​In Florida, the Florida Insurance Guaranty Association (“FIGA”) handles and resolves claims of insolvent insurers under certain statutory guidelines. But what happens when the underlying insurer had reached a settlement agreement with a claimant before becoming insolvent? You would hope that FIGA would be ordered to honor such an agreement. It is a beautiful thing when the law follows common sense. This happened recently in the case, Alessio ex rel. Estate of Garza v. FIGA.1


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It is a good practice to always review documents in detail before signing them. Courts usually enforce the terms of a document even if one party did not read and understand it before signing. One very important document to read and understand in the property insurance context is a settlement release. A proposed release often comes when a policyholder is happy to have a resolution and is eager to receive the settlement proceeds and move on. That eagerness should not distract policyholders from reviewing and understanding the terms of a release, since it is likely a binding contract.


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Contingent business coverage is a type of business interruption coverage intended to protect the “dependent business” from an external business income exposure. There are four (4) types of dependent business ISO endorsements:

  1. Contributing Premises, such as the businesses that deliver materials to the insured;
  2. Recipient Premises, such as the businesses that receive the insured’s products;
  3. Manufacturing Premises (businesses that make products for delivery to the insured), and
  4. Leader Premises, such as businesses that bring the customers to the insured.


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Texas Judge Susan Criss signed an Order this morning approving the settlement of the slabbed cases from Hurricane Ike. She made the following findings:

4. The Court finds that the Settlement was negotiated at arm’s length by Plaintiffs’ counsel and TWIA’s counsel. The Settlement is reasonable in light of the uncertainty as to whether the Class Members could prevail on their causes of action against TWIA, the risks and cost of litigation, and the value of claims foregone. The terms and conditions of Settlement are no less favorable to the Class Members than comparable arms-length terms and conditions that would have been agreed to by unrelated parties under similar circumstances.


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Louisiana Citizens Property Insurance Company has settled a state class action case, Press v. Louisiana Citizens Fair Plan Property Insurance Corp., for failing to fully pay overhead and profit to insureds. The proposed settlement, for $23 million, covers claims from Hurricanes Katrina and Rita.


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The Galveston Island and Bolivar Peninsula slab cases are settling. There was an agreement between the Texas attorneys that nothing would come out in the press until the clients signed the agreements. Since even the Texas Windstorm Insurance Association (TWIA) participated with a press release, I assume that the gentlemen’s confidentiality agreement to wait on telling everybody publicly that a settlement has been reached, even before clients have signed the releases, no longer applies. The vast majority of my clients have only received letters from our firm, and I am awaiting final figures from TWIA so that we can consummate the deal. I hope everybody is not optimistically jumping the gun.


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The oil spill attorneys advertising for a mass of clients and recent advertisements in Texas regarding Hurricane Ike claims, seem to indicate that all my colleagues always win, and win big. Nothing could be further from the truth. The truth is that if you are going to trial or push for what should fully be paid, at least one party to the litigation will lose and, sometimes, lose after a lot of money is offered to settle. Everybody loves to talk about their wins. Losses happen, and I am reminded of that bitterness and horrible feeling of injustice every now and then.


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September 1970 was a time of big personal change for me. We were living outside Washington, D.C. and my father had just received orders to the National Data Buoy Project at NASA’s Mississippi Test Facility, now known as the Stennis Space Center. My mother, who grew up in Philadelphia, Pennsylvania, was in tears wondering how her children were ever going to get an education in Hancock County, Mississippi. Three years later, she was crying as we left for Southern California. Rather than follow my father right away, we stayed an extra year, using an excuse that my father would be gone for nine months on a Coast Guard icebreaker. The best education and lessons I have ever had were from brothers of the Sacred Heart at Saint Stanislaus during seventh and eighth grades. Drew Brees had it right when he spoke of how much the New Orleans Saints football team means to New Orleans and the Mississippi Gulf Coast Region.


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