This well-known idiom alludes to a catch or mysterious element hidden in the details.1 Policyholders purchase insurance to protect and secure their property. Unfortunately, many carriers do not disclose provisions that limit their policyholders’ rights in the event a dispute arises.

Continue Reading The Devil Is In the Details. What Did Your Premium Discount Actually Cost You?

States have different laws that apply to property insurance contracts. This blog writes about the variances of those state laws all the time. For example, in Florida, absent a provision in the insurance policy, judges will rule that the place where the property is located determines which state law applies.
Continue Reading Which State’s Law Applies to The Property Insurance Policy? Florida Looks to Where the Property Is Located

Pipe failures leading to a washout underneath a foundation can be a significant loss for policyholders. The question is whether it is covered and how much may be covered. While many insurers will pay to fix the pipe, most will deny coverage for the foundation damage that is caused by the soils being washed out.
Continue Reading Is Pipe Failure Resulting in Foundation Damage from Washout Covered? Policy Form and Jurisdiction is Important

Arbitration clauses primarily found in surplus lines policies with a choice of law provision generally selecting New York law and a shortened statute of limitations are a trap for unwary public adjusters and attorneys. A recent federal appellate court case upheld such a clause despite a state law making it illegal. The holding of the case suggests just how complicated of a legal issue this is:

This appeal presents an issue of first impression in this circuit that lies at the intersection of international, federal, and state law: whether the McCarran-Ferguson Act, 15 U.S.C. §§ 1011–15, allows a Washington statute to reverse-preempt the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, a multilateral treaty. We conclude that the relevant provision of the Convention is self-executing, and therefore not an “Act of Congress” subject to reverse-preemption by the McCarran-Ferguson Act. Accordingly, we affirm the district court’s order compelling arbitration.1

Continue Reading Public Adjusters Beware of Arbitration Clauses Changing State Law

A recent insurance contract case came down to the step of determining which state law applied.1 While it is a liability contract case, the issue is the same and a very important one that is not often discussed. Property insurance adjusters often overlook what state law applies when interpreting insurance contracts and generally use the state law where the loss happens. While this is often the case, different state laws may apply in more complex commercial and surplus written policies.
Continue Reading Are You Interpreting An Insurance Contract? The first step is to determine which state law applies so you know what interpretation rules to use—Tuesday @2 With Chip Merlin will Discuss this Often Overlooked Step

A few years ago, I asked Merlin Law Group attorney Doug Grose, “How did we end up in arbitration in London, England with policy delivered in Texas, a loss in Houston, Texas and our client from Houston, Texas?” He told me there was an arbitration provision and the federal court ordered us to go to arbitration in London because that is where the policy required the arbitration take place. I asked Doug: ”Geez, forgetting the extraordinary increased cost to our client do this, what chance do you think we have in arbitration in London against Certain Underwriters at Lloyd’s of London?”
Continue Reading Choice of Law and Arbitration Provisions in Texas—Beware of These Provisions Which May Apply Laws of Another State

Insurance policies are complicated enough without getting into what law from what state will apply. Some policies have a special “choice of law” or “governing law” provision that allows the parties to agree that a particular state’s laws will be used to interpret the agreement even if the insured lives in a different state.
Continue Reading New York Choice of Law

As discussed in the first part of this series, sometimes there is a question of which state law will apply to an insurance dispute in litigation. Policyholders could be domiciled in one state; fill out an application for insurance in another state for a property located in another state. This question is called choice of law.

Continue Reading Which State Law Applies to My Insurance Claim? – Part 2

It may depend… At least that is the short and simple answer. We constantly deal with people from different states who may have contacts all over the country, properties in various places, insurance agents in different states and receive policies of insurance in various places from insurance carriers located anywhere in the world. Sometimes questions may arise about which State law will apply to a particular insurance dispute. This is often referred to as a choice-of-law rule.

Continue Reading Which State Law Applies to My Insurance Claim?