Frequently, claims managers, supervisors, adjusters or attorneyspicked up a new claims file and question why a claimant acted in acertain manner. When working a claim, it is generally taken at facevalue. The facts are as they are in the file, unless some surprisesturn up later.

When investigations proceed, things may be found to differ fromtheir initial appearance, or new material may surface. Whenaccident and loss reports are initially made, the forms may beincomplete with respect to details, but that is not uncommon.

Whether a particular claim appears to be legitimate is answeredbased upon the facts. Too often, one may see the fraudulent set upof a faked accident, auto or otherwise, and usually if something istoo obvious, it is handled early on in the process. Many timesthere may be questions surrounding an occurrence, but not anobvious fraud. Further investigation may identify questionableissues, however, there is an assumption that a claim presented isindeed legitimate.

From the perspective of handling claims, considering what mightoccur to cause problems for the insured should be a priority,though often it is not. Once a policy is secured by the insured, itmay be filed away and little thought given to the actual coverageinvolved. How frequently do most insureds really read and examine apolicy? Only when a problem arises is the carrier consulted.Perhaps the fault is not entirely the insured's and the industryneeds to do more about emphasizing the value of thinking ahead inan effort to prevent problems.

Large businesses may have the ability to do this in-house, butfew think about it. The easy answer is to let the insurance companyworry about any claims. However, that thinking may change atrenewal time.

While it is probably fair to say that most businesses attempt toprevent accidents and other potential causes of loss and liability,the degree of effort involved varies. The legal duty of a businessopen to the public is to use reasonable care to maintain thebusiness premises in a safe condition. But to what extent are stepstaken to insure this? Is the need emphasized to employees? Doesmanagement follow up? Some forethought may become extremelyvaluable in the event a future claim is made based upon a failureof such duty. While it is not possible to prevent all adverseincidents from occurring, being able to show prior reasonable carecan greatly impact liability.

A while back, this author happened to be looking through themen's clothing section of a large discount retailer when he noticedan empty hanger lying on the floor, partly under the display rack.After picking it up and placing the hanger back on the rack, hewondered how long that hanger might have been on the floor. Had anemployee noticed it and simply failed to pick it up? How much didmanagement press upon employees on the sales floor to actively lookfor things similar to this and take corrective action?

Pressing the need to take affirmative steps to correct potentialhazards should be frequently emphasized to the store associates,and the liability to the store for not doing so. While retailersoften have periodic sweep schedules, employees should also beencouraged to keep their eyes open for hazards. Keeping thebusiness open and minimizing its liability affects all concerned.While it is easy to state that a periodic sweep schedule is policy,it is much better to have the records confirming it. Should amatter go to trial, the judge or jury decides liability based onthe evidence presented. Carefully kept records of sweep schedulesmay be extremely valuable.

The author was also involved in the defense of a liability claimagainst a major retailer. The claim resulted from a customerslipping and falling, sustaining claimed injury, on the storepremises. What allegedly caused that slip and fall? A clothinghanger lying on the sales floor.

While a business cannot simply post an individual to constantlywatch an area to the exclusion of all else, it can certainlyhighlight the importance of paying attention to problems. Majoremphasis on inspection while involved in other duties is alwaysgood; look for possible problems while pursuing one's regularduties. If a problem appears, correct it or call for assistance todo so. Losses for the employer affect the employees, as theyincrease operating costs such as insurance premiums and if takentoo far, may cause a shut down.

Suppose that a problem has been discovered, but no appreciableaction was taken to rectify it? Consider guests staying in a hotelwith valuable property in their room. The lock on the sliding glassdoor is found to be broken and is reported, but no immediate actionis taken by the hotel to repair the problem. Subsequently, when theguests leave to go out, the room is entered by a thief thru theunlocked glass sliding door and property is stolen. The guests thenmake a claim against the hotel for the value of the property.

Most likely the hotel should have taken action upon beingnotified of the problem. In such a scenario there are multiple waysthe door may have been secured. Many hardware stores have simpledevices available to attach to tracks to prevent the door fromopening until the lock could be repaired. Even a suitable length ofwood or a pipe in the track could prevent the door from slidingopen.

In a situation like this there are a few other considerations.For example, many states have statutes attempting to limit ahotel's liability for loss or theft of property from rooms andrequire notice if safes are available. This can definitely affectoutcome. But, suppose it was not loss of property, but rather anintruder who caused personal injury to the occupants. Potentially avery serious matter, especially if little action was taken or theguests were not relocated to another room. Liability could begreat.

Preventing any and all problems is simply not possible, butadjusters and risk managers can encourage clients to think and actin advance. Creating a proactive mindset may help to reduceliability, if not eliminate it.