When an insured disputes coverage or the amount of loss under an insurance policy, it frequently finds it necessary to hire a claims professional – a licensed public adjuster or other claim consultant, or an attorney for assistance.
When an insured disputes coverage or the amount of loss under an insurance policy, it frequently finds it necessary to hire a claims professional – a licensed public adjuster or other claim consultant, or an attorney for assistance.…
My blog post from March 2018 addressed a presentation I was involved in which addressed the attorney’s role during the adjustment of a claim. As addressed in that blog post, the line can quickly become blurred between an attorney acting in his/her role as counsel and acting as the claims adjuster for the insurance company.…
In past blogs I’ve talked about rulings and the trend across the country where courts are deeming work product privilege in bad faith litigation for the claims attorney to be incorrect and so their work product is discoverable. Courts are ruling that just because an attorney for the insurance company is on a file and advising on a claim does not always mean that their work product is in anticipation of litigation and therefore is not privileged or confidential under the Attorney Work Product Doctrine.
Recently, while going through the insurance company claim file on two cases, I saw references to a coverage opinion letter from a lawyer (or referencing emails shared between the adjuster and an attorney about coverage). These communications occurred in the claims handling process before the claim was denied and before the policyholder hired me as their lawyer. At about that point in the claim file there was much redacting where the lawyer defending the case had blacked out (or blanked out) anything having to do with communications between the coverage lawyer and the insurance company. I sent (pre motion to compel) letters to opposing counsel kindly asking them to reconsider their redaction of the documents, and withdraw their objection to my discovery request. The response I got was one of complete disdain that I had the audacity to make such a request. This is because many insurance defense lawyers think that anything done by a lawyer at any point during the claims handling process is absolutely and unquestionably protected by the attorney-client privilege.
This is a question I was asked recently so I thought I would answer it here. In this case, the insured made a claim for hail damage done to the roof. The insurance company investigated the claim and hired an Engineer to inspect the property. The Engineer drafted a report and provided it to the insurance company. Based on that report, the insurance company denied the claim. When the insured and his public adjuster asked for a copy of the report, the insurance company would not produce it, saying it is privileged “work product.” So what is “work product?”
In March I blogged about a Washington case that held an insurer’s communications with their attorney used to determine a denial of a policyholder’s claim was not privileged. In National Union Fire Insurance Co. of Pittsburg v. TransCanada Energy USA, Inc.,1 a New York appellate court continues the trend. Although every state’s insurance laws differ, there are many similarities, and almost all states have ruled that an attorney’s communications with a client is privileged. However, when it comes to attorneys who are outside counsel for an insurer that render opinions during the insurer’s regular course of business of issuing a denial, courts are ruling that this attorney-client communication is one made as a business decision versus a legal purpose.
Generally, any communication between an attorney and client is privileged. I often tell clients that when they want to talk about their claim by someone, they should talk to their attorney only so as not to break any privilege issues. Although I know sometimes discussing the claim outside the attorney-client relationship is a must, those communications (emails, letters, etc.) are usually considered discoverable in the event of a lawsuit, and their insurance company is entitled to those non-privileged communications.
While reviewing an insurer’s claim denial letter yesterday, it occurred to me that it was time to remind folks of a few things: (1) loss reports, estimates, and the like prepared in the ordinary course of an insurer’s routine claim investigation are rarely work product immune and should be produced to the insured and/or the insured’s representatives during the claim process so that the propriety of an insurer’s claim decision may be assessed by more than the insurer, (2) claims must not be adjusted in an adversarial manner, and (3) adjusters (along with everybody else) must not engage in the unauthorized practice of law. Allow me to flesh these reminders out.
Last week, in Genovese v. Provident Life and Accident Insurance Company, No. 06-2508, — So.3d —-, 2011 WL 903988 (Fla. March 17, 2011), the Florida Supreme Court resolved the following issue:
DOES THE FLORIDA SUPREME COURT’S HOLDING IN ALLSTATE INDEMNITY CO. V. RUIZ, 899 So.2d 1121 (Fla.2005), RELATING TO DISCOVERY OF WORK PRODUCT IN FIRST-PARTY BAD FAITH ACTIONS BROUGHT PURSUANT TO SECTION 624.155, FLORIDA STATUTES, ALSO APPLY TO ATTORNEY-CLIENT PRIVILEGED COMMUNICATIONS IN THE SAME CIRCUMSTANCES?
The anticipation of litigation is the trigger used in Florida to determine when a party to an action can claim a work-product privilege in connection with a documents production.