Ever wonder what is in thieves and criminals minds when they are rummaging through stuff to either steal or destroy property? One recent Connecticut case, Mercedes Zee Corp. v. Seneca Insurance Company,1 involving the distinction between theft and vandalism would leave jurors to decipher the criminal mind and determine whether the motive of criminals was to act as thieves or vandals. The distinction is critical to coverage in many property insurance policies.

Continue Reading What Is and Is Not Vandalism and Theft Loss in a Property Insurance Policy

The last few weeks the world has turned its attention to the Puna lava flow on the big island of Hawai’i. Two weeks ago I visited this subject as the ‘a’a (creeping) lava neared the town of Pahoa and the questions of whether the damages would be covered under a fire claim or an earth movement policy began to emerge. This week, the lava has reached Pahoa and residents are ordered to evacuate. As of October 27, 2014, the lava has reached within 100 feet of the first home of Pahoa in its path towards the ocean. The photos of the devastation are dramatic and since there has been a moratorium on raising policy limits or even purchasing earth movement policies for at least a month, the citizens of Pahoa will find that their insurance policies have severe limitations on recovery. Although many homes will burn due to the excessive heat that ensues before lava actually reaches it, the alarming new claim hitting the news is that for those who have already evacuated, claims of looting are emerging. These theft claims would appear to be, at first blush, a claim that is separate and apart from that of fire or land movement of the lava itself.

Continue Reading Will Lava Flow Bring Insurance Theft Claims?

An order was recently handed down in Colorado federal court interpreting a policy theft exclusion.1 The plaintiff owned and insured a manufacturing facility. The policy provided coverage for damage caused by vandalism or malicious mischief, defined as “the willful and malicious damage to or destruction of the property covered.” It excluded coverage for loss “by pilferage, theft, burglary or larceny, except this Company shall be liable for willful damage to the building(s) covered caused by burglars in gaining entrance to or exit from the building(s) or any part of the building(s).”

Continue Reading The Theft/Burglary Exclusion in Colorado

Texas courts have ruled that insurance policies which provide coverage for vandalism, but exclude coverage for theft, also exclude any damage that is “in furtherance of theft.” Practically speaking, if a thief breaks through your interior sheetrock walls to steal the copper wires behind them, a typical insurance policy will exclude coverage completely, even for the damage to your sheetrock walls. Now, if they had been vandals instead, and had just smashed holes in your walls without stealing copper wire, your policy would likely provide coverage. As you can see, the difference is subtle, but very important.

Continue Reading Can Theft and Vandalism Occur at the Same Time in Texas?

It’s a sad truth that building owners have to worry about burglars breaking into their buildings to steal copper wire and pipes. Many insurance companies don’t cover damage as a result of theft, but a lot of them do cover any damage related to burglars breaking in and exiting a building. However, a recent case from the Texas Court of Appeals demonstrates that you may not be covered for everything you thought you were.

Continue Reading Texas Insurance Law: Vandalism Coverage and Theft Exclusions

An insurance company adjuster’s request for invoices of personal property items can be a trap for otherwise honest policyholders. I have been thinking about this topic as a result of Corey Harris‘ post, Notifying the Police in the Case of a Theft Loss, and the weekly highlighted fraud case in Claims Magazine, "Fraud of the Week: Suit Yourself." The basic rule for policyholders to remember is that you are under no obligation to give an insurance company what you do not have and never make up a document because the insurance adjuster says you need it to get paid. For policyholder counsel and public adjusters, protect your client and make certain they are not doing this.

Continue Reading Invoices: A Practice Tip for Policyholder Counsel and Public Insurance Adjusters — A Warning to Otherwise Honest Policyholders