njspls
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February 8, 2008. THE MARQUIS AGENCY & VICTOR O. SCHINNERER/ CNA. NJSPLS. Present:. The Character and Nature of Claims Against Land Surveyors. The Marquis Agency 900 Rt. 9 North, Ste. 503 Woodbridge, NJ 07095-1003 www.marquisagency.com. Richard N. Hartman - PowerPoint PPT PresentationTRANSCRIPT
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NJSPLSNJSPLS
The Character and The Character and Nature of Claims Nature of Claims
Against Land SurveyorsAgainst Land Surveyors
Ed Pagan, Jr., Esquire
Pagan Affiliates LLC
Richard N. Hartman
Construction Risk Management Consultants LLC
THE MARQUIS AGENCY
&
VICTOR O. SCHINNERER/ CNA
The Marquis Agency
900 Rt. 9 North, Ste. 503
Woodbridge, NJ 07095-1003
www.marquisagency.com
Present:
February 8, 2008
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What is a Claim?What is a Claim?
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Any written demand received Any written demand received by an Insured seeking remedy by an Insured seeking remedy and alleging liability or and alleging liability or responsibility on the part of responsibility on the part of the Insured or persons for the Insured or persons for whose conduct the Insured is whose conduct the Insured is legally liable.legally liable.
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What is a Pre-Claim?What is a Pre-Claim?
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The Insurance Company will The Insurance Company will pay for all costs or expenses pay for all costs or expenses the Insurance Company the Insurance Company incurs until the date a incurs until the date a ClaimClaim is made as a result of is made as a result of investigating a circumstance investigating a circumstance reported by the reported by the InsuredInsured..
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Where and by whom do Where and by whom do they come from?they come from?
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Insurance Company Claims Insurance Company Claims StudiesStudies
Important claim data to assist Important claim data to assist Surveyors in assessing and Surveyors in assessing and analyzing client and project analyzing client and project
risksrisks
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Frequency of Claims by Frequency of Claims by Claimant Identification Claimant Identification
(1997-2006)(1997-2006)
Client
General Contractor
Third Party Property DamageSpecialty Contractor
Other
18%
11%
2% 3%
66%
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Claims by Project TypeClaims by Project Type(1997-2006)(1997-2006)
Frequency= Reported ClaimsSeverity= CNA dollars Spent
Houses/ Townhouses
Land/ Site Develop
Highways
Retail/ Restaurants
Office Bldgs/ Banks
Schools/ Colleges
Condos
0%
5%
10%
15%
20%
25%
30%
35%
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1010
Residential Projects:Residential Projects:Claims by Problem Area Claims by Problem Area
(1997-2006)(1997-2006)
Frequency= Reported Claims
Severity= CNA Dollars Spent
Boundaries/ Easements/
Trespass
Construction Stakeout
Site Preparation
0%
10%
20%
30%
40%
50%
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Commercial Projects:Commercial Projects:Claims by Problem AreaClaims by Problem Area
(1997-2006)(1997-2006)
Frequency= Reported ClaimsSeverity= CNA Dollars Spent
Construction Stakeout
Boundaries/ Easements/
Trespass
Site Preparation
0%
10%
20%
30%
40%
50%
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Reported Claims Per 100 Reported Claims Per 100 FirmsFirms
198
4
19
86
198
8 19
90
199
2 199
4
19
96
19
98
20
00
200
2
200
4 200
6
Nu
mb
er o
f Cla
ims
0
4
8
12
16
20
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Claims Frequency Per 100 Claims Frequency Per 100 FirmsFirms
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
0
3
6
9
12
15
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Cumulative Percentage of Cumulative Percentage of ClaimsClaims
(1997-2006)(1997-2006)
Prior0-1 Year After
2-3 Years After
4-5 Years After
6-7 Years After
8-9 Years After
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
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Percentage of Claims Closed Percentage of Claims Closed with Indemnity Paymentwith Indemnity Payment
1997 1998 1999 2000
2001 2002 2003
2004
2005
2006
30%
34%
42%
46%
50%
38%
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Percentage of Claims Closed Percentage of Claims Closed with Defense Payment Onlywith Defense Payment Only
1997 1998 1999 2000 2001 2002
2003 2004
2005
2006
0%
5%
10%
15%
20%
25%
30%
35%
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What causes claims?
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Strategies for avoidanceStrategies for avoidance
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Early warning signsEarly warning signs
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Root Causes of Claims:Root Causes of Claims:
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Root Causes of Claims:Root Causes of Claims:
ClientClient
Scope of ServicesScope of Services
FeeFee
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Root Causes of Claims:Root Causes of Claims:
CommunicationCommunication
Innate desire to pleaseInnate desire to please
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Root Causes of Claims:Root Causes of Claims:
Lack of Mutual Lack of Mutual understandingunderstanding
Reliance on information Reliance on information furnishedfurnished
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Strategies for AvoidanceStrategies for Avoidance
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Strategies For Avoidance:
How do we Limit or Avoid the How do we Limit or Avoid the Potential for Claims?Potential for Claims?
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Business Steps for Avoidance:Business Steps for Avoidance:
Step by Step Guide to:Step by Step Guide to:1)1) Protect the interests of your Protect the interests of your
firmfirm2)2) Identify root causes of claims Identify root causes of claims
and early warning signsand early warning signs
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STEP 1STEP 1
What does the owner/ What does the owner/ client want?client want?
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STEP 2STEP 2
Why does the owner/ Why does the owner/ client want it?client want it?
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STEP 3STEP 3
When does the project When does the project need to be completed?need to be completed?
●●Is this schedule realistic?Is this schedule realistic?
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STEP 4STEP 4
What information does What information does the owner/ client have the owner/ client have that is necessary for that is necessary for
the surveyor to perform the surveyor to perform its services?its services?
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STEP 5STEP 5
Do we have the Do we have the capability/ capacity to capability/ capacity to complete this project?complete this project?
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STEP 6STEP 6
Is the fee/compensation Is the fee/compensation adequate/appropriate to properly adequate/appropriate to properly perform the services and assume perform the services and assume the risks we’re being asked to the risks we’re being asked to assume?assume?
Do we have all of the information Do we have all of the information to answer this question? to answer this question?
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STEP 7STEP 7
Memorialize these Memorialize these understandingsunderstandings
Leads to development of a Leads to development of a ContractContract
Scope of servicesScope of services Fee w/specified payment Fee w/specified payment
provisionsprovisions
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The Surveyor, the The Surveyor, the Attorney, the Claimant Attorney, the Claimant
and the Claimand the Claim
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PHASE 1PHASE 1
Initial Notice of a ClaimInitial Notice of a Claim
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A Step By Step Guide for A Step By Step Guide for you to follow to:you to follow to:
1)1) Protect the interests of your Protect the interests of your firmfirm
2)2) Understand and take Understand and take advantage of the coverage and advantage of the coverage and services afforded by your services afforded by your professional liability policy and professional liability policy and insurerinsurer
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1.1. STAY CALM STAY CALM
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2. 2. Accept all letters and Accept all letters and correspondence correspondence withoutwithout comment or argumentcomment or argument
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3. 3. DO NOTDO NOT admit liability admit liability and and DO NOTDO NOT attempt to attempt to
place blameplace blame
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4.4. Gather Gather ALLALL information/ information/ Develop a chronology of Develop a chronology of
events from start of project events from start of project up to initial notice of claim.up to initial notice of claim.
All principals and staff All principals and staff members involved in the members involved in the
claim should be prepared to claim should be prepared to document the circumstances document the circumstances surrounding the allegations.surrounding the allegations.
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5. 5. Contact your BrokerContact your Broker- Discuss matterDiscuss matter
- Start to understand coverage Start to understand coverage and services available to and services available to
your firmyour firm
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6.6. Send Information to BrokerSend Information to Broker
Send basic information only – Send basic information only – more detailed information more detailed information will be sent to insurance will be sent to insurance company and attorneycompany and attorney
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The written report to your The written report to your insurance company should insurance company should
include the following:include the following:
Your firm’s name and addressYour firm’s name and address
Brief narrative description of Brief narrative description of the allegation against youthe allegation against you
Name of person or entity Name of person or entity making the claimmaking the claim
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The written report to your The written report to your insurance company should insurance company should
include the following:include the following:
Amount of demand, if knownAmount of demand, if known
Any lawsuit papers or legal Any lawsuit papers or legal proceedingsproceedings
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The written report to your The written report to your insurance company should insurance company should
include the following:include the following:
Contract with client for the Contract with client for the projectproject
Any other documents or Any other documents or correspondence, including correspondence, including newspaper accountsnewspaper accounts
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The written report to your The written report to your insurance company should insurance company should
include the following:include the following:
NOTE: If the Claim/ incident involves a NOTE: If the Claim/ incident involves a traumatic situation (ie: structural collapse or traumatic situation (ie: structural collapse or serious bodily injury etc.):serious bodily injury etc.):
-Take photographs of claim site if possible-Take photographs of claim site if possible Amateur photos taken promptly are more Amateur photos taken promptly are more
valuable than professional ones taken at valuable than professional ones taken at a later date.a later date.
-In addition provide:-In addition provide: Date, Time, and Location of the situation.Date, Time, and Location of the situation.
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7. 7. Broker sends Broker sends Information to Information to
Insurance CarrierInsurance Carrier
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PHASE 2PHASE 2
The Claim, The Insurance The Claim, The Insurance Carrier & ClientCarrier & Client
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1. 1. Remain CalmRemain Calm
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2.2. Insurance Carrier/Claim Analyst Insurance Carrier/Claim Analyst will contact youwill contact you
- Discuss what to expect from Discuss what to expect from carriercarrier
- Discuss choice of defense Discuss choice of defense counsel to represent your firm counsel to represent your firm with insurance carrier/ claim with insurance carrier/ claim
analystanalyst
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3. 3. Insurance Company will Insurance Company will assign defense counselassign defense counsel
ALWAYS REMEMBER THAT ALWAYS REMEMBER THAT DEFENSE COUNSEL REPRESENTS DEFENSE COUNSEL REPRESENTS YOU AND YOUR FIRM, NOT THE YOU AND YOUR FIRM, NOT THE
INSURANCE COMPANYINSURANCE COMPANY
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4. 4. Tell claim analyst you Tell claim analyst you have the chronology of have the chronology of
events events
Complete chronology with Complete chronology with documentationdocumentation
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5. 5. Write down all Write down all questions you want to questions you want to discuss with defense discuss with defense
counselcounsel
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6. 6. Send questions to Send questions to defense counsel before defense counsel before
meetingmeeting
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7. 7. Prepare for meetingPrepare for meeting
Have copies of all contracts/ Have copies of all contracts/ professional service professional service
agreements, correspondence, agreements, correspondence, and memoranda available to and memoranda available to
give to defense counselgive to defense counsel
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Underwriting ImpactUnderwriting Impact
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Underwriting ImpactUnderwriting Impact Loss Run & Loss Ratio – losses paid Loss Run & Loss Ratio – losses paid
over 5 and 10 year time periods over 5 and 10 year time periods compared to premium paid over compared to premium paid over same time periods.same time periods.
Losses Paid is sum total of:Losses Paid is sum total of: Indemnity PaidIndemnity Paid
Expenses PaidExpenses Paid
Total Reserves – open claimsTotal Reserves – open claims