One of the more complex liability adjusting components of Workers Comp claims is subrogation.
Subrogation rears its ugly head (or the lack thereof) on a large percentage of Workers Compensation files. The percentage referred to is the lack of knowledge by WC adjusters on identifying and pursuing subrogation. Subrogation is basically placing the liability of the risk on a third party.
There are many subrogation articles in this blog. The reason is that many carriers and TPA’s just do not fully train their adjusters on the nuances of liability adjusting other than WC. Carriers and especially TPA’s can become very single-minded in the handling of WC claims. This is not an indictment of any single carrier of TPA. The problem is more systemic in nature.
A very good subrogation attorney published an article recently in the Insurance Journal. One of the internal links provided a great summary of subrogation laws. When one steps outside the comfort of WC liability, the process can become much more complicated.
One of the better subrogation websites included a national map of the various subrogation laws in every state dealing with whether the state is a:
- Contributory negligence state (bars recovery with only 1% of fault by the plaintiff) or
- Comparative negligence state (recovery by plaintiff is reduced or prohibited based on the percentage of fault attributed to the plaintiff), and
- Pure comparative or modified comparative state.
Kudos to the author Attorney Gary Wickert as it is one of those articles you should keep handy. An accident may occur in other states than just the one where the WC file will be handled. The list is not exhaustive, but well worth the read.
The reason for this article is sometimes the WC adjuster can write one letter and receive a subrogation recovery. The key is to make sure the adjuster handling the liability file (auto, premises, general liability, etc.) is put on timely notice. A letter by certified return receipt mail has been used as legal proof of a timely subrogation notice. It is the best $5 an adjuster can spend to preserve the right to recover.
Liability adjusting on WC files is a training issue that needs to be addressed to recover funds that carriers and TPAs sometimes leave on the table.
Article provided by James J Moore, AIC, MBA, ChFC, ARM. All articles are original content. Check out the full website at www.cutcompcosts.com.