[Bed Bug Supplement] From The Claims File

Supplement - Bed Bug Supplement

What happens when an account prevents you from performing work you know is necessary? And then you’re sued as a result?

September 29, 2015

Bed bug claims are now more common than ever. Attorneys around the country are starting to specialize in suing anyone who has anything to do with the account, mainly due to some of the large settlements and jury verdicts the public is seeing in the news. Let’s look at this bed bug case and see if you could have had this case dismissed:

Our insured treated a hotel. Bed bugs were found on the second floor but the PMP also wanted to inspect the rooms to the side, three rooms above and three below to see if there were any live bed bugs. It’s a fairly reasonable request. However, the manager said “no” as he didn’t want to pay for these “extra” inspections. So the insured treated the one room. Months later he gets sued by a customer who stayed at the hotel and was bitten by bed bugs.

It is rare that the pest management professional gets sued directly from the plaintiff. It is more common to be brought in on a third-party action by the hotel (the hotel gets sued by the customer and the hotel then sues the pest company after that). This is where it gets interesting.

Our investigation revealed that the room where the customer was bitten was one of the rooms that our insured wanted to treat but was told no. In reading the allegations, the customer sued our insured because, “We should have forced the manager of the hotel to inspect the room where the plaintiff was bitten.”

Yes, they said “forced.”

After shaking my head, I called the plaintiff’s attorney and went over the facts and asked why our insured was sued directly by his client. After the typical “lawyerese” response I basically told the attorney he had no contract with our insured so that exposure is out. We have it documented that we requested to inspect that room but were refused by the hotel manager. Five days later our insured’s lawsuit was dismissed. How did we get a dismissal that fast?

Questions to Consider.

What if this were to happen to your firm? Are you ready and able to respond appropriately? Consider the following:

1. How did the PMP document the manager refusing the other inspections?

2. Is documentation in your file sufficient?

3. What other documents should be used to protect your company when this happens (and it happens a lot!)?

4. Is it worth servicing the account when the customer limits what you know needs to be done vs. what services you end up performing? Are you ready to walk away if necessary?

Our Answers.

Fortunately, this PMP had all of his ducks in a row. In response to the previous questions:

1. This insured used a follow-up letter that we supplied and was created for this type of circumstance. It confirms the date of service and what the PMP offered to the customer in regards to the services that should be rendered. More importantly, it documented ONLY the services the owner/manager allowed our insured to perform, along with a comment about possible future infestations due to that decision.

2. Not only is documenting the prevention of the services you wanted to offer sufficient, it is everything. Today’s attorneys are not only subpoenaing your treatment records but also your training records, who attended training sessions, etc.

3. As stated previously, in-house training records are now being asked for by the plaintiffs, as are labels, SDS sheets, CEU certifications, etc. Plaintiffs’ attorneys are asking for everything you can imagine!

4. This is the one that is 100 percent up to you. Is any particular account “worth it”? It took years for PMPs to learn to walk away from termite contracts on houses with conducive conditions that were not corrected by the customers. There is no difference here, other than the fact that the defense costs are usually a lot more for bed bug exposures vs. termite claims.


Andy McGinty is executive vice president and COO of LIPCA Insurance, Baton Rouge, La. Learn more at www.lipca.com.