Administrative Lessons Learned Two Years After the BP Oil Spill

As the two-year anniversary of the capping of the Deepwater Horizon oil well approaches, the administrator of the BP Oil Spill Fund, Kenneth Feinberg, has released a book detailing his 30 years of experience as a fund administrator. Feinberg has administered or mediated such high profile cases as the Agent Orange class action lawsuit, a settlement that took place just hours before the trial was set to begin; the 9/11 Victim Compensation Fund; the Hokie Spirit Memorial Fund, instituted after the 2007 shootings on that campus; the executive compensation fund following the 2008 financial crisis; and the latest crisis fund Feinberg has mediated, the BP Oil Spill fund.

When asked if he would do it again, despite harsh criticisms against his administering of the fund, Feinberg said yes, according to a report by www.claimsjournal.com. Of course the amount of compensation could never replace the lost livelihood suffered by the victims of the Gulf oil spill, which in turn led to a bone of contention between Feinberg’s offices and those he was compensating.

Before the BP oil spill, funds to compensate victims usually were paid with taxpayer money. BP, through a handshake deal with President Obama, agreed to front $20 million dollars toward a compensation fund. And though this was a first of its kind situation, the funding of the fund by the company responsible for the actions causing its establishment in the first place, he does not foresee events working out this way again. Normally, companies deny liability for tragedies that they are involved in, preferring to litigate the matter for an extended amount of time.

What has Feinberg learned over the course of his latest job? Responding quickly and forcefully to criticism is important, as is admitting a mistake if one was made. Another lesson learned through his administration of the BP oil spill fund was to not overpromise when providing a timeline for claims processing. On the same note, delivering compensation in a fast and efficient manner is of vital importance, something which insurance companies should take to heart.

For more information about lessons learned after the BP Oil spill, visit: http://www.claimsjournal.com/news/national/2012/06/18/208659.htm