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SNOW AND ICE MANAGEMENT AND ICE MAN Lessons in Liability How to protect your snow removal business from liability issues By Randy Str ait In most areas of the United States, winter can be a dangerous season — and not just because of the inevitably risky driving con- ditions. Every year, thousands of people slip and fall on the ice. Sidewalks and parking lots are transformed into sheets of ice, and it's not uncommon for accidents to happen and injuries to occur. Quick to follow those injuries are expensive liability lawsuits, as the courts look for someone to blame. More often than not, the snow removal contractor will be the party left holding the bag. Prevalent in nearly all areas of the country, liability cases have been rapidly increasing over the years. More and more people are seeking outrageous amounts of financial gain after a fall, and will fight whomever they need to in order to collect.As a snow removal contractor, it's important to do whatever it takes to protect the com- pany and its clients from these potentially massive monetary losses. When one thinks of accident prevention, insurance is probably among the first phrases that come to mind. Although it is extremely vital for a snow removal company to have a solid policy, it's not the only protection needed. Setting clear terms in a contract and following best plowing practices will also go a long way in protecting a business. Ensure you're insured Owning a snow removal business can be expensive. From purchasing necessary equipment to hiring and training new employees to marketing the company, the costs truly add up. But perhaps the most important expense that goes into a business is a solid insurance policy. Because the snow removal business can be unpredictable, it's crucial for a contracting company to have an insurance policy that's large enough to cover the many claims that may arise. In fact, it's not unusual for the policy to be worth upwards of $3 million. Although the biggest overhead the company has, liability insurance isn't a choice in the snow removal industry. If an injured party files a claim against a contractor who doesn't have insurance, the contractor must pay the entire amount out of his or her own pocket.This could quickly end up costing the contracting company hundreds of thousands of dollars — easily wiping out much of its annual revenue. Consider the following scenarios:A truck driver slips on the ice and injures his or her back. If the injury is severe enough that he or she can't drive truck again, the claim will be enormous. It goes far beyond just paying for the medical costs. The snow removal company will also be responsible for paying his or her livelihood expenses. If the driver was making $40,000 a year and still had 20 expected years left on the job, the cost of the claim quickly adds 20 Arbor Age / November/December 2011 up and will suddenly be worth several hundred thousand dollars. Another scenario is the possibility of employee injuries on the property. If one of the client's employees slips and falls, they will likely file for worker's compensation.Worker's compensation pro- vides wage replacement and medical benefits for employees who are injured on the jobsite. In return, the employee must relinquish their right to sue the employer for negligence.This is a key con- sideration for contractors because the insurance company that covers that business's worker's compensation policy will likely seek restitution from the snow removal contractor. Furthermore,when a policy is up for renewal, large claims often come back to haunt the contractor — adding expense to his or her renewal. If the snow removal business has several claims against it, the insurance company will base its new policy off of those claims. Whether they were paid out or not, the insurance company will see them as potential losses. If the contractor has the potential to lose hundreds of thousands of dollars, the cost of their policy will greatly increase. Hands down, the best way a snow removal company can protect itself upfront is having a reasonable insurance policy.But when a slip and fall claim goes to court, and proof of a contractor's specific whereabouts is required, it's wise to arrive prepared. That's the ticket Another kind of "insurance"a snow removal contractor ought to put into practice won't be found through an insurance company. Should the contracting company ever be deposed in a court case, a great way to protect itself is by implementing a job ticket system. Common in snow removal contracting businesses — both big and small — paper job tickets have been widely used to track com- pany and employee information. A job ticketing system provides up-to-date information about the amount of hours spent on each job and who was delegated to which area. Although the idea behind it is good, the execution of a paper system may not hold up in court. Compared to electronic records, paper is not as trustworthy, and its authenticity can easily be questioned.To combat this concern, many snow removal con- tractors have adopted an electronic job ticket system. If all employees possess GPS phones, their activity can instantly and easily be tracked and recorded. Information on when the crew was dispatched, what time the job was started, and how long it took to complete will be crucial in court, even several years down the road. Once an insurance policy is intact and a job ticket system has been implemented, the next step is setting up a provisional contract with each client prior to the start of the winter season. www.arborage.com