The systematic process of analyzing a property insurance policy has been a topic in my last three seminars before public adjusting groups. I am suggesting a methodology so issues are uncovered early following a loss. After having all paperwork in place, I suggest that the first item to consider is "who" is insured under the policy.

Continue Reading Analyzing the Insurance Policy: “Who” is Insured Should Be the First Determination

Last year, my learned colleague, Shaun Marker, wrote a series of blogs on the ongoing litigation between El-Ad 250 West LLC and Zurich over Superstorm Sandy flood damage and delays in construction under a builders’ risk policy. You can read his articles here.

Continue Reading Flood Sublimit Applies to Delay in Completion Claim Where Delay is Caused by Flood

As I stated in yesterday’s post, Chip Merlin Speaking at the Insurance Appraisal and Umpire Association September 18 Meeting, umpires better show up so they to learn from me and not lose business. The question of bias for umpires was answered in Zurich American Insurance Company v. Omni Health Solutions.1

Continue Reading Umpire is Biased Based on His Firm’s Work for a Party—Are Appraisers Subject to this Rule?

An insurance appraisal award will typically not be vacated unless it clearly appears that it was made without authority or was the result of fraud, mistake or misfeasance of the appraisers. An appraiser is expected to provide an independent and unbiased opinion on the value of a loss. The persons appointed as appraisers must be impartial or disinterested. The same goes for umpires in the appraisal process.

Continue Reading Setting Aside an Appraisal Award for Bias or Conflict of Interest

In a recent case in Tennessee, homeowners suffered a fire loss and filed a claim with their insurance company, Anpac.1 The insurance company investigated the loss and found that the homeowners intentionally set the fire and denied coverage. It then filed a declaratory judgment action. The homeowners filed counterclaims for breach of contract, unfair claims practices and bad faith. They alleged that the insurance company ignored evidence that showed they did not set the fire. In Tennessee, a statute allows insureds to seek a penalty of up to 25% of the total liability where a claim is denied in bad faith.2 When an insurance company refuses to pay a claim within 60 days of a demand, it must pay an additional 25% if the refusal was not in good faith and caused the insureds additional damages.

Continue Reading Litigation Does Not End the Continuing Duty of Good Faith

It is official—in a case of first impression in New York,1 the appellate court will decide if a policy flood aggregate limit will apply to “downstream” financial losses such as delay in completion. The policyholder has filed the appellate brief on December 3rd requesting the appellate court to review the trial court’s ruling of first impression we discussed in: Delay in Completion Losses Under a Builders Risk Policy – Part 2.

Continue Reading Should Flood Aggregate Limit Apply To “Downstream” Financial Losses Like Delay In Completion?

On several occasions the following insurance industry argument has been addressed on this blog: the insurance company argues that since a claim proceeded to the contractual alternative dispute resolution process of appraisal and that it paid the award amount, there cannot be a bad faith case brought against it since they claim they followed the policy. This has been a hot topic in the Florida property insurance industry in the last couple of years. Florida’s Fourth District Court of Appeals ("4th DCA") has issued two opinions on this topic – State Farm Insurance Company v. Ulrich,1 and Trafalgar At Greenacres v. Zurich.2

Continue Reading In Florida, an Appraisal Award May Be a Final Determination of Liability For a Bad Faith Case

In part 2 of this series, I reviewed a New York trial court opinion in a case involving delay in completion coverage under a builders risk policy where damage was sustained during Sandy.1 The policyholder/developer sustained significant property and delay in completion loss from Hurricane Sandy. The court held that the policyholder was entitled to recover the total of $5 million for flood damages, physical damages, and the economic delay in completion losses sustained since they stemmed from the flood. The case was one of first impression in New York.

Continue Reading Delay in Completion Losses Under a Builders Risk Policy – Part 3