Let’s talk insurance: Devil’s in the details

by Mark J. Ram

Have you ever thought that a 10 minute phone call or a mission statement could one day see your company being sued for $20-$30 million?

That’s what could happen when lawyers build cases against Canadian carriers involved in accidents while hauling in the U.S.

Big motivation for big payouts

The U.S. is a litigator’s wonderland. Lawyers suing trucking companies can expect to get between 30-40 per cent of a multi-million dollar payout in contingency fees – a handsome payday.

And trends show that the number of multi-million dollar lawsuits is rising.

Canadian truckers are particularly attractive targets. Canadian truckers often have higher insurance policy limits than their American counterparts, which mean U.S. lawyers know they can earn a lot more when suing you. Also, as there’s no ceiling for personal injury awards (compensation for pain and suffering) in the U.S. (it’s capped at $300,000 in Canada), the lawsuits against you can be enormous.

That’s incredible motivation for U.S. lawyers. Not surprisingly, these lawyers will use whatever edge they can to make a carrier pay in court. Here are just a few examples of some of the tactics we’ve seen:

Cell phone bills?

In a trucking lawsuit, a plaintiff lawyer will likely try to implicate the carrier as the “at-fault” party. How can cell phone records help a lawyer?

Suppose that a fatigued Canadian trucker crashes into a passenger vehicle while hauling in the U.S. at night, killing the car’s lone occupant. The case goes to court, and the lawyer will make whatever points he or she can to show the jury why your trucking company should be made to pay.

A lawyer will subpoena logbook records to establish when the trucker says he was driving and at rest in an attempt to show that fatigue was a major factor in the accident. What if the driver received a call from his wife and talked to her for 10 minutes during the time he’s supposed to have been resting? What if he received a few more calls during this time?

By correlating the driver’s cell phone records against his logbook entries, a lawyer can make a case that the driver could not have possibly had sufficient rest to drive safely. What’s worse, the lawyer could also argue that the driver falsified his logbook since he was obviously not at rest when he said he was.

Your speed governor?

It’s surprising how a truck’s speed governor can form part of a plaintiff argument – even if speed never factored into the accident!

A lawyer’s investigation of an accident may discover that the truck’s speed governor was set at an arguably high rate, perhaps 10 or more miles per hour above the highest speed limit on that driver’s route.

When combined with other evidence the lawyer may present (such as poor safety ratings, company-wide speed offences and hours of service violations), the speed governor setting can become a damaging piece of evidence – even if speed wasn’t a factor in the accident. It can be argued that the accident was the inevitable conclusion to a pattern of misconduct, a disaster waiting to happen.

Your company’s mission statement?

You’ve read mission statements before – promises to be the best carrier for your shippers and deliver top-tier service and safety. Think this is just flowery language no one ever reads? Think again.

Plaintiff lawyers like to present a carrier’s mission statement after establishing a carrier’s fault in an accident.

The mission statement serves as the cherry-on-top. The lawyer will attempt to demonstrate that while the carrier says it’s committed to safety, the carrier is really only focused on profit as its practices show it doesn’t live up to its safety promise.

After all of the evidence is laid bare implicating a carrier in the death of an innocent person, what can be more damning than reading the carrier’s mission statement filled with commitments to safety?

The little things

Innocuous as they may seem, small things – like cell phone records, speed settings and mission statements – can do a lot of damage in a trucking lawsuit. These are just three of the many approaches a lawyer can take to show a carrier should be made to pay dearly for an accident.

Like a forensic investigator on TV dramas, where a strand of hair is enough to make a conviction, plaintiff lawyers will do what it takes to get the biggest payout possible. After all, they certainly have the motivation.If more carriers knew how lawsuits are argued and how evidence is used against them, truckers may be motivated to pay closer attention to the smaller things. The devil might just be lurking in the details.

– Mark J. Ram is president and CEO of Markel Insurance Company of Canada. Please send your questions, feedback and commentary about this column to letstalk@markel.ca. For more information about Markel visit www.markel.ca.

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