To borrow a quote from the movie Forrest Gump, handling general liability claims is “like a box of chocolates – you never know what you are going to get”. The general liability adjuster is faced with a myriad of issues, from coverage to risk transfer exposure, and must be able to address these issues in an organized, timely and calculated method. To successfully handle these issues, the insurance adjuster must develop each claim according to protocol, so that nothing is overlooked.

Understanding The Issues : The first thing that needs to be done by the adjuster is to obtain an understanding of the various issue involved. The insured themselves may have no clear idea as to why they have been placed on notice, or the allegations being made against them. The insured may not be aware of the claim being advanced against them. It therefore becomes the responsibility of the adjuster to develop a clear understanding of each party’s stance. Pinpointing the allegations and theory of liability is essential before anything else can be done.

Know The Coverage : Once the adjuster has an understanding of the issues involved, they then identify and address any possible coverage issues. Frequently, the initial coverage analysis is based on very limited information. For this reason, a timely and well written reservations of rights letter should be issued citing the potential coverage issues, which must be perfected through further investigation. Coverage is a very sensitive issue and should not be taken lightly by the adjuster. Discussions with management should be an ongoing process to ensure that the correct coverage position is taken.

Establish The Insured’s Role Or Status : It is essential that the adjuster develops a clear understanding of the role or status that the insured has in a general liability claim. Does our insured own or lease the premise? Is the insured a real estate management company? If so, does our insured have a real estate management agreement? Is our insured the snow and ice removal contractor? Is our insured the General Contractor, or are they a subcontractor? etc.

Find Out About The Insured’s Work Or Service : The adjuster needs to learn about the type of work or service the insured performs, and how this contributed to the alleged bodily injury or property damage. An expert will not only provide vital testimony to refute allegations of negligence being made, but will also assist the adjuster to understand the technical issues involved.

Secure And Analyze Relevant Documents : Although an insured may have no tort liability, they may have entered into a contract or lease agreement which could expose them to some kind of liability. The contract or lease agreement contains vital information needed to complete a contractual liability or risk transfer analysis. For this reason, an adjuster needs to recognize when there is a potential risk transfer exposure, and to secure copies of any applicable documents.

Secure Field Investigation : The scene of an accident may change. For this reason, it is necessary for the adjuster to develop a close rapport with their field investigator. It is the responsibility of the field investigator to communicate everything that may have a bearing on the claim, however insignificant it may seem.

The author, Joseph Badowski, is a liability insurance expert who has worked in the industry for more than 20 years. He currently works at Harleysville Insurance, and can be contacted at jkmbadowski@yahoo.com

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