Hints That you Might Have a Subrogation Case

Anytime that the failure of a product causes personal injury or property damage, there is a possibility that an insurance carrier could recoup its expenditures from the manufacturer, installer or servicer.  However, not all product failures result in grounds for subrogation claims.  Sometimes products “wear out” and when they do, it can be due to the expiration of the useful life of the product.  Case in point: water heaters.  Depending on who you talk to, the useful life of a residential water heater can be anywhere between five and ten years.  Then there are those more expensive models that can last between 10 and 15 years.  The life of a product has to be taken into consideration, usually during the investigation phase, so as to make sure that the subrogation case will not be summarily dismissed if the case goes to court.  In the case of fires, both structural and vehicular, where the cause was electrical or mechanical malfunction; the key here is whether the equipment was recently installed or serviced by an outside service company or individual.  In the case of existing equipment, the question of maintenance will arise and become a key piece of information.  If the equipment has been allowed to go unmaintained, then it might be possible for a manufacturer or installer to argue that the operating condition of the equipment was beyond their control and they cannot be held liable.   The same thing applies to situations involving water damage.  Water damage can occur from leaking refrigerators, dishwashers, washing machines, and any other piece of equipment that uses water in the process. 

There are also situations that arise where subrogation is not so obvious.  Assuming that an employer is operating a safe workplace, on the job injuries can be caused by the operation of equipment that is not properly guarded.  OSHA regulations are in effect that prohibit the operation of rotating or moving equipment without proper guarding.  Such equipment includes, conveyors, wire drawing machines, drill presses, milling machines, and stamping machines.  In many instances, rotating equipment is operated with the use of pulleys or flywheels.  These components have to be matched to the rotational speed of the machine.  If the machine is operated at a speed greater than the rated speed of the flywheel, then it is possible for the flywheel to fail.  If the flywheel fails under normal loading and within its expected life, then subrogation is possible.  However, if someone in the plant has increased the rotational speed of operation beyond load limits, then subrogation is most likely not possible.  It should be noted that many smaller pulleys are adjustable and as a consequence, rotational speed can be increased to a dangerous level.  In addition failures from hydraulic hoses can occur where the operator is sprayed with hot oil.  If the hose is routinely replaced as a maintenance item but, fails during its service lifetime, then it can be argued that the hose was defective and likely warrants a subrogation claim against the manufacturer.  Similarly, pressure vessels can EXPLODE and cause property damage and serious injury.  Vessels containing air, water, oil, or any other fluid under PRESSURE must be certified for the service.  If the vessel failed during its expected life, was not over-pressurized, maintained by minimizing corrosion, and inspected on a regular basis; then, subrogation against the manufacturer is a possibility.  However, if the vessel was manufactured in house, by the insured, then any injured employees might have a design defect claim against the employer.               

Government’s report on Toyota’s sudden acceleration problem

The government released its findings yesterday (2/8/11) and if you haven’t heard, there is nothing wrong with the electronics in Toyota vehicles that cause them to suddenly accelerate. According to the Associated Press, NASA engineers were involved in testing the vehicles in question. So much so, that we, the consuming public are supposed to get a warm and fuzzy feeling that all is right with the world and Toyota has our backs when it comes to safety in their vehicles. Wait a minute!  Are all the people that experienced sudden acceleration problems crazy? Did they fabricate their stories in an attempt to defraud Toyota? Is this a massive conspiracy? Common sense says no way! There are way too many incidents to discount. Just because the NASA people didn’t find a cause doesn’t mean that they were looking in the right place or running the right tests. Maybe there has to be more history before the cause can be found.  Random events occur  in the workings of electronics. I can’t prove what they are much less prove they occur. If this were possible, then I or someone else would be able to explain the sudden acceleration problem. In my dealings with machines that are electronically controlled, I have seen inadvertent movements that have been unexplainable. For example, I have investigated electronically controlled washing machines that, for no explainable reason, allow their front loading doors to open when the wash tub in filled with water. Needless to say, people are complaining and I don’t have any answers. But, something is obviously happening to cause the doors to open when they are supposed to be electronically locked. I don’t mean to place the damage caused by wash water on the same level as that of a vehicular accident. But, what I am saying is that I believe that something happens that takes control of the machines that we are supposed to have control over and sometimes, hurts us.

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