Scenario
A member was injured while climbing onto the sorority’s homecoming float. The member was walking along side the float with other members. The float was towards the back of the parade and was starting to fall behind. The walkers were instructed to board the float to speed up the procession. While the member was boarding the float, the driver accelerated. The member was wearing a toga that became entangled in the axle. The member’s body became locked in the axle of the trailer. It is alleged that the member was dragged for 110 feet. The member suffered severe and permanent injuries due to the accident.
A lawsuit was filed naming the University, the City, the driver of the float and the Sorority. The young man who drove and owned the truck and the trailer in which the float was built on had liability limits of $100,000. The City was dismissed from the lawsuit and the University was on the verge of being dismissed based on sovereign immunity. The driver of the truck argued that he was acting as an agent of sorority and the sorority should be vicariously liable for his actions which were allowing individuals to sit in the truck and block the view of the trailer and accelerating before accounting for the whereabouts of the participants. Defense Counsel felt that there was a good chance the sorority would be found to be vicariously liable for the driver’s actions.
The lawsuit settled during mediation for $1,500,000.
Issues to discuss
- How do your policies address events such as the one described above? What policies were broken in the above described claim? What policies would have prevented this claim from happening?
- What additional risk management policies should have been in place to minimize the likelihood of a claim like this happening again?
Scenario
A member was injured at a chapter event when she stepped on a piece of glass that was on the dance floor and sustained a laceration to her foot. There was a sign posted at the bar stating that no glass bottles were to be taken onto the dance floor. It was discovered that the chapter did not have a chaperone at the event even though their manual stated that a chaperone should be present at all events. It was argued that had the chapter followed its own policy and had a chaperone at the event, the chaperone would have been there to enforce the rule of no glass bottles on the dance floor.
Result
While there were other factors involved, the argument regarding the chapter not following their policy factored into the decision, and the insurance company settled the claim on the organization’s behalf for $187,500.
Issues to discuss
- What are your policies regarding chaperones?
- Are your policies reviewed on a regular basis to make sure they are up to date?
- When policies are not followed, they can be used against you.
Scenario
The chapter hired two buses to take their members and guests to and from an event. One bus had security, but the senior bus did not. On the senior bus, a fight broke out between two members’ boyfriends. One of the young men sustained a broken nose, as well as other facial fractures during the fight. It was confirmed by using Facebook that alcohol was being consumed on the bus.
Result
The claimant’s attorney alleged that the chapter did not provide the property security. He argued that if one bus had security, the other one should also and if it did that his client would not have been injured in a fight. The claim settled for $37,500.
Issues to discuss
- What are your policies regarding security?
- What are your policies regarding transportation to and from events?
- What policies would have prevented this incident from occurring in the first place?
Claims Involving a House Director
- The House Director purchased personal items on the Chapter’s account. The Chapter became aware of unusual purchases such as gift cards and began to investigate further. During the investigation, the Chapter discovered that when they would issue a check to Costco, the House Director would purchase gift cards for her personal use instead of food for the Chapter. The insurance carrier paid $7,326.90. The total amount of the loss was $9826.90 A $2,500 retention was applied.
- The House Director would alter/increase Sam’s Club invoices when she submitted them to the House Corporation for reimbursement. The insurance carrier paid $134,036.87. The total loss was $234,036.87. A $100,000 retention applied.
- The House Director opened a second Costco account membership without the knowledge of the House Corporation. The House Director used the card to purchase Costco Cash Cards, gift certificates and other personal items. The insurance carrier paid $53,066.94. The total amount of the loss was $58,066.94. A $5,000 retention was applied.
Claims Involving the House Corporation
- The House Corporation Treasurer embezzled approximately $37,000. The majority of the funds were taken by the Treasurer writing checks for cash. The embezzlement was discovered when the new House Corporation Board took over and realized that payroll withholding tax had not been paid, which lead to an audit. At the time the money was embezzled, the checks did not require two signatures. The insurance carrier paid $32,000. A $5,000 retention was applied.
- The House Corporation Treasurer embezzled money from the House Corporation funds. The House Corporation Treasurer wrote checks for cash and for personal items. The checks only required one signature. The claim was discovered when a new House Corporation Treasurer took over. The insurance carrier made a payment of $146,859. The total amount of the loss was $149,359. A $2,500 retention was applied.
- The House Corporation Treasurer wrote checks to pay for the remodeling of her house. Only one signature was required on the checks. The loss was discovered by another member of the House Corporation during an annual review. The insurance carrier made a payment of $16,856.96. The total amount of the loss was $19,358. A $2,500 retention was applied.
- The House Corporation Treasurer issued checks to herself and made ATM withdrawals using the House Corporation’s bank card for personal purchases. The loss was gradually discovered when the Treasurer became difficult to reach, checks started bouncing and bills started to go unpaid. At the time, the House Corporation only required one signature to be on checks. The insurance carrier paid $33,143. The total amount of the loss was $35,643. A $2,500 retention was applied.
- A House Corporation President stole over a million dollars over a seven year period. The House Corporation President would use House Corporation funds to pay several of her personal credit cards every month. Most of the payments were coded under food, house supplies, and repairs. The House Corporation President was the only board member. Therefore, no one else was reviewing payments issued out of the House Corporation’s account. The loss was discovered when another volunteer assumed the role of the House Corporation President. The volunteer immediately questioned payments issued to credit cards companies as the House Corporation did not have a credit card in their name. The insurance carrier paid the policy limit of $500,000. The total amount of the loss was $1,600,000.
- A House Corporation President stole $106,348. The loss was discovered as the House Corporation President failed to respond to a new House Corporation member. The new House Corporation member was able to follow a paper trail to find out the bank the House Corporation used. It was discovered that the account had been depleted. The funds were used for the House Corporation President’s personal use. Only once signature was required to be on the checks and the House Corporation President was the only person with access to the House Corporations account. The insurance carrier paid $101,348. A $5,000 retention was applied to the loss.
- A House Corporation President colluded with a third party and stole approximately $3,000,000. The House Corporation President set up a separate account without the knowledge of the other members of the House Corporation. The House Corporation used dual controls for legitimate business purchases. The insured carrier paid the policy limit of $500,000.
Claims Involving Chapter Officers
- The Chapter Treasurer wrote checks to herself by signing the previous Chapter Treasurer’s name to the checks. The loss was discovered when the Chapter discovered unpaid bills. After learning of the unpaid bills, the Chapter ordered bank statements and discovered the embezzlement. The insurance carrier paid $4,674.11. The total amount of the loss was $7,174.11. A $2,500 retention was applied.
- The Chapter Treasurer stole Chapter funds by issuing reimbursement checks to herself. The Treasurer falsified a spreadsheet and made up expenses that she allegedly incurred. When questioned about this, the Treasurer could not provide any documentation or receipts. The loss was discovered when bills were not being paid. The insurance carrier paid $10,782.73. The total amount of the loss was $13,282.73. A $2,500 retention was applied.
Claims Involving Headquarters Staff
- The Finance Director wrote checks to herself and other entities. The loss was discovered after the Finance Director was terminated. While cleaning out her desk, checks with forged signatures were discovered. This prompted the organization to review their bank accounts. It was discovered that the Finance Director had been making payments to her mortgage and credit card companies for a few years. The insurance carrier paid out $80,043.59. The total amount of the loss was $85,043.59. A $5,000 retention was applied.
- An employee and her husband colluded to steal badges that had been returned to the organization and stored at Headquarters. Additionally, the employee was also misdirecting the shipments of new member badges to her home address and selling for scrap value. Both the former employee and her husband were arrested. The insurance carrier paid the policy limit of $500,000. The total amount of the loss was $696,803.
Retentions are used by Chubb Insurance and they are also called deductibles which is more commonly known. You will find varying retentions depending upon:
- When the claim occurred (insurance company keeps increasing the deductibles as the claims experience trends in the negative
- When the claim occurred and whether there was evidence of dual controls
Scenario
After going through the organization’s appeal process in an attempt to have her membership reinstated, a former member filed a lawsuit alleging fraud and breach of contract. The lawsuit alleged that the organization failed to follow their own internal rules and procedures in terminating the plaintiff’s membership. Throughout the appeal process and the lawsuit, the organization stood by their decision to terminate the plaintiff’s membership. The organization did agree to pay $5,000 to the plaintiff for a settlement, but did not agree to reinstate the plaintiff’s membership. The defense costs in the matter totaled $66,207.
Issues to discuss
- The above claim example demonstrates the importance of following all proper procedures and policies when it comes to disciplinary issues. Even though the organization in this situation felt that they were on solid footing in how they handled the plaintiff’s membership termination, the insurance company still paid nearly $70,000 to defend the claim on the organization’s behalf. What are your organization’s policies and procedures regarding membership termination?
- What additional risk management policies might minimize the likelihood of a claim like this happening again?
Scenario
Two former members accused of hazing alleged that they were not given the required due process in their inappropriate dismissal from the organization. An actual lawsuit was not filed in the matter. A claim was submitted and the insurance carrier assigned defense counsel who worked with the claimants’ attorney to prove to him that the members were given due process and the termination of membership was appropriate. The claimant’s attorney eventually dropped the claim. However, the insurance company paid over $5,000 in defense costs.
Issues to discuss
- The above claim example demonstrates the importance of following all proper procedures and policies when it comes to disciplinary issues. Even though the organization in this situation felt that they were on solid footing in how they handled the former members’ dismissals, the insurance company still paid over $5,000 to defend the claim on the organization’s behalf. What are your organization’s policies and procedures regarding membership discipline and termination?
- What additional risk management policies might minimize the likelihood of a claim like this happening again?
Scenario
At a fraternity chapter house that was hosting a party, Jane Doe, chapter member, went out a second-floor door to a fire escape platform and fell through the hole, which provided a ladder access to the ground.
There had been a previous fall from this fire escape at the chapter house in question, and the chapter leadership posted a hand-made warning sign at the exit to the fire escape as a warning.
Result
Jane Doe suffered serious injuries and sued the Fraternity and House Corporation. The national Fraternity was dismissed from the lawsuit; however, the House Corporation was found 56 percent at fault with nearly $120,000 in damages.
Issues to address:
- The fire escape had already caused problems at this chapter, and the House Corporation did not address those concerns properly. Once a dangerous condition at the property is revealed, it must be appropriately addressed.
- How should the concerns about the fire escape have been addressed after the first incident?
- What risk management policies does your Chapter/House Corporation have in place regarding fire escapes?
This guide from Travelers, the insurance company for MJ Sorority clients, provides information on incorporating best practices and a prevention plan to help reduce the risks of slips, trips and falls at your business and on your premises.
Every year, up to 20 percent of the population in the United States contracts the flu virus. The effects of flu vary
from mild symptoms to severe illness and complications, including death. Disease experts have calculated that
once every 30 to 40 years, pandemic influenza affects people globally, resulting in a significantly greater number
of illness and deaths than the annual flu.
How flu spreads
Flu viruses spread in respiratory droplets through person-to-person or other close contact. Most adults can infect
others beginning one day before symptoms develop and from up to five to seven days after becoming sick. This
means that you can pass on the flu to someone else before you know you are sick, as well as while you are sick.
Human influenza viruses generally can survive on surfaces for two to eight hours.
Good health habits
Maintaining good health habits is important to keep you healthy and to minimize the spread of the influenza
virus. The Centers for Disease Control and Prevention (CDC) and other health organizations suggest exercising
regularly, getting enough rest and eating healthful balanced meals, in addition to a number of precautions to help
protect yourself and others from transmitting the flu. These precautions may include, but are not limited to:
- Avoid close contact with people who are sick. Keep your distance from others to help protect them from getting sick too.
- Stay home when you are sick. Prevent others from catching your illness.
- Keep your hands clean. Wash your hands often and rub hands vigorously for at least 20 seconds. If you do not have access to water and soap, use alcohol-based gels or hand sanitizers.
- Cover your mouth and nose. Use a tissue when coughing or sneezing to help prevent spreading the virus or, as the CDC suggests, sneeze or cough into your arm or sleeve. Viral droplets are less likely to spread doing this than coughing into your hands.
- Avoid touching your eyes, nose or mouth. Germs are often spread when a person touches something that is contaminated with germs and then touches his or her eyes, nose, or mouth.
For additional information visit the CDC website. The information provided in this document by Travelers is intended for use as a guideline and is not intended as, nor does it constitute, legal or professional advice. Travelers does not warrant that adherence to, or compliance with, any recommendations, best practices, checklists, or guidelines will result in a particular outcome. In no event will Travelers, or any of its subsidiaries or affiliates, be liable in tort or in contract to anyone who has access to or uses this information for any purpose. Travelers does not warrant that the information in this document constitutes a complete and finite list of each and every item or procedure related to the topics or issues referenced herein. Furthermore, federal, state, provincial, municipal or local laws, regulations, standards or codes, as is applicable, may change from time to time and the user should always refer to the most current requirements. This material does not amend, or otherwise affect, the provisions or coverages of any insurance policy or bond issued by Travelers, nor is it a representation that coverage does or does not exist for any particular claim or loss under any such policy or bond. Coverage depends on the facts and circumstances involved in the claim or loss, all applicable policy or bond provisions, and any applicable law.
CDC recommends a three-step approach to fighting influenza (flu). The first and most important step is to get a flu vaccination each year. But if you get the flu, there are prescription antiviral drugs that can treat your illness. Early treatment is especially important for the elderly, the very young, people with certain chronic health conditions, and pregnant women. Finally, everyday preventive actions may slow the spread of germs that cause respiratory (nose, throat, and lungs) illnesses, like flu.
How does the flu spread?
Flu viruses are thought to spread mainly from person to person through droplets made when people with flu cough, sneeze, or talk. Flu viruses also may spread when people touch something with flu virus on it and then touch their mouth, eyes, or nose. Many other viruses spread these ways too.People infected with flu may be able to infect others beginning 1 day before symptoms develop and up to 5-7 days after becoming sick. That means you may be able to spread the flu to someone else before you know you are sick as well as while you are sick. Young children, those who are severely ill, and those who have severely weakened immune systems may be able to infect others for longer than 5-7 days.
What are everyday preventive actions?
- Try to avoid close contact with sick people.
- If you or your child gets sick with flu-like illness, CDC recommends that you (or your child) stay home for at least 24 hours after the fever is gone except to get medical care or for other necessities. The fever should be gone without the use of a fever-reducing medicine.
- While sick, limit contact with others as much as possible to keep from infecting them.
- Cover your nose and mouth with a tissue when you cough or sneeze. Throw the tissue in the trash after you use it.
- Wash your hands often with soap and water. If soap and water are not available, use an alcohol-based hand rub.
- Avoid touching your eyes, nose and mouth. Germs spread this way.
- Clean and disinfect surfaces and objects that may be contaminated with germs like the flu.
- If an outbreak of flu or another illness occurs, follow public health advice. This may include information about how to increase distance between people and other measures.
What additional steps can I take at work to help stop the spread of germs that can cause respiratory illness, like flu?
- Find out about your employer’s plans if an outbreak of flu or another illness occurs and whether flu vaccinations are offered on-site.
- Routinely clean frequently touched objects and surfaces, including doorknobs, keyboards, and phones, to help remove germs.
- Make sure your workplace has an adequate supply of tissues, soap, paper towels, alcohol-based hand rubs, and disposable wipes.
- Train others on how to do your job so they can cover for you in case you or a family member gets sick and you have to stay home.
- If you begin to feel sick while at work, go home as soon as possible.
For more information, please visit www.cdc.gov/flu or call 1-800-CDC-INFO
This guide from Travelers, the insurance company for MJ Sorority clients, provides step by step instructions on how to develop a fire safety plan for your building.
This guide from Travelers, the insurance company for MJ Sorority clients, provides information for property owners on liability regarding sidewalks.