Some members prefer to handle smaller claims on their own and each member has their own reasons for doing so. The MIABC is supportive of this, but there are some restrictions. As a general rule, a member may handle property damage claims that do not exceed $5,000 (or $2,500 for members with a $2,500 deductible). The following points should be considered for claims handled by a member in-house:
- It is important to also report the matter to the MIABC as an incident. Circumstances might change, prompting the member to later refer the matter back to the MIABC. If the MIABC was not notified at the outset, coverage for the claim could be compromised by late reporting. The MIABC will open an incident file, rather than a claim file, to monitor the matter while the member attempts to resolve the claim on their own.
- Bodily injury claims are excluded from in-house handling. This is because even the smallest of bodily injury claims has the potential to escalate into something much larger. There are also requirements under the Health Care Cost Recovery Act to report all new bodily injury claims to the Ministry of Health Services which the MIABC does on behalf of its members. Failure to comply with this legislation may result in a further claim by the Province against the member for recovery of health care costs.
- Settlement of a claim handled by a member must not exceed the applicable amount. Losses to multiple properties caused by the same event constitute one claim; therefore, the member’s limit of $2,500/$5,000 will apply to all claims in aggregate. For example, if a water main rupture floods seven properties, the member may only handle the claim in-house if the total of all seven claims is within the limit.
- Direct negotiation and settlement may only be conducted between the member’s staff and the claimant or family member of the claimant. If a lawyer or adjuster is acting for the property owner, the matter must be handled by the MIABC.
- If a member is handling a claim in-house and new information is revealed indicating that the claim is in fact likely to exceed the limit, or if the claimant retains legal counsel, the claim must then be reported to the MIABC.
- Before settlement is concluded, a Final Release Form must be signed by the claimant. The member is to keep the original signed release in a permanent file and send a copy to the MIABC.