The poor policyholders whose homes cracked, popped, and dipped as a result of sinkholes induced by citrus farmers spraying their crops to prevent freezing damage should be happy it happened to them this year. Newly proposed anti-consumer sinkhole legislation would limit policyholders to 25% of their coverage limits for the most common sinkhole problems.
Continue Reading...(Note: This Guest Blog is by Tina Nicholson, an attorney with Merlin Law Group in the Houston, Texas, office. This is part of a series she and fellow attorney Javier Delgado will be writing on Texas property insurance issues).
Everyone knows what to do when disaster looms. When the disaster is a hurricane, you gas up the car and buy batteries. When it’s a tornado, you get in the closet with a flashlight and a radio. When a winter storm approaches, you buy food and firewood.
Continue Reading...I just finished a two day settlement conference of a commercial insurance claim dispute held on the 51st floor of Fulbright & Jaworski in Houston. The view from the conference room was beautiful and in juxtaposition to the manner my client felt the insurance claim was handled. As is becoming customary for many of my cases, the terms of the settlement are confidential. The resolution ended very amicably, although the process was somewhat frustrating. The significant aspect to others is this was a matter whose facts are similar to, and seem repeated in, thousands of other Texas losses, no matter if the loss is small or a complex middle eight figure claim. Insurance claim denials and delays seem commonplace in Texas.
Continue Reading...The Florida legislature passed a law prohibiting Public Insurance Adjusters from soliciting business within 48 hours of a loss. Obviously, the lobbyists for the insurance industry were overjoyed with this law’s passage because it effectively allows the insurance companies and the insurance restoration industry to set the tone of the adjustment, without the typical policyholder having access to professional help.
Continue Reading...One way to get cheaper rates is to buy an insurance policy that covers nothing. An article shows this is how the Florida legislature is tackling the insurance rate problem:
Continue Reading...A former insurance defense attorney called me yesterday, asking if I would represent him and his wife in their sinkhole insurance dispute. While he oversaw many sinkhole matters from the insurance company's position, I guess he knows that a lawyer who represents himself has a fool for a client. His call to me is part of a trend, sinkhole loss calls to our Tampa office have been on the rise. Last week, the St. Petersburg Times ran a front page lead article, Geologists Worry About Drought's Effects on Sinkhole Season. The insurance coverage available, various statutory changes, caselaw, science, and repair of sinkhole losses make these cases fairly complex. Extreme rains or droughts seem to make sinkholes more frequent.
Continue Reading...One wrongful adjustment method that occurs from time to time is the practice of taking the deductible from the policy limit. For insurers, this is a way to never pay the policy limit. When this occurs, the underwriter essentially charges unearned premium for the amount of the deductible, and the policyholder never has a chance to fully recover under the policy. Sometimes the practice occurs out of ignorance. Some just take advantage of the unknowing policyholder.
Continue Reading...Texas insurance law has its quirks which are different than the majority. My experience is that every state has its nuances of insurance coverage law. Not necessarily wrong, just different. Sometimes, incorrect judicial decisions are made and then remain the law for generations. Often, adjusters in the field simply ignore statutes or common law rules and adjust claims the way they are taught.
Continue Reading...I was honored to be given the Policyholder Attorney Honorable Mention Award from the Insurance Law Center. It was meaningful because I am a policyholder attorney in every case. However, some who read the comment posted by the Insurance Law Center with the award might have the wrong impression about the success that our firm, not just me, had in the Katrina Cases we litigated. This is what was said:
Continue Reading...(Note: This Guest Blog is by Frank Chimento, Director of Business Development and Client Services at Merlin Law Group).
I would feel confident making a wager that if Americans were polled on a scale of 1 to 10, with 1 being the least, their level of understanding or interest in insurance matters would be somewhere around 2.5. At least it was for me, until one day at the Almeda Mall in Houston, Texas.
Continue Reading...If you want to find a bunch of irate policyholders with plenty of stories to tell, hang out with Tina Nicholson and Javier Delgado in our Houston office. Commercial and residential policyholders have had enough frustration trying to do it themselves and are seeking legal counsel to fight the delays and denials from their insurance carriers. Anger at the insurance company and the adjusters working their claim is the prevalent emotion. Over the next several weeks, I plan to write much more on Texas property insurance law and protection it provides because Texas is the hottest new venue in the insurance litigation war. We are in the middle of it.
Continue Reading...Surplus lines insurance companies are a different breed of insurance cat. They are not admitted carriers in the state in which they do business. Thus, most states have consumer protection laws specifically regarding how surplus lines insurance carriers can do business.
Surplus lines carriers are very important to the insurance marketplace. They will often insure the risks many admitted carriers find too risky or novel. For example, when a property owner buys surplus flood insurance or a complex Difference in Conditions policy, it is often sold through the surplus lines market.
Continue Reading...A Comment from a previous post, How Ike Insurance Claim Help is Supposed to Be, provided insight to the understanding of the claims process from two adjusters in the insurance industry. The comment is worthy of repeating here:
Continue Reading...The deteriorating economy appears to be having an impact on our business. We are being referred more insurance disputes involving losses that are directly the result of the souring economy.
For the first time in a decade, we have been referred several fire claims that are allegedly of an incendiary (intentionally set) cause.
There are a number of reasons why fires are intentionally set. Statistically, the most common cause is adolescent males simply setting fires to property. Arson for profit is fairly rare, but insurers understandably hire specialized fraud attorneys, such as Barry Zalma, to take Examinations Under Oath and conduct investigation.
More and more buildings are unoccupied or vacant. When a building does not have somebody in it, the structure becomes an easier target for arsonists, vandals, and thieves. Accordingly, there appears to be more of these losses. Since policies often restrict coverage of and have exclusions that apply only to vacant or unoccupied buildings, more insurance coverage disputes occur.
For example, Tina Nicholson, of our Houston office, recently settled a case for a client where numerous break-ins, thefts, and vandalism had resulted in damage to the building. The policy at issue had specific clauses regarding exclusions and exceptions to exclusions pertaining to vandalism, theft and damage caused by burglars breaking in or exiting the building.
The Motion for Partial Summary Judgment and Memorandum of Law filed by Tina analyzes this very complex insurance coverage issue. These pleadings should be read by two types of people--those wanting to understand highly technical differences in the wording of commercial insurance coverage disputes and those that need help going to sleep. For such a commonplace loss scenario in this economic climate, the resolution depends upon which state law applies and the exact language of the policy in question.
If the economy worsens, I expect we will see more of this type of loss. Risk managers and property managers should carefully review their policies to make certain this type of loss is covered. I am fairly certain that adjusters in the industry have been made aware of the limitations in some of the policies.
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