Ray v. Draeger , 2015 Alas. LEXIS 76 ( 2015 )


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    THE SUPREME COURT OF THE STATE OF ALASKA
    KIMBER RAY,                                     )
    )        Supreme Court No. S-15347
    Petitioner,              )
    )        Superior Court No. 3AN-12-11421 CI
    v.                                       )        District Court No. 3AN-11-08969 CI
    )
    MEGAN DRAEGER,                                  )        OPINION
    )
    Respondent.              )        No. 7020 – July 17, 2015
    )
    Petition for Hearing from the Superior Court of the State of
    Alaska, Third Judicial District, Anchorage, John Suddock,
    Judge, on appeal from the District Court of the State of
    Alaska, Anchorage, David Wallace, Judge.
    Appearances: Michael J. Hanson and Barry Kell, Call &
    Hanson, P.C., Anchorage, for Petitioner. Jeff Barber,
    Barber & Banker, LLC, Anchorage, for Respondent.
    Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and
    Bolger, Justices.
    FABE, Chief Justice.
    I.     INTRODUCTION
    In a personal injury trial resulting from a car accident, the plaintiff sought
    to cross-examine the defendant’s medical expert about his substantial connection to the
    insurance industry in an effort to prove bias. But in response to defense counsel’s
    motion in limine, the district court ruled that the plaintiff could not refer to the fact that
    the defendant was insured or that her insurance company and others had hired the expert
    witness numerous times. The trial court did permit the plaintiff to cross-examine the
    expert witness about his financial interest in continuing to work for “defendants” and
    “defense attorneys.”
    On appeal from the district court judgment, the superior court concluded
    that the district court had abused its discretion by excluding evidence of the expert’s
    connections to the insurance industry, reasoning that the expert witness and the company
    which hired him had extensive dealings with the defendant’s insurance company and the
    insurance industry more broadly and that this information was relevant to the question
    of bias. We agree with the superior court that the district court erred in ruling that
    relevant evidence of the expert witness’s substantial connection to the insurance industry
    should be excluded. But the district court’s error was harmless because at trial the
    plaintiff was able to elicit testimony about the witness’s connection to the insurance
    industry. We therefore vacate the superior court’s remand order and reinstate the district
    court’s judgment.
    II.   FACTS AND PROCEEDINGS
    A.     Facts
    In July 2009 Kimber Ray rear-ended an automobile in which Megan
    Draeger was a passenger. There was no serious physical damage to either car, and at
    trial the accident was described as a low speed, low impact collision.
    Draeger did not complain of any injuries at the accident scene. But soon
    afterward, she experienced pain in her neck and shoulders, and she made an appointment
    to see a chiropractor six days after the accident. Draeger had a total of 24 chiropractic
    treatments between July and November 2009 at a total cost of $5,160. Nine months
    later, in August 2010, Draeger sought treatment from a physical therapist for neck pain
    -2-                                      7020
    and headaches. The physical therapist treated Draeger over nine sessions between
    August and September 2010.
    B.     Proceedings
    Draeger filed suit against Ray in the district court in July 2011. Ray
    admitted liability for the accident, so the trial focused on the extent of Draeger’s injuries
    and other damages related to the accident. Ray’s insurer, Government Employees
    Insurance Company (GEICO), paid for her defense.
    Ray filed a motion in limine based on Alaska Evidence Rule 4111 seeking
    to preclude reference at trial to the fact that Ray was covered by liability insurance with
    respect to Draeger’s claims. Draeger partially opposed the motion, arguing that she
    wished to cross-examine Dr. John Ballard, an orthopedic surgeon hired by Ray’s counsel
    to give expert testimony at trial, regarding potential bias. In particular, Draeger sought
    to examine Dr. Ballard about the fact that a substantial portion of his work as a medical
    expert is derived from referrals from insurance companies and that he had been hired
    many times by GEICO in particular.
    District Court Judge David Wallace granted Ray’s motion. Judge Wallace
    concluded that under the required Alaska Evidence Rule 403 balancing,2 the “minimal
    relevance” of the insurance evidence being offered to show bias, which is allowed under
    Rule 411, was outweighed by “the prejudicial nature and confusion of issues” that would
    more likely result if Draeger impeached Dr. Ballard by referencing GEICO or the fact
    1
    See Alaska R. Evid. 411 (excluding “[e]vidence that a person was or was
    not insured against liability” to prove negligence or other wrongdoing, but allowing
    courts to admit evidence of liability insurance to prove “bias or prejudice of a witness”).
    2
    See Alaska R. Evid. 403 (providing that “relevant[] evidence may be
    excluded if its probative value is outweighed by the danger of unfair prejudice, confusion
    of the issues, or misleading the jury,” among other factors).
    -3-                                        7020
    that Ray was insured. The order stated that “witnesses and parties shall be instructed that
    no reference should be made to the fact that defendant has liability insurance” or to “the
    fact that persons investigating this matter may have been employed by defendant’s
    liability insurance.” However, the order noted that “this ruling does not preclude
    plaintiff’s counsel’s ability to cross examine any witness on the issue of bias that relates
    to the nature of their work for defendants and/or the fact [that] there may be . . . financial
    reasons for the continuation of wanting to work for defendants.”
    Dr. Ballard frequently performs independent medical evaluations and
    medical record reviews for insurance companies. GEICO retained Dr. Ballard to
    evaluate medical records or conduct independent medical examinations 20 to 30 times
    in 2011 alone, though Dr. Ballard stated in a deposition that less than 5% of his work in
    Alaska comes from GEICO. Dr. Ballard does about 50 to 60 record reviews and 200 to
    300 independent medical evaluations per year; 40% of those evaluations are for claims
    of injury arising out of automobile collisions. He also co-founded a medical evaluation
    company called The Independent Medical Evaluators (T.I.M.E.), which provides
    medical evaluations. More than 98% of T.I.M.E.’s clients are insurance companies or
    defense attorneys. Although Dr. Ballard was no longer a co-owner of the company when
    he conducted the evaluation for this case, Ray’s counsel hired and paid him through
    T.I.M.E for this case. Dr. Ballard made over $100,000 per year from insurance defense
    referrals and between $300,000 to $350,000 per year from his insurance-related medical
    exam work. His total annual income is between $700,000 and $800,000, which includes
    his private orthopedic practice. Dr. Ballard testified that his income and the prospect of
    future employment by Ray’s counsel’s office were irrelevant to the opinions he offered
    regarding Draeger’s injuries and treatment.
    Dr. Ballard testified that, in his opinion, Draeger’s chiropractic treatments
    in 2009 were reasonable and related to her cervical, thoracic, and lumbar strains resulting
    -4-                                        7020
    from the accident. However, he testified that Draeger’s later physical therapy in 2010
    was not related to the accident and that, in his opinion, Draeger had recovered from the
    accident no later than November 2009.
    During cross-examination, Dr. Ballard confirmed that he was hired for
    evaluation in this case through T.I.M.E., and when asked by Draeger’s counsel whether
    “more than 98% of [his evaluations through T.I.M.E] are for insurance companies or
    defense attorneys,” Dr. Ballard answered, “Correct.” Ray’s attorney objected. At a
    bench conference Judge Wallace reiterated his order regarding testimony about
    insurance: “I thought I made it clear in my decision not to mention insurance. You can
    say ‘defense attorneys,’ you can say ‘defense.’ ” Neither party requested a curative
    instruction. There were no further references to insurance during trial.3
    The jury awarded Draeger $5,160 for past economic loss, equal to the full
    amount of her chiropractic treatments from July to November 2009. It also awarded her
    $775 for past non-economic damages. The jury did not award Draeger any damages for
    future economic loss or future non-economic loss.
    Draeger appealed to the superior court. She argued that it was improper for
    the district court to preclude her from questioning Dr. Ballard about the extent to which
    he was paid for his work as an expert witness by insurance companies. Judge John
    Suddock issued an opinion reversing the district court’s order limiting Draeger’s
    cross-examination of Dr. Ballard and remanding the case to the district court for a new
    trial. The superior court concluded that the district court had erred in preventing Draeger
    from cross-examining Dr. Ballard regarding his “relationship with the insurance industry
    3
    At the end of trial, the jury submitted a question regarding whether either
    party contacted their insurance company after the accident. The court responded:
    “[W]hether or not there was insurance in this matter is not for you to consider. You are
    to decide this matter on the evidence presented.”
    -5-                                       7020
    in general and GEICO in particular,” despite the fact that the district court’s ruling
    allowed Draeger to impeach Dr. Ballard regarding his near-exclusive work for
    “defendants” and “defense lawyers.” Ray filed a petition for review, which we granted.
    III.	   STANDARD OF REVIEW
    “In an appeal from a judgment of a superior court acting as an intermediate
    court of appeal, we independently review the judgment of the district court.”4 “We
    review a trial court’s decision to admit or exclude evidence for an abuse of discretion.”5
    We review a trial court’s Rule 403 ruling for abuse of discretion by “balanc[ing] the
    danger of unfair prejudice against the probative value of the evidence to determine
    whether the potential danger predominated so greatly as to leave us firmly convinced that
    admitting the challenged evidence amounted to a clear abuse of discretion.”6 We reverse
    only if “the error affected the substantial rights of a party.”7
    IV.	    DISCUSSION
    A.	   The District Court Abused Its Discretion By Not Admitting Evidence
    Of Dr. Ballard’s Substantial Connection To The Insurance Industry.
    1.	    Evidence of a witness’s connection to the insurance industry is
    admissible to show bias if its probative value outweighs the
    danger of unfair prejudice.
    Alaska Evidence Rule 411 provides that “[e]vidence that a person was or
    was not insured against liability is not admissible” to prove “whether the person acted
    4
    Pouzanova v. Morton, 
    327 P.3d 865
    , 867 (Alaska 2014).
    
    5 Jones v
    . Bowie Indus., Inc., 
    282 P.3d 316
    , 324 (Alaska 2012).
    6
    Conley v. Alaska Commc’ns Sys., 
    323 P.3d 1131
    , 1136 n.11 (Alaska 2014)
    (alteration in original) (quoting Brandner v. Hudson, 
    171 P.3d 83
    , 87 (Alaska 2007)).
    7
    Kingery v. Barrett, 
    249 P.3d 275
    , 281 (Alaska 2011) (quoting Bylers Alaska
    Wilderness Adventures, Inc. v. City of Kodiak, 
    197 P.3d 199
    , 205 (Alaska 2008)).
    -6-	                                    7020
    negligently or otherwise wrongfully.”8 But the rule allows courts to admit this evidence
    when offered for another purpose, such as to show “bias or prejudice of a witness.”9
    When Rule 411 does not bar evidence, it may still be excluded under Alaska Evidence
    Rule 403.10 Rule 403 provides that relevant evidence “may be excluded if its probative
    value is outweighed by the danger of unfair prejudice, confusion of the issues, or
    misleading the jury,” among other factors. Alaska Evidence Rules 411 and 403 thus
    work in conjunction: If the trial court decides that evidence of liability insurance can be
    admitted despite Rule 411, the court must then perform a Rule 403 balancing analysis
    to determine whether the evidence’s probative value outweighs the danger of unfair
    prejudice.11 “Under Evidence Rule 403, the trial court bears primary responsibility for
    determining admissibility of evidence.”12 As we have held previously, trial courts
    generally “have broad discretion in applying [the Evidence Rule 403] balancing test.”13
    8
    Alaska R. Evid. 411.
    9
    
    Id. 10 See
    Kingery, 249 P.3d at 285 
    (recognizing and upholding the trial court’s
    exclusion of liability insurance evidence under Rule 403 rather than 411); Gibson v.
    GEICO Gen. Ins. Co., 
    153 P.3d 312
    , 317 (Alaska 2007) (affirming exclusion of
    testimony about an insurance contract and an insurance settlement under Rule 403 rather
    than Rule 411).
    11
    Accord Todd v. Joyner, 
    685 S.E.2d 595
    , 596-97 (S.C. 2009) (“[I]f Rule 411
    does not require the exclusion of evidence of insurance, the court should then proceed
    to perform Rule 403 analysis and consider whether the probative value of the evidence
    is substantially outweighed by the prejudicial effect and potential for confusing the
    jury.”).
    12
    Marsingill v. O’Malley, 
    58 P.3d 495
    , 502 (Alaska 2002).
    13
    Schofield v. City of St. Paul, 
    238 P.3d 603
    , 608 (Alaska 2010) (citing Bluel
    v. State, 
    153 P.3d 982
    , 986 (Alaska 2007)).
    -7-                                       7020
    “When reviewing the exclusion of evidence under Evidence Rule 403 as
    unfairly prejudicial, we first consider the relevance of the [excluded evidence] and then
    determine whether . . . [the superior court’s exclusion of it] constitutes a clear abuse of
    discretion.”14 “The credibility of witnesses is always a material issue, so the only
    question of materiality or relevance when evidence is offered to impeach for bias is
    whether the evidence tends in reason to demonstrate the existence of some fact, state of
    mind or condition that a reasonable person would take into account in assessing the
    credibility of the witness under attack.”15
    Although evidence of bias is relevant and probative, courts sometimes view
    evidence of liability insurance as prejudicial. Rule 411 “is designed to prevent a jury
    from deciding a close case on an improper basis — i.e., whether or not a party is
    insured.”16 Courts can exclude evidence of a defendant’s insurance “to avoid prejudice
    in the verdict, which might result from the jury’s knowledge that insurance, and not the
    defendant, would be responsible for paying any resulting award of damages.”17
    14
    
    Kingery, 249 P.3d at 285
    (alterations and omission in original) (internal
    quotation marks omitted) (quoting Liimatta v. Vest, 
    45 P.3d 310
    , 313 (Alaska 2002)).
    15
    Hutchings v. State, 
    518 P.2d 767
    , 769 (Alaska 1974).
    16
    Shane v. Rhines, 
    672 P.2d 895
    , 900 n.6 (Alaska 1983) (quoting
    Commentary to Alaska R. Evid. 411); see also 
    id. (“There is
    a danger that insurance
    evidence might skew the decision-making process of the jury by making it regret a
    possibly wrong decision against an uninsured person much more than a similar decision
    under identical facts against a person whose insurance status is unknown, or by making
    the jury regret any erroneous decision against an insured party less than it would an
    erroneous decision against a person whose insurance status is unknown.”).
    17
    Todd v. Joyner, 
    685 S.E.2d 613
    , 616 (S.C. App. 2007); see also Vasquez
    v. Rocco, 
    836 A.2d 1158
    , 1163 (Conn. 2003) (“[T]he exclusion of evidence of a
    defendant’s insurance coverage ‘prevents the jury from improperly rendering a decision
    (continued...)
    -8-                                    7020
    However, we have yet to consider whether the danger of unfair prejudice can outweigh
    the probative value of evidence offered to show an expert’s bias in favor of the insurance
    industry in an automobile injury case.18 We turn next to that question.
    2.	    The probative value of evidence of a witness’s connection to the
    insurance industry is likely to outweigh the danger of unfair
    prejudice if the connection is substantial.
    We have not previously articulated a steadfast rule to guide the trial court’s
    determination of whether the probative value of a witness’s connection to the insurance
    industry offered to show bias outweighs the danger of unfair prejudice under Rule 403.
    The majority of jurisdictions that have considered this question allow insurance evidence
    to show bias only in cases where a “substantial connection” exists between a witness and
    the insurance industry.19 “The substantial connection analysis looks to whether a witness
    17
    (...continued)
    or award based upon the existence or nonexistence of liability coverage rather than upon
    the merits of the case.’ ” (quoting Conn. Code Evid. § 4-10(a), commentary)); Strain v.
    Heinssen, 
    434 N.W.2d 640
    , 642 (Iowa 1989) (“The prejudice stems from concern that
    a jury’s verdict may be increased or decreased depending on the availability of sums
    from which to pay an award, rather than the merits of a plaintiff’s case.”).
    18
    Though Rule 411 only excludes “[e]vidence that a person was or was not
    insured against liability,” it is implicated in evidence regarding an expert witness’s
    connection to the insurance industry to the extent that such evidence indicates that the
    party on whose behalf the witness is testifying is “insured against liability.” That is, an
    expert witness who has a relationship with an insurance company presumably testifies
    on behalf of a party who is insured and whose insurance carrier is providing
    representation in the case. Thus, Rule 411can be triggered by references to insurance
    that are not directly about whether a party is insured.
    19
    See, e.g., Bonser v. Shainholtz, 
    3 P.3d 422
    , 425 (Colo. 2000) (“A majority
    of jurisdictions addressing this issue have applied a ‘substantial connection’ analysis in
    order to balance the probative value and potential prejudice on the facts of each case.”);
    
    Vasquez, 836 A.2d at 1163-64
    (“The majority of courts that have addressed this issue
    (continued...)
    -9-	                                      7020
    has a sufficient degree of connection with the liability insurance carrier to justify
    allowing proof of this relationship as a means of attacking the credibility of the
    witness.”20
    Some jurisdictions define what constitutes a substantial connection between
    a witness and an insurer in terms of an ownership, agency, or employment relationship
    — that is, a relationship in which a witness has a “direct interest in the outcome of the
    litigation.”21 These jurisdictions often limit when a witness’s pecuniary interest can be
    used to establish a substantial connection by requiring something “[b]eyond mere
    payment in exchange for testimony [at] trial.”22 Courts have found a substantial
    19
    (...continued)
    apply a ‘substantial connection’ test to determine whether evidence of an expert witness’
    relationship to the defendant’s insurer is more probative of potential bias than it is
    prejudicial.”); 
    Todd, 685 S.E.2d at 597
    (“In considering whether an expert’s connection
    to a defendant’s insurer is sufficiently probative to outweigh the prejudice to the
    defendant resulting from the jury’s knowledge that the defendant carries liability
    insurance, this Court adopted the ‘substantial connection’ analysis employed in a
    majority of jurisdictions.”); Lombard v. Rohrbaugh, 
    551 S.E.2d 349
    , 355 (Va. 2001) (“A
    majority of jurisdictions addressing this issue apply a ‘substantial connection’ analysis
    to determine whether the relationship between a party and a witness, particularly an
    expert witness, is such as to make proof of their financial dealings sufficiently probative
    to outweigh prejudice that arises from knowledge that the party carries liability
    insurance.”).
    20
    
    Bonser, 3 P.3d at 425
    (internal quotation marks omitted) (quoting Otwell
    v. Bryant, 
    497 So. 2d 111
    , 115 (Ala. 1986)); see also 
    Vasquez, 836 A.2d at 1164
    (“Underlying this analysis is the premise that only some relationships between a
    defendant’s expert witness and the defendant’s insurance carrier give rise to an inference
    of bias that outweighs the countervailing risk that jurors might use the evidence for an
    improper purpose.”).
    21
    Mendoza v. Varon, 
    563 S.W.2d 646
    , 649 (Tex. Civ. App. 1978).
    22
    Strain v. Heinssen, 
    434 N.W.2d 640
    , 643 (Iowa 1989) (holding that, absent
    (continued...)
    -10-                                      7020
    connection where an expert witness was employed by and consulted for an insurance
    company and 10-20% of the expert’s practice consisted of reviewing records for
    insurance companies,23 and where an expert was employed by a consulting firm that
    derived roughly 30% of its income from insurance companies.24
    Importantly, courts have recognized a substantial connection in the absence
    of a formal employment relationship between an expert witness and an insurer. For
    example, in Lombard v. Rohrbaugh, the Virginia Supreme Court upheld a trial court’s
    decision to admit evidence of a medical expert’s relationship with an insurance company
    in an automobile accident case because the medical expert had received over $100,000
    annually from the insurance company for at least two years.25 The defendant argued that
    opposing counsel should not have been permitted to mention insurance because the
    witness was not an employee of the insurance company.26 The Lombard court held that
    “[a] witness’[s] status as an employee of an insurance company providing coverage to
    a party is evidence of potential bias, but the absence of an employer-employee
    relationship does not define the limits of cross-examination. At issue is the potential for
    22
    (...continued)
    an agency or employment relationship, payment by an insurance company in exchange
    for an expert’s testimony at trial was not probative enough to outweigh prejudice).
    23
    See Yoho v. Thompson, 
    548 S.E.2d 584
    , 586 (S.C. 2001).
    24
    See Mitchell v. Glimm, 
    819 So. 2d 548
    , 553 (Miss. App. 2002). Though the
    Mississippi Court of Appeals did not use the term “substantial connection,” its reasoning
    aligns with the analysis employed under the substantial connection test.
    25
    
    551 S.E.2d 349
    , 355 (Va. 2001).
    26
    
    Id. -11- 7020
    bias because of the witness’[s] interests in the case, not artificial labels.”27 We agree.
    This is particularly true given the modern corporate structure where employment and
    consulting relationships are often created ad hoc or through an intermediary and do not
    conform to traditional direct employment relationships.
    The Virginia Supreme Court has addressed a fact pattern that is similar to
    the one in this case. In Henning v. Thomas, a plaintiff in a medical malpractice case
    hired an expert witness through a company that “identifies other physicians throughout
    the country who are willing to review medical records and provide medical testimony.”28
    The witness signed an agreement with the company to assess cases and was to receive
    a set fee for reviewing depositions or transcripts and testifying; the company kept a
    portion of the overall fee paid to it by the plaintiff.29     The defendant sought to
    cross-examine the witness as to who retained him to testify, but the trial court did not
    permit “any question other than whether [the witness] was being paid to come to court
    to give his testimony.”30 The Virginia Supreme Court reversed, reasoning:
    The trial court’s ruling prevented defendants from doing
    precisely what defendants had a right to do. The defendant
    doctors were entitled to attempt to persuade the jury that [the
    plaintiff’s witness] was a “doctor for hire,” who was part of
    a nationwide group that offered themselves as witnesses, on
    behalf of medical malpractice plaintiffs. Once the jury was
    made aware of this information it was for the jury to decide
    what weight, if any, to give to [the witness’s] testimony. This
    27
    
    Id. 28 366
    S.E.2d 109, 112 (Va. 1988). Though Henning did not use the label
    “substantial connection,” it applied a similar analysis.
    29
    
    Id. 30 Id.
    -12-                                      7020
    was a classic case of an effort to establish bias, prejudice, or
    relationship.
    The trial court went too far when it limited defendants’
    cross examination to the bare question whether [the witness]
    was being paid to testify.[31]
    We similarly do not think a party’s cross-examination should be limited solely to
    questions regarding whether a witness is being paid to testify.
    The trial court’s substantial connection analysis should look primarily to
    “whether a witness has a sufficient degree of connection with [a] liability insurance
    carrier to justify allowing proof of this relationship as a means of attacking the credibility
    of the witness.”32 Where an expert witness has significant ties to the insurance industry
    as indicated by receiving a sizable portion of his or her income from insurance work,
    being hired by a firm that derives a large portion of its income from insurance
    companies, or facts that otherwise suggest an interest in the outcome of the litigation, the
    probative value of that substantial connection is likely to outweigh the danger of unfair
    prejudice, and is thus likely admissible to show bias under Rule 411 and Rule 403.
    3.	    To establish a substantial connection, a party may present
    evidence about a witness’s ties to the insurance industry without
    necessarily eliciting evidence about the other party’s individual
    insurance coverage.
    There are two types of testimony regarding insurance that may be at issue
    in this type of case. The first is whether the defendant was insured against liability, and
    if so, by which company. The second is whether an expert witness hired by the defense
    may have a substantial connection to the insurance industry and possibly a small number
    31
    
    Id. at 113.
           32
    Bonser v. Shainholtz, 
    3 P.3d 422
    , 425 (Colo. 2000) (internal quotation
    marks omitted) (quoting Otwell v. Bryant, 
    497 So. 2d 111
    , 115 (Ala. 1986)).
    -13-	                                       7020
    of companies in particular, which may be evidence of bias. At trial Draeger focused
    primarily on this second category: Dr. Ballard’s connection to the insurance industry.
    Her opposition to Ray’s motion in limine argued that “[s]tating merely that these experts
    do most of their work for the defense, or for defense attorneys, only exposes the tip of
    the iceberg. Working for a particular entity with a singular incentive to minimize the
    harm resulting from auto collisions implies a stronger incentive for bias than working for
    different defense attorneys or ‘the defense.’ ” Because Draeger’s primary interest was
    to explore Dr. Ballard’s connection to the insurance industry, admission of such evidence
    as how often Dr. Ballard worked for insurance companies or firms that serve the
    insurance industry and what percentage of his income was from his insurance work 33 —
    without revealing details about Ray’s coverage — would have satisfied Draeger’s goal
    of attempting to demonstrate Dr. Ballard’s potential bias.
    The district court, however, only allowed Draeger to probe the expert’s
    potential bias with a limited set of terms revolving around “the defense”: Its order stated
    that “this ruling does not preclude plaintiff’s counsel’s ability to cross examine any
    witness on the issue of bias that relates to the nature of their work for defendants and/or
    the fact [that] there may be . . . financial reasons for the continuation of wanting to work
    for defendants.” This ruling excluded the use of the word “insurance” in any regard. But
    restricting cross-examination to the use of the terms “defendants,” “defense counsel,” or
    “defense expert” may not convey the witness’s potential bias to a juror who may assume
    that attorneys represent both personal injury plaintiffs and defendants. The South
    Carolina Supreme Court addressed this specific question in Yoho v. Thompson, when the
    trial court had “informed [the plaintiff] that she could discuss [the expert witness’s] bias
    33
    See Noffke v. Perez, 
    178 P.3d 1141
    , 1150-51 (Alaska 2008) (upholding trial
    court’s ruling requiring an expert witness employed by T.I.M.E. to produce his tax
    returns in order to ascertain the witness’s income from his insurance work).
    -14-                                       7020
    by using generic terms such as ‘defense,’ ‘defendants,’ and ‘defense lawyer,’ but that she
    could not discuss his possible bias by using the word ‘insurance.’ ”34 The Yoho court
    rejected this approach, reasoning that references to insurance work are “qualitatively
    different from showing [that the witness] works for ‘the defense’ generally, and [are]
    much more indicative of possible bias.”35
    Parties should not have to couch a witness’s relationship with the insurance
    industry in code by referencing only “defense attorneys” or “defense work” when
    presenting evidence of an expert witness’s bias. Jurors may not understand this
    reference. And the point is that an expert witness with a substantial connection to
    insurance companies is working for the side with an interest in minimizing claims, and
    describing the witness’s relationship with insurers in clear terms is the most direct way
    to relay the entirety of that message to the jury.36 Though a jury may infer from this
    evidence that a party is insured, this inference presents a low risk of unfair prejudice
    because jurors will be aware that Alaska law requires drivers to carry automobile
    insurance.37 The opposing attorney should be able to elicit evidence about the witness’s
    34
    
    548 S.E.2d 584
    , 585 (S.C. 2001).
    35
    
    Id. at 586.
          36
    See Myers v. Robertson, 
    891 P.2d 199
    , 208 (Alaska 1995) (“[T]he jury
    should be provided with some context in order to fully and fairly evaluate the case and
    the testimony before it. Here, the fact of insurance could have been admitted consistent
    with Evidence Rule 411 because that information would tend to show the potential bias
    or prejudice of the . . . witnesses.”).
    37
    See AS 28.22.011 (“The operator or owner of a motor vehicle . . . shall be
    insured under a motor vehicle liability policy.”); Nelson v. Progressive Cas. Ins. Co., 
    162 P.3d 1228
    , 1231 (Alaska 2007) (“Alaska law generally requires Alaska drivers to carry
    automobile insurance.”); see also Mitchell v. Glimm, 
    819 So. 2d 548
    , 553 (Miss. App.
    2002) (“[I]n today’s society given the new mandates from our state legislature requiring
    (continued...)
    -15-                                      7020
    connection to an institutional set of insurance clients and to argue that the expert witness
    may wish to ensure repeat business.
    But a party may not need to specify any insurance company by name in
    order to establish a substantial connection to insurance clients. In many cases, evidence
    of a witness’s frequency of work for the insurance industry more broadly and the
    percentage of the witness’s income derived from insurance work sufficiently
    demonstrates the potential bias. Thus, in many cases, the trial court will not need to
    admit details of a party’s individual insurance coverage or information about any
    insurance company by name. The opposing party can often adequately expose the
    potential bias of an expert witness by showing that he has a close connection to the
    insurance industry.38
    37
    (...continued)
    mandatory insurance[,] . . . juries in many personal injury cases are aware that insurance
    companies are involved in the litigation. Otherwise, the jury is to assume that a
    defendant is breaking the law by not having insurance coverage.”). To mitigate any
    prejudice that might result from the jury knowing that a party is insured, the trial court
    can give a jury limiting instructions as to how to consider or not consider evidence of
    insurance. See Alaska R. Evid. 105 (“When evidence which is admissible as to one party
    or for one purpose but not admissible as to another party or for another purpose is
    admitted, the court, upon request, shall restrict the evidence to its proper scope and
    instruct the jury accordingly.”).
    38
    We do not decide the question whether a particular insurance company’s
    identity may be probative where an expert works primarily for a certain insurer, raising
    an inference that the witness would wish to please that primary client to secure repeat
    business. Here, Dr. Ballard stated in his deposition that “less than five percent” of his
    insurance work in Alaska is for Ray’s insurer, GEICO.
    -16-                                       7020
    4.	    Dr. Ballard has a substantial connection to the insurance
    industry and the district court abused its discretion by not
    admitting evidence of that connection.
    There is a substantial connection between Dr. Ballard and the insurance
    industry. Like the expert in Lombard v. Rohrbaugh,39 Dr. Ballard is highly compensated
    by the industry; he receives between $300,000 to $350,000 a year for his insurance
    reviews. This represents a large percentage of his total yearly income of up to $800,000,
    which includes his private orthopedic practice. And like the expert witness in Mitchell
    v. Glimm who was hired by a consulting firm that derives a sizable portion of its income
    from insurance companies,40 Dr. Ballard was hired for this case by a company that does
    98% of its work for insurance companies or defense attorneys.              The financial
    entanglements of both Dr. Ballard and the consultancy through which he was hired create
    a substantial connection to the insurance industry.
    Here, the district court excluded all reference to insurance as more
    prejudicial than probative, ordering that “witnesses and parties shall be instructed that
    no reference should be made to the fact that persons investigating this matter may have
    been employed by defendant’s liability insurance.” On appeal the superior court
    reversed the district court’s exclusion of insurance evidence and suggested that evidence
    of a substantial connection is invariably more probative than prejudicial. The trial court
    has broad discretion under Rule 403 balancing to determine whether the probative value
    of evidence outweighs its potential to create unfair prejudice.41 But if evidence of an
    expert witness’s substantial connection to the insurance industry is available, the weight
    39
    See 
    551 S.E.2d 349
    , 355 (Va. 2001).
    40
    
    See 819 So. 2d at 553
    .
    41
    See Marsingill v. O’Malley, 
    58 P.3d 495
    , 502 (Alaska 2002).
    -17-	                                     7020
    of factors that the trial court must balance will generally be static because the potential
    for unfair prejudice will probably not vary and thus should tilt in favor of admission,
    absent unusual factual circumstances. Because evidence of Dr. Ballard’s substantial
    connection to the insurance industry was available and was probative of bias, and there
    were no unusual factual circumstances in this case to suggest that the risk of unfair
    prejudice outweighs its probative value, the district court abused its discretion by
    excluding direct evidence of the connection.
    B.	    Because The Jury Heard Evidence Of Dr. Ballard’s Substantial
    Connection To The Insurance Industry, The District Court’s Error
    Was Harmless.
    Although it was an abuse of discretion for the district court to attempt to
    exclude direct evidence of Dr. Ballard’s substantial connection to the insurance industry,
    the error was harmless. “When the trial court has erroneously excluded evidence, a party
    must show that the error was harmful or prejudicial before we will reverse the trial court.
    The test for determining whether an error was harmless is whether on the whole record
    the error would have had a substantial influence on the verdict of a jury of reasonable lay
    people.”42 Thus, “[a]n erroneous ruling requires reversal only if our review of the record
    convinces us that it probably had a substantial effect on the jury.”43
    Though the district court aimed to exclude all evidence about insurance
    through its order granting Ray’s motion in limine, the jury ultimately did hear evidence
    42
    Barton v. N. Slope Borough Sch. Dist., 
    268 P.3d 346
    , 353 (Alaska 2012)
    (alteration and internal quotation marks omitted) (quoting Noffke v. Perez, 
    178 P.3d 1141
    , 1147-48 (Alaska 2008)).
    43
    Crosby v. Hummell, 
    63 P.3d 1022
    , 1028 n.23 (Alaska 2003); see also 
    id. at 1028
    (“[W]e find no reasonable likelihood that [the] exclusion . . . had any appreciable
    effect on the verdict. Even if error, then, exclusion of this evidence would have been
    harmless at most and would not warrant reversal.”).
    -18-	                                     7020
    about Dr. Ballard’s substantial connection to the insurance industry.             During
    cross-examination Draeger’s counsel established that Dr. Ballard was hired for
    evaluation in this case through T.I.M.E. and that he performs more than 100 medical
    examinations per year through T.I.M.E. in auto injury cases. When Draeger’s lawyer
    asked Dr. Ballard to confirm that nearly all “evaluations through T.I.M.E.[,] like what
    [he] did in this case, more than 98% of [evaluations] are for insurance companies or
    defense attorneys,” Dr. Ballard answered, “Correct.” Though Ray’s attorney objected
    and during a bench conference the district court instructed the parties not to mention
    insurance again, the trial court did not strike the testimony or give any curative or
    limiting instruction to the jury after Dr. Ballard’s testimony regarding T.I.M.E.’s
    primarily insurance-based clientele. Thus, the jury did hear some of the evidence that
    Draeger’s attorney advocates for here. Because the district court’s attempted exclusion
    of all insurance evidence was unsuccessful, it could not have had a substantial effect on
    the jury. And because Dr. Ballard provided an answer to a question that should have
    been allowed, the district court’s error was harmless.
    V.    CONCLUSION
    Although it was error to fail to admit evidence of the expert witness’s
    substantial connection to the insurance industry, which was not unfairly prejudicial, this
    error was harmless because the jury ultimately did hear some testimony about that
    connection. We thus AFFIRM in part the superior court’s reasoning but REVERSE and
    VACATE the superior court’s order remanding for new trial and REINSTATE the
    district court’s judgment.
    -19-                                      7020