Merlin Law Group has a new experienced California Insurance attorney, Victor Jacobellis, who is very busy fighting insurance companies like Farmers. Farmers has familiar advertisements showing cute situations where it pays claims. To be honest, it should also advertise and warn its customers how often it denies claims, how its polices are different than other companies who afford greater coverage, and that it often fights with its own customers.
A recent example is one of Farmers subsidiary insurer’s denial of its customer’s home that suffered damage from nearby construction causing vibrations which then caused cracks in her Los Angeles home. The pertinent stipulated facts were as follows:
The property was insured by an “all risk” policy…Colich & Sons dug a deep trench on plaintiff’s street to access the sewer lines. After installing a new sewer pipe, Colich & Sons backfilled the trench, and used a Hydra–Hammer to compact the soil. A Hydra–Hammer is a large machine that uses a multi-ton metal weight to strike the ground to compact soil…Plaintiff felt strong vibrations in her home, and noticed cracking and damage.1
Many insurance companies cover this type of loss and then sue the contractors or whomever is responsible for the cracking. Larry Bache wrote about this in Are Damages Caused By Blasting or Other Man-Made Earth Movement Covered Under Your Insurance Policy, and I wrote about it in Cracks Caused by Construction Operations May Be Covered.
In this case, the Farmers policy was written to exclude this type of loss. The policyholder didn’t recover. Indeed, Farmers prevailing attorneys moved for costs and fees against its customer who was sold “cheap insurance.”
Farmers should have huge warnings in its advertisements that potential customers should not be deceived by its clever ads depicting payments for unusual events. The product it sells is full of loopholes and far from a true “all risk” insurance policy.
1 Masson v. Mid-Century Ins. Co., 2018 WL 2440078 (Cal.App. 2 Dist.), 1 (Cal.App. 2 Dist. May 31, 2018).