Dear Insurancegal, The McDonalds coffee incident was by no means a frivolous suit. The coffee was at 190 degrees F and there were over 700 documented complaints about the coffee being too hot (at that temp it burns and destroys human flesh). The claimant offered to settle out of court for $20,000 and the defense attorneys said “no deal” so it went to trial, huge punitive damages were awarded, case was appealed, and was finally settled for an undisclosed six figure amount. Interested in the facts? Email me at darnovak@msn.com and I will FAX or email you a copy of a recent article in a professional insurance publication. Stop repeating garbage you read in the enquirer or star or overheard at the local coffee shop.
Please help me to understand this, unless the article is missing some information. This just doesn’t make sense a company is in business and doesn’t realize that they need to carry workers compensation for their employees. Granted the agent should have done a better job of documenting, a court wants us to believe that an employer is that stupid. Come on you have got to be kidding right?
The Accounting firm never saw a WC premium entry? never did an Audit? The local town never issued a office inspection or permit for the business to even operate and didn’t get a copy of the WC policy? Just how long has business been around and how many agents have they previously dealt with over the years? Commercial AUTO and Group Health ASK for the WC information! SOunds like scammers to me !
What is said between the parties, what is heard between the parties, probably should be documented by “camera” mounted by the a/c registers in every office. Or, on the walls of cubicles. Also in the entry ways, as employees and clients enter and leave. Sometimes we forget to come back and doc our management systems. Or, write on the activity sheets on the left side of the folders. It’s the nature of the business. However, as Truman said, “if you can’t take the heat, ……”. We’re being asked to become Robots, I guess. We’re way past 1984! Yet, I’m reminded of it everytime I stop for a Red Light. It has helped London. Cannot have a cop in every street corner or a Quality Assurance Person in every insurance agency, or can we? Missteps cost plenty “Mucho Dinero”. Gotta live with the Eye-in-the-Sky.
Doesn’t the state have any cheks and balances to control the rights of workers? In NY the Worker’s Comp board tracks all employers by their NY State unemployment number which ALL business are required to obtain. If they do not get verification of W.C. & disability coverage you get a lovely invitation to send them bucks. I’ve seen fines go as high as 20,000 for failure to maintain continuous coverage.
Why should the insurance agent be held responsible if someone didn’t get insurance. Is it up to the insurance agent to tell insureds what they need? There are all sorts of reasons here why the business should have been held totally at fault. Worker’s comp is one of the required coverages and they didn’t know that they didn’t have the coverage. Come on folks – guess California doesn’t treat its businesses as adults – need to have their hands held by everyone else. What a bunch of hooey…
Ahh welcome to the wonderful world of CA law. It matters not how obvious something is unless it is in writing (and sometimes not even that works) we award stupidity.
Can I remind everyone of the McDonalds claim where a woman burned herself on a hot cup of coffee but was then awarded a ridiculous amount of money because the cup didnt have “Caution Hot” in writing on it?
Our agency suffered a claim where one of our UW’s had clearly in writing put “we can not cover this exposure, there is no coverage in force” and the insured later suffered a loss and claimed they had taken that to mean that there was coverage…our E&O paid out $200k on that claim. In CA the party that can afford the loss is the one that pays for it.
I guess the moral of the story is don’t write business for any firm in Calif. unless they carry the Cadillac policy on everything. If they decline, or reduce coverage on anything; RUN! Otherwise you and your E&O carrier will be covering it. No wonder insurance costs so much in Cal.
Risk M, very good point, the problem clients who want to save every penny are not worth it. We need to send a strong messaage to these clients that the insurance agencies do now want them. That will funnel down to the most desperate, inexerienced and unethical agents. They would deserve each other!
Think I would have told the insured to go elsewhere, knowing they intended to break the law by not carrying workers’ compensation. Sounds like a Giant Red Flag
to me!!!
Ray: Why should the insurance agent be held responsible if someone didn’t get insurance. Why is that? As a consumer, and wife of permanent disabled employee, the boss did what he was to do. It’s just that HE WAS LIED TO by the PEO.
I would THINK it is the Insurance Agent/Broker/PEO’s duty to advise, and/or provide information re: WC. fault that the company they provide insurance to did not have WC Insurance. Think about it. For God sakes, it’s common knowledge (especially someone in the trucking business) that they needed WC. Do you think maybe this is just another company who rips off it’s clients and doesn’t forward monies to the WC Insurance Company? Yes, i would think that is is the agent’s fiduciary duty to advise them that they also need WC. We don’t have the full story here and I’ll bet it’s a dirty ins. company. I don’t think EMPLOYERS are as stupid as one might think. It’s the law. That’s it. So, I can tell you little stories about a lot of small business owners that were never advised that the monies that were taken right out of the employer’s business account, went right into their pockets I.E. CERTIFIED H.R. SERVICES. I’m certain you know of them. Well every week for years thjey would directly withdraw from their client and PAY WHO THEY ARE REQUIRED TO PAY. They of course did not and we are suffering because of it. $37,000 in 3 years in WC checks? gimmmie a break!! They are all finally under indictment, some already plead or already in jail, etc. BUT THE STATE OF PA MADE CERTAIN THAT THEY GOT THEIR 1 OR 3 MILLION IN state tax money that the AGENT/PEO never forwarded. As for the employer – he had no idea, NOTHING and no clue that there was no coverage. My husband, the client’s son and I are screwed for the rest of our lives because the boss did what he has done for years: Allow direct withdrawal for payroll, state tax, and WC. The PEO didn’t pay anyone – nothing. No WC checks, no medicals, nothing. Now we are left with med bills totalling over $500,000? The client (my father-in-law) paid his dues to the PEO/AGENT EVERY SINGLE WEEK. Then son gets injured (permanent RSD and subsequent brain surgery caused by the trauma of the wc injury)and we find out that there’s no coverage? I think that insurance companies have ruined our country. Destroying it completely. Think about it: Another employee was killed while driving his truck – heart attack at the wheel first day. Wife and 2 small children at home. He was 42 yrs old. Wife and children GOT NOTHING!!!!!!!!!!!!!
Why? because of the insurance company
It’s a disgrace that agents and the WC industry nationwide
Worker’s comp is one of the required coverages and they didn’t know that they didn’t have the coverage. Come on folks – guess California doesn’t treat its businesses as adults – need to have their hands held by everyone else. What a bunch of hooey
Well, the DOI will now come up with a written waiver for any commercial coverages not being purchased by the insured at the time any other commercial coverages are placed. If I write the health coverage, should I be liable for the employer’s failure to purchase P&C coverage for his business? The State of CA. failed to verify W.C. via the State Franchise Tax Board NOT HHR. The producer is not required to obtain a written waiver to exclude writing any coverage for a business as they are an educated buyer. The individual insurance buyer is so stupid, they must sign stating they do not want UM/UMPD. Appeal this to any court with a brain and provide the thousands of files whereby a CA. business chose to NOT purchase any other truly optional insurance coverage? When does this crap stop?
Kathy your story is a sad one but a bit misguided. 1st it is easy for you to claim that the business owner did everything they should have…..but what kind of business owner doesn’t question never receiving a policy. For example if you bought auto insurance but never received ID cards would you just have faith that you were covered? I think not.
2nd blaming the fall of America on insurance agents is a brave statement. In every profession there are a few bad apples but I don’t hear you blaming priests because some molest children or doctors who kill patients because they are not licensed or using expired products or construction workers who cut corners to save cost but then have houses collapse and kill people. Careful with your generalizations they are very dangerous.
3rd don’t blame the insurance company. It is the AGENT who is at fault, know that an insurance agent does not write a policy, it is written on a companies paper, if the company never gets the applications or issues the policy you can hardly blame them.
Seriously you have a client with employees who against advice doesn’t purchase work comp and you still do business with them? Isn’t that a red flag that the customer is perhaps ethically challenged at best or confused at least? Do you need the commisssion that bad to keep them as a client? Guess the answer here was a resounding NO.
Insurancegal’s post did not say it was a frivolous suit, just that the amount of $$ was ridiculous. Courts continue to show a lack of common sense in awards and allowing suits to go forward. The McDonald’s suit was about a supposed lack of “Hot Liquid” warning on a cup. What a crock! I suppose if she got a cold lap from a soda spill, she would have claimed a lack of “Cold Liquid” warning on that cup too! It doesn’t take a lot of common sense to negotiate the world, but these people try to raise being a dufus to a higher level & we all get to pay for it.
The pltf in the Mcdonalds case was way up in her years and wore heavy wool clothing. The liquid went trhou 3 layers of woolen clothing. The coffee was red hot. 3rd degree burns.
My personal opinion is that the verdict is correct. HRH is not a small time podunk agency. They’re nationwide and handle small/mid-sized business.
Each year that the renewal of the client’s coverage comes up, the agent should have addressed the lack of workers compensation…THEN, follow up in writing and have the client sign and confirm that they acknowledge they do not have workers’ compensation.
Having worked in the business (both in California and Texas) for over 20 years, this is a common sense move that would have protected the agency’s ASSets.
Is it excessive – maybe. But the information we don’t have is all of the details that came out at trial. All we have is a summation. There may have been information that came out at trial that showed the agency had truly dropped the ball on this one.
Insurancegal may not have said the mcdonalds coffee case/lawsuit was frivolous but i will. the pltf was stupid and we should not reward people for their stupid behavior. the case should have been thrown out of the case due to the pltfs entitlement attitude and the belief in no personal responsibility. sorry for being off topic.
Steve. Bet you wear a Kaiser Hat. As a result MacDonalds does not fill the cup all the way up and gotta wait a bit before drinking it. It’s still molten.
Do you know how many times I have burned my tongue on my mother’s good food? I have yet to sue her. But coffee drinker, if you will be my lawyer, I will do it. Because that is just irresponsible of her to serve food (that is expected to be piping hot) piping hot.
And then after that, i’m going to sue Nike. I bought the running shoes, how come I can’t dunk like mike? I agreed to be just like him!
And then after THAT, i’m going to sue Dell, the keyboard’s keep chipping away my manicure and I have to keep getting them fixed.
AND THEN AFTER THAT, i’m going to sue myself because I thought i looked good in pleather.
Coffee is hot. No matter where i buy it from, it’s hot. damn hot. ERGO, i always let it cool down before I drink it.
frivolous is not the word i would use for this lawsuit…but if i put what i want, IJ will bleep it out.
You put something out in the field-of- commerce, unlike your mom’s piping hot grub, then you’re at the mercy of those whom are injured more easily than you. Heck, you’re in Nebraska and munch hard-uncooked field-dried cornnuts, you never get hurt! But apparently, the pltf’s bar is a whole lot better than the defense bar…whose job is to bilk the insurance co’s into believing “their” cases are winnable and crank up a billion chargeable hours. The jurors, many times think differntly. Some are hard-nosed and some are not. You cannot compare parents with entities that sell products. Your mom is immune from your crying whenever you get colic. E-coli, rotten foodstuff, failure to label things likely to burn you. Pecuniary driven distributors are not immune. In the long run the population is better off. If it weren’t for that, then why need “completed ops or products liability” coverage or general liability policies. Take them out completely from businesses insurance policies, stop offering it, select only hard-nose jurors,and adjust the insurance workforce employment accordingly. Result, maybe more bank robberies.
Please don’t compare someone spilling hot coffee on THEMSELVES to an ecoli breakout. That’s apples to oranges.
I don’t know what else to say to you…coffee is hot, be careful before you drink it…I bet you when she burns herself on her own coffee, she doesn’t complain.
Folks – Let’s get back to the original issue. A firm didn’t have workers compensation so they sued (and won) an insurance agency. The firm did not have the required insurance so they sued an agency which did not fully document the fact that the insured didn’t want the coverage. Deep pockets at its worst.
Isn’t this like buying a boat and not getting enough life jackets. When your boat sinks sue the boat dealer who didn’t sell you enought life jackets. To me this is the same concept.
The insurance agent is not responsible to make sure that the clent buys the necessary insurance. The agent is only responsible for getting the client the insurance they ask for. If they decline to purchase insurance it is not the agents fault for the results of that client’s failure.
Wow, so professional. Do you treat your clients and customers this way as well? Guess you don’t know how to have a conversation or a debate. Sucks to be you. Not ignorant just a realist.
A full and proper account review would require that you ask why you have a business w/o Workers Comp. Your AE should offer coverage and every renewal and, if declined, send a letter confirming the decline… Even better, find a reason to get a copy of their WC coverage – needed for umbrella pricing, perhaps.
Calif is an unusual state when it comes to jury awards…the producer should have documented the file, and sent a letter confirming there was and offer and a refusal by the client to purchase the coverage(which is required by law). it seems the emloyeer could have been held responsible if the agent had covered his 6 oclock…never let this happen to you..a note in the file and a letter to the insured, would have saved a lot of grief for all parties involved..
Coffee neeeds to be heated from 180F to 190F to break out the oils which give the taste. However as a medic we learn that burns can occur as low as 110F. To meet what the court wanted any coffee vendor should drop the temp to below 110F before sale but who would want it at that temp I do not know. The court was a typical nanny where we never have any responsibilty for any of our own actions. Shall we try for 98.6 as an agreed standard?
If you had the opportunity to see the medical report and photos that included skin grafting in “personal areas” for the 3rd degree burns, you would understand why the award was so high. We aren’t talking about a simple scald. McDonalds was given an opportunity to just pay medical expenses and turned it down.
I don’t really think the area burned is relevant is should be deemed “more valuable” than any other area. Furthermore, I don’t think McDonalds should be responsible for her medical bills either. She spilled the coffee on herself after she had made the purchase and was driving away. I’m guilty of putting a bottle of water or pop in between my legs yes, but common sense should step in with HOT coffee.
Lesson #1: Documentation is key, when a customer does not want W/C, or does not pay his W/C premium send him a letter and keep it on file. Did this agency never hear of customer files, call logs or documenting calls in Outlook or some agency software.
Lesson #2: Part of running a successful agency is reducing exposure, minimizing difficult or bad customers that force you to take short cuts on their behalf at a big exposure for your agency. Documenting to death or firing those customers is half of running a successful agency and just as important as pure production, at least in Cali.
This is the same agency ( HRH )that had to pay $30 million for it’s price rigging schemes and they weren’t smart enough to figure a way out of this mess? These are examples of what happen when the greed factor takes over and ethics are thrown out the window. Producers for this company need to be sent back to Insurance 101 and carry an Insurance for dummies book with them.
TO ALL:
How long have you people been in Insurance??? We do insure Stupidity and have for decades where have you been??? Why else would we buy E & O coverage, we make mistakes, face it we are human….
I have read several of the comments and I believe for the most part, some of you are missing the point. The main focus on this is the fact that the agency did not document their files thoroughly. Does not matter if the client refused the coverage, or that the agency still has the
client as a customer. In todays society, it is a MUST that you document your files thoroughly and send letters of coverage rejection out to each client.
I haven’t been on due to anxiety, depression and just closing my eyes to this mess.
So, I guess I didn’t speak properly? Sorry. I am talking about PEO’s. PERIOD. Not agents. PEO’s. YOu do know who they are right? Well, every week they provide payroll services, pay your state taxes, federal taxes, provide and pay WC INSURANCE!! This is a trash business i’m talking about. Our life has been ruined, along with our children. All due to a PEO who pocketed every dime the employer allowed the PEO to directly DEDUCT from business account. The PEO put First Union American into insolvency because they were behind 2K in premiums. Sadly WC lapsed on 12/31/03 and my husband’s injury happened on 1/19/04. They are now INDICTED and I cannot wait to testify for the FBI once they wrap up!! it’s called RICO. They committed a crime and I pray they pay, emotionally, physicially and FINANCIALLY. Just like we are still doing. I work in thelegal field and yes, insurance comapnies own the USA and that is my personal opinion. Yes, I am a defense legal secretary who works for a defense firm WHO represents INSURANCE COMPANIES. So I am not biased but what is fair is fair. In the above matter, WE ALL KNOW THAT THEY CLIENT DID NOT REFUSE WC. It’s the law and all business owners know that. The agent screwed up and fortunately is paying the price. I hope we win also. I’m very very tired…….
P. S. I am Roman Catholic, first generation American, daughter of two immigrants from Ireland. Yes the priests should pay, dam right. I spent 12 years in Catholic school and am hitting 50 years old. And yes, I wonder how many boys I went to school with were molested. Remember, The Catholic Church is exonerated from all. They have their own rules, own probably as much real estate as insurance companies and I hope all those priests burni n hell! Yes, I blame the doctors, and yes they should be sued (i.e. when hubby reailzed something was wrong with his leg immidiately after surgery and his surgeon immediately started testing him for the hardware implanted in his back was placed properly, and YES, I saw it in his eyes – he thought we were going to sue him. No way, he’s an excellent surgeon and unfortunately, my husband has PERMANENT NERVE ROOT DAMAGE FROM HIS INJURY AND THERE WAS NO WC IN PLACE AT TIME OF INJURY – LAPSED 5 DAYS EARLIER – LUCKY US!! and yes the construction companies should also be sued if they are at fault which we know they ALL ARE. So, like I said. I work in the legal field for a DEFENSE FIRM. I hate plaintiff’s law, will not work for plaintiff’s lawyers with their frivolous suits, blah, blah. Employer did receive the policy. Been in business for 50 years and knows what to do and what is required and unfortunately, hired a PEO. Generalization, sorry. I was certainly angry when I wrote that reply and still am. But I will just continue to stay off websites searching for answers. I’ll just keep in touch with the FBI who always keeps in touch with me!!!
Dear Insurancegal, The McDonalds coffee incident was by no means a frivolous suit. The coffee was at 190 degrees F and there were over 700 documented complaints about the coffee being too hot (at that temp it burns and destroys human flesh). The claimant offered to settle out of court for $20,000 and the defense attorneys said “no deal” so it went to trial, huge punitive damages were awarded, case was appealed, and was finally settled for an undisclosed six figure amount. Interested in the facts? Email me at darnovak@msn.com and I will FAX or email you a copy of a recent article in a professional insurance publication. Stop repeating garbage you read in the enquirer or star or overheard at the local coffee shop.
Didn’t anyone ever ask the company why it wasn’t aware that it never paid any work comp premium? Probably not relevant in a California court.
Please help me to understand this, unless the article is missing some information. This just doesn’t make sense a company is in business and doesn’t realize that they need to carry workers compensation for their employees. Granted the agent should have done a better job of documenting, a court wants us to believe that an employer is that stupid. Come on you have got to be kidding right?
I hope this case is appealed. This verdict is outragious.
The Accounting firm never saw a WC premium entry? never did an Audit? The local town never issued a office inspection or permit for the business to even operate and didn’t get a copy of the WC policy? Just how long has business been around and how many agents have they previously dealt with over the years? Commercial AUTO and Group Health ASK for the WC information! SOunds like scammers to me !
What is said between the parties, what is heard between the parties, probably should be documented by “camera” mounted by the a/c registers in every office. Or, on the walls of cubicles. Also in the entry ways, as employees and clients enter and leave. Sometimes we forget to come back and doc our management systems. Or, write on the activity sheets on the left side of the folders. It’s the nature of the business. However, as Truman said, “if you can’t take the heat, ……”. We’re being asked to become Robots, I guess. We’re way past 1984! Yet, I’m reminded of it everytime I stop for a Red Light. It has helped London. Cannot have a cop in every street corner or a Quality Assurance Person in every insurance agency, or can we? Missteps cost plenty “Mucho Dinero”. Gotta live with the Eye-in-the-Sky.
Seems to me that both the company and the agency (come on, no documenation about this coverage issue at all?…That’s nonsense!!) should get hammered.
It is funny that insurance people like us always believe that insurance people can do no wrong (like in this case).
Doesn’t the state have any cheks and balances to control the rights of workers? In NY the Worker’s Comp board tracks all employers by their NY State unemployment number which ALL business are required to obtain. If they do not get verification of W.C. & disability coverage you get a lovely invitation to send them bucks. I’ve seen fines go as high as 20,000 for failure to maintain continuous coverage.
I’m glad I don’t work in Cal.
Why should the insurance agent be held responsible if someone didn’t get insurance. Is it up to the insurance agent to tell insureds what they need? There are all sorts of reasons here why the business should have been held totally at fault. Worker’s comp is one of the required coverages and they didn’t know that they didn’t have the coverage. Come on folks – guess California doesn’t treat its businesses as adults – need to have their hands held by everyone else. What a bunch of hooey…
Ahh welcome to the wonderful world of CA law. It matters not how obvious something is unless it is in writing (and sometimes not even that works) we award stupidity.
Can I remind everyone of the McDonalds claim where a woman burned herself on a hot cup of coffee but was then awarded a ridiculous amount of money because the cup didnt have “Caution Hot” in writing on it?
Our agency suffered a claim where one of our UW’s had clearly in writing put “we can not cover this exposure, there is no coverage in force” and the insured later suffered a loss and claimed they had taken that to mean that there was coverage…our E&O paid out $200k on that claim. In CA the party that can afford the loss is the one that pays for it.
I guess the moral of the story is don’t write business for any firm in Calif. unless they carry the Cadillac policy on everything. If they decline, or reduce coverage on anything; RUN! Otherwise you and your E&O carrier will be covering it. No wonder insurance costs so much in Cal.
Risk M, very good point, the problem clients who want to save every penny are not worth it. We need to send a strong messaage to these clients that the insurance agencies do now want them. That will funnel down to the most desperate, inexerienced and unethical agents. They would deserve each other!
Think I would have told the insured to go elsewhere, knowing they intended to break the law by not carrying workers’ compensation. Sounds like a Giant Red Flag
to me!!!
Ray: Why should the insurance agent be held responsible if someone didn’t get insurance. Why is that? As a consumer, and wife of permanent disabled employee, the boss did what he was to do. It’s just that HE WAS LIED TO by the PEO.
I would THINK it is the Insurance Agent/Broker/PEO’s duty to advise, and/or provide information re: WC. fault that the company they provide insurance to did not have WC Insurance. Think about it. For God sakes, it’s common knowledge (especially someone in the trucking business) that they needed WC. Do you think maybe this is just another company who rips off it’s clients and doesn’t forward monies to the WC Insurance Company? Yes, i would think that is is the agent’s fiduciary duty to advise them that they also need WC. We don’t have the full story here and I’ll bet it’s a dirty ins. company. I don’t think EMPLOYERS are as stupid as one might think. It’s the law. That’s it. So, I can tell you little stories about a lot of small business owners that were never advised that the monies that were taken right out of the employer’s business account, went right into their pockets I.E. CERTIFIED H.R. SERVICES. I’m certain you know of them. Well every week for years thjey would directly withdraw from their client and PAY WHO THEY ARE REQUIRED TO PAY. They of course did not and we are suffering because of it. $37,000 in 3 years in WC checks? gimmmie a break!! They are all finally under indictment, some already plead or already in jail, etc. BUT THE STATE OF PA MADE CERTAIN THAT THEY GOT THEIR 1 OR 3 MILLION IN state tax money that the AGENT/PEO never forwarded. As for the employer – he had no idea, NOTHING and no clue that there was no coverage. My husband, the client’s son and I are screwed for the rest of our lives because the boss did what he has done for years: Allow direct withdrawal for payroll, state tax, and WC. The PEO didn’t pay anyone – nothing. No WC checks, no medicals, nothing. Now we are left with med bills totalling over $500,000? The client (my father-in-law) paid his dues to the PEO/AGENT EVERY SINGLE WEEK. Then son gets injured (permanent RSD and subsequent brain surgery caused by the trauma of the wc injury)and we find out that there’s no coverage? I think that insurance companies have ruined our country. Destroying it completely. Think about it: Another employee was killed while driving his truck – heart attack at the wheel first day. Wife and 2 small children at home. He was 42 yrs old. Wife and children GOT NOTHING!!!!!!!!!!!!!
Why? because of the insurance company
It’s a disgrace that agents and the WC industry nationwide
Worker’s comp is one of the required coverages and they didn’t know that they didn’t have the coverage. Come on folks – guess California doesn’t treat its businesses as adults – need to have their hands held by everyone else. What a bunch of hooey
Well, the DOI will now come up with a written waiver for any commercial coverages not being purchased by the insured at the time any other commercial coverages are placed. If I write the health coverage, should I be liable for the employer’s failure to purchase P&C coverage for his business? The State of CA. failed to verify W.C. via the State Franchise Tax Board NOT HHR. The producer is not required to obtain a written waiver to exclude writing any coverage for a business as they are an educated buyer. The individual insurance buyer is so stupid, they must sign stating they do not want UM/UMPD. Appeal this to any court with a brain and provide the thousands of files whereby a CA. business chose to NOT purchase any other truly optional insurance coverage? When does this crap stop?
Hman
Kathy your story is a sad one but a bit misguided. 1st it is easy for you to claim that the business owner did everything they should have…..but what kind of business owner doesn’t question never receiving a policy. For example if you bought auto insurance but never received ID cards would you just have faith that you were covered? I think not.
2nd blaming the fall of America on insurance agents is a brave statement. In every profession there are a few bad apples but I don’t hear you blaming priests because some molest children or doctors who kill patients because they are not licensed or using expired products or construction workers who cut corners to save cost but then have houses collapse and kill people. Careful with your generalizations they are very dangerous.
3rd don’t blame the insurance company. It is the AGENT who is at fault, know that an insurance agent does not write a policy, it is written on a companies paper, if the company never gets the applications or issues the policy you can hardly blame them.
Seriously you have a client with employees who against advice doesn’t purchase work comp and you still do business with them? Isn’t that a red flag that the customer is perhaps ethically challenged at best or confused at least? Do you need the commisssion that bad to keep them as a client? Guess the answer here was a resounding NO.
Insurancegal’s post did not say it was a frivolous suit, just that the amount of $$ was ridiculous. Courts continue to show a lack of common sense in awards and allowing suits to go forward. The McDonald’s suit was about a supposed lack of “Hot Liquid” warning on a cup. What a crock! I suppose if she got a cold lap from a soda spill, she would have claimed a lack of “Cold Liquid” warning on that cup too! It doesn’t take a lot of common sense to negotiate the world, but these people try to raise being a dufus to a higher level & we all get to pay for it.
The pltf in the Mcdonalds case was way up in her years and wore heavy wool clothing. The liquid went trhou 3 layers of woolen clothing. The coffee was red hot. 3rd degree burns.
My personal opinion is that the verdict is correct. HRH is not a small time podunk agency. They’re nationwide and handle small/mid-sized business.
Each year that the renewal of the client’s coverage comes up, the agent should have addressed the lack of workers compensation…THEN, follow up in writing and have the client sign and confirm that they acknowledge they do not have workers’ compensation.
Having worked in the business (both in California and Texas) for over 20 years, this is a common sense move that would have protected the agency’s ASSets.
Is it excessive – maybe. But the information we don’t have is all of the details that came out at trial. All we have is a summation. There may have been information that came out at trial that showed the agency had truly dropped the ball on this one.
Insurancegal may not have said the mcdonalds coffee case/lawsuit was frivolous but i will. the pltf was stupid and we should not reward people for their stupid behavior. the case should have been thrown out of the case due to the pltfs entitlement attitude and the belief in no personal responsibility. sorry for being off topic.
Steve. Bet you wear a Kaiser Hat. As a result MacDonalds does not fill the cup all the way up and gotta wait a bit before drinking it. It’s still molten.
Do you know how many times I have burned my tongue on my mother’s good food? I have yet to sue her. But coffee drinker, if you will be my lawyer, I will do it. Because that is just irresponsible of her to serve food (that is expected to be piping hot) piping hot.
And then after that, i’m going to sue Nike. I bought the running shoes, how come I can’t dunk like mike? I agreed to be just like him!
And then after THAT, i’m going to sue Dell, the keyboard’s keep chipping away my manicure and I have to keep getting them fixed.
AND THEN AFTER THAT, i’m going to sue myself because I thought i looked good in pleather.
Coffee is hot. No matter where i buy it from, it’s hot. damn hot. ERGO, i always let it cool down before I drink it.
frivolous is not the word i would use for this lawsuit…but if i put what i want, IJ will bleep it out.
*insurancegal bows courtesly to Nebraskan
You put something out in the field-of- commerce, unlike your mom’s piping hot grub, then you’re at the mercy of those whom are injured more easily than you. Heck, you’re in Nebraska and munch hard-uncooked field-dried cornnuts, you never get hurt! But apparently, the pltf’s bar is a whole lot better than the defense bar…whose job is to bilk the insurance co’s into believing “their” cases are winnable and crank up a billion chargeable hours. The jurors, many times think differntly. Some are hard-nosed and some are not. You cannot compare parents with entities that sell products. Your mom is immune from your crying whenever you get colic. E-coli, rotten foodstuff, failure to label things likely to burn you. Pecuniary driven distributors are not immune. In the long run the population is better off. If it weren’t for that, then why need “completed ops or products liability” coverage or general liability policies. Take them out completely from businesses insurance policies, stop offering it, select only hard-nose jurors,and adjust the insurance workforce employment accordingly. Result, maybe more bank robberies.
Please don’t compare someone spilling hot coffee on THEMSELVES to an ecoli breakout. That’s apples to oranges.
I don’t know what else to say to you…coffee is hot, be careful before you drink it…I bet you when she burns herself on her own coffee, she doesn’t complain.
Folks – Let’s get back to the original issue. A firm didn’t have workers compensation so they sued (and won) an insurance agency. The firm did not have the required insurance so they sued an agency which did not fully document the fact that the insured didn’t want the coverage. Deep pockets at its worst.
Isn’t this like buying a boat and not getting enough life jackets. When your boat sinks sue the boat dealer who didn’t sell you enought life jackets. To me this is the same concept.
The insurance agent is not responsible to make sure that the clent buys the necessary insurance. The agent is only responsible for getting the client the insurance they ask for. If they decline to purchase insurance it is not the agents fault for the results of that client’s failure.
Wow, so professional. Do you treat your clients and customers this way as well? Guess you don’t know how to have a conversation or a debate. Sucks to be you. Not ignorant just a realist.
A full and proper account review would require that you ask why you have a business w/o Workers Comp. Your AE should offer coverage and every renewal and, if declined, send a letter confirming the decline… Even better, find a reason to get a copy of their WC coverage – needed for umbrella pricing, perhaps.
Calif is an unusual state when it comes to jury awards…the producer should have documented the file, and sent a letter confirming there was and offer and a refusal by the client to purchase the coverage(which is required by law). it seems the emloyeer could have been held responsible if the agent had covered his 6 oclock…never let this happen to you..a note in the file and a letter to the insured, would have saved a lot of grief for all parties involved..
Coffee neeeds to be heated from 180F to 190F to break out the oils which give the taste. However as a medic we learn that burns can occur as low as 110F. To meet what the court wanted any coffee vendor should drop the temp to below 110F before sale but who would want it at that temp I do not know. The court was a typical nanny where we never have any responsibilty for any of our own actions. Shall we try for 98.6 as an agreed standard?
If you had the opportunity to see the medical report and photos that included skin grafting in “personal areas” for the 3rd degree burns, you would understand why the award was so high. We aren’t talking about a simple scald. McDonalds was given an opportunity to just pay medical expenses and turned it down.
I don’t really think the area burned is relevant is should be deemed “more valuable” than any other area. Furthermore, I don’t think McDonalds should be responsible for her medical bills either. She spilled the coffee on herself after she had made the purchase and was driving away. I’m guilty of putting a bottle of water or pop in between my legs yes, but common sense should step in with HOT coffee.
Lesson #1: Documentation is key, when a customer does not want W/C, or does not pay his W/C premium send him a letter and keep it on file. Did this agency never hear of customer files, call logs or documenting calls in Outlook or some agency software.
Lesson #2: Part of running a successful agency is reducing exposure, minimizing difficult or bad customers that force you to take short cuts on their behalf at a big exposure for your agency. Documenting to death or firing those customers is half of running a successful agency and just as important as pure production, at least in Cali.
This is the same agency ( HRH )that had to pay $30 million for it’s price rigging schemes and they weren’t smart enough to figure a way out of this mess? These are examples of what happen when the greed factor takes over and ethics are thrown out the window. Producers for this company need to be sent back to Insurance 101 and carry an Insurance for dummies book with them.
TO ALL:
How long have you people been in Insurance??? We do insure Stupidity and have for decades where have you been??? Why else would we buy E & O coverage, we make mistakes, face it we are human….
I have read several of the comments and I believe for the most part, some of you are missing the point. The main focus on this is the fact that the agency did not document their files thoroughly. Does not matter if the client refused the coverage, or that the agency still has the
client as a customer. In todays society, it is a MUST that you document your files thoroughly and send letters of coverage rejection out to each client.
I haven’t been on due to anxiety, depression and just closing my eyes to this mess.
So, I guess I didn’t speak properly? Sorry. I am talking about PEO’s. PERIOD. Not agents. PEO’s. YOu do know who they are right? Well, every week they provide payroll services, pay your state taxes, federal taxes, provide and pay WC INSURANCE!! This is a trash business i’m talking about. Our life has been ruined, along with our children. All due to a PEO who pocketed every dime the employer allowed the PEO to directly DEDUCT from business account. The PEO put First Union American into insolvency because they were behind 2K in premiums. Sadly WC lapsed on 12/31/03 and my husband’s injury happened on 1/19/04. They are now INDICTED and I cannot wait to testify for the FBI once they wrap up!! it’s called RICO. They committed a crime and I pray they pay, emotionally, physicially and FINANCIALLY. Just like we are still doing. I work in thelegal field and yes, insurance comapnies own the USA and that is my personal opinion. Yes, I am a defense legal secretary who works for a defense firm WHO represents INSURANCE COMPANIES. So I am not biased but what is fair is fair. In the above matter, WE ALL KNOW THAT THEY CLIENT DID NOT REFUSE WC. It’s the law and all business owners know that. The agent screwed up and fortunately is paying the price. I hope we win also. I’m very very tired…….
P. S. I am Roman Catholic, first generation American, daughter of two immigrants from Ireland. Yes the priests should pay, dam right. I spent 12 years in Catholic school and am hitting 50 years old. And yes, I wonder how many boys I went to school with were molested. Remember, The Catholic Church is exonerated from all. They have their own rules, own probably as much real estate as insurance companies and I hope all those priests burni n hell! Yes, I blame the doctors, and yes they should be sued (i.e. when hubby reailzed something was wrong with his leg immidiately after surgery and his surgeon immediately started testing him for the hardware implanted in his back was placed properly, and YES, I saw it in his eyes – he thought we were going to sue him. No way, he’s an excellent surgeon and unfortunately, my husband has PERMANENT NERVE ROOT DAMAGE FROM HIS INJURY AND THERE WAS NO WC IN PLACE AT TIME OF INJURY – LAPSED 5 DAYS EARLIER – LUCKY US!! and yes the construction companies should also be sued if they are at fault which we know they ALL ARE. So, like I said. I work in the legal field for a DEFENSE FIRM. I hate plaintiff’s law, will not work for plaintiff’s lawyers with their frivolous suits, blah, blah. Employer did receive the policy. Been in business for 50 years and knows what to do and what is required and unfortunately, hired a PEO. Generalization, sorry. I was certainly angry when I wrote that reply and still am. But I will just continue to stay off websites searching for answers. I’ll just keep in touch with the FBI who always keeps in touch with me!!!
Thank you.