Subrogating for the Sake of Subrogating

In the business of conducting forensic investigations, subrogation, at times, is part of the work.  Most property insurance policies contain a clause which allows for the insurer to assume the rights of the insured if the insurer pays for damages caused by a third party.  In other words, if you are injured or your property is damaged by a product or another person, your insurance company has the right to recover what it paid you by subrogating, or suing, the manufacturer of the product or other party that caused your injury or property damage.  This is a fairly common practice among property insurance companies, and rightly so.  In terms of products, there is a lot of garbage out there and the companies that produce faulty products should be held responsible.  But, other the other hand, what about responsible companies that produce products by incorporating a formal design process?  Should they be held responsible?  The answer is, at the very least, they are definitely scrutinized. Sometimes, they are held responsible and unfairly so. And it’s not just manufacturers; it can be service companies or anyone that is perceived to have been connected to the incident, no matter how remotely.  Here’s the deal: insurance companies don’t want to “get left holding the empty money bag”, they want their money back.  Not all insurance companies are bent on treating everyone unfairly for the sake of recovering their expenses.  But, there are a few and those of us that provide a service to the insurance industry have had an experience or two with them.  The kind of experience that I am referring to is the kind where the company’s opinion becomes the expert’s opinion before any work is ever done.  This is clearly wrong.  Expert firms, regardless of the type, whether engineering, fire investigation, public adjusting, accounting, etc, are supposed to be independent and unbiased.  However, there are expert firms in existence that will say whatever the insurance company wants them to say in order to get the assignment, and more importantly, collect the fee.  In the 25 years that I have been practicing in engineering forensics, I have learned that if you maintain your integrity, those “questionable” insurers will rarely engage your services, if at all.  Second, when you encounter an expert representing a “questionable” insurer, scrutiny of the insurer’s allegations and their expert’s report will usually reveal that the allegations are not reasonable and not based on a solid foundation.  Those of us that care about truth and fairness don’t really have to worry about those others too much.  Their tactics take care of them and the rest of us know it.                

Be Careful How You Treat Your Engineering Investigator!

Consider the following incident involving a vehicular impact and damage to the vehicle’s transmission. Assume that the driver hit an object in the road and claimed that the object caused damage to the transmission’s oil pan.  In short, fluid leaked out and the transmission was ruined.  On the surface, this seems like a plausible scenario and it would be reasonable to conclude that the failure of the transmission could occur after being hit by flying debris from the object that was struck.  However, what if evidence was found to indicate that things were not  as they appeared?  Needles to say, the final conclusions went against the owner’s claim.  Understandably, the owner would be upset and most likely not open to an alternative explanation.  If you are trying to get your insurance company to pay off on a claim, the last thing you want to do is insult the investigator.  The investigator has no interest in the outcome of the settlement between you and your insurer.  As a result, if you accuse the investigator of acting improperly with no evidence to support your accusation, neither the investigator or your insurer is going to feel inclined to help you in any way.  Not many people know this but, whenever a claim arises, the policyholder can hire their own engineer, appraiser, adjuster, attorney and anyone else they need to help prove their claim.  However, professional help does cost which is why insurers are seldom opposed in the claims process.  So, when you are faced with talking to an engineer, adjuster, appraiser or anyone else hired by and insurance company, be as polite and honest as you can be.  If you disagree with something, you can ask questions but, don’t insult or accuse the inverstigator of taking a “kickback”.  Instead, the time for an appeal ccomes after the initital decision is made by the insurer.  After that, appeals can be made directly to the insurer.  If there is  no satisfaction, then file a complaint with your state consumers affairs department or the office that regulates insurance companies.