Proactive claims management can curb large verdicts

As ‘nuclear verdicts’ rise, companies should take a proactive approach to risk and claims management, a panel of experts said at the Captive Insurance Companies Association’s 2025 International Conference in Tucson, Arizona.

By tackling incidents before they develop into liability claims and creating company cultures where employees feel comfortable reporting near misses, commercial policyholders can reduce the likelihood of large court awards and settlements, they said.

When disputes do go to trial, earlier efforts to manage the claims process can result in lower payouts.

In many situations, risk managers and claims managers start at a disadvantage when a demand for compensation comes in, said Amy Evans, executive vice-president at claims management company Intercare Holdings.

“By the time you get it, you’re behind the eight ball. The plaintiff’s attorney, the claimant – they all know more about their claim than you do. You may not have even known that the event occurred,” she said.

To try to get ahead of potential claims, Revantage Corporate Services has increased reporting of incidents, including near misses, over the past several years, said Adam Miholic, vice-president, head of captives and procurement, at the Blackstone Inc unit.

The company, which has operations ranging from data centres to affordable housing units, has a claims team that liaises with internal managers, third-party administrators and insurers, he said.

“As soon as we’re made aware of an incident, there’s a report that goes out to our internal team: This is what happened, this is who’s involved, this is what we know, and, based on our experience, here’s what we think could happen in a claim,” Miholic said.

As a result, the company is aware of as much information and data as possible before a claim is submitted, he said.

“Also, because we have a captive, we’re not just an insured on our programmes – we are a participating insurer, so we’re also notifying our carriers,” Miholic said.

Even if incidents do not develop into claims, the process of reporting near misses can help improve risk management and safety when companies use the incidents to identify weaknesses in their organisations and fix them, said Jennifer Kope, director of claims at Beta Healthcare Group, a hospital and health care insurer.

To benefit from the reporting of near misses, organisations should not be punitive but develop a culture where employees feel safe when disclosing the incidents, she said.

“Without that, by the time you get to claims or meeting a defence lawyer, you have employees who don’t trust the system, don’t trust the employer, and then you have to deal with testimony that comes from a disgruntled employee, and everything becomes much worse,” Kope said.

When claims occur, proactive management can help limit final claims payment, Evans said.

For example, in a case where a medical provider performed the wrong surgery, the company paid for the correct surgery, rehabilitation costs, lost wages, a housekeeper and other expenses before the claim was submitted and the case went to trial, she said.

As a result, when the plaintiff’s attorney submitted a large claim, including damages he had calculated, the company was able to say that it had already paid for all the economic damages, Evans said.

“We completely deflated his claim and got it well into six figures, instead of seven and eight figures, on a clear liability case,” she said.

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