Adjusters hate to listen to lawyers pontificate about case law. I know because of surveys we have done asking adjusters what they want to get out of presentations and how they best can learn. Instead, adjusters want lawyers that are making presentations to explain the practical implications of how they can better do their job.

In my presentations at the Windstorm Conference with Steve Pate yesterday afternoon, I tried to do just that. Adjusters, whether company, independent or public, are travelling to disaster sites in many states. The subtle differences in each state’s insurance laws have to be considered by all adjusters in their day to day activities. And, there are some general themes and trends common to all.

Here is the list of cases we discussed in our presentation that we believe will affect those adjusting claims in Gulf Coast areas outside of Florida:

Here are some practical points of adjustment that should be implemented and considered:

1. Flood exclusions are being upheld in cases throughout the Gulf Coast. Policyholders may have coverage for hurricanes as a "windstorm," but the law is recognizing that the flood/storm surge damage from the hurricane is excluded.

2. Mental distress claims brought about by wrongful claims conduct will be recognized in Mississippi and Louisiana. The Louisiana standard to support such a claim is very low. Adjusters must be trained to use the "golden rule" with adjustment activities and appreciate the emotional distress caused by a catastrophe followed by a serious discussion of adjustment.

3. Arbitrary guidelines suggesting an outcome for an investigation will give rise to claims practice violations or bad faith lawsuits.

4. Adjusters must make a full investigation of a loss. In slab situations, engineers will almost always have to be consulted on a case by case basis to support a claims decision.

5. In Mississippi, the insurer bears the burden to prove the amount of excluded flood damage under an all risk policy. The policyholder must prove the amount of wind damage caused to contents under a named peril policy.

6. Louisiana has very liberal proof of loss requirements for policyholders to satisfy. Insurers must be very prompt paying undisputed amounts of claim damage to avoid penalties.

7. Second homes that are not primary residences raise a number of potential coverage defenses which may apply to underwriting and application misrepresentations. These are often not raised by adjusters in the field. Agents need to make certain second home coverages are properly written to avoid errors and omission claims.

8. Safe is better than sorry. While one Texas case suggests a method to avoid the two year and a day statute of limitation in Texas, the safer practice is to file litigation on claims disputes within two years from the date of loss.

9. Insurers have a "reasonable basis" defense to claims of bad faith. Adjusters should promptly and fully investigate losses detailing findings and obtaining bona fide consultant opinions when needed to show a good faith basis for a claims decision. And, they must fairly consider all evidence and not be selective as to evidence indicating less or no coverage.

10. Appraisals in Texas are going to be much more common. While the law is very unclear, courts are tending to enforce appraisal first and review causation and coverage issues later in most situations.

11. National Flood Proofs of Loss have to be filed on time and completely. If not, there is an appeal procedure that is now subject to judicial review if National Flood arbitrarily denies a request for a late filing or claims determination change.

12. Texas practically places a much higher burden of proof on the policyholder to prove the amount of covered versus non-covered loss. Recent Louisiana decisions also follow this reasoning by making the policyholder segregate the amount of covered versus non-covered loss. Engineers, contractors and consultants often give a percentage of covered versus non-covered loss with support to meet this burden.

I hope these points are helpful. It sure beats reading all those cases.