Monthly Archives: September 2013

When an SIR Isn’t

SIR Doesn’t Say What Insurer Thought In this case the California Court of Appeal was asked to once again apply the well-established principle that any limitation on the coverage provided by a liability insurance policy must be express and consistent … Continue reading

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No Ambiguity

Homeowners Policy Not a Farm Policy When the clear and unambiguous language of an insurance policy does not provide the coverage an insured needs he, and his counsel, will argue that the policy is ambiguous and should be construed to … Continue reading

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Don’t Brag About Fraud

Second Fraud Attempt Results in Conviction Faking a vehicle theft in California is a felony. Making a claim to an insurance company knowing it is false is a felony in California. Making a false representation to an insurance company as … Continue reading

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How To Avoid “Cumis” Counsel

No Conflict No Independent Counsel When an insurer agrees to provide a defense with a reservation of rights and approves independent counsel selected by the insured to represent the insured in an underlying tort action, pursuant to Civil Code section … Continue reading

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Appraisal Award Enforced

Limited Grounds to Set Aside Appraisal Almost every first party property insurance policy contains an appraisal condition that allows three independent appraisers to determine only the amount of loss. The purpose of an appraisal provision is to prevent one party … Continue reading

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Flood Insurance Is Different

Conditions Must Be Met All litigants in the United States are equal. All contracts in the United States are interpreted as written. Some litigants and some contracts are more equal than others. When insurance is paid by the government the … Continue reading

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Contribution & Defense Costs

When a Release Isn’t Enough The Supreme Court of New Jersey was asked to resolve, in Potomac Insurance Co. of Illinois v. Pennsylvania Manufacturers’ Association Insurance Co., A-2-12 (N.J. 09/16/2013), what it called a “novel question”  whether an insurer with an … Continue reading

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Fraud Victim Punished

Policy Rewritten to Make Defrauded Insurer Pay Rescission of an insurance policy, by definition, means the policy never existed and the parties are returned to the status quo. The insured gets the premium back and the insurer gets the policy … Continue reading

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TANSTAAFL

Free Life Insurance For Life As a famous economist once said: “There Ain’t No Such Thing as a Free Lunch.” (TANSTAAFL) Regardless of how obvious this statement is people keep bringing to courts claims of their right to a free … Continue reading

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Colorado Court Rewrites Insurance Policy

Voluntary Payment Okay If No Prejudice to Insurer The public at large, and some courts, do not like insurance companies. The public thinks that insurers take money (premiums) and then do everything possible to avoid payment of claims and should … Continue reading

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Barry Zalma Reports

It Costs To Lie to Your Insurer Continuing with the eighteenth issue of the 17th year of publication of Zalma’s Insurance Fraud Letter (ZIFL) Barry Zalma reports in the September 15, 2013 issue on: 1.    Pennsylvania case establishes why lies … Continue reading

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Limitations Must Be Written In Policy

Insurer Needs to Interpret Policy In Favor of Insured Landlords buy insurance to protect against the risk of losing rental income when the property is damaged by fire or some other insured peril. Insurance policies insuring against loss of rents … Continue reading

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Appraisal Compelled

Limitation on Duties of Appraisers Flexible Appraisal in a first party property policy is mandated in most states by statute. It is a means by which an insured and insurer can resolve disputes over the amount of loss. It does … Continue reading

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To Stack or Not to Stack, That Is The Question

Clear & Unambiguous Policy Term Must be Enforced In Missouri the state established a public policy allowing uninsured motorist coverage (UM) policies to be stacked where policies issued on multiple vehicles could be added for a single accident even if … Continue reading

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Florida Rewrites Insurance Policy

Florida Statute Impairs Contract Every homeowners policy issued in the United States requires that for an insured to collect the difference between actual cash value (ACV) and replacement cost value (RCV) the insured must actually expend the funds or contract … Continue reading

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Refusing Free Defense Stupid & Expensive

Defendant Must Pay for Lawyer of His Choice A stupid radio contest caused a woman to die. The program conducted a contest at the station for listeners called “Hold Your Wee for a WII.”  Jennifer Strange was one of the … Continue reading

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Sit On Your Rights – Lose

Arbitration Award Affirmed Plaintiff, Excelsior Insurance Company (“Excelsior”), appealed from a trial court order confirming an arbitration award issued in favor of defendant, One Beacon Insurance Company (“Beacon”). Both Excelsior and Beacon are members of Arbitration Forum, Inc. (“AFI”), and … Continue reading

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No Opposition Fatal

No Insurance Policy Covers Every Possible Risk of Loss Clark and Nancy Sadler appealed a summary judgment granted in favor of Texas Farm Bureau Mutual Insurance Companies (“Farm Bureau”) on the Sadlers’ Deceptive Trade Practices-Consumer Protection Act (DTPA) claim. The … Continue reading

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When Is A Letter a Suit?

Ninth Circuit: A State Can Insert a Definition Into a Policy After It Expired The Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq. (“CERCLA”), establishes a retroactive strict liability regime that imposes joint and several … Continue reading

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Interpleader

When an Insurer Must Interplead Funds When an insurance company is faced with competing claims for the proceeds of a life insurance policy and cannot determine which claim is proper, it may deposit the benefits of the policy into court … Continue reading

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Due Process & Punitive Damages

Punitive Damages Over 10:1 Violates Due Process The fear of every insurer sued for the tort of bad faith is that the jury will run away from reason and punish the insurer in a manner violative of its rights of … Continue reading

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International Fraud

Zalma’s Insurance Fraud Letter September 1, 2013   Continuing with the seventeenth issue of the 17th year of publication of Zalma’s Insurance Fraud Letter (ZIFL) Barry Zalma reports in the September 1, 2013 issue on: 1.    Fraud in China. 2.   … Continue reading

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