Column: Risk Management

A Slanted Field

By: | August 29, 2017 • 3 min read
Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at [email protected]

I recently underwent a surgical procedure. At my pre-op appointment, I met with my surgeon and other supporting medical staff. Upon entering the room, the surgeon asked me: “How are you, Jennifer?” I worryingly answered: “Um. My name is Joanna.”


The doctor hastily looked through his records, realized he had the wrong chart, the wrong sample labels, and likely was preparing for the wrong procedure. We all joked at the error, but I won’t lie, before they put me under, good risk management forced me to ask the anesthesiologist if he knew my name. “All will be ok, Joanna.” And it was.

It is a somewhat funny story, only funny as nothing went wrong. But for some people, this is not the case. Medical malpractice and errors happen. These errors can be devastating.

A 2011 study in the New England Journal of Medicine reported that 75 percent of physicians in “low-risk” specialties and virtually 100 percent of physicians in “high-risk” specialties could expect to face a malpractice claim during their careers, with 73 percent of those settled malpractice claims involving medical error.

These torts are real, people do suffer. A $250,000 damage limit feels wrong. It feels too low.

Every professional, myself included, obtains professional liability insurance to assist with costs of potential lawsuits that stem from our errors or misconduct. This is no different for doctors.

But for some reason, doctors appear to be receiving preferential consideration. The House recently passed medical tort reform legislation, Protecting Access to Care Act (H.R. 1215), intended to lower the cost of health insurance by 25 to 30 percent, according to the CBO, by lessening the burden of medical lawsuits. The bill caps non-economic damages such as punitive damages at $250,000 for medical malpractice.

This reform made me pause. How can we allow such discrimination between victims of medical malpractice and victims of other torts? Why handcuff our judicial system and limit a jury as to what they can award victims for non-economic damages – pain, suffering, diminished enjoyment of life?

These torts are real, people do suffer. A $250,000 damage limit feels wrong. It feels too low.

I think of the infamous McDonald’s hot coffee burn claim. In 1994 Stella Liebeck received $160,000 to cover medical expenses after suffering third degree burns for coffee split on her lap.

In addition, the jury felt it important to affect behaviors at McDonald’s when they learned that such burns where not unique to Liebeck. Allegedly 700 persons reported burns from their coffee over a decade only to be ignored.

The jury felt this safety hazard needed addressing. It awarded punitive damages equivalent to two days’ worth of coffee revenues at McDonald’s, which amounted to $2.7 million. The trial judge reduced the final verdict to $640,000. Nonetheless, McDonald’s heard the message and has since lowered the temperature of its coffee.


Let’s not get duped into thinking that tort reform is needed to curtail greedy claimants and frivolous lawsuits. Punishment is intended to change bad behavior. Punishment has to be painful to truly deter repeated misconduct.

What would McDonald’s think of a $250,000 punishment? What is that — four hours’ worth of coffee sales?

We have to look at what these tort reforms are actually reforming: Insurance companies’ bottom lines, supported by predictable budgets and litigation outcome certainty.

But these kind of tort reforms also impact victims’ rights and liberties and judges’ ability to dispense justice. The biggest damage here is to democracy itself. What is that worth? &

More from Risk & Insurance

More from Risk & Insurance

2018 Power Broker

To the Ends of the Earth

From the frozen Arctic to the inferno of a high net worth divorce, Power Brokers go to extremes to find solutions for their clients.
By: | February 20, 2018 • 2 min read

Looking for the Power Broker Winners? Click Here.

Picture this: A bitter divorce so heated that the principals are only communicating through their attorneys. Then their house burns down. Imagine walking into that situation and trying to find solutions that will please both parties.

But that’s exactly what 2018 Power Broker® Jeff Kaplan, family office practice leader, Risk Management Strategies, did.

Kaplan, who won in the Private Client category, negotiated the sale of the property — forget the rebuild, let the new owner take that on, he counseled his clients — orchestrated a 30-day auction for its sale, and achieved a profitable result for every party in the transaction, each half of the feuding couple and the developer of the sold property.

To the client, Kaplan’s work, including his high degree of emotional intelligence, released him from the “seventh circle of hell.”

From that doused inferno, let us now cast our eyes to the frozen north.


The owner of a barge learned their property sank off of Nome, Alaska, (average temperature 27 degrees Fahrenheit). With an approaching freeze threatening to seal off the harbor, the owners, Phoenix Marine, risked losing valuable equipment.

Into action sprang George Andersen, a 2018 Power Broker® in the Marine category. With precious little time to lose, Andersen negotiated the claim and communicated proactively with the U.S. Coast Guard and other officials. Then he commissioned salvage divers from New York to travel to Alaska and retrieve the valuable equipment from the sunken barge.

Before we depart the Arctic, let us consider another 2018 Power Broker® from Aon, Christian Wise. To arrange cover for a defense contractor’s radio installations in a remote Arctic location, Wise dispatched a loss control engineer, complete with instructions on the use of a shotgun should polar bears interlope in temperatures that registered negative 29 degrees Fahrenheit.

One of the radio installations had already burned to the ground due to scant local fire protection, culminating in a $20 million loss. Despite that, working with London underwriters, Wise and his team were able to shave $1.3 million off an initial property premium cost of $1.8 million.

Power Brokers are judged by a team of Risk & Insurance® editors and writers over a three-month period each year. After interviews with hundreds of sources, winners are picked for their creativity and resourcefulness, their excellent customer service and their industry knowledge.

Not every Power Broker® required one of their associates to tote a shotgun. But many of them went to extremes for their clients; some of them waded into hurricane ravaged neighborhoods to document damage; others put their personal lives on hold, including one Power Broker® who delayed his honeymoon to attend a meeting on behalf of his client.

This year, 158 Power Broker® winners were chosen, as well as 55 finalists, spanning 25 industry categories. Congratulations to every one of these exceptional individuals. Click here to begin reading the profiles of this year’s winners. &

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]