Insurers Urged to Sharpen Claim Defense Tools

Insurers and their commercial clients are paying out too much on claims that could be defended, speakers warned at a recent seminar hosted by Crawford Adjusters Canada Ltd. “I’m darned tired of seeing these companies and insurers kicked around by claims they shouldn’t have to pay,” says Owen Smith, a defense lawyer and president of Strategic Risk Control Ltd.

Smith says lawyers are spending too much time gathering documents for trial, while clients are unprepared to provide the needed documents to defend a claim. Insurers and risk managers need to ask “what would you need [in terms of documentation] tomorrow if you went to court?”.

Insurers and adjusters, some of whom have little trial experience, need to be better prepared for trial and to use experts when needed, says Crawford CEO Glenn Gibson. “You may be able to write a good report, you may be a scientific whiz…but if you get in the witness box and don’t give good evidence, it doesn’t mean a thing.”

Furthermore, insurers need to battle the image that they will not take claims to court, but settle for the sake of expediency, notes Joe Hardy, director of risk management and insurance for Hudson’s Bay Co. “People [plaintiffs] will go away thinking it’s not going to be that easy [to get insurers to settle].”

And, despite some high profile “bad faith” claims, insurers need to remember “we are entitled to expect the claimant to prove their claim”, says Susan Watts, senior vice president of claims for Zurich Canada. That said, insurers need to pick cases they can win at trial, because one bad case can make bad law for everyone, she adds.