Monthly Archives: December 2014

Cooperate in Defense or Lose Everything

Insured Hurts Itself and Its Victims A third party liability insurance policy promises the insured to defend and indemnify it if the loss is due to a risk of loss insured against. The insured of a third party liability insurance … Continue reading

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Report Promptly, Sue Quickly or Else

Private Limitations of Action Provision Enforceable First-party property insurance policies always include a prompt reporting requirement and a private limitations of action provision. Even if the claim is reported promptly once it is denied the insured should never sit on … Continue reading

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Insurer May Litigate Coverage Dispute

No Coverage – No Suit Against Insurer In Quihuis v. State Farm Mut. Auto. Ins. Co., — Fed.Appx. —-, 2014 WL 7331247 (C.A.9 (Ariz.) 12/24/14) the Ninth Circuit Court of Appeal, tracking Arizona law, was asked to allow an insured … Continue reading

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Brothers Shouldn’t Fight

Intentional Acts Not Covered Disputes between relatives are never happy if they come to court and litigation. Families who should love each other turn love to hate over jointly owned property. The disputes between relatives ofter appear more like war … Continue reading

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Notice of Claim is When the Insurer Receives It

Claims Made and Reported After Premium Finance Cancellation Claims made and reported policies provide limited coverage by requiring that the claim against the insured must be made and reported to the insurance company before the expiration of the policy. Arguments … Continue reading

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ERISA Bars Jury Trial Against Health Insurer

Must Prove Private Limitations of Action Provision The Employee Retirement Income Security Act (ERISA) was designed to, among other things, limit the remedies available to people enrolled in an ERISA plan to those remedies allowed by the statute. By so … Continue reading

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Arson-for-Profit Doesn’t Pay

Go Directly to Jail, Do Not Pass Go Arson is probably the dumbest form of insurance fraud. With modern municipal fire departments arson fires seldom totally destroy the premises, evidence is always left for arson investigators to review, and firefighters … Continue reading

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Biased Judge Disqualified

Judges Ought to be More Learned Than Witty It has long been said in the courts of this state that “every litigant is entitled to nothing less than the cold neutrality of an impartial judge.”   State ex rel. Davis v. … Continue reading

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Insurance Lawyer Expert Striken

Legal Issues Not Proper Expert Testimony A plaintiff seeking to use an insurance coverage lawyer as an expert to convince a jury that an insurer was responsible for breaching the tort of bad faith, must be careful in the choice … Continue reading

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A Christmas Story of Fraud

The Sleaze This year I inadvertently failed to place this story in Zalma’s Insurance Fraud Letter. It is one of more than 80 stories in my e-book, “Heads I Win, Tails You Lose” and is an expression of how insurance … Continue reading

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Failure of Contract to Provide Indemnity

Rights of Third Party Beneficiary Limited to Terms of Contract Whenever a party to a contract wants indemnity from the other party(ies) to the contract it usually will demand such indemnity in writing from each of the other parties to … Continue reading

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You Only Get What You Pay For

Special Assault & Battery Exclusion Applies Insurance, as I have said often, is nothing more than a contract where a liability insurer – for example – promises to defend and indemnify the insured against certain identified risks of loss in … Continue reading

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Zalma’s Insurance Fraud Letter — December 15, 2014

Merry Christmas & Happy Chanukah In the 24th issue of its 18th year of publication of Zalma’s Insurance Fraud Letter (ZIFL) Barry Zalma, on December 15, 2014, continues the effort to reduce the effect of insurance fraud around the world … Continue reading

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Infrared Detection of Mold

An Excerpt from the Mold Coverage Guide Experts can bring infrared technology to the examination of the property to allow the inspector to see where water leaks not visible to the naked eye exist. Infrared Thermography (IT) is a technique … Continue reading

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The Eight Corners Rule Defeats Right to Defense

No Accident If You Shoot a Person In the Head at Close Range Terry Graham, Jr., shot and killed would-be burglar, Hiram Joshua Chambers, at Graham’s ranch house in Smith County, Texas by shooting him in the face at close … Continue reading

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Insurance Fraud

Insurers are faced with three major types of insurance fraud: fraud in the inception The insured misrepresents or conceals facts material to the decision of the insurer to insure or not insure the prospective insured. If the insured lies in … Continue reading

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A Dam Case

When ACV is RCV Less Depreciation The definition of the insurance term “actual cash value” (ACV) has resulted in multiple definitions depending on jurisdiction. Some define it as fair market value, some define it as replacement cost value (RCV) less … Continue reading

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Doubt About Exclusion Requires Coverage

If any Part of Suit Requires a Defense The Entire Suit Must Be Defended An insurer’s duty to defend, although not unlimited, is extremely broad and requires an insurer to provide a defense for insured and uninsured events if there … Continue reading

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What is Liability Insurance?

How Do I Buy It? Insurance, by definition, is a contract where the insurer, for consideration (premium) agrees to indemnify another against a contingent or unknown risk of loss. It is used as a method to spread losses among many … Continue reading

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Business Risks Never Insurable

Insurance of a Business Risk Creates a Perverse Incentive to Sue Corporate Officers and Shareholders Being in business is always a risk. When a person or entity builds something – a yacht, for example – it always runs the risk … Continue reading

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The Claims Interview

The Interview is a Structured Conversation The beginning of every claim investigation is the interview of the insured and/or the claimant. Every person involved in claims needs to know the basics of the interview. The Interview is a structured conversation. … Continue reading

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Resident Relative Must Abide in House

Mother’s House Not Son’s Residence Susan and Peter White (White), appealed an order of the Superior Court denying their petition for a declaratory judgment that respondent Charles Matthews (Matthews) was covered under a homeowner’s insurance policy issued to his mother … Continue reading

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Fishing Expedition Prohibited in Texas

Scouring Claim Files Not Related to Insured Wrong The business of insurance requires each party to the insurance contract to treat each other with good faith so as to not prevent the other from receiving the benefits of the insurance … Continue reading

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Indemnity & Insurance – Who Goes First

Additional Insured Must Collect from Insurance Before It Can Seek Contractual Indemnity Many contracts have dual purposes when it comes to shifting the risk of loss. Usually the owner requires the contractor to name it as an additional insured on … Continue reading

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Inadequate Adjusting Expensive

Failure to Establish ACV Promptly Insurance companies know how to settle property damage claims under a policy with replacement cost value (RCV) coverage. They obtain the agreement with the insured the full cost to repair or replace and the actual … Continue reading

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Fraud Struggle Continues

Zalma’s Insurance Fraud Letter December 1, 2014 In the 23rd  issue of its 18th year of publication of Zalma’s Insurance Fraud Letter (ZIFL) Barry Zalma, on December 1, 2014, continues the effort to reduce the effect of insurance fraud around … Continue reading

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