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October/November 2009
Changing Directions on Claims Costs in Alberta
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Contents OCTOBER/NOVEMBER 2009 • VOLUME 3 • NUMBER 5
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Cover Feature 12 Changing Directions As the plaintiffs in Morrow v. Zhang seek leave to appeal from the Supreme Court of Canada, insurance companies are bracing themselves for what the future might bring as the constitutionality of the cap is again being questioned. BY LAURA KUPCIS
Spotlight 18 Taking on Trucks At AZ Claims in Oakville, performing the best job possible when adjusting claims is priority number one.
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BY LAURA KUPCIS
Education Forum 40 Mediation Basics Mediation is a less formal dispute resolution than the costlier litigation option. For mediation to work, both parties must be open to solutions.
News Features 20 Handling Surety Claims
30 Subrogating Liability Claims
Surety bonds is a guarantee quite different from an insurance policy.
Insurance companies are required to report non-auto related liability claims to the Ministry of Health and Long-Term Care.
BY LAURA KUPCIS
24 Northern Exposure
BY LAURA KUPCIS
A summer at a Northern adjusting firm opens the eyes of a university student considering a career in insurance.
34 Deliver Policies Quickly to Avoid Unwanted Risk
BY DANIEL PLANT
26 Winds of Change Strong winds and 17 tornadoes left behind a wake of damage in Ontario, bringing up the question of the need for improved building codes. BY LAURA KUPCIS
28 Mitigating Loss Costs
How much protection an insured will receive from a cover note is still being debated in the Courts. BY JENNIFER PEREIRA
36 Preparing the Adjuster’s File for Litigation
An adjuster offers up four scenarios to guide.
Tips to maximize the value of the adjuster’s file and reduce the costs to the insurer.
BY LAURA KUPCIS
BY DON MCGARVEY
36 Departments 4 First Notice 42 On The Scene
Columns 40 Education Forum
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FSCO denies claim for caregiver and housekeeping benefits A Financial Services Commission of Ontario (FSCO) arbitrator has denied an insured’s claim for caregiver benefits and housekeeping/ home maintenance benefits following a vehicle collision. Mohammad Asghar was injured in a motor vehicle accident on Aug. 2, 2006. He applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company. Asghar’s dispute with State Farm is with regards to his entitlement to the continuing payment of weekly caregiver and housekeeping benefits. Asghar sought $350 per week for caregiver benefits, as well as $100/week for housekeeping/ home maintenance, up to Aug. 2, 2008. At the time of the accident, he lived in a basement apartment with his nephew, his nephew’s wife and their three children. He claimed he took care of the children and took responsibility for housework at the time of the accident, but could no longer perform these duties as a result of the collision. Invoices submitted for both childcare and housekeeping costs were inconsistent and were essentially unreliable evidence, wrote Fred Sampliner, FSCO arbitrator. As well, Asghar failed to show that he was the primary caregiver for the children. As a result, FSCO dismissed his claims for the benefits. “Mr. Asghar is not entitled to payment of caregiver benefits under Part IV of the Schedule,” Sampliner wrote. “Mr. Asghar is not entitled to payment of housekeeping expenses under section 22 of the Schedule.” ●
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Ontario court awards record auto injury amount of $18.4 million A 22-year-old Beeton, Ont. woman who suffered a serious brain injury in a 2002 auto accident has received a court award of $18.4 million. The sum, awarded by the Ontario Superior Court, is thought to be the highest-ever damage award in Canada for injuries suffered in a car accident. Katherine-Paige (KP) MacNeil, 15 years old and in Grade 10 at the time of the accident, was riding in the back seat of a 1989 Tempo at 1 a.m. on Aug. 2. Trevor Bryan was driving when the car ran a stop sign and became airborne, smashing frontfirst into a ditch along Highway 89 north of Toronto. MacNeil was the only person in the car wearing a seat belt. The impact of the crash fractured MacNeil’s skull and left her with multiple, permanent and catastrophic brain injuries. Ontario Superior Court Justice Peter Howden found “she is no longer employable in any job” as a result of the crash. Howden awarded a total judgment of $18.4 million, which included a loss of future income to McNeil of about $1.4 million and future care costs of
about $15.2 million. The Ontario Ministry of Transportation signed a so-called ‘Mary Carter agreement’ with the plaintiffs. Under a Mary Carter agreement, a co-defendant — in this case the MTO — agrees to provide the plaintiffs with a payment of specified damages regardless of whether or not the plaintiffs lose a tort case. In return, the codefendant’s liability is proportionately reduced, by increasing the other codefendants’ liability. In this case, the MTO’s co-defendants include State Farm, which is said to be the plaintiff’s under-insured vehicle insurer. Wawanesa Mutual Insurance Company was added on as a third party defendant. As a result of the Mary Carter agreement, the insurers were not present at the time the award was calculated. Howden notes in the decision that “a companion action, ordered to be tried with or after this one, will deal, as one of its main issues, with the insurance coverage in respect of the MacNeil’s claim for loss arising out of the August 2nd, 2002 accident.” ●
Insurer’s reserves “should almost never be ordered produced”: FSCO arbitrator An insurer’s reserves “should almost never be ordered produced” in statutory accident benefits claims made under Ontario’s SABS legislation, an arbitrator for the Financial Services Commission of Ontario (FSCO) has found. Reserves are estimated amounts assigned by an insurer to account for the total possible future payout of a person’s claims arising from an accident. In Security National Insurance Company/Monnex Insurance Management Inc. and Wakeel Qazi, FSCO arbitrator David Evans notes that arbitrators have historically meandered back and forth on the question of whether or not an insurer should be disclosing information about its reserves in AB claims. On the one hand, arbitrators have ruled that reserve information is relevant regarding an insurer’s investigation of a claim and should therefore be disclosed.
October/November 2009
On the other, arbitrators have concluded, as was done in Ouimet and Wawanesa Mutual Insurance Company, that: “evidence about total claims serves little to advance an insured person’s claim for specific benefits, while offering potential to sidetrack the disability or treatment issues.” Evans observed “the courts have generally taken the same position as set out in Ouimet,” namely that reserve information “does not have a semblance of relevance” for the purpose of determining a specific claim for accident benefits. “I see no reason why arbitral case law should differ from the courts in this area,” Evans said. “I find that providing irrelevant information to an insured does not serve the purpose of consumer protection, or that the provisions of the SABS require their production.” ●
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F first notice Issues affecting the claims manager Deficient infrastructure is a significant problem in many areas, which could lead to restrictions on coverage or the creation of a different pricing structure, according to panelists at the Canadian Insurance Claims Managers’ Association (CICMA) general meeting. George Cooke, president and CEO of The Dominion, noted at the Sept. 9 meeting the lack of proper infrastructure is a significant issue in many areas — one that can be seen in the recent losses in Hamilton after the city saw more than 37 mm of rain fall on July 26. In order to curb rising claims frequency and insurance costs, it is likely in the future there will be restrictions on certain coverages. There will likely be a different pricing structure for water coverage, and there will be a definite impact on the marketplace, Louis Gagnon, president of Intact Insurance, added. The panel also discussed what they believed needed to be done in order to develop the “right calculator” in regards to insurance to value. For Gagnon, there appears to be a lack of generally defined best practices in the industry for determining insurance to value, or determining replacement costs. “We need to strive to develop best practices,” he said. Cooke noted that while the directwriter model may lend itself to the use of calculators, it doesn’t work so well for broker-model companies. He said perhaps it is time to consider dumping the current calculator tools and simplifying matters by simply determining square footage and other basic characteristics of the risk and charging premium. “The dilemma then becomes only determining the right amount of premium,” he said. “If we properly define the problem we can work towards the right solution.” When looking at the Ontario auto insurance product, panelists were asked to pick the one thing they would change. Gagnon said he would want caps on benefits for both tort and accident bene-
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fits and for certain treatments that AB responds to. Cooke said, while he does not want to choose just one, would go back to a pre-no-fault pure tort system. He says he thinks Ontario should move to defining what a minor injury is as they do in Alberta, Nova Scotia, New Brunswick, and Prince Edward Island, rather than what a serious and permanent injury is. There should be a basic standard package of coverage with many other coverages being optional. Alain Thibault, president & CEO, TD Insurance, said if he had only one choice, he would go back to the Ontario Motorist Protection Plan, (OMPP) (1990-1994). Otherwise, more currently standard coverages becoming optional would be a benefit. He adds a more clear definition of catastrophic injury would be helpful and that stronger exclusions on the tort side would produce the necessary savings. While the panelists had thoughts on how to improve the product, none expressed full confidence in the fixability of it. Thibault says he does not believe that there is a one-time fix for the product and that constant tweaking will be necessary. He noted he was cautiously optimistic. The auto insurance product is a very big challenge for government to fix, Gagnon said, adding he is not sure if it is possible. He expressed concern about ongoing affordability for consumers and just how much a consumer may understand with respect to the impact and the reasons for the changes within the product. Cooke said he thinks the government is concerned about maintaining affordability and that there will likely be an announcement by mid-October. This will have a strong consumer thrust and with more choice, but the ultimate outcome may bear little resemblance to the FSCO report. ● ~ With files from Troy Bourassa
October/November 2009
Insurance industry sees spike in PIPEDA-related complaints The insurance industry yielded 17 per cent of the Personal Information and Electronic Documents Act (PIPEDA)-related complaints lodged in 2008. Last year there were 442 new complaints in total, marking an increase from 2007’s 350 complaints. Financial institutions as a whole took the lion’s share of complaints (between 22 per cent and 30 per cent) and the insurance industry took second place, with 71 complaints, said the Privacy Commissioner of Canada’s Annual Report to Parliament 2008. Most of those 71 complaints related either to difficulties that complainants had in gaining access to their personal information in the industry’s possession, or issues related to the use and disclosure of the information. “The reason for this spike is not yet apparent, and we do not know whether it will continue in the future,” the report said. “We have noticed, however, that complainants are using PIPEDA in claims disputes with their insurance providers, which is a legitimate and parallel use of the law.” Some complaints have also centred on techniques that insurance adjusters use to evaluate or substantiate claims, it continued. One of those techniques is covert video surveillance, the report said. In response to the mounting complaints of this nature, the Office of the Privacy Commissioner of Canada launched a consultation process in the fall of 2008 and published guidelines in 2009. ●
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F first notice Claimants need to meet threshold of due diligence before applying for benefits from Ontario’s insurer of last resort An insurance claimant and his or her legal representative need to meet a minimal threshold of due diligence before they approach the Ontario Motor Vehicle Accident Claims Fund as a “first insurer,” a FSCO arbitrator has found. The Motor Vehicle Accident Claims Fund acts as an insurer of last resort, paying a claim when no other insurer responsible for the claim can be identified. In Haseeb Tariq and Motor Vehicle Accident Claims Fund, the claimant, Tariq, sustained an injury when the rented vehicle he was driving collided with the rented vehicle a friend was driving in front of him. The accident occurred on May 6, 2006. Tariq made an application for accident benefits to the Fund on Oct. 6, 2006. In a letter to Tariq’s lawyer dated Oct. 11, 2006, the Fund said it was not able to consider the claim because Tariq was driving a rented car that was insured. Almost two years later, the Fund received a completed application for AB benefits sent by Tariq’s lawyer. The part of the form that requests the name of the insurer was filled in
Paul Aquino Publisher, (416) 510-6788 paul@canadianunderwriter.ca Fax: (416) 510-6809
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A bi-monthly magazine (6x per year), Claims Canada is published by Business Information Group, a division of BIG Magazines LP, a leading Canadian information company. Business Information Group is located at: 12 Concorde Place Suite 800, Toronto, ON, M3C 4J2. Claims Canada magazine is the Official Publication of the Canadian Independent Adjusters’ Association [CIAA] and through its editorial content and circulation brings together the ‘entire property & casualty insurance claims market nationally’ with information and insight into the profession, business and people of insurance claims and loss adjusting. All key claims process stakeholders are reached as part of our readership community – including: both CIAA member and
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with “unknown/TBD.” A police report followed the application on Dec. 19, 2008. Explaining the lengthy delay, Tariq told the arbitrator that he was not able to get his rental car company to provide the name of its insurer. Also, he said he was not aware that it was possible to obtain a copy of the police report, which would have contained the information on insurance coverage. “There was no explanation provided as to the reason for the two-year delay in obtaining the report,” FSCO arbitrator Elizabeth Nastasi wrote. “Further, there was no evidence presented that neither the applicant nor his counsel encountered any difficulties in requesting or obtaining the police report. “I find that Mr. Tariq’s decision to send his completed application to the Fund was arbitrary given the limited efforts he made to determine the insurer of the rental car in this case. His efforts in attempting to obtain the name of the insurer do not meet the threshold of establishing a nexus between himself and the Fund.” ●
Claims Canada
October/November 2009
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non-member independent claims adjusting firms; insurance and reinsurance company executive, claims management and claims adjusting personnel; corporate risk managers and loss control professionals; insurance brokers; insurance law firms; forensic engineers and accountants; appraisal, restoration, rehabilitation and collision repair professionals; Insurance Institute chapters; insurance associations, regulators and related claims market recipients. The contents of this publication may not be reproduced or transmitted in any form, either in part or in full, without the written consent of the copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without prior written consent.
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Message from the President La Plume du Président PATTI KERNAGHAN
As the 26th president of the Canadian Independent Adjusters’ Association, I am both honoured and humbled at the opportunity to serve our membership across Canada. Honoured to be chosen by my peers for such a prestigious position, and humbled by the wealth of work that has gone before me. The association’s 25th Annual General meeting and Convention in Montreal was a huge success. Jean Marc Laurin, convention chair, and his committee did an excellent job and must be commended for their hard work and stellar program — in particular Pat Battle for her heroic organizational efforts. For me the most enduring part of the convention and AGM was the distinct feeling of camaraderie amongst us, and the obvious desire to grow and enhance our offerings to the membership. I was overwhelmed with the generous encouragement and offers of support. My husband, Pierre Coupey, and I would like to extend our thanks for the warm welcome we received. At the AGM it was a pleasure to hear of the many provincial accomplishments and of the many initiatives undertaken by various executive committees. Clearly president Reno Daigle has set the bar high for the coming year. His guiding hand and wisdom has moved the association forward, laying the groundwork for my executive team and me, and for that I am very appreciative. The National Insurance Conference of Canada has invited the CIAA president to join their advisory committee and to be present at their convention in Ottawa. I will be attending with our first vice president Mary Charman. The NICC is designed to be a forum where senior industry executives meet to discuss the complex issues facing the Canadian property and casualty insurance sector. This will be an excellent opportunity for Mary and me, on behalf of the CIAA, to listen to industry leaders and be heard as the independent adjusting voice in Canada. The property and casualty industry writes approximately thirty six billion dollars worth of premiums in Canada and employs approximately 110,000 people. There are roughly 2,700 independent adjusters licensed in Canada, which means we are less than 3 per cent of the people working in the industry. We are a community of professionals within the p&c 10
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En tant que 26e présidente de l’Association canadienne des experts indépendants, je me sens à la fois honorée et impressionnée par l’occasion qui m’est offerte de servir nos membres dans tout le Canada. Je suis honorée d’avoir été choisie par mes pairs pour occuper ce poste prestigieux et impressionnée par l’important travail effectué par mes prédécesseurs. La 25e Assemblée générale annuelle et le Congrès de l’Association qui se sont tenus à Montréal ont connu un énorme succès. Le président du Congrès, Jean-Marc Laurin, et son comité ont été formidables et méritent nos félicitations pour l’excellence de leur travail et leur fabuleux programme d’activités. Je cite en particulier Pat Battle, pour les prodigieux efforts déployés dans le domaine de l’organisation. Pour ma part, j’ai eu la vive impression, au cours du congrès et de l’assemblée, qu’une franche atmosphère de camaraderie nous unissait et qu’une volonté évidente d’encourager et d’améliorer les avantages offerts à nos membres nous motivait. J’ai été touchée par les encouragements et les offres de collaboration reçus. Mon mari, Pierre Coupey, se joint à moi pour vous remercier de l’accueil chaleureux qui nous a été fait. Au cours de l’assemblée générale, ce fut un plaisir de prendre connaissance des nombreux projets provinciaux et des nombreuses initiatives des divers comités de direction. Il est clair que le président Reno Daigle a placé la barre haute pour la prochaine année. Sa compétence et sa sagesse ont fait avancer l’association et jeté les bases des travaux que mon équipe et moi devrons accomplir, ce que j’apprécie beaucoup. La conférence nationale de l’assurance du Canada a invité la présidente de l’ACEI à se joindre à son Comité consultatif et à assister à leur prochain congrès à Ottawa. Je m’y rendrai en compagnie de Mary Charman, 1re vice-présidente. La CNAC constitue un forum où les cadres supérieurs de l’industrie débattent des problèmes complexes que soulève le secteur des assurances I.A.R.D. Ce sera pour Mary et moi, en tant que représentantes de l’ACEI, une excellente occasion d’entendre les leaders de l’industrie et de se faire entendre comme porteparole de notre association. L’industrie I.A.R.D. produit environ trente-six milliards de dollars en primes au Canada et compte environ 110,000 employés. Il y a près de 2,700 experts indépendants autorisés au Canada, ce qui signifie que nous constituons moins de 3 pir cent des travailleurs de l’industrie. Nous sommes un groupe de travail au sein de l’industrie I.A.R.D. Si nous www.claimscanada.ca
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industry. By working together we will strengthen the profession of independent adjusting in Canada. As the association voice for independent adjusters in the Canadian property and casualty insurance market, the CIAA must continually strive to improve. I see this firstly as our opportunity to develop as a professional body and secondly to bring value to our membership and our clients, the companies we collectively service. Through the strong camaraderie in our association, we have that opportunity. My major initiative this year will be to undertake a Creative Strategic Planning session for the CIAA with the ultimate goal of reassessing the direction of our association. As part of the process, we will look to our stakeholders to help change the focus of the association. Listening carefully to members and stakeholders will help us shape our visions and plans. The Creative Strategic Planning committee mandate will be to lay a foundation of actionable plans for the association with immediate and long-term goals over the next five years. The intention will be to change, grow and bring value to the membership, which in turn will bring value to the claims industry. I am looking forward to an exciting year with support from all over Canada. I am very pleased to be serving the membership at this time, a time of change and challenge! ■
joignons nos efforts, nous pourrons renforcer la profession d’experts indépendants au Canada. En tant que seule voix de l’association des experts indépendants dans le marché canadien I.A.R.D., l’ACEI doit constamment chercher à s’améliorer. Dans ce fait, je vois d’abord une occasion de développement comme organisme professionnel et, ensuite, de valorisation pour nos membres et nos clients, les sociétés que nous servons en commun. Cette occasion nous est offerte par la franche camaraderie qui règne dans notre association. Cette année, j’ai pour principal projet d’entreprendre pour l’ACEI une session de Planification Stratégique Créative, dont l’objectif sera de réévaluer l’orientation de notre association. Entre autres choses, nous consulterons nos gestionnaires à ce sujet. L’écoute attentive des membres et des gestionnaires nous aidera à élaborer nos priorités et nos plans. Le comité de Planification Stratégique Créative aura pour mandat de poser, pour notre association, les bases de plans réalisables dotés d’objectifs à court et à long terme étalés sur cinq ans. L’objectif principal sera de modifier, rehausser et valoriser l’association pour nos membres, ce qui entraînera la revalorisation de l’industrie de l’indemnisation. L’année s’annonce stimulante et je compte sur l’appui de tous, où que vous soyez au Canada. Je suis ravie d’être au service des membres de l’ACEI en ce moment, alors que des changements et des défis se profilent à l’horizon! ■ Translation provided by Henry Arcache, Themis Translations
NATIONAL EXECUTIVE 2008 – 2009 PRESIDENT Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300-1575 West Georgia Street Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 Email:pkernaghan@kernaghan.com 1ST VICE-PRESIDENT Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 Email: Mary.Charman@crawco.ca 2ND VICE-PRESIDENT Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca
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SECRETARY Marie C. Gallagher, FCIP, CRM McLarens Canada 71 King Street, Suite 204 St. Catharines, ON L2R 3H7 Phone: (905) 984-8282 Fax: (905) 984-8290 Email: marie.gallagher@mclarens.ca TREASURER Randy P. LaBrash, CIP, CFE, CFEI Crawford & Company (Canada) Inc. 300 – 191 Lombard Avenue Winnipeg, MB R3B 0X1 Phone: (204) 947-2340 Fax: (204) 943-9168 Email: Randy.Labrash@crawco.ca PAST-PRESIDENT Reno Daigle, CIP, CLA, FCIAA Crawford & Company (Canada) Inc. 326 McIntyre Street W. North Bay, ON P1B 2Z1 Phone: (705) 476-2120 Fax: (705) 476-9280 Email: Reno.Daigle@crawco.ca
EXECUTIVE DIRECTOR Patricia M. Battle Canadian Independent Adjusters’ Association/ L’Association Canadienne des Experts Indépendants Centennial Centre, 5401 Eglinton Avenue West, Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Toll Free: 1-877-255-5589 Fax: (416) 621-7776 Email: pbattle@ciaa-adjusters.ca DIRECTOR James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca
DIRECTOR John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 Email: john.jones@mclarens.ca DIRECTOR Carol A. Messervey, CIP, FCIAA, FIFAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 Email:cmesservey@marshadj.com
DIRECTOR Jean-Marc Laurin, FPAA, CRM, FCIAA Cunningham Lindsey Canada Limited 1250 Guy Street, Suite 1000 Montreal, PQ H3H 2T4 Phone: (514) 938-2124 Fax: (514) 938-5445 E-mail: jmlaurin@cl-na.com
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Changing Directions Once again insurers in Alberta are left to wonder about the direction they will need to take with respect to handling minor injury claims, as the cap in Alberta is in question once more while the plaintiffs seek leave to appeal from the Supreme Court of Canada. BY LAURA KUPCIS
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hether or not the Supreme Court of Canada will hear the case of the Alberta cap or not remains to be seen — but the plaintiffs in the case have sought leave to appeal. Once again insurance companies are left to determine a direction to take while handling minor injury claims, until a final answer surrounding the cap is received. The Minor Injury Regulation (MIR) imposes a $4,000 limit on non-pecuniary damages with respect to minor injuries — a sprain, a strain, or a WAD injury caused by an accident — which do not result in serious impairment. The impetus of the cap was to help curb rising insurance premiums, and reduce the number of uninsured drivers in Alberta. The constitutionality of the MIR was first called into question when two plaintiffs submitted that their rights under s. 7 and s. 15(1) of the Canadian Charter of Rights and Freedoms had been violated as a result of the MIR. This past June, the Alberta Court of Appeal struck down the ruling from the lower court, determining the cap on claims for minor auto injuries does not infringe on the Canadian Charter of Rights and Freedoms. The plaintiffs in the Alberta Court of Appeal case, Peari Morrow and Brea Pederson, — who were injured in two separate automobile accidents — have sought leave to appeal the decision of the Alberta Court of Appeal to the Supreme Court of Canada. And insurance companies once again brace themselves for the unknown. If the Supreme Court agrees to hear the case, how much longer will claims be in a state of flux? What will happen to claims costs if the Supreme Court ultimately decides the cap is, in fact, unconstitutional? “One of the things that I think all insurance companies look at is they try to have a balance,” Murray Lennie, regional lines manager, Western region, The Economical Insurance Group, says. “When new laws or legislation comes in, it throws that balance out. It’s very hard to predict on a new set of rules where you’re going to end up. Justice Wittmann’s decision was one way, then www.claimscanada.ca
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the Court of Appeal is another way and now there’s been an application for leave to have this heard by the Supreme Court of Canada. So you are looking at a fluctuation in the rules that you are playing with, and that, for insurance companies, is a difficult obstacle to overcome. It’s not impossible, it’s just that everybody throws a wrench into the works and the machinery has to change direction, so to speak.”
Court of Queen’s Bench Morrow suffered soft tissue injuries to her neck and upper back, diagnosed as a grade two whiplash associated disorder (WAD II), as a result of an auto accident in October 2004. She was still suffering from pain, which was affecting her life at the time of the trial in April and May 2007. Pedersen suffered soft tissue injuries to her neck, shoulders, back and wrists from an auto accident in March 2005. All her pain resolved within a month except for pain in her wrist, which was still present at the time of the trial and affected her daily life and household chores. The trial judge, Chief Justice Neil Wittmann, found that if not for the cap, the respondents would have been entitled to non-pecuniary damages in excess of $4,000. He assessed general damages for pain and suffering of $20,000 for Morrow and $15,000 for Pedersen. The plaintiffs had challenged both section 7— the right to life, liberty or security — and section 15 — the right to equal protection and benefit of the law without discrimination based on disability — of the Charter. When looking at whether the cap, which restricts the right to sue a tortfeasor for the recovery of damages for pain and suffering to $4,000, was in violation of s. 7 of the Charter, Wittmann determined that it does not violate s. 7 in this case. When it came to section 15, Wittmann noted minor injury victims are subject to stereotyping and prejudice and are often viewed as malingerers who exaggerate their injuries. Having assessed the cap against the four contextual factors set out in Law, he
determined a reasonable and dispassionate person would conclude the MIR is demeaning to the dignity of that group and would make them feel less worthy as human beings. On Feb. 8, 2008, Wittmann ruled to eliminate the cap, stating that it “constitutes an unjustified breach of the s. 15(1) equality rights of minor injury victims based on the enumerated ground of disability.” He found the only appropriate remedy for the case was the nullification of the MIR.
Court of Appeal Then it was off to the Court of Appeal. This time the outcome was different. Justice Patricia Rowbotham allowed the appeal, noting the trial judge failed to assess the entire legislative scheme when analyzing impugned legislation under section 15 — he had focused solely on the MIR. She noted the MIR was enacted as part of of a scheme of legislation which included protocols for diagnosing and treating minor injuries, increases in section B medical benefits, and caps on automobile insurance premiums. Rowbotham concluded by focusing solely on the MIR it resulted in a flawed assessment of the Law’s contextual factors. “Although the trial judge did not err in finding that the MIR makes a distinction between minor injury claimants and those suffering other injuries from motor vehicle accidents, and that this distinction was on an enumerated ground (disability), I conclude that he erred in finding this distinction was discriminatory.” She went on to note he erred by concluding the insurance reforms as a whole perpetuate the stereotype. In her view he failed to analyse the insurance reforms as a whole, including the Diagnostic and Treatment Protocols Regulation (DTPR), which recognizes that the injuries suffered by MIR claims are real. When analyzing whether the claimants needs and circumstances are met by the legislation, the trial judge failed to assess the medical benefits provided to minor injury claimants in exchange for their reduced damages for pain and suffering, she determined.
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“I conclude that in applying the four contextual factors from Law, a reasonable person in the position of the minor injury claimants would not conclude that the distinction drawn by the cap on non-pecuniary damages is discriminatory,” she wrote. She ruled that when the MIR is considered within the entire scheme of the insurance reforms, it does not infringe on section 7 or 15 of the Charter and the legislation, as a whole, responds to the needs and circumstances of the injured.
Supreme Court of Canada Currently, the plaintiffs, the appellants, claimants, insurance companies, and the industry as a whole are waiting to learn whether the Supreme Court of Canada will agree to hear the appeal. Fred Kozak, partner with Reynolds Mirth Richards & Farmer LLP, and lawyer for the plaintiffs, suspects whether leave is granted will be known late this year. “I hope the SCC will agree to hear the appeal and if they do that they will strike down the legislation on the basis that it treats people unequally, that it contravenes section 15 of the charter,” Kozak says. “Section 15 guarantees equality and so (the legislation) breaches section 15. It’s essentially an assertion that the legislation discriminates on the basis of a disability.” Effectively, the plaintiffs are looking for fair compensation for an injury versus a cap of $4000 no matter the minor injury. Kozak says that, “we think that every innocent injured victim should have the right to have a court determine an appropriate amount of general damages.” The Insurance Bureau of Canada, however, opposes the application based on the fact the proposed appeal does not meet the test of “public importance” that governs applications for leave to appeal to the Supreme Court of Canada. “The Court of Appeal was correct in its approach and its conclusion regarding the s. 15(1) challenge,” the IBC wrote in its response to the SCC. “The applicants have not raised any equality issues that requires resolution by this Court.” The applicants noted in their request 14
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for appeal that, “the Alberta Court of Appeal’s judgment in Morrow v. Zhang reflects a widespread and fundamental confusion in applying this Honourable Court’s jurisprudence on the right to equality guaranteed by section 15(1) of the Canadian Charter of Rights and Freedoms.” The request for leave to appeal goes on to note the judgment “first, allows a government to pass legislation which perpetuates prejudice against a group of victims by expanding the scope of the inquiry to an ill-defined legislative “scheme”; second, interprets this Court’s recent equality jurispru-
“Given that the Court of Appeal found that the impugned legislation does not infringes. 15(1), this issue is irrelevant in the context of the case.” ~ Insurance Bureau of Canada
dence as directing an almost-exclusive focus on formal equality in the section 15(1) analysis; and third, finds that there is virtually no role for section 1 analysis in an equality case in light of the jurisprudence from this Honourable Court.” In its response, the IBC noted that, the scope of the legislative scheme to be considered when dealing with a s. 15 challenge is a fact-specific matter that varies with the particular regulatory scheme in issue and its legislative history. “Identifying the relevant portions of surrounding or related legislation for
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purposes of a contextual analysis is not particularly complex or novel exercise. Under the modern approach to statutory interpretation, any statutory provision must be interpreted in context,” the IBC wrote. The IBC goes on to note that looking at the cap alone would be misleading. The MIR itself recognizes that soft tissue injuries may cause serious impairment and non-pecuniary damages awards for serious soft injuries are not capped. In addition, the DTPR establishes medical protocols to alleviate the pain and suffering caused by all soft tissue injuries. “A reasonable claimant would thus conclude that Alberta was trying to advance recognition and treatment of soft tissue injuries as real injuries, not to demean them,” the IBC wrote. The IBC further notes, “The applicants’ suggestion that the second contextual factor from Law is not relevant, is not consistent with this Court’s jurisprudence. Indeed, as the Court of Appeal noted, in reviewing this Court’s s. 15 decisions, Professor Hogg found that ‘the correspondence factor seems to have become key.’ In Kapp, this Court recently reiterated the importance of all four of the Law contextual factors.” Furthermore, “given that the Court of Appeal found that the impugned legislation does not infringe s. 15(1), this issue is irrelevant in the context of the case.”
Within the insurance world While the issue remains in the hands of the court system, insurance companies continue to try and keep up with the changing direction of the cap — on, off, on — and work to ensure that they have adequately reserved no matter the outcome. “If the cap is ultimately determined to be unconstitutional, assuming a couple of things: the Supreme Court of Canada hears the case and finds that it is not constitutional, then insurers will have had their premiums approved at a level that assumes the cost savings of the cap are in place,” Randy Bundus, vice president, general counsel and corporate secretary of IBC, says. “If those cost www.claimscanada.ca
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savings of the cap are no longer in place because the cap is not valid, then the premiums will have been inadequate for the costs of the product. Consequently, there is the likelihood of unfounded liability as insurers would not have collected sufficient premium to cover the ultimate cost that the system will bear to them — and there are various estimates as to what that amount is.” The biggest issue is around pricing and what the cost of the product is, Karin Ots, senior vice president of injury and casualty claims at Aviva Canada, says. “These policies were sold many many years ago at a price that’s already been realized and, I think as a corporation (and likely the industry as well), that’s the bigger struggle that we are having. What’s the ultimate cost of all of this going to be on those claims and those policies that were sold and then how do we, at some point, make up a deficiency?” Alberta primary insurers are looking at a cumulative, annual capital cost of $330 million each year going forward without a final court authority on the matter, Barbara Sulzenko-Laurie, vice president of policy at IBC, said during the 2009 Swiss Re Breakfast. The figure assumes no premium adjustments have been made to adjust for the uncertainty of the issue. The annual capital loss going forward is in addition to the estimated $425 million in unrecoverable costs from claims open at the time of the February 2008 Alberta court decision to strike down the minor injury cap. Looking at auto insurance liability in Alberta, the impact of the cap challenge has resulted in a loss ratio 25 per cent higher in 2008 than in 2007, SulzenkoLaurie noted. The loss ratio went from just over 50 per cent in 2007 to slightly more than 76 per cent in 2008.
Cap on cap off Between Wittmann’s ruling that the cap was unconstitutional and the Court of Appeal’s overturning of that decision, the way in which insurance companies handled minor injury claims varied by company — some continued with business as usual as though the cap 16
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was still in place, others reverted back to where things were before the implementation of the claim, while others fell somewhere in between. “When we get into a position of negotiating a settlement of a claim, most of our clients have tailored their final releases to include language around the fact that there is a potential further appeal of the Alberta Court of Appeal decision,” Walter Waugh, vice president of operations for Western Canada with Crawford & Company (Canada) Inc., says. “And if the Supreme Court of Canada ultimately does make a decision and if it’s one contrary to the Alberta Court of
Alberta primary insurers are looking at a cumulative, annual capital cost of $330 million each year going forward without a final court authority on the matter.
Appeal, this settlement is still valid and further claims are not going to be considered.” Peace Hills Insurance went as far as to implement a two-tiered system where clients received notification of what the claim is worth under the cap and what the claim would be worth if there wasn’t a cap — a claim might only be worth $3,500 cap or no cap, or it could be worth $5,500 without a cap. The way the system worked was that claimants would receive what the claim was worth under the cap immediately and then if and when the Supreme Court of Canada makes its ultimate ruling, if it is determined that the cap is unconstitutional, then claimants would receive the remainder of the value of
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their claim, plus interest, when that decision was made.
Determining exposure This way, a claim is effectively closed and the claimant has been paid what Peace Hills determined was accurate under the cap. Furthermore, the company knows its exposure — ie. an additional $1,500 — if the cap is determined to be unconstitutional. If the cap was ruled to be constitutional, the claimant receives notice the file has been paid in full, and the file is closed. “We have continued to reserve our files as if there was no cap,” Diane Brickner, president and CEO of Peace Hills Insurance, says, noting that the company implemented the two-tiered system after Wittmann’s decision. “We haven’t changed our reserving practices since the Appeal Court. As far as we are concerned, when we look at our claims, we feel that we are more than adequately reserved for.” At Co-operators General Insurance Company, after the cap decision was released at the trial level, the company increased its minimum case reserve for Alberta injury claims. “This reserve was still not adequate to represent the true exposure of these claims,” Brian Kirkconnell, national claims director for Co-operators General Insurance Company, says. “However, we also included a provision in our Incurred But Not Reported (IBNR) for an amount that represented the risk that the Court of Appeal would uphold the decision.” The key is to not make decisions in isolation, Lennie says. Alberta is not the first province to have “rules and regulations hoisted upon us,” so there is experience within companies on how to assess where future reserving settlements on claims should be. “Sometimes you’re right and sometimes you’re wrong,” he says. “The problem is the continual fluctuation and do you jump with both feet going one direction and then have it shift like we did here with the Appeal? A lot of companies have had to change their reserving which has been good or bad depending on how you look at it.” Most companies have set something aside in their IBNR to cover the continwww.claimscanada.ca
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gency of losing, Ots says. “But again, until this ultimately plays out, who knows what the cost is going to be,” she says.
Stagnant claims Because there is a significant inventory of outstanding claims that are sitting in limbo, when the final ruling comes down, they are going to hit the settlement track all at once, Bob Doiron, vice president of claims at Peace Hills Insurance, says. “It’s really going to be akin to like a property catastrophe loss. This volume of stuff is going to hit the pipe and it’s going to be a mad scramble to try and get these things settled,” he says. For Peace Hills, having a two-tiered system in place will help to alleviate some of this “big rush” after the final ruling comes down. Marja Welton, Alberta regional manager for Kernaghan Adjusters, says she’s noticed there are a number of lawyers sitting on files waiting for the Supreme Court decision. “It is our understanding that there is a stockpile of claims,” she says. “The insurers have told us that they are under the impression that some lawyers have many files sitting in a drawer waiting for the final decision. Some claimants are simply ignoring settlement attempts hoping that the cap will be abolished before their limitation period.” Martin Moran, assistant vice president of desktop solutions at Cunningham Lindsey Canada, notes there were also delays when the case was in the lower court. “We had files in our office that were not proceeding,” Moran, who was recently the district manager of the Edmonton office, says. “Things were not moving forward and it was fairly clear that they were claims that would have fallen under the minor injury regulation and just they were not settling until such time that the decisions came down.” Shauna Dobson, senior adjuster in Edmonton with McLarens Canada agreed that some claimants would hold on, not wanting to settle until the court decision came down. There were some claimants who were willing to accept that the cap was the cap and settle for $4,000, while others were well aware the cap was being appealed and were wanting to wait for a court decision. She www.claimscanada.ca
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would follow up every once in a while with the claimants who would say they were going to keep waiting because they’d heard a decision would come through soon. The volume of claims that an adjuster needs to carry has increased because they used to be able to turn files over a lot quicker, Doiron says. There is a steadily increasing volume of claims that are, for all intents and purposes, sitting dormant. There are certainly more open claims, Ots says, that are effectively in a holding pattern. “They are open on the desk, but you do worry about once there is a final resolution, you’ve got a fairly big body of claims that will start moving along and whether or not you are adequately staffed for that,” she says.
Facing uncertainty The uncertainty of it all is the biggest factor for most companies. Wittmann’s decision sent Peace Hills into a “tailspin,” because the company was about to close its year-end when the auditors
came back and said the year-end needed to be restated to include what it will cost in claims. “We had to reopen our year-end results and we had to change them,” Brickner says. “We had to put in an increased IBNR, etc. That was disturbing; that was upsetting.” Doiron adds the company had to go back and reevaluate all outstanding claims that appeared to be affected by the cap, which involved “some objective evaluation on our part.” The claims department might feel that the claim falls under the cap, but the plaintiff’s counsel might think otherwise, he says. Then all the cap files needed to be rereserved as though the cap did not exist, which affected the company’s reserves, he says. “For our business, the insurance industry, consistency and certainty are so important,” Brickner says. Ots points out that, “the crazy thing of all of this, all of these challenges and all of this legal rigmarole — it doesn’t get people better. None of this actually helps return somebody to their preaccident status.”
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S spotlight Taking on Trucks AZ Claims is focused on doing the best job possible when adjusting truck-related claims BY LAURA KUPCIS
hen asked about the types of files his company, AZ Claims Services Ltd., handles, Richard Swierczynski says simply, “anything to do with a truck.” When he talks about his company and adjusting, the enthusiasm for both his work and the industry he works in is palpable. When asked to describe the day-to-day activities of his company, his answer is simple and straightforward: “Basically anything to do with a truck,” Swierczynski says again. When pressed, he goes on to explain, “that could be a bodily injury claim where a truck has hit someone, it can be a property damage claim where the truck has struck something like a house or a guard rail or a building, it could have some environmental implications for example, a diesel spill or cargo spilled on property or on the roadway that has to be cleaned.” “It can involve the theft of a tractor/trailer/cargo,” he continues. “Cargo claims themselves can sometimes be complex in nature. They may involve multiple parties such as shippers, consignees, shipping agents,
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freight forwarders and load brokers, each potentially having separate responsibilities or liabilities. They might also encompass more than one mode of transportation such as sea, air, or rail, each of which may be subject to their own domestic or international shipping rules and regulations. Almost everything you buy gets to the store by truck. It could be a machine that makes a product or a raw material that goes into the product or the finished product itself.” “It can be anything,” he adds. “You never know what you are going to get; it’s always a surprise.” Because the company specializes in transportation related claims only, it has effectively worked with a core group of clients since its inception in 2003. “Transportation is a large industry but it’s also a small industry where everybody knows everybody,” Swierczynski says.
Routine maintenance But with that comes a new set of challenges. In today’s economy, there are not many companies picking up transportation insurance. In fact, many have left the business over the years. “Someone once told me that after some point in starting a business, your focus shifts to maintaining it and that brings different challenges,” Swierczynski says. “We’ve all heard the saying the only constant is change and nothing can be more true when describing the insurance industry and
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the transportation industry.” The key to maintaining business, for Swierczynski and AZ Claims, is to always do a good job. Quality and, just as importantly, consistency, is key. “My first boss told me, ‘If you adjust a file well, you’ll always get another one’ and ‘Never give someone a reason not to assign you a claim’.”
Rolling with the changes Swierczynski has the advantage of having handled transportation related claims exclusively for the last 15 years. This means that he knows what to look for in a claim and is able to draw on his experience to avoid pitfalls where possible. “Quite often, a small decision you may or may not make during the initial stages of a claim can have a big effect on the ease or difficulty in bringing the claim to its resolution,” he says. “There’s something to repetition.” The life of a transportation adjuster is not for everyone. “You have to be extremely flexible in both your work and home life,” Swierczynski says. “I’ve had to quickly change an entire day’s work schedule just because of one phone call from an insurer that requires an emergency cargo inspection or an interview from a driver that will only be at a truck stop for the next two hours,” he says “I’ve missed my share of family barbeques because the cell phone rings and I have to attend an accident scene right away,” he adds. “This is the norm, not the exception. It’s a 24/7 job.” www.claimscanada.ca
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You also have to be committed to continual education. One day, you’re dealing with changes to load securement rules or driver log book requirements or the Highway Traffic Act. Another day, you’re researching how the terms and conditions on a bill of lading issued in a foreign country might have an effect on a claim involving cargo damages that took place somewhere along the way to Ontario, Swierczynski says. AZ Claims is a two man operation with its office located in Oakville, Ont. In addition to Swierczynski, there is one other adjuster, Paul Beard, who also has been exclusively handling trucking claims for over 10 years. “Some of our clients deal with us because of the fact that we are a small firm,” Swierczynski says. “They like the quickness and ease in which we can implement changes to the way claims are handled to meet their changing needs and expectations.” When he looks into the future, Swierczynski says he likes the road he’s on right now even though the trucking industry is currently under considerable pressure because of the recession. This has not been a good year for trucking companies. The amount of freight being shipped is down and this has resulted in an overall decrease in transportation claims in the industry. Claims volume at AZ Claims, however, has remained constant.
Taking care of business Being a small firm presents its fair share of challenges. Having a good accountant and someone that knows computers is critical. Making the right investments in technology is difficult since what you purchase today is most probably obsolete by the time you get home from the store with it. “Less can sometimes be best,” Swierczynski says. “Keep it simple if possible.” And for those inevitable times when things do go wrong? “Surround yourself with smart people that you can call upon.” Swierczynski says. Part of those people Swierczynski www.claimscanada.ca
ensures are around, are fellow members of the Canadian Independent Adjusters’ Association (CIAA). “I’ve always found great value in belonging to CIAA,” he says. “I’ve been involved in the CIAA for 10 years now.” He goes on to say the association is a valuable resource tool. If a member
firm has a question, be it on licensing or errors and omissions insurance — there is someone to call. “We can draw on the resources and experiences of the entire organization to find the answer,” Swierczynski says. “And it’s vast — look at the people we’ve got here; we’ve got great people.”
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Handling Surety Claims A 42-year-veteran of the adjusting world decodes surety bonds. BY LAURA KUPCIS
surety bond is effectively a guarantee — quite different from an insurance policy. A surety bond involves three parties: the surety (insurance company), principal (contractor) and obligee (owner). Many different types of surety bonds exist, but two produce about 95 per cent of all losses, Ted Baker, president of Baker, Bertrand, Chassé & Goguen Claim Services Limited, told delegates at the Canadian Independent Adjusters’ Association’s annual conference in Montreal. A performance bond guarantees the performance of the principal contractor to an obligee owner. The labour and material payment bond, often referred to simply as a payment bond, is a guarantee that the subcontractors and creditors of the principal will be paid in the event of a default of the principal. “Behind both bonds is a construction contract,” Baker said. “That’s really what the bonds are attached to: They are guaranteeing the performance of your contractor in a contract to build buildings, to build things.”
A
Underwriting a surety bond The underwriting of a surety bond is very subjective and completely up to the underwriter, because it is not actuarially driven, Baker said. An underwriter would look at the three C’s of suretyship: character, capacity and capital. All of these factors are important, but the most important factor is the financial strength of the contractor, Baker pointed out. The underwriter must evaluate the contractor on those three C's and then say either say ‘Yes, I support this,’ or ‘No, I do not.’ 20
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“Once you get in bed — and that’s not literally — with your contractor, the underwriter is in for a ride because he cannot stop issuing bonds,” Baker said. “A contractor that is bonded is getting work at a certain level. If you take the bonding away from him he won’t get work at that level. He won’t get the cash flow. So once you write a few bonds you’re with him. It takes an underwriter with big ones to bite the bullet and say no more.” One basic premise of suretyship is that there’s supposed to be no losses. The whole idea is there is a backup when a bond is written for somebody. In theory, if the underwriter has a loss and has to pay, he can go to the principal and recover the cost. However that never works, because by then the principal is gone, Baker said. “I am standing here, 42 years in the business, as living proof that there are lots of losses.”
Handling a surety loss Baker got a call in July 1993 from a surety underwriter about a problem with a general contractor. Matthews Construction, based in Mississauga, Ont., was the third-largest general contractor at that time. It had 104 bonded contracts and $300 million in work on hand. “They were in trouble,” Baker said. “The call I love. You’ve got to love this call because you know it’s going to get you six years’ work.” Over the next three months Baker and his company analyzed the financial statements, looked at all the company’s jobs and came to the conclusion that for Matthews to survive, the company needed about $200 million in new work in the next 12 months at a 10 per cent
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margin just to service the debt. “Well that’s impossible,” Baker said. “You can’t get $200 million in new work in the next year unless you bid everything at a loss, which doesn’t help cause you might have cash flow but at the end of the day you’re bankrupt. And he never had 10 per cent margin in his life.” During this time, the underwriter suspected the contractor was going to fail, but not want to be cited as the of the failure. The underwriter, therefore wrote three new large contracts, two for jobs the firm had never previously handled. Basically, the underwriter lucked out, Baker noted. The bank decided it had had enough of Matthews’ financial condition and put in a receiver. “We had prepared for this,” Baker said. “We had developed a game plan, because what are you going to do with 60 active jobs across Canada and about five in Texas? How do you handle all that?” Matthews was going out of business; since it was a default, the surety is on the hook, Baker said. Looking at the three C's — character, capacity and capital — it was decided that the first two C's were present in Matthews’ case: There was nothing wrong with Matthews’ work and there was nothing wrong with the superintendents, staff or the projects themselves. The only problem was the third C — the company was broke. The surety on a performance bond has three basic options. One is to remedy the default and give money to the contractor, but there’s no limit on the bond then. Second, the bonding company can finish the job itself. Third, the www.claimscanada.ca
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ec jobs can be re-tendered. Since re-tendering 60 jobs would take years, it was decided the bonding company would finish the jobs. Five separate companies were established. The superintendents from Matthews Construction took over ownership and these companies finished the jobs. The payment bond was used to cover the debt; subtrades and suppliers were paid immediately to finish the job at the original subcontract price. One of the bank’s primary pieces of security is the receivable — i.e. work that’s been done on the job but not paid by the owners. “Those receivables were about $25 million,” Baker said. “We beat the bank to the receivables” By having a good claim-handling strategy and experienced staff, a potential $100 million loss exposure was reduced to just under $20 million, and all bonded projects were finished on time.
John R. Smith, Crawford & Company (Canada) Inc., was inaugurated as an honourary life member during the 2009 CIAA Annual Conference in Montreal. This membership is the association’s highest honour bestowed upon only those members that have gone over and above in serving and furthering the objectives of the association. Smith joined the CIAA in 1973, taking on the role of CIAA national convention chair in 1997-1998, he was the national secretary in 1999-2000, and was national treasurer from 2000 to 2006 and national executive committee director from 2006-2009. ●
Andrew Hernandez, Crawford & Company (Canada) Inc., was awarded the distinguished Fellow of the Canadian Independent Adjusters’ Association (FCIAA). Brian Gough, FCIAA chairman, had the honour of presenting Hernandez with the distinction at the 2009 CIAA Annual Conference in Montreal. The FCIAA designation is a prestigious recognition of an individual’s ongoing professional development, expertise and real and recognized contribution to the insurance industry. ●
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CIAA 25th Annual General Meeting and Conference; Montreal, Québec
Delegates and guests attended the 25th annual Independent Adjusters’ Association (CIAA) Annual Conference in Montreal, Que. Attendees played a day of golf, enjoyed dinner at Le Cabaret du Roy in Old Montreal and sailed on a boat cruise through the harbour. Hockey legends Rejean Houle and Yvan Cournoyer started off Saturday’s education sessions with keynote speeches. Afterwards, local lawyers discussed the courts’ interpretations of liability and property policies, and member adjusters explained their experiences with unusual claims. The conference came to a close with the president’s ball, when Patti Kernaghan, president of Kernaghan Adjusters, took the helm as the association’s newest president. ●
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Northern Exposure How a summer in the North and a gamble on the part of a business owner leads to a future in insurance for one student. BY DANIEL PLANT
We are all too familiar with pure risk in the insurance industry, but speculative risk is reserved for other arenas. This summer, an Arctic adjuster and I came together in a situation where we both had something to lose. I was a student, just finishing my third year of economics studies at Queen’s University, who travelled 3200 kilometers to Yellowknife in May, exchanging 15º C for -15º C in the hope of finding my way at Arctic West Adjusters. Greg Merrithew, owner, had only seen a resume and met me briefly, but as a believer in investing in youth, he seized the opportunity to bring me on board. Had I been incapable of handling the job or the location, it would have been a costly hiring. But the gamble paid off. There is something special about Arctic West Adjusters. Everyone must prove capable in all areas, such is the shortage of personnel and all else in the North. Within two weeks I was travelling to snow-ridden Nunavut, hitchhiking to the investigation site no less. By the end of the summer, I had opened and closed several claims on my own. I had earned my adjusting license and the 24
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trust of my co-workers through their encouragement for me to be confident; thanks to the small-office ‘can-I-helpyou?’ culture at Arctic West. This is a story that needs to be told more often in the insurance industry. As a student of insurance I greatly admire and appreciate Greg’s initiative and his commitment to making a difference in the industry. I may never
work for Greg again, but I will work in the industry of which he is a part of and while that will benefit him, it will benefit others much more. I strongly encourage others within the industry to make a habit of this big-picture approach. On the macro level, this will pay off for everyone. The talent of the claims department must be increased in capacity and in capability. The best way to do this is to inform and seek out
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students, show them the ropes, and let them see that the industry is servicebased and full of the business world’s most caring people. This has been my experience. Arctic West Adjusters is a perfect microcosm of the claims world. I showed up as the batboy and by the end I was playing shortstop. Tickets are selling, but the league is short players. A summer at Arctic West was like walking on at spring training and by October I was vying for the pennant. No one could have described that to me, I had to experience it for myself. I was very fortunate to share the bench with the Arctic West team. Internships and mentorships are crucial practices for fostering the growth of responsible and knowledgeable adjusters. Post-internship, I have realized how essential such an experience was and how it will continue to provide value to my planned career in the p&c insurance Industry for years to come. I could not have known this until immersed in the venture. Daniel Plant is a fourth year economics student at Queens University. He spent this past summer interning at Arctic West Adjusters in the Northwest Territories. www.claimscanada.ca
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The Winds of Change BY LAURA KUPCIS
photo courtesy of A.S.A.P Secured
trong winds blew through southwestern Ontario on Aug. 20, intensifying as they moved east. The winds created a solid north-to-south line of thunderstorms extending from North Bay through southern and central Ontario, to well south of the lower Great Lakes. Seventeen tornadoes emerged from that storm cell, tying the Aug. 2, 2006 record set for most tornadoes in Ontario in one day. According to Environment Canada, “it appears the same parent storm generated intermittent tornado damage for a remarkable 125 km, extending from New Lowell to Moonstone through Gravenhurst to Ril Lake.” Four of these tornadoes were rated as F2 storms on the Fujita Scale, with peak winds between 180 and 240 kilometres per hour. The province has not seen more than two tornadoes in one day since May 31, 1985.
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Damage costs In the Quebec town of Mont-Laurier, an F2 tornado tore through on Aug. 4, causing about $6 million in insurable damage. The storm was short, but the damage was extensive, resulting in 250 claims, according to the Insurance Bureau of Canada. Out of these 250 claims, insurers reported 146 claims for damage to homes and personal property totalling close to $4 million. Eightyeight auto insurance claims were made, with damages estimated at $400,000. It is estimated that damage to businesses and companies in the area was about $2 million. The total insurable cost from the Ontario tornadoes was not available as of press time, but reported damage included downed trees, flipped cars, 26
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damaged homes, collapsing sheds and a nearly demolished hockey arena.
Detailed damage Most of the houses in the Woodbridge area of Vaughan are built with unreinforced masonry walls and pitched roof construction, according to a report from the University of Waterloo, Vaughan Ontario Damage Investigation — The August 20, 2009 Tornadoes. Significant damage to roof shingles and sheathing were observed. Furthermore, there was substantial damage to the structural components of the roof, specifically the roof trusses, ranging from the removal of several trusses to complete failure of the roof. This structural debris caused significant damage to houses downwind. The damage to the house walls was likely mitigated because the homes are made of brick veneer versus vinyl siding, according to the report. Most of the damage was the result of the failure of the nails to connect to the walls. This caused the roof to fly off and, subsequently, the walls, lacking support, to collapse. According to the report, “in nearly every case the nails had been sheared through the edge of the plywood rather than the expected failures, where the nails either pull through the plywood or withdraw from the roof truss. Moreover, standard nailing patterns place more nails along the perimeter of the panel than in the interior and the perimeter nails are less prone to construction errors (nails missing trusses), coupled with the shear failure mode described above, this may result in a lower uplift resistance than would have otherwise been expected.”
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Industry role During a presentation organized by the Institute for Catastrophic Loss Reduction (ICLR), one of the report’s author’s, Gregory Kopp, a researcher at the University of Western Ontario, said some of the tornado damage in Vaughan could have been mitigated if the roofs had simply stayed attached to the homes. Attaining this could be as simple as using hurricane braces — a relatively inexpensive fix — to ensure that roofs can withstand high winds. The ICLR is in talks now to determine the role it can take, on behalf of the Canadian property and casualty industry, in regards to raising awareness about building codes and enforcement of said codes. Paul Kovacs said the ICLR was looking at two possible directions: Sharing research about tornado damage to help improve building codes, and following the lead of the U.S. p&c industry where communities are rated dependent on how well their codes are enforced. Whether a program like this could be imported into Canada, the cost associated and whether it is worth investing in is being looked at. “We are going to have more tornadoes and we are going to have more hurricanes and we are certainly going to have more wind in the future,” Robert Tremblay director of research, IBC, says. “The question is to what level must we build the future houses to withstand and these are important questions.”
Water trumps wind For Tremblay, while the tornado events are definitely important, when looking from a cost perspective, water damage is the number one loss for polwww.claimscanada.ca
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icyholders — not tornadoes. Two rain events in Ontario — one in Hamilton on July 26 and one in Ottawa on July 28 — were approximately three times more costly (based on preliminary figures) than the tornadoes that struck across Ontario. The concern is the increasing failure of the municipal infrastructure, which results in sewer backup into homes and buildings. “Practically every major urban centre in Canada has significant problem with this infrastructure and as an industry of course we are covering sewer back up and that is costly too,” Tremblay says. “[Sewer backup] is definitely, at the national level, far more important than wind damage. This doesn’t mean that we don’t have to work on wind damage; that’s why we have the Insurance Research Lab for Better Homes.”
ly networked through computers, cell phones and so on, and as soon as we get notification and are aware of damages occurring, we respond immediately.” If the situation requires it, he says his team has the ability to bring outside Crawford resources in as well to help handle the event. To ensure the safety of the items within the damaged homes in the area, security companies were called in to secure the site. A.S.A.P Secured was there early on Aug. 21 securing a number of areas in Vaughan, including a
dental office and a catholic school in addition to residential properties. “We are there working in conjunction with the local authorities to make sure that the individual homes that were covered under certain insurance company’s policies that we do work for were protected,” Rob Garland, vice president of A.S.A.P., says. “The fact is that they can go on to temporary housing or other locations and not have to worry about their valuables going missing or anybody going through their things.”
Industry at the ready No matter the type of event, the industry is effectively prepared to handle large losses. RSA was on the scene of the tornadoes in Woodbridge that evening, so quickly in fact that one of its staff was following the OPP up the highway, Irene Bianchi, vice president of claims, said. Residents were allowed back in their homes the following morning and RSA was on site with its mobile claims response unit to ensure its insureds were able to open a claim immediately. Bianchi estimates the company had roughly 40 to 50 claims in the Vaughan area, with much of the damage being top roofs or fencing. There were a few homes where the roof was completely ripped off. “We did have a fair number of claims, it’s keeping everybody busy we’ve responded to everybody,” she says. “As we get the claim notification we are actively working on it. But it’s just the scope of the disaster really; it’s a very very small neighbourhood, but a lot of damage within that small piece and similarly in the Maple area as well.” Crawford & Company (Canada) Inc. had people in the Durham area late in the afternoon of Aug. 20 responding to various resident and commercial losses, Mike Koch, property and catastrophe manager, says. “We have to react based upon the numbers that are presented by the clients,” says, adding adjusters react very quickly. “When we see these cells coming through the radar, our people are on high alert, especially in the areas. We’re completewww.claimscanada.ca
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25th Annual RIMS Canada Conference
St. John’s, Newfoundland and Labrador
Mitigating Loss Costs or most risk managers, the majority of claims that come across the desk are casualty losses. They are of higher volume and more time-consuming than property losses, James Giffen, director of the Global Technical Services (GTS) division at Crawford & Company (Canada) Inc., said during a seminar at the RIMS Canada Conference. Property losses, however, while less frequent, tend to be more severe and garner more publicity. Giffen outlined four scenarios to guide adjusters and risk managers in mitigating claims costs: • It is important to pay attention even when investigating small matters • Work with your adjuster by disclosing and discussing all aspects of the loss • What to think about when a severe loss doesn’t fit into the regular mould • The appraisal process
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We got it, we don’t got it A 20-year-old 400-unit building underwent renovations seven years prior to a loss, including a complete renovation of the industrial kitchen. A meal service for the residents and a restaurant ran out of the kitchen. Two years after the kitchen was redone, part of the laminate floor was bubbling up. Over time, the floor began to peel away further and started to lift. Building management contacted the risk management department. The situation was noted, but it was determined it was not a big issue for the facility itself, and a few more months went by, Giffen said. The kitchen staff began noticing an odour. Again building management called risk management, which said the matter should be looked into. When the crawl space under the kitchen was looked at, a pvc pipe joined at to a cop-
per pipe was found to have been dripping and leaking for years. “They needed to get in a significant amount of restoration and remediation and abatement firms in to work on it,” Giffen said. “Finally, at that point, clearly the risk management [department] needed to get very well involved. They were now in a crisis situation, where they were going to have to rip out all of the supports below the kitchen, take out the kitchen, replace the entire kitchen and start again.” Effectively, this has become a situation in which a potentially minor loss had turned into a serious financial factor for the corporation. “I think it’s paying attention to these little issues and looking into them and making the insurers aware of them at an early stage,” Giffen said. “Insurers these days tend to be a little more lenient on fre-
Illustration by Glenn McEvoy
BY LAURA KUPCIS
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quencies versus payouts so it tends to be better safe than sorry.”
Group hug A manufacturing facility suffered superficial damage to its building, as well as very minor damage to the manufacturing equipment during a rainstorm. When adjusters went it to investigate, the insured presented them with vague answers, focusing instead on a desire to fix the building. The insured gave no firm information about any other aspect of the loss that was of concern to the insured. “We went through whether they had been shut down and how badly their equipment was affected and we’d get answers such as ‘We’ll you know,’ ‘The machines are running a little slow’ and ‘We’ll work on them, it’s no big deal’,” Giffen said. The insurance company and adjusters dealt with fixing the loss. They restored the facility and made some minor repairs to the equipment. As the insurer was having what it thought was its final meeting with the insured, the matter of business interruption and an extra expense claim was raised. The insured noted there had been some extra expenses and some lost revenue; all told, the insured said, was $650,000.
“Nobody likes surprises,” Giffen said. These cases often end up taking far longer to finalize because of the nature in which information is presented and developed.
The big guns A fire burned through the open roof trusses of a 110,000 square foot shopping plaza, demolishing the building in roughly three hours. The insured and the insurance company both spoke to two different contracting companies, their estimates ended up being roughly $7 million apart. It was ultimately determined that the proper route was to hire a company that specialized in building large buildings. A well-known construction firm was brought in on a consulting basis to sit with the insured, the architects and the engineers to price out the job. The company was able to put together a building scope and a survey and narrow down the to initial estimates. “When it came time, at the end of the day, to meet with the broker and the insured and their team with regard to reconstruction, we really found the firm like that, when they are sitting at the table, can’t be ignored,” Giffen said.
Antique road show On occasion the insured and its insurer(s) reach an impasse with regard to quantum of the loss. At this point, litigation tends to be the most popular approach. The appraisal process is one of the most effective tools of the Insurance Act when two sides can’t agree on a value, Giffen said. It is not a very complicated or time-consuming event; either side can elect to go to appraisal. It supercedes all other manner of litigation with regard to quantum. A proof of loss needs to be filed. The election must be made in writing by either side. Once the notification has been received, each side has seven days to choose an appraiser. Within 15 days of choosing an appraiser, an umpire must be agreed upon otherwise the court will appoint one. The appraisers meet and try to resolve the issues together. Failing that, each appraiser will submit their brief to the umpire and set a hearing date. During the hearing, positions are put forth and the umpire decides on each of the items involved. If two of the three parties can agree on what the umpire is leaning towards, it is signed off on and the agreement is binding, Giffen said. It tends to be completed within a day or two.
When you’re not FirstOnSite, who is?
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25th Annual RIMS Canada Conference
St. John’s, Newfoundland and Labrador
The 2009 RIMS Canada Conference in St. John’s got kicked off with a bang with the official launch party of ClearRisk on Sept. 11. On Saturday afternoon, Granite Global Solutions held its first annual RIMS Canada conference event at Mexicali Rosa’s, hosted by the member companies — McLarens Canada, King-Reed Investigation Services and Sibley & Associates. Saturday evening, Cunningham Lindsey Canada hosted delegates at the Yellow Belly Pub. Crawford & Company (Canada) hosted guests at the Masonic Temple, while Quelmec Loss Adjusters treated their company to dinner at The Cellar Restaurant. The 2009 RIMS Canada Casino Night, hosted by GCAN Insurance Company, was held at St. John’s Geo Centre, where full colour planets of our solar system hung in the centre’s 3-story high reception hall. The conference also included a large trade booth floor and a number of educational sessions for those attending. ●
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Subrogating Liability Claims The Ministry of Health and Long-Term Care reminds insurers to report non-automobile liability claims. BY LAURA KUPCIS
nder the Health Insurance Act the Ministry of Health and Long-Term Care has the right to subrogate for non-automobile liability claims. Under the Act, the Ministry has the right to recover medical and hospital costs incurred when treating people injured in an accident, except automobile accidents in the province, caused by someone else’s negligence, according to a 2007 Annual Report of the Office of the Auditor General of Ontario. This includes such accidents as slip and falls, medical malpractice and product and general liability. This right also exists under the Long-Term Care Act, 1994 for recovery of community based services. According to section 35 of the Health Insurance Act, “A liability insurer shall notify the General Manager of negotiations for settlement of any claim for damages including insured services and may pay to the Minister of Finance any amount referable to a claim for recovery of the cost of insured services and such payment discharges the obligation of the liability insurer to pay that amount to the insured person.” The Ministry previously had the right to subrogate for injuries stemming from an automobile accident, but insurers now pay an annual assessment to cover these costs. Insurers are currently paying an annual levy of $142.3 million, Barbara Sulzenko-Laurie, vice president of policy at the Insurance Bureau of Canada (IBC), notes. However, since the inception of the auto agreement, insurers have not been reporting non-auto accident-related claims to the same extent as they were prior to the agreement, Anne Utley, manager of the subrogation unit, supply chain and facilities branch, Ontario Ministry of Health and Long-Term Care, says. In 2005, the auditor general of Ontario reported a number of deficien-
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cies, including a lack of reporting on the part of insurance companies in relation to liability claims — many of the claims that were being reported were being done so by plaintiff’s counsel, Utley says. In response to the auditor general’s report, the Ministry of Health and Long-Term Care, met with the IBC to determine the best way to let insurers know about the need for reporting. Sulzenko-Laurie conducted a survey in 2008 of insurance companies to ascertain what was being done and she learned that in virtually all cases insurance companies were deferring to legal counsel who were then reporting the incident to the Ministry. The Ministry’s interpretation of the legislation, however, is that both insurance companies and legal counsel are required to report any non-auto related claim, she says. According to the Ministry, when a settlement is in negotiation, the insurance company must report any nonauto that is still in open status. For legal counsel, there is the obligation to include the subrogated claim in the injured person’s claim for damages. “However, it would be very beneficial for an insurer to report much sooner than that, because [the Ministry] has to research all the health care costs associated with the injury,” Utley says. “We have to go to various sources to get that information — such as online sources, community care access centers or hospitals — and then we have to discriminate which services are related to the injury and which are non-related. So it is beneficial to give some notice in order to be able to prepare that so then the claim can be settled in its entirety immediately as opposed to waiting to get the Ministry’s subrogated claim.” Furthermore, by notifying the Ministry, insurance companies are able to avoid closing a file only to have to reopen it again to pay an additional
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amount for the OHIP subrogated claim. “In addition to the typical written claim procedures and staff notices, Aviva has a comprehensive computerized system for management of all injury claims,” David Hicks, vice president, casualty claim, Aviva Canada, says. “That system includes a field that specifically prompts the claim advisor to consider whether there is a subrogated health care claim from the Ministry, and the amount of any such claim. In conjunction with this, claim staff is encouraged to notify OHIP (or obtain claimant counsel confirmation of notice) early in the claim process, rather than waiting until settlement negotiations are under way. This early notice helps to avoid the possibility of forgetting about the OHIP claim, or the possibility of jeopardizing a settlement due to delays that can occur when notices are not sent until the last minute.” “Although some insurers may feel that early notice can create problems where it is later concluded that the insured defendant is not liable (or not fully liable) for the claim, this has not been our experience,” he goes on to say. “We have not encountered any significant difficulties arising from our early notice protocol.” When reporting to the Ministry, insurance companies need only provide basic information such as the date of the incident, a brief description of the incident (ie. slip and fall, dog bite, etc.), the name of the injured party and some identifiers, such as a current address, date of birth or the claimant’s OHIP number. “Anything that [an insurance company] can give us that can help us direct to the right services,” says Susan Cole, senior business consultant, supply chain and facilities branch, Ontario Ministry of Health and Long-Term Care. www.claimscanada.ca
For ORIMS 50th Anniversary Gala and plan to spend a most elegantly appointed evening on Thursday May 27th, 2010 at the Liberty Grand Ballroom ... in grand style!
www.ontario.rims.org
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Deliver Policies Quickly to Avoid Unwanted Risk BY JENNIFER PEREIRA
The degree of protection provided to an insured by a cover note continues to be the subject of debate in Canadian courts. Typically a cover note describes coverage in basic terms — property insured, premium, coverage limits, period of coverage and the like. The details of exclusions and conditions that might adversely affect the insured are often absent from the cover note. Section 124 (1) of The Ontario Insurance Act, R.S.O. 1990, c. I-8, along with its counterparts in other jurisdictions, provides a measure of protection to an insured where this occurs. Section 124 (1) of the Ontario Act states: 124 (1) All the terms and conditions of the contract of insurance shall be set out in full in the policy or by writing securely attached to it when issued, and, unless so set out, no term of the contract or condition, stipulation, warranty or proviso modifying or impairing its effect is valid or admissible in evidence to the prejudice of the insured or beneficiary. In the Act, “contract� is defined as including interim receipts or writing evidencing an insurance contract. This has been interpreted by the Courts to include cover notes and interim binders. The purpose of s.124 (1), and similar legislation in other provinces, is to ensure that adequate notice is given to an insured, of limiting terms and conditions, before an insurer will be entitled to rely upon them.1 This protects the insured, who might otherwise be prejudiced by not knowing that a particular risk is not covered. 34
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Questions of coverage will sometimes arise when losses occur after the issue of a cover note, but before a policy, containing the entirety of the terms and conditions, is issued. The debate often centers on the degree of knowledge that the insured has, or can be expected to have, of policy contents. The issues are firstly whether an insured has received adequate notice of an adverse term, and secondly, whether an insured has agreed to the terms that are contained in the policy. In practice however, these two issues are so closely related that they rarely receive separate attention from the Courts. This, along with the failure of the Courts to clearly articulate a test has sometimes made it difficult to predict whether coverage will exist. Where an insured who receives a cover note has actual knowledge of a restrictive term or condition contained in the policy, it is relatively simple for a Court to find agreement to the term or condition, and the policy wording is more likely to apply. The more difficult case will be where the insured does not have knowledge of the restrictive term or condition, even though it may be usual in nature. There does not yet appear to be a consensus in Canada as to the circumstances that will allow an insurer to assume that the insured is aware of the restrictive term or condition, nor a consensus as to whether awareness will allow an insurer to rely on the term or condition where there is no notice of it in the cover note. Canadian jurisprudence does not appear to have developed a consistent framework within which to analyze these cases. For example, in Hwang v. AXA Pacific Insurance Co.,2 the British Columbia Court of Appeal did not apply the B.C. www.claimscanada.ca
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equivalent of s. 124. In Hwang the insurer alleged the full at the mine before the policy was issued. Needless to say, policy excluded coverage for the claim against the insured. there was no security guard on-hand. The insurer was The insured claimed not to have received the policy booklet, allowed to rely upon the requirement that there be a securiand the trial judge accepted this as a fact. The declarations ty guard, and coverage was denied. In the view of the Court, page, which had been received by the insured, did not, of the reference to the security requirement in the interim course, set out the full policy terms. The discussion centered binder was clear and the insurer could rely upon it. The case on whether or not an insured could take the benefit of an appears rightly decided however, the facts were such that instrument without taking its burdens. The Court held that if the Court was able to make its decision without developing the insured wished to rely on the wording of the full policy, a framework for analysis. Details appear to be key for the B.C. Supreme Court in as issued, in order to establish his claim, he had to accept the 0712914 BC Ltd. v. Aviva Insurance Company of Canada.5 policy wording in its entirety. Justice Southin, writing for the Court, was of the view that Here, the interim binder included the words “Subject to: the insured, having received the declarations page, should Alarm Warranty.” A loss occurred before a policy could be have known that there was another document containing the issued. Once issued, the policy contained an alarm warranpolicy wordings, and he should have asked for it. In the result, ty endorsement which made coverage contingent upon the the insurer was allowed to rely on terms and conditions in insured’s alarm system being maintained and activated the policy that had not been set out in full in any form of when the premises were empty. The insurance broker brought the existence of the alarm warranty to the attention writing provided to the insured. of the insured verbally. The insured’s In Ontario Hwang has been criticized. property was subsequently burgled while In Hazen v. ING Insurance Co. of CanaThe issues are the alarm system was inactive. The da,3 Justice Carnwarth expressed, Where an insurer takes no steps to Court held the alarm warranty was firstly whether an deliver a copy of the policy to the insured unenforceable, notwithstanding the full insured has received details of the warranty had been brought it seems illogical that the insurer can rely on exclusions in the policy merely by to the attention of the insured prior to adequate notice of referring to the document in subsequent the loss. The Court held that as the an adverse term, communications to the insured. insured did not have an opportunity to read and accept the full warranty before In Hazen, the insureds sought coverand secondly, the loss, the warranty was unenforceage for damages to their home caused by whether an insured able. In the view of the Court, the claim flooding from a frozen pipe. The insurhas agreed to the was to be adjudicated by reference only ance policy included a clause that to the contract as expressed in the interexcluded coverage for loss or damage terms that are im binder. from freezing and flooding unless the contained in the It remains unclear within Canadian insured had taken specific precautions jurisprudence as to how much detail which had not been taken. The insured policy. need be set out in the cover note before claimed not to know of this requirement because they had not received a copy of an insurer can rely on a restrictive term the policy. ING maintained the policy was mailed, or, in the or condition. There is also uncertainty as to how actual alternative that the insured had constructive notice of the knowledge by an insured, of a restrictive term or condirequirements since renewal receipts of the policy incorporat- tion, impacts the obligation of the insurer to provide detail ed the original policy by reference. The Court refused to dis- in the cover note. As such, prudence requires cover notes miss the insured’s claim on a summary application, holding contain as much detail as possible, of restricting terms and that the determination of an insured’s knowledge of a restric- conditions, and that full policies be delivered on a timely tion in coverage will depend upon the individual facts in each basis. case. Accordingly, there was a triable issue. However, the Court did not articulate a comprehensive framework for Jennifer Pereira is an associate with Robertson Stromberg what acts by an insurer might meet the requirements of s.124. Pedersen LLP in Saskatoon Saskatchewan. Robertson Stromberg More specific guidance can be found in the Alberta Pedersen LLP is a member of The ARC Group Canada. Court of Appeal in New Forty Four Mine Ltd. v. Saint Paul Fire and Marine Insurance Company.4 Here, a corporate 1. 0712914 BC Ltd. v. Aviva Insurance Company of Canada (2007) BCSC 163, [2007] I.L.R. I-4578, 45 C.C.L.I. (4th) 120, [2007] B.C.W.L.D. 1319, [2007] insured requested a policy for a mine they wished to reopen. B.C.W.L.D. 1361, 69 B.C.L.R. (4th) 343 (B.C. S.C.) at paragraph 30. In order to obtain adequate insurance, the broker deter- 2. (2001) BCCA 410, 91 B.C.L.R. (3d) 34, 154 B.C.A.C. 231, 252 W.A.C. 231, mined that a 24-hour security guard was necessary, and the 32 C.C.L.I. (3d) 201, [2002] I.L.R I-4056 (B.C. C.A.) corporate secretary informed him that this was the case. The 3. [2006] I.L.R. I-4493, 35 C.C.L.I. (4th) 62 (Ont. S.C.J.) interim binder referred to the 24-hour security require- 4. (1987), 53 Alta. L.R. (2d) 312, 78 A.R. 364, [1987] 5 W.W.R. 673, [1987] I.L.R. 1-2247, 28 C.C.L.I. 81 (Alta. C.A.) ment. The insured received the binder and glanced through it, but failed to fully grasp the requirement. There was a fire 5. Ibid., note 1. www.claimscanada.ca
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Preparing The Adjuster’s File For Litigation Maximizing the Value of the Adjuster’s File and Minimizing Costs to the Insurer BY DON MCGARVEY
The way in which an adjuster maintains their file can make a dramatic difference in its value when litigation ensues and counsel is retained. Providing a comprehensive, well-organized package to counsel can also result in significant cost savings for the insurer. Having acted for insurers for over 20 years, I’ve seen the full spectrum, from comprehensive, highly organized files to a jumble of incomplete paper that raises more questions than answers. The effectiveness of counsel upon being retained is often largely dependent on how quickly and efficiently counsel can understand the facts and determine the issues. This is where the adjuster can be of great benefit in helping set the table for an organized defence engagement that impresses not only the insured, but the opposition as well. What follows is a primer on how an adjuster should prepare the insurer’s file for counsel when counsel is retained. These are 36
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practical tips garnered over the past several years. There may be differences between first party claims, third party claims, subrogated claims and coverage litigation, but the focus here will be on third party claims and how the adjuster’s file ought to be prepared for counsel. When dealing with an adjuster’s file, one must be mindful of issues regarding privilege, why certain documents are created and whether certain documents will ultimately be producible in the litigation or protected by one of several varieties of privilege. As overriding principles, adjusters should be mindful of three points when preparing their file for referral to counsel: 1. A full and complete investigation by the adjuster before the file is provided will save time and money. 2. The more efficiently and precisely counsel can review the adjuster’s file and become acquainted with the facts and legal issues, the better. 3. Proper documentation, background information and precise instructions are critical to ensuring that counsel can become promptly and efficiently acquainted with the background facts and circumstances thereby providing a springboard for a prompt and effective defence. During the course of an adjuster’s work on a claim, there will be certain tasks that are routinely performed. These include taking statements from the insured, possibly from the claimant, and from witnesses. The importance in obtaining and preserving this information soon after the event is critical. Often, statements are taken by tape recording. In most jurisdictions, the tape itself constitutes a document and needs to not only be preserved but provided to counsel. For example, if there is a tape recorded statement from the claimant, that tape is often a document which must be produced to the claimant if and when litigation ensues. As such, those tapes, including any transcriptions, ought to be provided to counsel. www.claimscanada.ca
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The same can be said of surveillance. While it is often the case that surveillance reports contain excerpts from videotape in the way of still photographs, it is important that the original surveillance tape, in its entirety, be provided to counsel. This is generally retained by the investigators and never seen by the insurer. If counsel receives only the portions of the surveillance videotape which are helpful to the defence, and those portions of the videotape comprise only a small percentage of the overall surveillance, the
Whenever a file is about to be referred to counsel, the adjuster ought to contact counsel and without providing any information as to the facts or the merits of the case, ask counsel to perform a conflicts inquiry in relation to the parties involved in the claim.
impact of the overall surveillance may be misunderstood. The entire videotape surveillance, in its entirety, ought to be provided upon the referral of the matter to counsel. Expert reports are typically gathered at the adjuster level but, on occasion, counsel receives only a copy of the original of these reports. The original expert report ought to be provided to counsel where the expert has been retained by the insurer. In casualty litigation, the adjuster will typically gather medical information from the third party or the third party’s counsel. The necessity for adjusters to properly maintain this information and ensure that it is labeled as constituting the file of “Dr. Jones,” for example, can’t be overstated. Typically, a number of adjusters simply place one file onto a brad or in a “medicals” file and there is the likelihood that the file of “Dr. Jones” will be co-mingled with the file of “Dr. Smith.” When the adjuster’s file is copied, it is often difficult to distinguish one file from another, especially where the adjuster simply provides instructions to a clerk in the adjuster’s office to “copy entire file.” A great deal of time is often required to reconstruct precisely what was on the adjuster’s file (and whose records they were) when we have received simply a full photocopy of an adjuster’s file without an indication of where a particular medical chart or file stops and starts. Several companies have differing philosophies about the amount of information to be provided to counsel. For example, electronic claims logs are supplied by some companies whereas they are not supplied by others. Management notes and records are redacted by some insurers but not by others due to corporate policy. It is often helpful to counsel to know the thoughts and comments of management throughout the claims handling process where those thoughts and comments are recorded in a claims log. Perhaps, without knowing it, the insurer, through its adjuster and management, tend to develop a theory of the defence throughout the claims handling process and that defence the-
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ory is often clearly articulated in the comments of management. If insurers and adjusters are disinclined to provide such notes and records, they would be well advised to nevertheless articulate the defence theory as they see it upon the file being referred to counsel. It is often helpful for counsel to have a copy of the expense ledger so counsel knows early on what the insurer has paid for in the way of docu-
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ments and records from the third party. This can be a valuable and time saving tool for counsel when it comes time to resolve the case and determine what is owing on a Bill of Costs. Whenever a file is about to be referred to counsel, the adjuster ought to contact counsel and without providing any information as to the facts or the merits of the case, ask counsel to perform a conflicts inquiry in relation to the parties involved in the
THIS IS MORE THAN A HURRICANE. To business owners who have tirelessly committed themselves, it’s the loss of their dream and livelihood. To insurance professionals, it’s the challenge to fairly and accurately quantify what their loss is worth. :KHQ HQYLURQPHQWDO GLVDVWHUV VWULNH WUXVW WKH ÀUP WKDW SURvides an expert, objective opinion and quality resources. BDO. More than you think. Business Interruption | IRB Calculations | Personal Injury Claims
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claim. Only once counsel has advised that conflicts have been cleared should the file be sent to counsel. Once conflicts have been cleared, the letter of instruction from the adjuster to counsel should include: 1. The policy number, claim number and the precise date of loss; 2. The names of all parties, potential parties, insurers for the parties and potential parties and witnesses; 3. Recent and up-to-date contact information for the insured, witnesses and experts; 4. The limit of liability (some insurers refuse to do this, but it allows counsel to identify the potential for liability in excess of the limits); 5. Any coverage issues that may affect the defence of the action; 6. Background facts giving rise to the claim; 7. The theory of the defence as established by the insurer; 8. Insights and impressions of the insurer including presentation of the insured, witnesses, etc.; 9. Specific instructions as to the handling of the matter. By following this sort of template, and including the proper documentation in an orderly fashion with originals when required, it can save the adjuster and the insurer money by allowing counsel to become well acquainted with the matter in a prompt and efficient way. While there will surely be variations from file to file, this method of referring a matter to counsel stood the test of time and has been an effective way of communicating with and retaining counsel. Don McGarvey is a partner with the Edmonton office of McLennan Ross LLP practicing insurance and commercial litigation. McLennan Ross LLP is an independent member firm with The ARC Group Canada.
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A SERIES OF ARTICLES PROVIDED BY THE INSURANCE INSTITUTE OF CANADA
Mediation Basics: Key Roles and Stages
hen the negotiations in the adjustment of a claim break down or when the insurer denies the claim, parties may turn to mediation, mini-trials, arbitration, appraisal, or litigation. Because litigation can be costly and subject to delays, an insurer may choose a less formal dispute resolution method, such as mediation. Methods based on cooperation can help to decrease animosity between the parties, settle the matter more quickly and amicably, and promote opportunities for future business relationships. However, some cases are not suited for mediation. For example, instances when a legal precedent needs to be established or when a claim is allegedly fraudulent. Moreover, entering mediation does not guarantee that a settlement will be reached, but if one is reached, it is binding.
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Mediation theory Mediation is assisted negotiation — parties in dispute retain control over the situation. For mediation to work, both parties must be open to creative solutions, and each party is expected to actively and cooperatively participate in seeking resolution. The focus is on uncovering the needs and interests of the bargaining parties in a neutral and cooperative environment, not on determining who is right or wrong. Discussions in mediation may go 40
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beyond the legal issues of the case. In insurance disputes, mediation can be used to determine how much damages are worth, what each party should contribute to any settlement, or other rights-based issues requiring a yes or no answer, such as issues of coverage, priority of coverages, or loss transfer.
Mediator’s role Mediators control the mediation, ensuring that the environment is conducive to cooperative negotiation, but they do not take sides or impose a result. As neutral third parties, mediators help the disputing parties to identify the real areas of dispute, explore possible solutions, generate creative solutions, and negotiate fairly and respectfully. They ask questions to ensure that all necessary information is disclosed, and they must listen intently to be able to accurately summarize the issues. When emotions are high, the mediator’s role is made more challenging. In these cases, the parties are usually kept apart to prevent needless emotional confrontations, and the mediator shuttles back and forth between them.
insurer. When the claimant is a third party, the claims representative represents the insured. In such a case, the insured may not be required to attend. The claims representative is usually a member of the insurer’s staff (for example, the claims examiner), but occasionally an independent adjuster may be assigned to act as the insurer’s representative during the proceedings. The claims representative should come to mediation with sufficient authority to settle the claim. Alternatively, arrangements can be made to
The Mediation Team Selecting the appropriate mediation team can be fundamental to the success of the session. A loss adjuster who has been embroiled in negotiations may be replaced by a claims examiner or a neutral party (but it must be someone with enough authority to authorize the negotiated settlement). Likewise, litigation counsel might be replaced by mediation counsel.
Claims representative’s role In insurance mediation, the claimant attends the session. Sometimes the insured is the claimant and the claims representative represents the
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have a senior claims person on call, ready to increase settlement authority should it be necessary to do so. The claims file should be reviewed carefully before mediation to ensure that reserves are reasonable based on the existing evidence. During the mediation, the claims representative should be sensitive to the mediation paradigm and acknowledge a claimant’s potentially contentious personal issues. The representative may choose to speak briefly in the opening statement, and a few wellchosen words that seek to find common ground may have a positive impact with the claimant. Non-confrontational communication techniques, such as eye contact and conciliatory body language, should be adopted. The claims representative should face the claimant rather than the mediator since the parties in dispute are trying to persuade each other of their respective positions, not the mediator. The mediator is merely a facilitator. Over the course of the mediation, claims representatives must be prepared to deal with new information and reassess the claim if required. New evidence submitted or the assessment of the claimant as a witness may convince a loss adjuster to adjust the evaluation of the claim either higher or lower.
Lawyer’s role The parties in a claims dispute are usually represented by lawyers. Lawyers generally help in the process of selecting a mediator and are involved in the logistics of setting up the meeting. They offer advice to their clients about the law and about how to avoid pitfalls associated with the mediation process. Counsel participate in negotiations, interpret information, and provide feedback as necessary. Issues in law must be brought to the insurer’s attention and an objective analysis offered of how events will play out in the case. It is usually counsel who will articulate www.claimscanada.ca
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The mediation agreement sets out all the terms and conditions of the mediation, including what will happen if the mediation is cancelled or runs into overtime, the confidentiality of the proceedings, and any other terms that might be a source of contention later.
the insurer’s position on the file during the mediation. When an agreement is reached, counsel draft the Minutes of Settlement to set out the agreed-upon terms in writing. For the Minutes of Settlement to be legally binding, they must be executed with legal counsel and each party must receive independent legal advice about the contents. In certain centres in Ontario, defence counsel must participate in mandatory mediation as a required step in all litigated cases; in other locations, this may not be required. Adjusters must gain an understanding of the process in effect in their respective territories and their role in it.
Mediation agreement After the mediation is booked, the mediator sends confirming correspondence, including a mediation agreement, to counsel. The mediation agreement sets out all the terms and conditions of the mediation, including what will happen if the mediation is cancelled or runs into overtime, the confidentiality of the proceedings, and any other terms that might be a source of contention later. The mediator arranges for the agreement to be reviewed and signed by both parties. The confidentiality condition offers protection to the participants and allows them to speak freely, knowing that what they do or say at the mediation will not impair future litigation. If the case winds up in court, discussions that occurred in mediation cannot be introduced as evidence. The mediation agreement also indicates who will pay the costs of the mediation. In a commercial setting, parties usually agree at the outset to share the costs: this is perceived to ensure the neutrality of the mediator. In insurance matters, however, the insurer often agrees at the outset to pay. The loss adjuster may query whether this is appropriate in the circumstances of the case or whether the parties should begin by agreeing to share the costs. Some insurers ask the claimant to share the costs of mediation subject to an undertaking that the insurer will pay the full cost if the claim settles at mediation. This approach gives the claimant a stake in the mediation process and an incentive to seriously consider a settlement. For an overview of the other stages in the mediation process, see the Education Forum pages in the upcoming December/January issue of Claims Canada. This article is based on excerpts from the study material in the Claims Professional Series of applied courses – a core of the CIP Program that helps adjusters learn the functional knowledge and skills required of their profession.
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O on the scene Robert Parizeau has been appointed director of technical resources at FirstOnSite Restoration. His key focus will be to standardize and maintain consistent operating procedures in the field. He was most recently working at the company’s North Bay office. In addition to his operational responsibilities, Parizeau will spearhead the development and implementation of “FirstInEducation,” an Robert Parizeau external training program that FirstOnSite provides to it various customers, allowing participants to attain industry education credits. ● Winmar Franchise Corp. has announced the opening of its newest location Winmar Lanark County, in London, Ont. The location, located at at 40 Bennett Street, Carleton Place, K7C 4J9, will service the Lanark County, Smith Falls, and Carleton Place area. Owner/operator, Dan McPhee, has “years of experience in the property restoration business and is committed to providing quality customer service, fostering long term relationships, and devoted to servicing the insurance industry and their clients,” Winmar says. ●
CIAA New Members — July 2009 INDIVIDUAL MEMBERSHIP Coast Claims Service Ltd. Gloria Barry Gregory Ross Lorie McKenzie-Bulcock Mikolaj Janaszak, BA Daniel Lutes William Millman, BA, CIP Verdonna Noye, CIP Elizabeth Gaudet Jim Sarkany Donald McConaghy Zena McCreary-Beniac, CAIB Shannon McRae
Campbell River, BC Courtenay, BC Duncan, BC Nanaimo, BC Nanaimo, BC Nanaimo, BC Nanaimo, BC Port Alberni, BC Port Alberni, BC Victoria, BC Victoria, BC Victoria, BC
Cunningham Lindsay Canada Limited Robert MacKay, BA, B.Ed., RIBO New Glasgow, NS Kernaghan Adjusters Limited Dean Larocque Calgary, AB Plant Hope Adjusters Ltd. Carol Allard Campbellton, NB John J. Aucoin, FCIP Campbellton, NB Daniel Levesque Edmunston, NB Jean Bourque Moncton, NB Jonathan Frenette Moncton, NB Lyssa Lapointe, BBA, CIP Moncton, NB Maryse LaPointe-Bourque, CIP B.Ed. Licentiate Murielle LeBlanc, CIP Moncton, NB Mike Turner, CIP Moncton, NB
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Investigator Investigator Student Investigator Licentiate Licentiate Licentiate Student Licentiate Licentiate Investigator Investigator
Cunningham Lindsey has announced a series of executive level appointments. John Seyler has been appointed director of specialty services, Canadian operations of the company. Martin Moran has been appointed assistant vice president of Cunningham Lindsey, desktop solutions — a newly created position. Lisa McCabe has been appointed assistant vice president, Western operations, at Cunningham Lindsey. Stephanie Page has been appointed district manager for Edmonton effective Sept. 1. ● John Seyler
Martin Moran
Lisa McCabe
Stephanie Page
CIAA New Members — August 2009 INDIVIDUAL MEMBERSHIP Arctic West Adjusters Ltd. Amanda Parsons Amee Pond
Yellowknife, NT Yellowknife, NT
Investigator Investigator
Canadian Claims Services Robert Clement, CIP Vincent Howie, B.Sc. Dana Nieminen Graeme Nieminen
Winnipeg, MB Winnipeg, MB Winnipeg, MB Winnipeg, MB
Licentiate Investigator Licentiate Investigator
Cunningham Lindsey Canada Limited Andrea Digdon, BA. CIP Dartmouth, NS
Investigator
Horizon Adjusters Ltd. Kristi Morris, CIP Lana Sullivan
Grande Prairie, AB Grande Prairie, AB
Licentiate Investigator
J.P. Hamilton Adjusters Ltd. Karen Engstrom, CIP
Winnipeg, MB
Investigator
Kernaghan Adjusters Limited Blair McGregor, CIP Brett Roberts Chris Keeler Ernie Saranchuk Brian Ward David Lind, CRM Emmanuel Sol Cruz
Vancouver, BC Vancouver, BC Edmonton, AB Edmonton, AB Edmonton, AB Winnipeg, MB Winnipeg, MB
Investigator Investigator Investigator Licentiate Licentiate Investigator Investigator
McLarens Canada Harry Toews
Winnipeg, MB
Investigator
Student
Investigator
Licentiate Licentiate Student Licentiate Student Investigator Moncton, NB Licentiate Investigator
Townsend & Leedham Adjusters Ltd. Christopher Zambo, FCIP Edmonton, AB
Licentiate
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Belfor Restoration held its 5th Annual invitational at Sleepy Hollow Golf & Country Club in Stoufville, Ont. on Aug. 13. More than 80 golfers attended and enjoyed lovely weather and great food. Funds raised during the event went to fight breast cancer. â—?
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O on the scene Riverfront Medical Services marked its 20th Anniversary on Jul. 9 with an evening celebration at Marben Restaurant in Toronto. Dr. Sheldon Levy, president and medical director, along with Anna Tsaggarelis, executive director of business development and operations, welcomed more than 170 guests from the insurance industry to join in the celebrations. â—?
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Winmar Toronto/Brampton and No Problem Movers held its first annual mix and mingle boat cruise on Sept. 17. Guests set sail aboard the Obsession III for a four hour tour around the Toronto harbour. Guests were treated to a fabulous view, great music and tasty hors d'oeuvres while meeting new friends. Proceeds from the event went to local charities, including a $700 donation to the AIDS Committee of Toronto. â—?
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CIAA REGIONAL PRESIDENTS 2009 – 2010 NEWFOUNDLAND & LABRADOR Neil F. Lacey, CIP, FCIAA Crawford & Company (Canada) Inc. 44 Torbay Road, Suite 300 St. John’s, NL A1A 2G4 Phone: (709) 753-6351 Fax: (709) 753-6129 E-mail: Neil.Lacey@crawco.ca NOVA SCOTIA Nicholas B. MacDonald, AIIC Cunningham Lindsey Canada Limited 11 Morris Drive, Suite 200 Dartmouth, NS B3B 1M2 Phone: (902) 421-1519 Fax: (902) 429-7296 E-mail: nmacdonald@cl-na.com NEW BRUNSWICK & PRINCE EDWARD ISLAND Luc Aucoin, BBA, FCIP Plant Hope Adjusters Ltd. 16 Coronation Drive Moncton, NB E1E 2X1 Phone: (506) 853-8500 Fax: (506) 853-8501 E-mail: laucoin@planthope.com QUEBEC/AESIQ Charles A. Berthiaume Réclamations C. Berthiaume 44, Chemin d’Oka Saint-Eustache, PQ J7R 1K5 Phone: (450) 491-6165 Fax: (450) 491-6230 E-mail: rcb@reclamationscberthiaume.ca ONTARIO Richard Swierczynski, BA, CIP AZ Claims Services Inc. 1500 Upper Middle Rd., Unit #3, P.O. Box 76041 Oakville, ON L6M 3G3 Phone: (905) 825-0027 Fax: (905) 825-5543 E-mail: richard@azclaims.ca MANITOBA Timothy W. Bromley J.P. Hamilton Adjusters Ltd. 125 Enfield Crescent Winnipeg, MB R2H 1A8 Phone: (204) 944-1057 Fax: (204) 944-1606 E-mail: tbromley@mts.net SASKATCHEWAN Rob Johnston Midwest Claims Services 320 Gardiner Park Court Regina, SK S4V 1R9 Phone: (306) 522-1656 Fax: (306) 569-1256 E-mail: rob@midwestclaims.ca WESTERN Bea Boutcher, CIP Horizon Adjusters Ltd. #207, 9814 – 97 Street Grande Prairie, AB T8V 8H5 Phone: (780) 402-8383 Fax: (780) 402-7888 E-mail: bea.boutcher@horizonadjusters.com PACIFIC James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 203 – 5780 176A Street Surrey, BC V3S 4H1 Phone: (604) 574-6275 Fax: (604) 574-7354 E-mail: Jim.Eso@crawco.ca
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National Standing Committees 2009 – 2010 ADVISORY Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca Reno Daigle, CIP, CLA, FCIAA Crawford & Company (Canada) Inc. 326 McIntyre Street W. North Bay, ON P1B 2Z1 Phone: (705) 476-2120 Fax: (705) 476-9280 E-mail: Reno.Daigle@crawco.ca James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca Jean-Marc Laurin, FPAA, CRM, FCIAA Cunningham Lindsey Canada Limited 1250 Guy Street, Suite 1000 Montreal, PQ H3H 2T4 Phone: (514) 938-2124 Fax: (514) 938-5445 E-mail: jmlaurin@cl-na.com John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca Carol A. Messervey, CIP, FCIAA, FIFAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 E-mail: cmesservey@marshadj.com CAREER RECRUITMENT PLANNING Wendy S. Fralick, AIIC Cunningham Lindsey Canada Limited 50 Burnhamthorpe Rd. W., Suite 1102 Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-3485 E-mail: wfralick@cl-na.com Christina Welton, FCIP McLarens Canada 637 The Queensway, Unit 9 Peterborough, ON K9J 7J6 Phone: (705) 740-0023 Fax: (705) 740-2296 E-mail: christina.welton@mclarens.ca COMMUNICATIONS Craig J. Walker, CIP, FIFAA, FCIAA Maltman Group International 1049 McNicoll Avenue Toronto, ON M1W 3W6 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com John D. Seyler, AIIC Cunningham Lindsey Canada Limited 50 Burnhamthorpe Rd. W., Suite 1102 Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-3485 E-mail: jseyler@cl-na.com
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Fred R. Plant, AIIC Plant Hope Adjusters Ltd. 16 Coronation Drive Moncton, NB E1E 2X1 Phone: (506) 853-8500 Fax: (506) 853-8501 E-mail: fplant@planthope.com CONSTITUTION & RULES John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca CONVENTION Allan B. Hart, BBA, CIP, CRM Coast Claims Service Ltd. 2727 Quadra Street, Suite 6 Victoria, BC V8T 4E5 Phone: (250) 386-3111 Fax: (250) 386-1473 E-mail: ahart@coastclaims.com DISCIPLINE Reno Daigle, CIP, CLA, FCIAA Crawford & Company (Canada) Inc. 326 McIntyre Street W. North Bay, ON P1B 2Z1 Phone: (705) 476-2120 Fax: (705) 476-9280 E-mail: Reno.Daigle@crawco.ca EDITORIAL John M. Sharoun, FIIC, CFE, FCIAA Crawford & Company (Canada) Inc. 300 – 123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 867-1188 Fax: (416) 867-1925 E-mail: John.Sharoun@crawco.ca
Carol A. Messervey, CIP, FCIAA, FIFAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 E-mail: cmesservey@marshadj.com FCIAA E. Brian Gough, FCIP, CLA, FCIAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 E-mail: ebgough@marshadj.com Robert V. Pearson, CLA, FCIAA AAL Alberta Ltd. 600 – 2424 4th Street S.W. Calgary, AB T2S 2T4 Phone: (403) 452 2195 Fax: (403) 452 3568 E-mail: rvp@aaladjusters.com Jean-Marc Laurin, FPAA, CRM, FCIAA Cunningham Lindsey Canada Limited 1250 Guy Street, Suite 1000 Montreal, PQ H3H 2T4 Phone: (514) 938-2124 Fax: (514) 938-5445 E-mail: jmlaurin@cl-na.com FINANCIAL Randy P. LaBrash, CIP, CFE, CFEI Crawford & Company (Canada) Inc. 300 – 191 Lombard Avenue Winnipeg, MB R3B 0X1 Phone: (204) 947-2340 Fax: (204) 943-9168 E-mail: Randy.Labrash@crawco.ca
Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca
Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300 – 1575 West Georgia St. Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 E-mail: pkernaghan@kernaghan.com
Fred Silvestri, BA, CIP NCRS 121 King Street W., Suite 1810 Toronto, ON M5H 3T9 Phone: (416) 733-9265 Fax: (416) 733-0510 E-mail: fred.silvestri@srsconnect.com
Reno Daigle, CIP, CLA, FCIAA Crawford & Company (Canada) Inc. 326 McIntyre Street W. North Bay, ON P1B 2Z1 Phone: (705) 476-2120 Fax: (705) 476-9280 E-mail: Reno.Daigle@crawco.ca
EDUCATION Gary A. Ellis, BBA, FCIP, RF, FCIAA, CLA, FIFAA Crawford & Company (Canada) Inc. 18 Great George Street Charlottetown, PE C1A 4J6 Phone: (902) 566-1011 Fax: (902) 894-3044 E-mail: Gary.Ellis@crawco.ca W.E. (Ted) Baker, BA, CFE, FCIAA Baker, Bertrand, Chassé & Goguen Claim Services Limited 3660 Hurontario St., Suite 601 Mississauga, ON L5B 3C4 Phone: (905) 279-8880 Fax: (905) 279-5338 E-mail: webaker@bbcg.ca EMERGENCY MEASURES David W. Lyon, FCIP, CLA, FCIAA Cunningham Lindsey Canada Limited 111 Granton Drive, Suite 220 Richmond Hill, ON L4B 1L5 Phone: (905) 707-5527 Fax: (905) 764-3398 E-mail: dlyon@cl-na.com Roger S. Bickers, CIP, FCIAA McLarens Canada 600 Alden Road, Suite 600 Markham, ON L3R 0E7 Phone: (905) 946-9995 Fax: (905) 946-0171 E-mail: roger.bickers@mclarens.ca
NOMINATING Reno Daigle, CIP, CLA, FCIAA Crawford & Company (Canada) Inc. 326 McIntyre Street W. North Bay, ON P1B 2Z1 Phone: (705) 476-2120 Fax: (705) 476-9280 E-mail: Reno.Daigle@crawco.ca Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300 – 1575 West Georgia St. Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 E-mail: pkernaghan@kernaghan.com John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca Carol A. Messervey, CIP, FCIAA, FIFAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 E-mail: cmesservey@marshadj.com PRIVACY James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca Wendy S. Fralick, AIIC Cunningham Lindsey Canada Limited 50 Burnhamthorpe Rd. W., Suite 1102 Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-3485 E-mail: wfralick@cl-na.com Keith P. Edwards, FCILA, CLA, FUEDI-ELAE CIAA Honorary Life Member c/o CIAA National Office 5401 Eglinton Ave. W., Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Fax: (416) 621-7776 E-mail: info@ciaa-adjusters.ca
IBC: LIAISON & FORMS Tammie Norn, CIP ProFormance Adjusting Solutions Inc. 3601 Highway 7, Suite 400 Markham, ON L3R 0M3 Phone: (905) 612-7777 Fax: (905) 612-7778 E-mail: tnorn@proadjusting.ca LEGISLATIVE Russell E. Malkoske, BA, FCIP, CLA QA Adjusting Company 279 Provencher Blvd. Winnipeg, MB R2H 0G6 Phone: (204) 233-8844 Fax: (204) 233-7793 E-mail: qa-russ@shaw.ca LICENSING J. Miles O. Barber, B.Comm. (Hons.), FCIP, CRM Network Adjusters Ltd. 67 Folkestone Blvd. Winnipeg, MB R3P 0B4 Phone: (204) 897-5793 Fax: (204) 897-5797 E-mail: mbarber@mts.net MEMBERSHIP & QUALIFICATIONS Rob Johnston Midwest Claims Services 320 Gardiner Park Court Regina, SK S4V 1R9 Phone: (306) 522-1656 Fax: (306) 569-1256 E-mail: rob@midwestclaims.ca
www.claimscanada.ca
ciaa conf ad
10/28/09
2:09 PM
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Canadian Insurance Claims Managers’ Association / Canadian Independent Adjusters’ Association United & Committed Leadership through -Education • Professionalism • Communication
CICMA/CIAA Ontario Chapters’ 43rd Annual Joint Conference Tuesday, February 2, 2010 Metro Toronto Convention Centre, Toronto, Ontario Registration 8:00 a.m. • Seminar 9:00 • Reception and Lunch 12:30
Guest speakers from:
FRAUD! Fool me Twice… SHAME ON ME!
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Please send registration to: Ray Schostak Global Reinsurance Company 480 University Avenue, Suite 1400, Toronto, ON M5G 1V2 RETURN WITH CHEQUE PAYABLE TO: CICMA/CIAA JOINT CONFERENCE
● ● ● ● ●
the ISD/IBC a major Private Investigation Firm a National Insurer a leading Independent Adjusting Firm a well known Law Firm
and more!
CICMA
NAME:____________________________________________________ COMPANY: ________________________________________________ ADDRESS: ________________________________________________ CITY: ___________________________POSTAL CODE: _____________ EMAIL: ___________________________________________________ PHONE: (_____) ____________________________________________ FAX: (_____)_______________________________________________
Please Indicate affiliation: CICMA ❏ CIAA ❏ Other ❏
Winmar-CC_CU-Oct2009:Van-Directory List
9/14/2009
9:59 AM
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