"Any and all potential evidence should be saved until the claim is closed."
By R. Bruce Wright, CPCU
About two years ago in the RE-marks issue dated Jan-Feb-Mar of 2010 I included a short item entitled “Save the Evidence” that discussed the potential value of physical evidence and the importance of retaining any bits or pieces of material that could eventually be of use in defending a case. If you would like to review that earlier article, it is available in the archive. Recent events suggest that it may be valuable to address this topic once again. Without going too deeply into the specifics of the case, which is currently being settled, I want to bring to everyone’s attention some issues raised by the events of a recent claim that highlight just how important it can be to preserve any and all of the available physical evidence involved in any incident.
In this case, the original report was that a small grass fire had started due to a defect in a customer’s machinery out in the field. The utility crew responded at the time of the initial report, found the meter, meter base, and allied installations had been fully engulfed by the fire before the fire department had managed to put it out. Since they believed that the customer’s equipment had been the source of the fire, they de-energized the entire line, removed the meter, and left. The incident was recorded, sent in as a notice to the insurance folks to deny, and in due course a denial letter was sent.
From that point things began to go downhill. The landowner advised the utility that he believed the source of the fire was not on his side of the meter, but was in the utility’s equipment, so he was going to pursue this further. Over time a couple of additional claimants came forward. It appeared that the “small fire” initially reported had apparently burned fields in the area owned by 3 different landowners, including crop fields used for livestock feed. These livestock owners too eventually came forward to add their claimed losses to the case, looking for the value of purchased feed and/or prematurely disposed livestock. Other damages tacked on included loss to fences, as well as lost productivity of the fields. All of this came to light after the initial claim was denied.
In order to prepare for a defense, the claims folks went back to the utility and asked to examine the meter and all other parts and pieces that had been removed from the site, with the idea of sending them out to a forensic lab for analysis. Unfortunately, all of the damaged (and therefore useless) pieces had been disposed of. Absence the physical evidence, there was no way to prove that the fire damaged the meter, rather than the meter’s failure starting the fire. In the end, it was decided that this was a case that could not be successfully defended.
The moral is that any and all potential evidence should saved until the claim is closed and the adjuster or defense attorney advises it is no longer needed. The little bit you spend to store it could pay big dividends down the line. So, “When in doubt, don’t throw it out!”
(You can find additional information, including important tips on preserving the chain of evidence, in the article mentioned above.)