By David Dickie, The Solutions Group
As the home care business heats up along with the coming of summer, we are seeing more and more situations where home care company owners are not filing insurance claims on a timely basis. This is beginning to create some challenges for some of our policy holders.
In a recent case, the insurance company sent a nice letter that read in part “…there is no coverage for this matter. Your policy requires notification of a theft claim within 120 days of knowledge of an incident. According to the police report, your caregiver was arrested on November 11, 2014 and you were interviewed as part of that process. The claim was filed on March 30, 2016, more than one year later…”.
In another incident, an agency owner experienced the death of a client. There was ongoing correspondence between the agency owner’s attorney and the attorney of the estate of the deceased, but they did not notify us or the insurance company until two years later. During that span, the agency owner submitted applications to our insurance company indicating that there were no claims or incidents that might result in a claim. They only let us know after moving to another broker and insurance company. Not a good situation for anyone involved – the new company did not cover because it was a prior incident and the old company did not cover because the policy had expired.
There would have been coverage for both if there had been timely notification.
Most insurance policies contain language requiring an insured to file a report of a potential claim within a certain time period. The required time frame us usually within 120 days of the event. It is very important to consider carefully any incident that occurs in your agency that might eventually create an insurance claim. If a reasonable person might conclude that there is potential liability, then you should file the claim.
If there is an incident that could potentially result in a claim sometime down the road, document every detail of the event. If a claim unexpectedly arises from an incident, which was not filed at the time, it is helpful to have written documentation for the insurance company. That way the insurance company can’t squirm out of the claim by alleging it should have been filed upon incident.
When to File a Claim
While there can be some situations within the gray area, mostly it is a no-brainer. You absolutely should file a claim in the following circumstances:
- Correspondence from an attorney arrives at your office, even if it is only a request for medical or employment records
- An employee says they were hurt on the job (even if you think they are lying)
- A client alleges theft by a caregiver
- A client is hospitalized due to a fall that occurred while a caregiver was on duty
- A caregiver is in an at-fault car accident while on the job
When in doubt, ask your broker and request that they document the file regarding any decision.
For more information on what you need to know about Liability Insurance and Workers Compensation, download the Free Research Report