? • Disclosing privileged information? • Avoiding waiver • Periodic calls and meetings • Identify and head off problems
What Happens If the Insurer Refuses to Pay? • Evaluate insurers’ reasons for refusing • Insurer definitely right? • Iffy? • Arguable? • Insurer wrong • Legal issues or factual questions? • How do you tell who is right?
What Happens If the Insurer Refuses to Pay? • Do you need outside assistance? • Broker • Consultant • In-house counsel • Outside counsel • Process of evaluating the claim • Legal uncertainties • Factual uncertainties
What Happens If the Insurer Refuses to Pay? • First steps • Gather policies • Learn facts • Process of evaluating the claim • Legal uncertainties • Factual uncertainties • Respond to insurer
What Happens If the Insurer Refuses to Pay? • Negotiate • Informal negotiation • Broker and insurer? • Client and insurer? • Counsel and counsel? • Effective negotiation strategies • What if negotiation doesn’t work?
What Happens If the Insurer Refuses to Pay? • Does policy have an “ADR” clause? • Mandatory choice of mediation or arbitration? • Mandatory arbitration? • What is mediation? • How a mediation works • What is arbitration? • How an arbitration works • Pitfalls of an insurance arbitration • What if you have a multi-policy program?
What Happens If the Insurer Refuses to Pay? • Litigation • Where do you file? • What do you allege? • Litigation – how it works • Litigation process • Discovery – documents; written discovery; depositions • Motion process • Settlement conference/mediation • Trial/appeal