HOW TO DEAL WITH SUBSCRIBER’S LOSS
The only news worse than hearing that your subscriber suffered a loss [and the alarm didn’t function as expected – by you or your subscriber], is the correspondence from your subscriber or its insurance company or lawyer asking for records regarding the alarm system and incident records. Your level of panic will correspond fairly closely with 1) the importance of the subscriber, 2) the nature of the loss, personal injury, death or monetary, 3) what information you have on why the alarm system or alarm services failed, assuming it did, 4) the strength of your contract with the subscriber and 5) your insurance coverage.
Though the inquiry for information or records could be merely exploratory, rather than accusatory, you should still treat it as a “claim letter”. The claim letter puts you on a “higher alert” and triggers certain responsibilities that you need to be aware of and comply with quickly. It’s possible that you have already taken all of these steps as soon as you became aware of the loss, even without a “claim letter”. But, if you haven’t, at the very least you need to 1) conduct an internal investigation and get written incident reports from all personnel involved in the alarm system or alarm services. This can include installers, repair techs and central station operators; 2) preserve all records, which would include contracts, correspondence, completion certificates, repair orders, central station activity reports, recordings and video and audio data; 3) contact your insurance company. Your notice to the insurance company must be reported to the carrier in conformance with the insurance policy terms and conditions. The policy will tell you where to send the Notice of Claim. Reporting to your broker will not usually comply with the policy notice requirement, though your broker can send in the notice of claim for you. 4) ask your carrier for immediate assistance of counsel, especially if you think there is any possibility that you won’t have coverage for the claim or enough insurance to cover the claim. In other words, if there is a chance that you may be on the hook for any part of the loss, as opposed to your insurance carrier, you want to be certain that you are properly guided from the start. A mistake on your part at the beginning could have consequences at the end of the matter.
Here is a quick guide:
Step one. Email your insurance company claims department that you have a potential claim. Ask that they provide you with guidance now since the subscriber is requesting information. Ask them to engage me [they might depending on which carrier and how demanding you and your broker are about it].
Step two. If you notify only your broker instead of the carrier claims department then you have to get copy of written notice sent by your broker to the claims department of the carrier. Notifying the broker does not satisfy the obligation to notify the carrier.
Step three. Preserve all records for this subscriber. That should include contracts, service records and central station activity reports. Make sure you print out hard copies and retain the electronic copies as well. Put in safe place because it could be while before you need these documents.
Step four. Unless the carrier offers to provide immediate guidance and instruction otherwise, you can provide the subscriber with any records and documents that pertain to that subscriber. You should not however provide any internal investigative reports or incident reports generated by you or the central station. You should not offer any explanation of how the fire loss occurred.