Sports Law • Risk Management

Risk Management Practices in Poor Economic Times

If your organization chooses to skimp on safety and risk management practices, you likely will see an increased incidence of injuries and worker’s compensation claims. Even if you continue to maintain a comprehensive risk management program and utilize safe practices, insurance fraud may increase in a bad economy as economic motivation leads people with mounting credit card debt and unemployment to be motivated to pad insurance claims or to develop insurance fraud schemes.

Some examples of insurance fraud that could occur in the sports and recreation field include:
• Exaggerating the severity of an injury that is subject to a lawsuit or worker’s compensation claim.
• Deliberately falling or otherwise becoming injured and claiming that such injury was due to the organization’s negligence.
• Orchestrating a motor vehicle accident with a vehicle owned by the organization in order to collect insurance.
Although insurance fraud is often difficult to detect and the insurance industry, health care system and consumers are billed billions of dollars each year for fraudulent claims, there are some steps that organizations can take in order to protect themselves, which include:
1. Maintaining safe practices in recreation and sports program, with a comprehensive risk management program.
2. Whenever an incident occurs, prepare an incident report, which includes all relevant facts and the identity of all witnesses to the incident and their addresses and telephone numbers.
3. Instruct any personnel or volunteers that use the organization’s vehicles to call the police if they are involved in a motor vehicle accident and make sure they immediately write down the license plate number of the other involved vehicles and exchange information with the other drivers.
4. Consider using security cameras and security personnel in your facilities.
5. If you suspect that fraud has occurred contact the police and the National Insurance Crime Bureau (NICB) at www.nicb.org or 1-800-TEL-NICB.
6. You may also discuss concerns about suspected insurance fraud with your insurance agent, or if a claim has been made, with the assigned claims adjuster.
7. If you are a defendant in a lawsuit, inform your attorney of any facts that you have that support your suspicions of an inflated claim of injury or fraud.

Hopefully, your organization will thrive in the upcoming months and years. Continuing your safe practices and risk management programs should be a high priority in accomplishing this goal.