As a child of the 80s, I remember all the television commercials constantly reminding me “reading is fundamental,” and my English teachers testing me to see if I understood how a word or phrase in one part of a book was important to another section of a book. Little did I know, those commercials and my English teachers were teaching me an important lesson about reading an insurance policy.

One of the first things we should do after a loss is carefully read the insurance policy for coverage. You not only want to just read the policy sections that pertain to losses and exclusions; but also read the definitions of the terms, see where else and how else a term may be used within the policy.

Continue Reading Reading is Fundamental: Court Finds Vandalism Exclusion Denies Coverage to Intentionally Set Fire

Some courts across the country have determined whether arson is included within an exclusion for "vandalism and malicious mischief." This issue arises under the vacancy type of exclusion within property insurance policies. Florida appellate courts had not spoken directly on this issue, until just recently.1

Continue Reading “Vandalism And Malicious Mischief” Can Include An Intentionally Set Fire (Arson)

Recently, a defense attorney in a case I’m working on attempted to inject elements of “The Arson Defense” into the lawsuit. Only problem is, we are not claiming fire damage. However, that got me thinking about the various defenses insurance companies typically use to avoid paying insurance claims. Today, I will discuss “The Arson Defense.”

Continue Reading “The Arson Defense” Used by Insurance Companies Against Texas Policyholders

Allstate Indemnity Co. v. Shoopman
Docket No. 09-cv-0083
(E.D. Ky. February 11, 2010)

In this case, the Shoopmans’ home was substantially damaged by fire. After they filed a claim, Allstate investigated the causes of the fire and suspected the fire was the result of arson and that an “insured person” was involved in the arson and/or concealed or misrepresented material facts relating to the loss. Allstate filed an action, asking the Court to declare that the Shoopmans are not entitled to coverage under their homeowners policy. The Shoopmans filed a counterclaim, alleging violations of the Unfair Claims Settlement Practices Act (“UCSPA”) and the Kentucky Consumer Protection Act (“KCPA”), for bad faith in handling their claim. At issue in this opinion was Allstate’s motion for summary judgment. 

Continue Reading Court Finds That an Agent’s Bad Manners and Technical Violations of Procedures and Rules Does Not Establish Bad Faith

(Note: This Guest Blog is by Robert Reynolds, an attorney with Merlin Law Group in the Coral Gables, Florida, office. This is the eleventh of a thirteen part series he is writing on examination under oath).

Back in the days of yore when, in true Gunga Din fashion, I hauled the man’s water defending insurance companies I was a fraud specialist. Every claim I handled had some indicia of fraud. And, believe me, if you or your client walked into the room for an examination under oath and I was conducting that day’s EUO, you were in for a long, difficult ordeal. I would move heaven and Earth to prove the fraud. But on the occasion when the facts bore out that there either was no fraud or there was no evidence to prove the fraud by clear and convincing evidence (the burden the carrier must establish in court to uphold a fraud denial, which is a higher standard than the normal preponderance of the evidence in civil court) I would actually tell the carrier to –please be seated before reading this next line— PAY THE CLAIM. Imagine that. Unfortunately, in today’s climate all too often when a claim comes across the inside examiner’s desk it seems the only tool provided by the carrier to evaluate the claim is a rubber stamp with the word “DENIED” and a red ink pad. With that being said, what should public adjusters expect when a claim is being investigated for fraud? Specifically, carriers love to shake the fraud stick at fire claims. What questions may be anticipated at an examination under oath of a suspicious fire claim?

Continue Reading Typical Questions Asked During an EUO of an Arson or Suspicious Fire Case

(*Chip Merlin’s NoteSandy Burnette is a prominent insurance defense attorney with exceptional experience in cases where insurance fraud or arson are suspected. I have known Sandy for 27 years. As you can see from his rhetoric, he is a fierce defender for those engaged in the fight against insurance fraud. Keeping with my Fair and Balanced blog, I invited Sandy to compose a guest post reflecting his views and experience.)

Well, seeing my name mentioned in your recent blog on insurance fraud was certainly enough to capture my attention, but the content of your remarks compels me to respond. Nobody who knows the two of us will be surprised to see we disagree, but in this instance you are simply wrong, Chip.

Continue Reading Sandy Burnette Defends Insurance Fraud Fighters

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