Tag Archives: Liability Insurance

Big nasty claims in the casualty sector

On June 12, Advisen held a webinar entitled “Big nasty claims. What are the large loss trends in the casualty sector?” To qualify as big and nasty, the casualty claims stem from injury and/or property damage resulting from incidents such as train derailments, chemical spills and food contamination, frequently involving multiple parties, and costing $100 million or more each.

Advisen’s large loss dataset yielded some interesting insights into trends in this area, and Jim Blinn, Advisen’s moderator, was joined by two Allied World claims experts, James Minniti and Paul DeGiulio.

Advisen’s dataset reveals that pharmaceutical and medicine manufacturing, transportation equipment manufacturing, and machinery and electronics manufacturing are the top three industries involved in large claims, with public administration in fourth place.

Railroad accidents and derailments, a frequent source of large claims, are attractive to the plaintiffs’ bar because the technology is often available to have prevented the accident, but has not been implemented, said the panel.

Concussion litigation, another source of big claims, contains many coverage issues and coverage litigation is happening concurrently with trials. The National College Athletic Association has its first concussion trial this week, and a lot of people will be watching as the organization is expected to be a target for more lawsuits. Concussion injury defendants also include colleges and high schools.

When it comes to predicting which lawsuits may results in large claims, James Minniti said that looking at the plaintiffs’ lawyer’s name is a good bet, “you can be reasonably sure it’s going to be a bad case” if a certain top-notch plaintiffs’ attorney or firm is involved. Paul DeGiulio added that the venue is also important, for lawsuits tried in Philadelphia or Los Angeles the cost could be much higher.

 

 

 

 

Sugar: The Next Tobacco?

Is sugar the next tobacco? Liability insurance experts say it could be.

Excessive, but not always obvious use of sugar (also salt) in food has the potential for systemic loss, a recent Lloyd’s report found.

The potential loss scenario unfolds if excessive levels of sugar are found to be harmful by scientific studies and if courts find food producers and/or the distribution chain liable for resulting damages.

“A societal shift may make the addition of significant amounts of sugar to our food unacceptable, with liability risks affecting food manufacturers (and possibly distributors and retailers).”

A sample footprint in the report (below), starting from sugar beet and cane farming to sugar and confectionary manufacturing and spreading to various other food manufacturers, wholesalers, retailers, and food and drink outlets shows the widespread distribution of sugar and the potential impact on many customers:

“Historical data suggests that the spread would also be amplified by the presence of large corporates with large insurance cover and funds.”

Businesses address their liability concerns through many types of risk management, of which insurance is an important component, according to the Insurance Information Institute.

A Swiss Re study indicated that the United States in 2013 had the largest commercial liability insurance market in the world both in premium volume ($84 billion) and as a percentage of Gross Domestic Product (0.50 percent).

‘Tis The Season…For Lawsuits

In true holiday spirit we just got our kids to the mall to see Santa this week. Its an annual tradition, a visit that helps keep the magic alive in our all-too-knowing six and four-year olds’ minds and more importantly yields the holiday photo that keeps on giving throughout the years.

Every year Santa faces a barrage of questions. This year was no different. Our six year-old started: “Santa, I have a question. How come you know I want a two-wheeled scooter?”

Luckily, the letter from the North Pole had arrived a few days earlier telling him he had made the Nice List and that Santa knew from our elf Chippy just what he was wishing for.

This was confirmed by Santa at the mall who said: “Because you’ve been good and it’s magic.”

But what if the conversation had gone a different way?

Sometimes magic confronts reality and a lawsuit ensues, reminding us what’s at stake for Santa and the mall this Christmas.

Take this post over at Randy Spencer’s Open Mic published in the latest issue of online newsletter Coverage Opinions (edited by attorney Randy Maniloff of White and Williams LLP)

In the post, Court Holds a Mail Santa Liable: Damages Owed For Failure To Deliver A Toy Fire Truck, Randy Spencer – the only stand-up comic to specialize in insurance – tells of a Montana trial court that found a mall and its Santa liable for a child’s emotional injuries after promising a toy that was not left under the tree come Christmas Day.

How much damages did the court award in this case? $95,000.

All of which is a timely reminder that Santa (and the malls that embrace the Christmas spirit) need insurance too.

Which is why the Insurance Information Institute (I.I.I.) urges St. Nick to review his insurance policies to be sure he’s got the right insurance coverage with its Santa’s Insurance Wish List.

And we suggest the I.I.I.’s business insurance checklist would make a great stocking stuffer in this case.

All the best for a happy and safe holiday season!