Claims Gulf

Florida politicians let BP know in plain language that they have not been pleased with how the oil giant has been handling claims from the big and small businesses and families hurt by the Gulf oil gusher it created. It so happens that each of the ambitious state politicians is running for a new office and sees an opportunity to score some points with angry, frustrated voters. But that does not diminish their efforts to add to the pressure on BP to do the right thing. That’s about all elected officials can do in this crisis. There is no doubt these pols are also motivated by concern for their fellow Floridians and the state’s environment and economy.

BP senior vice president Bob Fryar at a recent Cabinet meeting claimed turnaround time on claims for individuals has been about 5 days; for small business, about 7 days.

The hold-ups often have to do with paperwork- BP wants to see tax returns or other proof of revenues.

Large businesses including hotels, marinas and restaurants are also hurting yet BP was just getting around to setting up system to expedite these claims weeks after the explosion in the Gulf.

“I don’t think speed is in your vocabulary yet,” Chief Financial Officer Alex Sink told Fryar at the Cabinet meeting. “People are just trying to survive. These people need money in their bank accounts. I’ve seen grown men cry.”

Sink added: “Your definition of speed and mine are two different things.”

“The speed with which claims are paid relieves a lot of suffering,” reiterated Gov. Charlie Crist. “These families don’t have a lot of resources.”

Gov. Charlie Crist also asked BP to fork over more money. “We demand it,” Crist said. “You’re a company with enormous resources.”

Attorney General Bill McCollum pressed BP to set up an escrow account, as has been recommended by others. “There’s got to be more you can be doing,” said McCollum, venting frustration shared by many Floridians.

Sink said the $5,000 interim payments BP is handing out are being looked at as “shut up money” by many whose immediate cash flow needs are much greater than that.

There are laws governing claims process for insurance companies -but it’s not clear what people can expect from BP. Sink has called for the federal government to take over the entire claims process.

Engineers are still trying to figure out how to plug the gusher-something BP should have been required to prove it could do before it was even allowed to begin deep sea drilling.

Similarly, it has become clear that large self-insured firms like BP should also be required to have plans in place for handling claims in an emergency rather than trying to create the systems after an explosion, when the firm’s main focus needs to be on stopping the damage. The plans should include the “definition of speed” that CFO Sink reminds us has been missing from BP’s current efforts.

Businesses and individuals shouldn’t have to wait days or weeks for systems to be worked out after an explosion. As Sink notes, insurers have to follow laws; there should be laws to protect BP claimants, too.

Topics Claims