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HomeMy WebLinkAboutR-75-0623arm g 7/11/75 A.S6 RESOLUTION No, 7522 A RESOLUTION RAT/1Y11 O AND CONFIRMING THE ACTION OF THE C1T MANAGER 1N EXECUTING THE CONTRACT WITH MR. PAUL WEER TO PERFORM PROPESS1Of AL SERVICES AS A CLAIMS SUPERVISOR POR A PER/OD OP ONE MONTH EE01NNINO ON THE 30th DAY Off' JUNE, 1975 AND TERMINATING ON THE 31st DAY OF JULY, 19751 COMPENSATION FOR SUCH SERVICES IN THE AMOUNT OF $1, 450.00 TO RE DISBURSED FROM LAW DEPARTMENT SALARY FUND WHEREAS, the City of Miami is contemplating a self-insurance program; and WHEREAS, the services of a claims supervisor are required in order to evaluate the existing system of investigation and adjust- ment of claims involving City property, such evaluation to be conducted in cooperation with the Departments of Law and Police; and WHEREAS, Mr. Paul Weber is qualified for this position and is willing to perform these services for the City of Miami NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. The action of the City Manager in executing the contract with Mr. Paul Weber to perform professional services as a Claims Supervisor for a period of one month beginning on the 30th day of June, 1975 and terminating on the 31st day of July, 1975, is hereby ratified and confirmed. Section 2. Compensation for the services of Claims Super- visor in the amount of $1,450,00 are to be disbursed from the "DOCUMENT INDEX ITEM NO. 7 // &TY COMMISSION MEETING Or JUL 171975 naokimom so 96 - G -23 Law Dapartl e t §ala y fttht s PASgED AND ADOPT f this PREP " ED AND APPROVED BY: George F. ox, Jr. Assistant ity Attorney day of juju Mauriet A. Terre M A y Attest: H. D. Southern APPROVED AS TO FORM AND CORRECTNESS: edriffsekn'S. Lloyd City Attorney CITY CLERtt Sys auk. eller This is completed in the degree deemed necessary for eadh type accident of accident situation. The serious accident such as a fatality receives a thorough investigation to include the traffic report, scene photos, diagram measurements, transcribed statements of those involved to include witnesses, medical examiners reports, reports concerning alcohol content in the blood and notes of the special accident investigator. On City vehicles, the drivers report and supervisors report are needed. The extent of investigative work -up diminishes in a reasonable manner in accordance with the seriousness of each accident. The basic items as to City vehicles are the standard Florida Highway Patrol traffic accident report, driver's report and super- visor's report. These items are used for any departmental review board, along with the City operators driving record. The Police Department Review Board is interested in the frequency and type of accident, so as to determine preventability. Just punishment is set out in each matter. Driving problem areas can be discovered for future correction. The basic three (3) items are completed on each accident. Dollar amount is of no concern in determining preventability on a City vehicle accident. Although by state statute, accidents of less than $100 property damage need not be reported, when a report is called in, it is given the proper work -up, whether it is a City or private vehicle. This procedure is a savings in time as to private vehicles due to the late reporting procedure under the state statute Along this line, there is an income to be gained from the sale of accident reports. The amount cannot be determined by the number as related to the property damage dollar amount, for either class of vehicle. There would be a potential sale of reports 215 of the 310 City Police vehicle accidents for 1974. Those involving the strik- ing of a parked vehicle numbered 33 and could possibly be added. A dollar amount could be $645 as a low if one (1) report is sold for each of 215 accidents. Striking of fixed objects is also a potential source of revenue from Police report sale. They number 62 for 1974. Presently, waste of time and money does not appear evident. It appears with 324 vehicles and 310 accidents during 1974 in the Police Department that a thorough driving course should be part of the Police Academy curriculum. This could be included in a pursuit driving course. Awareness of safety toward reduction of accidents is a mustwhether a self insurance program is maintained or fleet coverage is continued thru a carrier, gt An Otter all drivers instriacti. na : prOgraM it it t rder to re evaluate all i ivo ved ih bpbtatibt of City Vehicles.. A Meeting including Major Stith, Capt. Wilson and Special Investigator Si.atkowski was held concerning availability of Police Accident Reports tt was agreed that copies of accident reports for all accidents involving City vehicles would be ttlade available for review by the adjuster on a daily basis. This would be delivered to the Law De- partment, for the previous 24 hour period, by 9 30 AM daily. If a report has a .potential error, the area of concern will be circled in red. A final approved copy will follow as soon as possible. The basic investigation completed is sufficient and necessary for the purpose of preliminary decisions as to future claims handling. In reference to the flash report, as pertains to the self insurance system and also to gain the necessary early access to circumstances involving serious accidents, a liason officer should be appointed. This should probably be one of the Special.Accident Investigators. Arrangements should be made to include the adjuster's presence at specific accident scenes involving City vehicles and bodily injury to occupants of other vehicles or pedestrians. When necessary access to the full Police Investigative File, it will be obtained thru Special Accident Investigator Siatkowski. It should be noted that if the recently designed Vehicular Loss Control Program is adopted, the departmental review boards would be abolished. This function will pass on to the safety director for proper administration. If the self insurance program is to become operational, Major Smith will be notified A.S.A.P. after 7/17/75. We should set up a system with the Chief of Police. POTENTIAL NUMBER OF CLAIMS FOR INVESTIGATION & HANDLING The statistics of Hartford Insurance Group indicate total claims handled from 6/19/74 to 5/29/75 at 383 including bodily injury and property damage claims. With 310 accidents noted to exist with Police Department vehicles it appears that the number of total accidents involving all city Departments could be greater in number than those for which claims were handled by the carrier, considering the existence of comparative negligence. A discussion with the Public Property Accountant Bill Harnick reveals the property damage to City vehicles other than normal wear and tear, amounted to approximately $65,000 for the past year. The bulk of this was damage repair to Police Department vehicles, The total number of accidents were not available. Statistics concerning other departments as to number and amounts were not available. Page 0) tvAt referred to another Section for &monthly bbtd1 partmtnt to cover the tame one (1) year time period. Mildred at ektention 5561 is to provide this group of figures. Mention MA8 made to the fact that the motor pool vehicles numbered 600, with another 500 trucks. There is no readily available data to pinpoint actual claim atatus. As an estimate it it apparent that the number of City vthicle accidents requiring 80M0 investigation would probably double the 206 property damage claims paid in 1974d1975, or 412 accidents. Review of the Police Accident Report t on all City vehicles would determine prOper.activity on each potential claim, PROPERTY DAMAGE_ OR BODILY_IN3URY CLAIMS_STATISTICS The statistical run available concerns 6/19/74 to 2/3/75 and indicates a total of 85 files which include claims from 131 sources. The eight (8) month period would average 10.6 files per month. This does not agree with the total count on the statistical run. A call has been placed to Hartford's local office to attempt to clarify the figures. Average cost for bodily injury was $1534 low $74, high $4000. Property damage average $319.95, low $26.00 and high $2000. Along the line of number of claims, a reserving system will have to be included in the program, so as to keep track of the dollar amount anticipated from potential claims. There is always the chance of the serious accident which must be considered, not only for reserving, but for ultimate payment. MONTHLY REPORT A monthly report of claim activity, will be submitted to include claims recived thru the last work day of each month. Content will include the number of accident reports involving city vehicles reviewed (breakdown by Department) the number of new claim files opened, the number of claims settled in the property damage and bodily injury areas and a breakdown as to amount paid for each. The pending file case load will be included. Transfer of a file for de- fense of a lawsuit will also be noted so as to have a suit count. AUTHORITY TO SETTLE CLAIMS It is suggested that the City Attorney be given settlement authority up to $1000 per claim. The ready availability of authority to settle claims rapidly will save money over the long run. It is an old proven fact that the older a claim is the more it costs to settle. Prompt, personal attention is a known money saving device, Page t4) Along this life, 'on clear cases + E liability, the property damage should be paid as soon as possib1.e, taking into eo to :def`ati supplemental damage discovered after ah ifiit al estiriate. In many instantee this will atop bodily injury Cla.itc s from developing.. Consideration to a loss of use claim should be given where actually necessary. It must be closely controlled to avoid a run away emperise. A specific rental agreement can be arranged with one Or more automobile rental agencies. All requests for authority should be by recommendation supported by proper material such as estimates, appraisals, rental bills, medical reports, medical bills, drug bills, and lost time and wage material. The adjuster should be provided with authority, on a per claim basis. If used, supporting material for review by the City a limited amount Of the file will contain Attorney. INITIAL LOSS HANDLING The primary reason for response to an accident scene is fast, fair, efficient claim handling. Rapid referral of accident reporting is a necessity. It will aid in completing additional investigation deemed necessary to determine a liability position. Rapid identification of claimants will aid in control which if maintained throughout the claim life can result in a dollar savings. Non -injury statements at the accident scene can stop many further allegations of a further bodily injury claim. Activity to be coordinated with A.I.U. Minor settlements, to include property damage and bodily injury, not of the nuisance type, could be made at the scene or early in the life of the claim in required instances. Many accidents of a minor nature will involve property damage only, however,' bodily injury claims do develop from any type accident. PROPERTY DAMAGE There are several methods of handling property damage, the simple way on minor items being thru the use of two (2) estimates by garages of the claimant's choice. Each must be checked against the vehicle for being proper for payment to include overlap, only used when proper, and parts discount. Greater damage should be established thru a professional appraisal service. This is also much more acceptable for any court appearance required to support a specific dollar amount, The use of an appraser can eliminate the need for this department's purchasing all of the assorted property damage material required to reach a proper repair figure. It willalso save on the constant up -dating of all material., such as reaching the value of a total loss. Page ) Estimates for damage to building structures and other property dart be handled by outtide cohtractora. Thig thould be minimal aa far as the actual number of claimreceived. A .ule of tervito feea and general information hag beeft Obtained from Auto Appraisal Service for review. initially, this would be lest expensive to utilize Where required, rather then employ an additional adjuster. too.ILY XNVAV teing a self insurot, brings about the tecetsity of be- longing to the index system. The directory of subscribers indicates that the coordinator of tmployee SerVices is a meMber. TherefOre, it may be possible for the self insurance program to gain usage of this service without additional expense. This will be researched at this time, via correspondence with the Index System. The Index System is operated by the American insurance Association on a non-profit basis. It accumulates third party personal injury claim records to provide an information source for subscribers. This is helpful to determine a claimant's accident history as concerns any relation- ship of the present injury allegation. We will require a complete work -up of all material pertaining to each bodily injury claimant so as to evaluate a claim, taking into consideration all justified special and general. damages. This includes gathering, verification, evaluating and any handling of pre-trial work involving an injury claim. The normal manner of settlement is one lump sum, extinguish - any and all claims. However, recently there has been a trend toward a payment in advance system on clear liability cases so as to control specific claimant's special damages. Any amount paid in advance is used as a set off toward the final settlement. The activity of no fault insurance in Florida, must be con- sidered previous to any payment in advance being offered. All settlement will be handled within the Law Department's authority when ever possible. If claim value is in excess of this authority, a resolution will be prepared to go thru proper channels. As a side issue, over the years it has been found that the nature of claims is closely associated with the law. This is expecially true as concerns motor vehicle insurance. • One of the reasons being that claims are in most instances handled and negotiated with plaintiff attorneys. They are generally informed in their specialty, whether it concerns statute law or case law. Law in these areas tends to change rapidly in this state. As it does, legal research is required so as to determine the proper channel to follow. Page '0) Attorneys are in a position to diteuss and work but legal problem areas in c1.a : i handing much t t re rapidly than persortnel Of any other Department. oite specific areas that do develop requiring legal con§ul- tat:on :are in the field of torts and the dodtrines involved, all laws involving tttotbi vehicles, law Of evidence as applied to proper investigative work up and claims evaluation. Settlement tiegoti&tiof mid termination is normally not a problem, etcept in special: situations requiring a court approval. Last but not least some claims do go to trial, requiring clOee cooperation 'between claimstnan and attorney. One does complement the other for a Successful operation which in many instances allows a savings in claims dollars: • MAN_�tOW R, REWIRRMRN 'S Initially, it is suggested that one supervisor adjuster be utilized to handle the claim work load. If a seven (7) day - 24 hour service is required, one working supervisor and three (3) adjusters would be a minimum to make the program function. A provision must be included an independent adjusting firm on a be used for basic investigation on control quality and also hold down under the early stages to use very limited basis. It would specific items only, so as to outside expense. No shotgun liability investigation is to go to an independent. This should hold down outside expense. A request has been made to the local office of Crawford & Company, so as to obtain a resume of their available services and charges. This Company is deeply involved in the handling of bodily injury and property damage claims having some 79 adjusters available in Dade County. Past experience dictates billing expense over $100.00 for basic investigation. Retention of a file throughout its complete life can be very expensive, due to the frequent reporting, normal outside activity, obtaining special damages of claimants, negotiating of claims, etc. Expense can easily reach the $500 to $1000.00 range, on each claim. • So as to make the program a monetary success, the use of personnel under the direct control of the City, in as many claim files as possible is required. Outside help must be used only when actually necessary. A Claims Secretary will be required to handle the clerical functions, such as file set up, transcription of dictation, clerical processing of file material. With the passing of a short period, some lawsuits will generate requiring a defense attorney being assigned. A Legal Secretary will be required in this area to assist the claims attorney. Page (7) initially, the supervisor adjustor will require basic office equipment, iment, two (2) desks, two (2) file cabinets, a dictating machine. The 24 hour availability of an automobile is required due to the untimely hours of accidents as well as the contact of people involved in the claims. It may be of benefit that the vehicle be telephone equipped, so as to provide rapid re- sponse to the scene of an accident of the scope requiring immediate action. Forms will be required such as releases of the proper type, claim drafts, lost time and wage authorizations, medical authorizations and miscellaneous forms for reporting. The adjuster should also be a notary public so as to allow taking of sworn statements. PAUL WEBER Adjuster