Last week, in "Insurers Helped Write Bill Intended to Shrink Citizens," Paige St. John reported that the insurance industry is writing the pro-insurance legislation that some of our elected Legislators are currently advocating.
Continue Reading...As you may have heard, Senate Bill 1714 (the CPIC rate increase bill) passed through the Senate Banking and Insurance committee yesterday following the passage of a strike-all amendment filed by the bill's author, Senator Alan Hays.
Continue Reading...Last week, Tom Hanks and his wife, Rita Wilson, filed suit against their long time insurance broker. The complaint, filed in the Superior Court for the County of Los Angeles, contains ten claims, including professional negligence, breach of fiduciary duty, fraud, conversion, and unjust enrichment.
Continue Reading...The Atlantic hurricane season is fast approaching, and now is a great time to start preparing. One great way to protect your property is with hurricane shutters. Shutters go over windows and other openings in a building to keep out flying debris, protect windows from breaking, and help keep building air pressure stable during a hurricane.
Continue Reading...Civil Authority provisions normally provide coverage for business income losses when action to an insured premise is prohibited by a governmental action. This coverage is not easily triggered, as many elements must be met to obtain the oft elusive benefits.
Continue Reading...This is part-one of a two-part series that will discuss the recent ruling in the case of Walker v. Teachers Insurance Company.
Continue Reading...Bad faith litigation is premised on an insurance company’s obligations to its insureds and/or third party to claimants. The duties that an insurance company has to insureds and claimants can arise from the common law duty of good faith and fair dealing, statutes, administrative policies or regulations and legal precedent. The nature of the relationship between the insurance company and the claimant is an important factor that is considered when evaluating the duties that a carrier has to a particular claimant. This week’s post will address the following issue: although an insured who files an uninsured/underinsured motorist claim against its own carrier an insurance company might stand in the shoes of a third party with regard to some aspects of the evaluation of the claim, the carrier nevertheless owes its insured a heightened duty of good faith, as if it were a first party claim.
Continue Reading...Last week, in Genovese v. Provident Life and Accident Insurance Company, No. 06-2508, --- So.3d ----, 2011 WL 903988 (Fla. March 17, 2011), the Florida Supreme Court resolved the following issue:
DOES THE FLORIDA SUPREME COURT'S HOLDING IN ALLSTATE INDEMNITY CO. V. RUIZ, 899 So.2d 1121 (Fla.2005), RELATING TO DISCOVERY OF WORK PRODUCT IN FIRST-PARTY BAD FAITH ACTIONS BROUGHT PURSUANT TO SECTION 624.155, FLORIDA STATUTES, ALSO APPLY TO ATTORNEY-CLIENT PRIVILEGED COMMUNICATIONS IN THE SAME CIRCUMSTANCES?
Continue Reading...I recently traveled to Tallahassee to do some legislative work relating to the insurance bills before the Florida Legislature. In addition, on Tuesday I participated in a very successful press conference with Representative Kriseman and Senator Fasano that outlined how anti-consumer these bills are. In response to this press conference, the insurance industry and their legislative supporters made some interesting comments:
Continue Reading...Dr. Robert Hartwig and the Insurance Information Institute (III) do an excellent job providing timely information regarding insurance topics. A recent story on insurance coverage for nuclear accidents is an example. As a result of the current catastrophe in Japan, I have been asked by a number of individuals about property insurance coverage in the event of radiation damage. The III answers the question in "Insurance Coverage for Nuclear Accidents."
Continue Reading...Recently, a defense attorney in a case I’m working on attempted to inject elements of “The Arson Defense” into the lawsuit. Only problem is, we are not claiming fire damage. However, that got me thinking about the various defenses insurance companies typically use to avoid paying insurance claims. Today, I will discuss “The Arson Defense.”
Continue Reading...In Major Bad Faith Legislation Filed in Tallahassee, I promised a further analysis of Florida Senate Bill 1592, explaining why this bill is bad for property insurance policyholders. Two striking parts of the bill is the elimination of accountability for good faith conduct and the prevention of common law remedies. This bill as written applies to more than just third-party claims practices -- it applies to first-party claims conduct. Here is an analysis substantially made by Ruck DeMinico of our firm:
Continue Reading...Believe it or not, the official start of the hurricane season in the Atlantic basin is less than three months away. Now is a critical time for policyholders to review their policies with their agents to verify their coverage for flood, particularly if the property is located in a flood zone. Those in the Gulf Coast know all too well the vulnerability of coastal areas to hurricane storm surges. According to Jamie Rhome, leader of the National Hurricane Center’s storm surge unit, there are maps that measure regions of vulnerability with the question: “What is the worst-case potential for flooding possible due to a certain category of storm for this region?” These maps remind the public of the risk of living in coastal areas prone to storm surge.
Continue Reading...(Michelle Claverol will be back next week with her regular post on Business Interruption Claims. She is currently volunteering on a medical mission to Peru, and is not blogging).
Last week I wrote about an agent negligence case that highlighted the importance of carefully reading everything you sign. Continuing with that theme, is a Tennessee case dealing with a “failure to procure” claim.
Continue Reading...If you are interested in setting yourself apart from the crowd and showing carrier representatives you subscribe to the highest ethical standards, you should consider going the extra mile and earning the CPCU designation.
Continue Reading...In the category of fact is stranger than fiction, the following newspaper article about human nature and the concept of retaliation intrigued me:
Cop Blows Whistle on Insurance Agent
By Ryan AbbottJACKSBORO, Tenn. (CN) - A police officer sued Tennessee Farmers Insurance Co., claiming its agent doubled the premiums on his homeowner's policy to retaliate for the cop's having given him a speeding ticket.
Ricky Ford, a patrol sergeant for the LaFollette Police Department, sued Farmers and its agent James Daniel Arnold in Campbell County Court.
Ford ticketed Arnold for going 60 in a 40 mph zone, and Arnold "admitted this violation and thereafter paid a fine for speeding," the complaint states.
Ford says that after this, "the defendants sought to cause economic damages to the plaintiff by threatening to discontinue his homeowners insurance coverage, amending his homeowners coverage, which he had had for nearly 11 years, and thereafter doubling the plaintiff's insurance premiums, all for which the defendants sought to retaliate against the plaintiff for having performed his public duty functions and to otherwise cause serious economic consequences to the plaintiff."
Ford claims that the defendants willfully violated state law by retaliating against him for doing his public duty.
Ford seeks $75,000 in compensatory damages and $225,000 in punitive damages, for unfair trade and interference with contract.
He is represented by David Dunaway, of LaFollette and Knoxville.
(Click Here to see the Complaint)
Continue Reading...In my last post, I began my evaluation of a decision in the Kentucky Court of Appeals called Hamilton Mutual Insurance Company of Cincinnati v. Buttery, 220 S.W. 3d 287. The decision evaluated by the Kentucky Appellate Court in Hamilton initially arose when Mr. Buttery’s home was vandalized. He filed a claim with his insurance company, Hamilton Mutual. The adjuster sent by Hamilton to Mr. Buttery’s home told Mr. Buttery that he would receive payment for the claim within ten days. After almost one year of providing a tremendous amount of information and documentation and submitting to four examinations under oath, Mr. Buttery received no payment on his claim. He filed a bad faith lawsuit against Hamilton basing his complaint on Hamilton’s failure to act in a timely fashion to settle his claim. Hamilton appealed a jury verdict in Mr. Buttery’s favor. My last post provided the factual and procedural background for how the case came before the Kentucky Appellate Court. I would now like to pick up where I left off and address some of those defenses asserted by Hamilton.
Continue Reading...The Herald-Tribune is to be congratulated for digging into the honest facts of sinkhole claims and showing that the insurance industry is denying 85% of all sinkhole claims. Here is the Graph:
Myths and rumors in the property adjusting community are puzzling to me. As the current President of the Windstorm Insurance Network®, I was copied on an internet post that wrongly indicated that the Windstorm Insurance Conference® had attendance by public insurance adjusters that outnumbered the attendance of insurance adjusters by a four to one margin. The statement was ignorant and completely wrong.
Continue Reading...Public adjusters should adjust first party claims and not third party liability claims. To do otherwise is the practice of law. I am warning public adjusters about this topic because of an email I received:
Continue Reading...Chip, good morning. we need your input on Public Adjusters doing 3rd party claims. In several of your presentations I have heard, Public Adjusters are not allowed to do 3rd party claims. Other FAPIA members said the contrary. Please clarify. Please see the string of emails below in chronological order from the most recent to the latest. Thank you.
Often during the litigation “fog of war,” insurance companies become privy to additional information regarding the policyholder’s claim that they were not aware of at the time they denied it. And sometimes defense lawyers try to use that new information against the policyholder. This situation raises the following question: what facts do courts in Texas consider for purposes of bad faith claims?
Continue Reading...There are a variety of defenses that an insurance company can assert when facing a lawsuit for bad faith. None of my posts, however, have addressed the one that I came across in Hamilton Mutual Insurance Company of Cincinnati v. Buttery, 220 S.W.3d 287 (Ky. App. 2007). In Hamilton, the Kentucky Appellate Court analyzed a number of interesting bad faith issues, and I will address most of them. The one that is the most interesting to me, however, is the defense asserted by the carrier that it relied upon the advice of its attorney. I will dedicate two weeks to this case and will address the carrier’s defenses in next week’s post so that this week I can start with the details of how the claim originated and how the matter came to be evaluated by the Appellate Court.
Continue Reading...I have been following a honey ham-business-income saga in the Ohio federal court system. In HoneyBaked Foods Inc., v. Affiliated FM Ins. Co., No. 08-1686, 2011 WL 834067 (N.D. Ohio March 4, 2011), the district court faced a tough coverage question. Rather than ruling one way or the other, the district court certified the issue to the Ohio Supreme Court to determine whether Ohio law recognizes the doctrine of reasonable expectation of coverage.
Continue Reading...Los Angles will be the location for NAPIA/CAPIA insurance West Coast Seminar. NAPIA, the National Association of Public Adjusters, has teamed up with the California Association of Public Insurance Adjusters to provide this one day seminar to public adjusters on March 23, 2011, at the Marina del Rey Hotel. This seminar promises to be filled with practical and helpful educational presentations including:
I have received a number of emails regarding the tragic tsunami and earthquake that occurred this morning off the coast of Japan. Most have been questions regarding insurance coverage for potential consequences in Hawaii and on the west coast.
Continue Reading...Recently, I discussed a case dealing with insurance agent duties in California. In an effort to bring the discussion closer to home, I will discuss a recent Florida decision. In Mitleider v. Brier Grieves Agency, Inc., No. 4D09-3362, --- So. 3d ----, (Fla. 4th DCA February 16, 2011), Corey Mitleider brought suit against his insurance company and insurance agent for negligence, negligent misrepresentation, and vicarious liability. The problem arose because Mitleider did not purchase uninsured motorist coverage when purchasing his automobile insurance. Mitleider claimed he relied on the advice of his insurance agent, who told him that uninsured motorist coverage wasn’t necessary to be fully covered.
Continue Reading...Back in October of 2010, I had the privilege of attending the 15th Annual Insurance Law Institute in Austin, Texas. Over the course of the program, I listened to varying opinions on both sides of the insurance debate. Attorney James K. LaRoe, of Dallas, Texas, compiled a list of the top commercial hurricane damage claim disputes from a Texas perspective. Here, I present to you the top five commercial and hurricane Ike damage claims as presented by Mr. LaRoe.
Continue Reading...The Florida Senate must have taken a page from Insurance Company Declares War on Public Adjusters, as a recently filed Senate Bill SB 1714 prevents Citizens policyholders from hiring public adjusters. Since Citizens claims it is already immune from damages it causes while breaching good faith claims duties, policyholders would certainly lose if this bill becomes law. It would be easier for Citizens to reduce its claims costs by taking advantage of its policyholders after losses are suffered.
Continue Reading...So I guess we finally have an answer as to how we “fix” the insurance “problem” in Florida. The insurance industry, through some of our elected officials, has proposed some legislation that will “rein in fraud,” “inject some free market principles into insurance,” and “stop us from socializing insurance.” (All three of these quotes are actual remarks made by current Legislators). Let’s see what our industry friends have for us so far this session:
Continue Reading...Florida’s Third District Court of Appeal just released an opinion related to a policyholder’s claim for prejudgment interest after an appraisal award. In Alberto Jugo v. American Security Insurance Company, No. 3D09-3246 (Fla. 3d DCA 2011), the Third District held that a policyholder was not entitled to prejudgment interest on the supplemental amount of the appraisal award from the date of loss, despite the insurer’s denial of the “supplemental” claim.
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"Chipper, how have you been?" and "Chipper, we need to get together with Ira and play some golf" were two phrases I recalled when I learned of Bruce Swerling's death last week. Harvey Goodman was on the other end of a late Friday afternoon phone call concerning a coverage issue, and he told me he just left Bruce's funeral. I was shocked and saddened. I told Harvey I was more interested in a drink and remembering a person I enjoyed both personally and professionally.
Bruce Swerling was a gentleman. He carried himself with dignity and as a true professional, especially when it came to business interruption and extras expense claims. Whenever he was in the audience during a speech, Bruce would always invite interesting debate. It was obvious that he was one of the best at his profession. His peers recognized this as well.
As discussed in my post, Insured’s Control or Operation of Leader Property Does Not Trigger Contingent Business Coverage – Understanding Business Interruption Claims – Part 50, it is generally understood that ownership or insurable interest (i.e., leaseholds) over the dependent property, or supplier, destroys contingent business income coverage. However, in Park Electrochemical Corp. v. Continental Cas. Co., No. 04-4916, 2011 WL 703945 (E.D.N.Y. Feb. 18, 2011) the court declined to follow this maxim of business income loss, proving once again that a diligent broker can save you millions.
Continue Reading...Maplewood, Minnesota resident, Micah Coburn, recently experienced the benefits of hiring a public adjuster. The help Micah received from his public adjuster, Benjamin Johnson, was detailed in a report posted earlier this week on NewarkAdvocates.com. Coburn’s home suffered a fire loss, and he hired Benjamin Johnson as his public adjuster for the personal property claim. Before hiring Johnson, Coburn was concerned that his claim would not be properly paid.
Continue Reading...Florida’s Senator Thrasher and Representative Baxley have filed identical bills which gut long-standing common law and statutory consumer protection laws.
Continue Reading...There are many grounds upon which a court can find that a carrier acted in bad faith. In some cases, a court will not make an express finding of bad faith but will rule against an insurer on equitable principles. Either way, the repercussions faced by the carrier can be significant and unexpected. Although Price v. New Jersey Manufacturers Insurance Company, 182 N.J. 519 (2005) is not a bad faith case, it addresses how an insurer’s lack of good faith can impact an insured’s rights, including tolling the statute of limitations.
Continue Reading...The Texas Association of Public Insurance Adjusters (TAPIA) will be holding their Annual Conference in Houston on April 21, 2011. I encourage all Texas public adjusters to attend.
Continue Reading...Julie Patel, of the Sun-Sentinel, does a fantastic job reporting on insurance issues. Her latest piece on sinkholes, Sinkhole Claims Push up Insurance Premiums in Florida, suggests that the root cause of the problem is the geology underneath Florida structures. She reported:
Continue Reading...A special hearing has been set this Friday regarding Texas Windstorm Insurance Association (TWIA) Hurricane Ike litigation following TWIA being placed under administrative oversight. The Texas Department of Insurance has the power to place TWIA under its control during a time of crisis. Apparently, new information provided to the Department of Insurance lead to the finding that TWIA is in a condition hazardous to the public or to its policyholders.
Continue Reading...As an attorney representing policyholders in Texas, it should come as no surprise that I often disagree with the Texas courts’ rulings. However, sometimes the Texas courts get it right. One clear example is the manner in which Texas courts construe ambiguous provisions in insurance policies. On this issue, the courts have been very clear: insurance policy ambiguities are construed in favor of the policyholder.
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