HomeMy WebLinkAboutIR 7122 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7122
000'rift,
`a ok? To the Mayor and Members of the City Council June 3, 1986
'Subject: OVERVIEW OF RISK MANAGEMENT DIVISION
AND CITY CASUALTY CLAIMS PROCESS
The City of Fort Worth is self-insured, and many factors must be weighed when
making risk management decisions, including the important one of economics.
Each year the City budgets and sets aside funds for the payment of claims and
lawsuits and their related expenses. The proposed budget for FY 1986-87 is
$1 ,914 , 000. The amount budgeted for FY 85-86 is $874 , 910. FY 84-85
expenditures totaled $1,273,305.
In addition to investigating and resolving casualty claims, the staff of the
Claims Office in the Risk Management Division also devotes a significant amount
of time to loss control efforts. Over the past few months, the City's Claims
Adjuster has presented approximately 40 safety meetings for various departments .
She currently is presenting a two-hour class on legal responsibilities to the
Fire Department. Sessions are scheduled each week for four months.
Another important risk management tool includes the collection and analysis of
loss history. The City's claim record for the past twelve months includes:
Number of claims presented: 780 (Average of 15 new claims per week)
Number of claims denied: 110
Number of claims referred elsewhere: 50
Number of claims closed (no interest): 23
Number of claims paid and closed: 216
*Total accumulated figure expended to settle these claims: $142,400
*Average figure expended per claim: $660
Number of claims pending: 380
Amount recovered in subrogation: $210,000
Number of subrogation claims pending: 135
*A copy of that outline is attached, example #6.
*Draper/Jarrett claim excluded from averages; settlement was $366,465
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
Informal Report
Continued Page 2
Op, overview of Risk Management Division
and City Casualty Claims Process
The steps involved in resolving a casualty claim filed against the City are
outlined below:
I. Claimant phones with complaint
A. Listen sympathetically, explain our claims process, and instruct
claimant regarding estimates, etc.
B. Refer claimant to own insurance carrier, when,appropriate, and explain
subrogation - for purposes of expediting recovery.
C. Send claimant a blank Notice of Claim form. (Example attached, #1)
II. Claimant sends properly executed Notice of Claim (NOC) form to City
Secretary
A. City Secretary reduces each claim to paragraph form to submit with all
others received to City Council, weekly. (Example attached, #2)
B. City Secretary sends acknowledgment form letter to claimant. (Example
attached, #3)
C. City Secretary sends entire batch of new claims to us.
1. Usually receive this batch within three weeks of original receipt
date.
III. Liability investigation begins
A. Log and record each new claim and set up claim file.
B. Send an interim form letter beneficial to all parties concerned.
(Example attached, #4)
C. Send memo to appropriate department(s) outlining investigation
necessary; requesting a reply within two weeks.
D. Receive our reply from department(s).
1. Determine an appropriate plan of action or initiate subsequent
investigation necessary.
a. A complete investigation can require anywhere from a few
days to months to complete. Normal time is approximately
four weeks. L
b. Investigating and evaluating a claim includes many factors;
i.e. ,
1. Research applicable City ordinances
2. Research applicable statutes/immunities/defenses
3. Research applicable case law
4. Review medical specials and/or property damage estimates
5. Meet with various parties in person
6. Examine scene or site
7. Evaluate our liability and dollar exposure and
settlement possibilities/economics
8. Evaluate distribution of liability/contributory
negligence
9. Consider all; including public opinion and precedent set
10. Determine action plan of settlement negotiation or
tactics
Informal Report
Continued, Page 3
op" Overview of Risk Management Division
and City Casualty Claims Process
C. "Special" claims are brought to Committee Claims/Case review
(form example attached, #5)
1. This review is held monthly to discuss special cases and
claims, (usually four claims and six lawsuits) . Parties
present include Risk Management and Legal staff.
E. Claim is Resolved.
1. Denial
2. Refer to appropriate source
3. Settle with accord and satisfaction
a. All claims in excess of 5,000 require approval of Mayor and
City Council.
b. Send Full and Final Release of Any and All Claims to
claimant for proper execution and return for consideration.
C. Upon receipt of same, we request requisition for payment
d. Requisition goes to Accounting; usually takes three weeks
for check,to be sent to claimant or returned to adjuster or
our attorney for disbursement
Some claims require and receive immediate handling. We attempt to identify
potential problem claims and treat them accordingly.
The Risk Management staff, with assistance from the Department of Law, has
prepared a comprehensive briefing on the history and current status of this City
activity and a discussion item on this subject is scheduled on the June 3 Work
Session agenda.
The staff will be prepared to provide additional information and respond to any
questions you may have at that time.
X
DOUGLAS HARMAN
CITY MANAGER
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