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 * Sections
   * Critical Risks
   * Risk Management
   * The Insurance Industry
   * Claims & The Law
   * Workers’ Comp Forum
   * Risk Insiders
   * Sector Focus
   * .
   * Risk Central
   * Power Broker
   * Risk Matrix
   * Risk Scenarios
   * Risk All Stars
   * Teddy Award
   * Sponsored Content
   * Branded Webinars
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   * Digital Issue
   * Issue Archive
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   * National Ergo & Ergo Expo
 * Advertise
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   * About R&I
   * Contact Us
   * Media Kit

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BRAVING THE WAVE OF CUMULATIVE TRAUMA CLAIMS: INSIGHTS FROM SODEXO’S MEGAN ANGUS

Sodexo’s Megan Angus exhibits a tireless approach to settling cumulative trauma
claims in the hospitality sector.
By: Gregory DL Morris | July 14, 2023
Topics: July/Aug. 2023 Issue | Risk All Stars | Workers' Comp | Workers' Comp
Forum



The tapering-off of the pandemic has been countered by a wave of claims — not
directly as a result of COVID-19, but rather a surge in cumulative trauma (CT)
claims from employees who were laid off or furloughed during the pandemic’s
economic ups and downs.

The situation is particularly acute in the hospitality sector due to the vast
amount of physical labor involved in daily operations.

And, because of the regulatory and legal environment in California, that state
has seen CT litigation skyrocket, which has put Megan Angus, western senior
claims manager for Sodexo, front and center.

“CT claims almost always involve litigation,” said Angus.

She explained that sometimes they are retaliatory after an employee is let go,
but they can also be opened three or four years after an employee has left the
firm.

To counter the costs and complications of CT claims, Angus developed a response
plan that has enabled Sodexo to reduce time, effort and expense on CT claims.

“The process starts as soon as we receive notice of litigation,” said Angus.

“It includes myself, claims adjustors and our defense counsel. I had the
authority to put it into effect, but I felt it was important to get buy-in from
our director of claims management. I also socialized it with the team at our
claims management firm, Gallagher Bassett.”

The first step in the process is to determine if the employee, or former
employee, is acting from anger, in which case the CT claim can be viewed as
retaliatory.

“Many of them are,” said Angus. “In those cases, our goal is to minimize our
exposure.”

She explained that, in general, the plaintiff’s bar has little incentive to
close cases, so the onus falls on the company and its claims management firm to
be diligent about expediting the case to a settlement.

Of course, defense counsel is also charging by the hour, but as Angus noted, “We
do have defense allies who are willing to engage with us and not just bill it
out to resolution. But as soon as you get one CT claim settled, in a few months,
there are three more coming in.”

That last comment is a clue to the character of 2023 Risk All Star Angus, said
Carol Ungaretti, managing consultant for U.S. casualty claims with Aon’s Global
Risk Consultancy.

“I’ve worked with Megan for about five years. It’s a difficult job, constantly
putting out brush fires, or like playing Whac-A-Mole,” Ungaretti said.

“But she is diligent and she is curious. Somehow, she stays excited,” Ungaretti
added.

“She knows that what may be considered ‘best practices’ may be outdated. She
looks at things and says, ‘I wonder about that. I’d like to dig into it.’ Megan
somehow has the energy and takes the time to find new approaches.” &

--------------------------------------------------------------------------------

Every year, Risk & Insurance selects deserving candidates to become Risk All
Stars. These are risk managers who, through their perseverance, passion and
creativity, make a big difference to the stability of their organizations.

See all the 2023 Risk All Star Winners here.

Gregory DL Morris is an independent business journalist currently based in New
York with 25 years’ experience in industry, energy, finance and transportation.
He can be reached at riskletters@theinstitutes.org.





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SPONSORED: PHILADELPHIA INSURANCE COMPANIES



HOW A CARRIER PARTNER CAN HELP NAVIGATE A CHALLENGING MANAGEMENT AND
PROFESSIONAL LIABILITY MARKET

A combination of a choppy economy with increased claims frequency and severity
could lead to rate increases in the Management & Professional Liability market.
By: Risk & Insurance | April 3, 2024

Rates in the management & professional liability (M&PL) markets were on the rise
from 2020 to early 2023 and are now falling rapidly.

M&PL divisions manage a number of different insurance products including
management liability (D&O), professional liability (E&O), employment practices
liability (EPL), fiduciary liability policies, cyber, etc. In 2023 and into
2024, a big influence on the marketplace has been the extremely aggressive and
softening public company D&O market.

Though these rates have been softening for management liability, that may change
over the next few years as companies continue to adjust their business models
motivated by economic uncertainty. Layoffs were up nearly 200% last year, Forbes
reported, even as other recession indicators, like the inflation rate, improved.
A recession could lead to an increased claim activity and force carriers to
raise rates.

“Whenever there is a meaningful downturn in the economy, we tend to see claim
frequency pop up,” said George Schalick, Jr., senior vice president of the
Management and Professional Liability Division at Philadelphia Insurance
Companies (PHLY).

With continued fiscal uncertainty, businesses potentially already burdened with
pandemic-related claims should seek a carrier with a long history in M&PL
products. They will provide much-needed risk management guidance and be better
positioned to support their insureds during market fluctuations.


WHY INSUREDS MIGHT SEE AN UPTICK IN M&PL CLAIMS

George Schalick, Jr., Senior Vice President of the Management and Professional
Liability Division, Philadelphia Insurance Companies

The current soft market might come as a bit of a surprise as it does not track
with previous underwriting cycles and economic conditions. Afterall, many
privately held and non-profit organizations struggled during the early days of
the pandemic with shutdowns and rapidly declining revenues.  But the Government
assistance programs, like the Paycheck Protection Program loans, helped keep
many afloat during the tough times.

“During COVID many organizations stopped doing business until they were able to
sort out all of the health and safety challenges,” Schalick said. “They were
forced to lock down, but then all the government assistance programs allowed
them to keep people employed. The increased volume of claims we anticipated we
would see coming from the lockdowns and restrictions that were imposed upon
businesses in the U.S. didn’t manifest at first.”

“Just because there wasn’t an onslaught of reported claims at the beginning of
the pandemic, doesn’t mean the circumstances that would give rise to a claim
being reported didn’t occur. Courts and the judicial system were closed or
slowed and now that they are back open, we’re starting to see the circumstances
that occurred during the COVID lockdowns becoming claims today,” Schalick said.
“Litigation is progressing.”

Added to the delayed pandemic litigation is a concern over newer claims that
might be filed as the country inches toward an economic downturn. Though a
recession was avoided in 2023, experts think a soft dip could occur in 2024,
with 76% of economists saying there’s a 50% or less chance of an economic
downturn this year — that almost always results in more management liability
claims.

“During the Great Recession in 2008, we saw an almost immediate spike in claims
because of the economic conditions and the pressure it placed on organizations.
They were making personnel changes with significant belt tightening almost
immediately.” Schalick said.


WHAT’S IN STORE FOR M&PL POLICY RATES IN 2024?

Despite an uptick in claims and increased economic uncertainty, management
liability rates haven’t increased, resulting in market-wide pricing levels that
may not meet the increased pressure of rising settlements and jury verdicts.

“Rates are going the other direction and settlement values are not falling,”
Schalick said.

The mismatch between rates, claim frequency and severity is, in part, because
carriers experiencing the dramatic soft market in the public D&O market are
seeking premium gain in the private and non-profit market.

“In the public company market, the rates have been decreasing significantly. The
rates were increasing in the private, not-for-profit market, and rightfully so,
but there’s a desire to supplement overall mid-size D&O for carriers who also
write private not-for-profit, and they see that as an opportunity to aggregate
premium,” Schalick said. “So the always competitive landscape in the private,
not-for-profit market has dramatically increased in the last 18 to 24 months.”

Still, companies of all sizes and types should be concerned about management
liability rates in the future. Legal system abuse is resulting in increases in
both the amount of litigation and the size of verdicts plaintiffs are receiving.

Certain areas of the country are particularly vulnerable to this type of legal
system abuse. As a result, insureds in these localities are likely to be
vulnerable to rate increases.

“The environment is so positive for the plaintiff that forces premium increases
so carriers are able to stay in that market long term,” Schalick said.


WHY A TENURED CARRIER PARTNER CAN HELP INSUREDS NAVIGATE AN UNCERTAIN MARKET

It’s clear that insureds are facing an uncertain M&PL market over the next few
years. Fortunately, carriers with a long history in the M&PL space will be there
to offer stability.

Philadelphia Insurance Companies has been supporting this market for 35 years.
PHLY is committed to offering long-term rate stability, even as economic and
claims trends start to push premiums upwards. They have an appetite for all
sorts of companies, large and small, for-profit and nonprofit alike.

“We’ve been at this game for a long time and are one of the most tenured
underwriters in this space,” Schalick said. “We like to stay very consistent.”

 PHLY has worked with both for-profit and non-profit on management liability
policies. With dedicated M&PL teams throughout the company’s 13 regions, PHLY
provides the support agents and brokers are looking for on behalf of their
clients. The teams know their regions well and can respond to local trends.
They’re also dedicated to making the renewal process as easy as possible for
their partners and policyholders.

“We have real confidence in our results, so we focus a lot on making the renewal
experience as painless as possible for all agents and insureds,” Schalick said.

The company is also investing in tools to help insureds avoid losses. Earlier
this year, they launched a new online risk management platform, PHLYGateway,
which offers resources for insureds on how to create an employee handbook and
trainings on issues such as recognizing workplace sexual harassment and
discrimination.

If insureds have questions, they can consult a Best Practices Help Line,
provided via the platform. That way, they can get on the spot risk management
guidance to help them prevent claims.

To learn more, visit:
https://www.phly.com/mplDivision/managementLiability/default.aspx.


 



This article was produced by the R&I Brand Studio, a unit of the advertising
department of Risk & Insurance, in collaboration with Philadelphia Insurance
Companies. The editorial staff of Risk & Insurance had no role in its
preparation.















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