Governmental Liability

Claim professionals rely upon their defense counsel. Defense counsel are state-specific specialists that provide necessary and valuable expertise to claim professionals. Local defense counsel provide insight into local politics, courts, juries, legislation, and statutes impacting the defense of public entity lawsuits. In turn, claim professionals are able to identify national trends or unique cases due to management of litigation on a nationwide basis. Working together, claim professionals and defense counsel can rely upon each other’s strengths and better understand and anticipate the needs of the case. Respect in this relationship allows the partnership to flourish, improving the overall defense of the insured.

The DRI Governmental Liability Committee is committed to fostering and improving relationships between attorneys defending claims and lawsuits and the professionals who hire them. The committee has a subcommittee specifically devoted to this relationship. The Partnering with Industry Subcommittee has an ongoing commitment to ensuring that defense attorneys successfully partner with insurance industry professionals. This is especially important in the ever-changing legal environment in which we are currently practicing. There are several lessons learned from the ongoing work done by the Partnering with Industry Subcommittee. Partnership of every kind (professional and personal) requires considerable time, effort, and commitment. However, it particularly requires attention to these details when litigation arises from a politically or socially charged situation, as is often the case, with lawsuits against governmental entities. The objective of the Partnering with Industry Subcommittee is to develop a positive collaboration in order to resolve lawsuits in a manner that is most favorable for the insured. The essential elements of a successful partnering agreement between attorneys and insurance professionals and insureds include many things but at a minimum, the parties must have: (1) a trusting relationship; (2) a commitment to partnering; (3) mutually identified goals and a plan to meet those goals; and (4) a strong, open workflow of information and communication that involves the attorney, claim professional, and the insured. Ensuring that the insured is involved with the case development and strategy anchors the relationship between the claim professional and the attorney.

Trust is built through actions and not words. The various parties must demonstrate through their actions, on a daily basis, that they can be relied upon to complete tasks in a timely manner and on occasion collaborate to think of “out of the box” solutions. In other words, each party must be honest, keep their word, and complete what they have promised to complete. Each must be open to constructive feedback. Having a trusting relationship between all parties is key to a successful partnership. This is accomplished through ensuring that each partner gives the other partner professional courtesies and has an open line of communication with the other partner. The partners must mutually share in and understand each other’s risks and goals.

There must be a fundamental commitment to partnering by both the insurance professional and the attorney defending the claim. The relationship is not one of control or jockeying to see who can control the relationship. Instead, it is one in which the parties move beyond the concept of authority or power to one in which the defense of the matter is optimized by input from all participants—insured, insurance professional, and attorney. An adversarial, confrontational attitude between any branch of the tripartite relationship will result in wasted energies, loss of focus, and ultimately, a less than optimal result. Although there can be differences of opinion and strategy, it is in the best interest for the defense of the insured for the claim professional and defense counsel to challenge each other and push each other for support. In sum, there must a commitment to partnering by each party for the best result.

Having a partnering plan jointly developed to defend the lawsuit that is agreed upon by both the attorney defending the matter and the claim professional is also needed. This plan should identify specific mutual goals and objectives of the partnering participants. After the plan is agreed upon, the partners must engage in a continuous evaluation and review of the plan based upon any changes. When the insurance professional and attorney work as partners to develop an early, agreed-upon strategy at the beginning of the claims process, they can more effectively work together to implement that strategy, and outcomes are improved.

The partnership must also have a strong open workflow of information and communication. There must be open communications in which ideas, concerns, both positive and negative are shared. Both the insurance professional and attorney have a shared ownership in the successful defense of the case for the best possible outcome for the client. As long as both the insurance professional and the attorney respect, honor and reward this open communication, and have an enthusiastic sharing of ideas and insights, it will be a productive relationship. How this communication occurs may differ. It can be through regular phone updates, emails or even through a shared software application. Strong and timely communication is the key to success of the partnership between the insurance professional and the attorney.

Another key for both the claim professional and defense counsel to remember is that the partnership is actually a tripartite partnership. It is important for counsel and the claims professional to partner with each other, but it is also vital that the insured be as active of a member of that partnership as the insured desires. Some insureds are more directly involved in the case due to heightened interest or consent to settlement provisions while others merely would like updates or involvement only at time of settlement. Making sure the insured is “on the same page” as both the defense counsel and the claim professional in the early stages of a lawsuit is the pinnacle of a successful tripartite relationship.

Defense counsel can foster this by making sure the insured is aware of the challenges in the case, providing the insured with reports on liability and damages, and helping insureds understand the risk of trial or benefits of settlement. On occasion defense counsel has a special relationship with the insured and is a trusted long-term advisor. On the other hand, there are occasions when the defense counsel may be working with the insured for the first time and has no experience with the particular insured. Regardless, in both instances, the defense counsel often is key to engaging the insured in the litigation process and can help foster that relationship with the claim professional also. Making sure the insured is as involved as the insured desires or is required, is the final piece of this partnership.

Insurance professionals and defense lawyers working together results in significantly better outcomes and a higher level of client satisfaction. Partnering also results in a higher probability of timely and on-budget completion of the defense of a matter by the attorney, resulting in a satisfied client. The collaborative relationship between insurance professionals and attorneys is even more important with the challenges faced by everyone over the last year. There is truth to the statement that “Collaboration moves beyond the power of one to the power of team.” The Governmental Liability Committee remains committed to ensuring a successful partnership between the insurance industry and its member lawyers through the Partnering with Industry Subcommittee.

Mary G. Erlingson is chair of the DRI Governmental Liability Committee's Partnering with Industry Subcommittee. She is a founding member and the managing partner of Erlingson Banks, PLLC. Mary serves as general counsel to several law enforcement agencies in Louisiana. In addition, Mary represents various public entities in civil litigation. Her dual role as general counsel and defense attorney has provided Mary with the unique opportunity to develop many related areas of practice including governmental relations, employment law, ethics law, law enforcement defense, corrections defense, and administrative law.

Sarah R. Schmitz is vice chair of the DRI Governmental Liability Committee's Partnering with Industry Subcommittee. She is a claims manager at Intact Public Entities (formally OneBeacon Government Risks) in Plymouth, Minnesota. Sarah manages two¬–three adjusters who handle a range of claims brought against municipal entities, public officials, and law enforcement professionals. In her six years with Intact, Sarah has also handled claims legal malpractice, real estate errors and omissions, employment and directors and officer’s claims. Prior to Intact, Sarah practiced law at Meagher & Geer, LLP, where she focused her practice on insurance coverage and real estate and also clerked at the municipal law firm of Kennedy and Graven. Sarah also served two terms on the Minnetonka Planning Commission.