Welcome to Dubai !Managing Claims in the Hospitality and Tourism Sector

• Ronald Smith Risk Manager

• Joana Nogueira Complex Claim Adjuster

• David Todd Loss Adjuster

• Michael Ducker Senior Associate

On The Panel

1. RESORTS

2. INSURANCE

3. LOSS ADJUSTING

4. LEGAL DEFENCE

Four Steps of Claim Management

1. RESORTS

2. INSURANCE

3. LOSS ADJUSTING

4. LEGAL DEFENCE

Four Steps of Claim Management

Waterpark

Food & Beverage

Hotel

RESORTS:SOURCES OF

CLAIMS

ANNUAL ATTENDANCE

Resort Guests: 1.2m

F&B Covers: 4.1m

Waterpark: 1.6m

INCIDENT OCCURS

HOTEL

FOOD & BEVERAGE

WATERPARK

INQUIRY(Fact Finding)

Security

Food Safety

WaterparkManagement

INTERNALREPORTING

Claims Manager

EXTERNALREPORTING

LITIGATIONDEFENCE

Opportunities to Settle

Q.A.Dept.

Risk Management/Legal Department

CLAIM MANAGEMENT PROCESS

• WATERPARK• Slips, Trips and Falls• Collision (slides)• Contusions/Strains/Sprains• Abrasions/Lacerations

• HOTEL• Slips, Trips & Falls• Bruises/Strains/Sprains• Abrasions/Lacerations

• FOOD & BEVERAGE• Food Allergies• Food Contamination• Flu-like symptoms

CAUSES/TYPES OF CLAIMS

• Late or Non-Reporting of Incident

• Failure to Get Statement from Claimant

• Failure to Get Statements from Witnesses

• Inability to Use CCTV Technology

• First Reports from Outside Correspondence

• Aggregation of Low Value Settlement

• Conscious of Power of Social Media

UK: Package Travel Regulations of 1992Tour Operator Claim Management andIndemnification Clauses

Claim Management Challenges

http://www.dailymail.co.uk/news/article-3953448/Travel-firm-uses-spies-rumble-company-bogus-sick-claims.html

1

Trolling for Illness Claims by UK Solicitors

1. RESORTS

2. INSURANCE

3. LOSS ADJUSTING

4. LEGAL DEFENCE

Four Steps of Claim Management

Risks Triggering Your Liability Policy

• Each day brings different incidents with the potential to escalate.

• Some Are Routine:

• Slips and falls,

• Food poisoning,

• Missing items from guests .

• Damages caused by valet parking.

• Others Are Extraordinary:

• An allergy caused by a henna tattoo.

• Child drowning in the adults swimming pool.

Process: Practices for Liability Claims

• Claims handler to acknowledge receipt of a claim in a prompt fashion:• Request further information to assist in taking a coverage position• Appointment of experts to assist in the enquiries when needed.

• Insured to facilitate insurers investigation, acquisition of documentation and evidence.

• Depending on the case, insurers might select to guide the insured how to conclude a simple case. With more complex cases, insurers will establish direct contact with the claimant, with the aim of conducting a successful negotiating. The ultimate objective is to bring the matter to a fair and just conclusion.

• All documents that support payments, diagnosis, disability, evaluations, calculations etc. should be secured and preserved.

• When required, insurers will appoint defense counsel to defend insured interest.

Best Approach in Case of an Incident

• Listen Properly

• Protect guest’s privacy

• Be alert: a docile guest might become an aggressive claimant!

• Report the incident

• Investigation is required to determine liability, the sooner the better

• Decide what information is required and the right questions to ask

• Take photos of the scene, conduct site investigation, and preserve evidence

• Witness memories fade quickly: please secure written statements

What Do People Claim For?

• Property Damage: • The cost of repair or replacement of a damaged or lost object

• Bodily Injury/Illness: • Reimbursement or payment of medical expense and compensation for the pain

and suffering caused by the injury and the effect it has had on their lifestyle.

• Financial losses: • Lost earnings, bonuses and overtime because of the accident; in addition to

travelling expenses for visits to the hospital. Loss of use of vehicle.

• Provisional Damages: • Where there is risk that a medical condition caused by the accident will

deteriorate within a certain time in the future.

Required Information

Incident Report:• Information on the guest (name, age, nationality, ID copy, contact details)• The circumstances (incident date/time, reported date/time)• Action taken• The allegations• Description of the injury or damage• Description of the location of the incident • Photographs / measurements / CCTV footage• Highlights on any demands/allegations

Additional Documents:• Witness statements: Avoid personal opinions• Medical records• Police / Fire brigade report • Damage estimates

Key Points

• Hotels are not liable for every accident or loss that occurs on the premises

• For the hotel to be liable, there should be a proven Breach of duty and causation

• Hotels have a general duty to exercise "reasonable care" for the safety and security of their guests, either to:

a) Correct any situation that can constitute danger (mostly when there are similar incidents reported);

b) Warn on the existence of that danger.

• Hotels may be "vicariously liable" for the NEGLIGENCE of their employees, vendors or 3rd party contractors.

• Take corrective measures to prevent re-occurrence

Alert - Suspicious Claimants

• Opportunists, repeat offenders, professional and organized fraud;

• Motives: greed, financial pressure, moral hazard, arrogance, etc…;

• Indicators: very friendly, very angry, previous history, suspicious circumstances, altered documents, non-disclosure of proper information or documents, exaggeration and fabrication, with an intention to make a gain or cause a loss;

• How we might defeat it: develop an anti-fraud culture, while respecting the company policies and the applicable laws.

1. RESORTS

2. INSURANCE

3. LOSS ADJUSTING

4. LEGAL DEFENCE

Four Steps of Claim Management

What is a Loss Adjuster?

• Insurance claims expert

• Appointed by Insurance/reinsurance carrier

• May specialize in a certain field, e.g., liability claims

• Independent, impartial – first party claims

• Third party claims – we’re on your side!

• Duty to act professionally

The Role of the Loss Adjuster

• Establish the circumstances of loss – Insurer’s eyes and ears on site

• What happened – who, what, where and when?

• Cause – involvement of forensic experts/interview witnesses

• Extent of Loss & Damage – type of injury/extent of physical loss or damage

• Gather evidence – potential defence?

• Subrogation – can I get my money back?

• Communication – with both Insured, Insurers & third parties

Who is at Risk for Claims?

• Hotels

• Restaurants

• Spas

• Water parks

• Theme parks

• Golf course operators

• Marine & aviation operators

Risks & Sources of Potential Liability Claims

• Swimming pools

• Water parks

• Water sports

• Marine pleasure craft

• Desert safaris

• Aviation – hot air balloons/light aircraft

• Slip/trip & fall

• Food poisoning

• Fire

• Golf course risks

• Theft of personal effects

• Valet parking

• Amusement rides

• Miscellaneous – e.g. legionnaire's disease

Risks & Sources of Potential Liability Claims (cont.)

Loss Adjuster Enquiries

• Review of initial documentation received

• Review policy coverage

• Arrange site attendance

• Inspect the situation of accident/incident

• Establish the standard operating procedure

• What went wrong, if anything?

• Gather evidence

• Interview witnesses

• Take photographs

• Prepare report(s) for Insurer’s consideration

1. RESORTS

2. INSURANCE

3. LOSS ADJUSTING

4. LEGAL DEFENCE

Four Steps of Claim Management

Liability Claims: Litigation Process

• UAE Courts:– Civil Courts– Criminal Courts– Shariah Courts

• Litigation divided into three stages:– Courts of First Instance– Courts of Appeal– Court of Cassation

• Procedures of the UAE Courts• Role of advocacy / pleadings • Proceedings in Arabic• Expert appointment

Liability Claims: Duties and Legislation

• Employers required to ensure the health of safety of employees at work, and of visitors to premises

• Breach of this duty, leading to death or injury, can give rise to both financial and criminal penalties

• Principle legislation:

– Labour Law (Federal Law 8 of 1980)

– Penal Code (Federal Law 3 of 1987)

– Protection of Workers from Hazardous Works (Min. Dec. 4/1 of 1981)

– Working in Remote Areas (Min. Dec 27/1 of 1981)

– Employee Penalty Guidelines (Min. Dec. 28/1 of1981)

– Prevention of Hazards at Work (Min. Dec. 32 of 1982)

– Standards of Medical Care (Min. Dec. 37/2 of 1982)

Types of Liability – Criminal / Administrative Sanctions

• Penal Code

• Contains financial and detainment penalties

• Labour Law and Ministerial Decisions

• Breach of H&S obligations punishable by fine >AED10k and/or imprisonment for >6 months

• Fines can be levied against the company, but officers could face imprisonment

• Imprisonment usually only imposed where gross negligence has occurred

• Administrative Sanctions:

• Ministry of Labour and Social Affairs is the competent authority to “police” the workplace and apply certain administrative sanctions

• Ministry can suspend or cancel a company’s licence in the following circumstances:

• Failure to take adequate precautions against H&S risks to employees, visitors

• Failure to remedy violations of the regulations

• Failure to report an accident or death in the workplace

• With the exception of a failure to report an accident or death in the workplace (which attracts immediate criminal proceedings), administrative sanctions are usually applied prior to any criminal sanctions.

Types of Liability – Fixed Compensation

• Shar’ia Principles:

• Diya (blood money for causing a death, currently set at AED200k)

• Arsh (compensation for causing injury, operates on a sliding scale)

• Ghurah (compensation for causing death of an unborn baby)

• The effect of Diya on other forms of compensation?

• Cassation No 119/2004 it was held that claim for material losses (i.e. LOE) can also be made

• Claims culture in the UAE

• Comparison with other jurisdictions

• Damages awards

Types of Liability – Fixed Compensatory Damages

• Any other relevant laws?

• Article 282 Civil Code: general provision whereby those committing acts causing harm to others can be made to account for their actions

• Article 290 Civil Code: damages may be reduced in the case of contributory negligence

• Article 291 Civil Code: principle of joint and several liability

• Vicarious liability?

• Article 313(b) Civil Code: those who suffer damage/loss due to a harmful act committed by a subordinate/employee by virtue of, or during the performance of his job.

• Supervisor: whoever has actual control by way of supervision and direction over a person who caused the damage

Hazards of Litigating in the UAE

• No binding precedent

• Lack of disclosure rules

• “Without prejudice” communications

• Settlement negotiations / admissions of

liability

• Protracted proceedings

• Forum shopping

Q & A