Keeping with the theme of looking at total loss standards across the union, I turn my attention this week to Delaware. While Delaware was more fortunate in avoiding catastrophic destruction than nearby states New Jersey and New York, it is still important to have a solid grasp of what a total loss really is in case devastation strikes.
For those of you unfamiliar with insurance-related appraisals, appraisals are supposed to provide a quick and easy way to resolve insurance disputes. Most insurance policies provide that after an insurance company has had the opportunity to adjust a claim, if the two sides disagree on the amount of the loss, they each can select an appraiser to represent them. Those two appraisers then attempt to resolve the dispute on their own. If the two appraisers cannot resolve the matter completely, they submit their
We often discuss the fact that in property insurance coverage cases, the policy is our road map. Also, how important the words and their meanings are in policies. Interpretations and facts are the deciding factors in coverage cases. A simple word like “reside,” may seem clear and be understood by most people. When you ask people on the street how they define the term, you may receive several different responses. When the facts of a case are applied to insurance policy coverage cases, coverage can hinge upon the words used in the policy and whether they are clearly used or defined. Consider a recent case from a New York Appellate Court.
For many individuals who suffer a property loss, the most stressful time is the adjustment period with their own insurance or the insurance of the party that caused the loss. Often, during the adjustment people need money for temporary housing or have lost all their personal possessions and are trying to rebuild their lives or businesses. The Hawaii Supreme Court recognized the rights of a third-party claimant to bring an intentional infliction of emotional distress (IIED) cause of action when an insurer’s outrageous behavior causes harm. This case leaves the door open to a potential IIED cause of action in first party matters.
I attended an excellent conference earlier this week primarily consisting of high-caliber public adjusters and high-caliber policyholder attorneys. Not surprisingly, the presentations were superb. During a couple of the presentations, different seasoned attorneys commented along these lines: “just give the insurance companies what they request.” I generally agree. There is generally no need to nitpick with an insurance company, and I assure you insurance companies, their adjusters, and their legal counsel do not mind your nitpicking. First, nitpicking during claim adjustment serves as a nice basis for an insurer to delay claim payment.
In my line of work, whether or not an insurer acted in bad faith is an important topic. Policyholder attorneys must look at how an insurer conducted its investigation to ensure their client was treated fairly by the carrier. Whenever a client asks me whether something an insurer did constitutes bad faith, I rarely give a simple yes or no answer. These questions require an in-depth look into the facts and related case law to develop an informed opinion. But even where you think the facts prove an insurer committed bad faith, a court normally has the final say, and you may disagree with it.
I have previously blogged about the pros and cons of purchasing earthquake insurance. This week, I write to discuss an associated topic - the differences between an all-risk and a named peril insurance policy, and which is better in a given situation.
We all know that when a statute runs, your rights to bring a claim
are lost. In California, the insurance policy dictates how long an
insured has to bring a lawsuit or claim against an insurance company in
the event of a loss. During the time the insurer is adjusting the claim,
the time limit is tolled and effectively, an insured's time to bring a
claim stands still during the adjusting period.
On October 18th, over 9 million Californians participated in the Great California ShakeOut, an annual earthquake preparedness drill. Although I was not one of the participants, I certainly remember from my grade school days that one should drop to the floor, take cover under a desk or table, and hold on.
How simple a statement is this: In Insurance Policies, Words Matter?
This seems pretty easy. However, sometimes insurers interpret the words
of their policies in manners that defy logic and harm their
policyholders. Interpretation of words and language opens the door to
argument, but in the insurance context, there are rules related to
interpretation of insurance policies and exclusions.
Starting January 1, 2013, public insurance adjusters will be allowed to assist policyholders in Virginia with their property insurance claims. Virginia, the birthplace of our nation, now joins the other 44 states that license public insurance adjusters.
I recently noted the importance of Contingent Business Income (CBI) coverage in Are Your Business Relationships Insured? – Understanding Business Interruption Claims. CBI coverage protects an insured from income losses caused by an interruption or slow-down in the operations of a “dependent business” (i.e., purchasers, suppliers, distributors or service providers). A Missouri jury understood the importance of this coverage, which I affectionately call “relationship insurance,” awarding $11 million in business income losses to a roofing material manufacturer that was affected by the shut down of its asphalt supplier.
With the Presidential election merely weeks away and fresh off the second Presidential debate, I turn this week to a political battleground. Numerous states such as California and Illinois are shoe-ins for President Obama, while other states such as Texas and Georgia are locks for Governor Romney. Consequently, both candidates spend most of their efforts on “swing states.” Among those swing states, Florida and Ohio, have the most delegates and seem to be receiving the most attention. Because I have already reviewed Florida total loss case law, I found fitting to spend my time this week looking at Ohio.
I recently took a trip to McAllen, Texas, to survey the damage left behind after this year’s record-setting hailstorms. Driving through town, I could still see many broken business signs and battered wooden roofs that are awaiting repair. Off in the distance, I saw contractors repairing many roofs, including businesses and schools. It was apparent that the insurance claims process is well underway, and some insurers are taking good care of their clients, while others were not.
Many businesses buy business interruption coverage to cover a loss of business income in the event of a covered loss. Business income provisions generally provide benefits for an amount of time designated in the policy, typically termed the period of restoration,1 or until the business is able to resume operations.
Over the weekend, I saw a headline about a councilman in the Northern
California city of Clayton who was convicted of felony embezzlement
this past week… I thought the conviction would certainly not help his
chances for re-election in November, but then I read further. This
councilman’s day job is as an insurance broker. Apparently he took
$159,000 in premiums from a Silicon Valley company but never forwarded
the money to the insurance agency. I did not see any details about how
this all transpired, but aside from being an anecdote for the “What Were
You Thinking?” category, I asked myself, how did the insured not know
it paid for insurance it was not getting? Did the insured not see or
review a policy? Certainly, aside from the criminal aspects of this
case, there are some civil implications as well.
In recent weeks, there have not been as many published opinions and orders in Florida involving hurricane claims as there were a year or more ago. However, there was a recent case in the U.S. Middle District Court of Florida involving a Hurricane Wilma claim. It involved a familiar scenario where the insurer filed a motion asking the Court to dismiss the case claiming the policyholder’s complaint was barred by the statute of limitations, among other arguments.