A story posted yesterday on AZCentral.com raises some troubling ethical questions about the involvement of insurance company investigators in fire investigations conducted by public fire officials. Historically, insurance companies have routinely cooperated with public fire investigations, offering expertise and resources not available to public sector fire investigators.
Could that level of cooperation be coming to an end? Could it jeopardize the criminal prosecution of arsonists? That is one implication of an in depth article written by Wendy Halloran on the case of Barbara Sloan, who was charged with arson by the Phoenix Fire Department in 2009.
Among the questions raised: what happens when an insurance company representative’s annual bonus hinges on a certain claim being denied due to a fire being determined to have been set by the insured? Might that bonus be incentive enough to bias the insurance representative (adjuster, agent, or investigator), or pressure others to change their opinions about how a fire started? And might it influence the level of assistance the insurance company renders to a local fire investigator in a given case?
Probably the most troubling question posed by the Halloran article: might an insurance company’s investigator provide evidence to public fire investigators that incriminates an insured of arson while simultaneously concealing exculpatory evidence?
The AZCentral article is worth the read. While I disagree with the implication that insurers should be prohibited from cooperating with public fire officials and sharing information, it would seem to me that some ethical guidelines need to be considered.
As an initial thought, any exculpatory evidence in the possession of a cooperating insurer should be required to be produced. PERIOD. END OF STORY. After all, an insured pays a premium to an insurer and is entitled to the insurer honoring the covenant of good faith and fair dealing. It is hard to consider a more glaring example of bad faith by an insurer, than conducting an investigation seeking to find incriminating evidence against the insured so as to be able to deny the claim, finding instead exculpatory evidence, and then concealing that exculpatory evidence.