Monthly Archives: June 2015

Heads I Win, Tails You Lose

How Not to Commit Arson – A Fictionalized Story About Insurance Fraud by Barry Zalma, Available at http://www.zalma.com/zalmabooks.htm

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When Does an Endorsement Supersede the Base Coverage Wording?

Coverage Determined by What Is not What Might Be Insurance companies and the people they insure have the right to limit the coverage available under the policy. For each coverage that is eliminated by endorsement the premium cost is reduced. … Continue reading

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When is a “Known Loss” Not Known?

Know Loss Exclusion Requires Knowledge of the Damage Claimed Insurance requires, before a loss can be covered, that the loss was contingent or unknown before the policy was issued. Insurers, using a belt and suspender methodology, not only rely on … Continue reading

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Can Insured Get Back Premium if No Loss?

Risk of Loss Is Transferred to Insurer on Inception of Policy No one enjoys paying insurance premium. Everyone would like to pay no premiums until the day before a loss rather than wait for years before obtaining the benefits of … Continue reading

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SIU Regulations Webinar

Webinar – Compliance With The California SIU Regulations To sign up for the live webinar by Barry Zalma, Esq., CFE on July 8, 2015 at 8:00 a.m. Pacific Time and 11:00 a.m. Eastern time, go to: http://www.complianceonline.com/compliance-with-the-california-siu-regulations-webinar-training-703989-prdw?channel=M3_NW_JL08_Barry_JN19_BR or call Toll … Continue reading

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Can an Insured Receive Coverage for Breach of Fiduciary Duty

Trustees Should Not Cheat Beneficiaries Directors and officers (“D&O”) insurance is limited to the actions of the officers in their capacity as an officer of a corporation. It, like every other policy issued, contains exclusions. It’s exclusions are different than … Continue reading

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What is a “Residence Premises” & Who Are Resident Relatives?

Homeowners Policy Requires Insured to Reside at Dwelling By definition a homeowners insurance policy insures the owner against the risk of loss of the dwelling where the insured resides. It should not insure the named insured who does not live … Continue reading

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Condition Precedent Enforced

Can an Insurer Refuse Coverage Because Insured Entered Into Settlement Without Insurer’s Consent Insurers may limit the terms and conditions of the contract of insurance to protect their interest. No insurance company covers every possible contingency. All have exclusions and … Continue reading

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Does the Notice-Prejudice Rule Unfairly Disadvantage an Insurer of Its Contractual Rights?

Montana Adopts Notice Prejudice Rule A Commercial General Liability (CGL) insurer sued its insured contractor and real-property owners for declaratory judgment that insurer had no duty to indemnify, defend, or cover counterclaims asserted by owners in the insured’s state-court action … Continue reading

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When Must An Appraisal Award Be Reversed?

Appraisal Panel Must Appraise Loss Not Claim Appraisal is, in California, a form or arbitration where the appraisers (arbitrators) are required to find the actual cash value of a loss. When the insured and the insurer disagreed on the scope … Continue reading

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What is The Covenant of Good Faith and Fair Dealing?

The Covenant of Good Faith Is Mutual In this, my second video blog I describe the definition of the tort of bad faith. © 2015 – Barry Zalma Barry Zalma, Esq., CFE, has practiced law in California for more than … Continue reading

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What is Insurance

A video blog.

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Millions for Defense and Never Accept Fraud

Fraud Fails – Insured Must Pay Insurer Insurers act in good faith and pay fire claims and additional living expense promptly as required by the policy and the law. They expect that the persons insured will treat the insurer with … Continue reading

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Is an Arson Fire Vandalism in Tennessee?

Lack of Definition Makes Exclusion Unclear An arson fire is an intentional act causing damage to property. Vandalism is an intentional act causing damage to a structure. A person can be convicted of the crime of vandalism if he or … Continue reading

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May Insurers Insure Against Punitive Damages?

Insurance For Punitive Damages Against Public Policy In most states insurance against awards of punitive damages are against the public policy of the state because it will allow the insured to defer his wrongful conduct onto an insurer. The deterrent … Continue reading

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Innocent Misrepresentation Supports Rescission

Why Did It Take Adjusting 175 Claims Before the Insurer Learned it Was Deceived? Staffing agencies and employee leasing organizations have difficulty obtaining workers’ compensation insurance for a reasonable price. The agencies and leasing organizations are sometimes tempted to misrepresent … Continue reading

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The “Chutzpah” of Fraud Perpetrators

Zalma’s Insurance Fraud Letter June 15, 2015 The ACE Conference Barry Zalma will be speaking, June 18, 2015 on “Millions for Defense & Not a Dime For Tribute” at the Annual America’s Claims Event in Austin, Texas. The ACE Conference … Continue reading

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Appraisal Can Stay Litigation

Appraisal Compelled to Resolve Dispute Over Quantum of Loss Insureds and insurers who have no trouble resolving disputes over the applicability of coverage have difficulty in reaching agreement about the amount of loss on either an actual cash value or … Continue reading

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Conflict of Interest Required To Remove Counsel

Insurer Appointed Lawyer’s Duty is to Client It Was Retained to Defend Insurance companies have the right and obligation to choose counsel to defend its insureds. Counsel retained by an insurer to defend an insured, contrary to the belief of … Continue reading

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Appraisal Award Binding

Payment of Appraisal Award Satisfies Policy Promise to Indemnify In an opinion expressing the brevity required of a decision on an issue of insurance law that is patently obvious, the Missouri Court of Appeal decided in James-Miller v. American Family … Continue reading

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Vicarious Liability & Additional Insured Endorsement

Duty To Defend Based on Extrinsic Evidence Capital City Real Estate, LLC (“Capital City”) initiated a declaratory judgment action in the District of Maryland, seeking a declaration that Certain Underwriters at Lloyd’s London (“Underwriters”) were obligated to defend and indemnify … Continue reading

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Insured vs. Insured Exclusion

One Insured Can’t Get a Defense When Sued by Another Insured Robert D. Redmond sued ACE American Insurance Company (“ACE”) after it refused to provide insurance coverage in connection with a civil suit Redmond’s former employer brought against him. The … Continue reading

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Why Is There An Insurance Adjuster?

The Adjuster The insurance adjuster is not mentioned in a policy of insurance. Standard first party property insurance policies, based upon the New York Standard Fire Insurance policy, contain conditions requiring the insured to, within sixty days of the loss, … Continue reading

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Is There Coverage for Assaulting Your Employee?

Business Dispute Not Covered by Homeowners A Homeowners policy provides worldwide liability insurance coverage to the homeowners subject to various exclusions and limitations. In Perry v. Hartford Underwriters Insurance Company, Not Reported in A.3d, 2015 WL 3508099 (Del.Super., 6/3/2015) a … Continue reading

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When Does Assault & Battery Exclusion Apply ?

Assault & Battery Exclusion Easy to Prove When Patrons Shot Places of public accommodation like bars, restaurants and hotels that serve alcoholic beverages are subject to rambunctious customers who may injure innocent customers. Insurers are loathe to insure risks where … Continue reading

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New York’s Difficulty With The Tort of Bad Faith

It Takes More than a Refusal to Pay a Claim to Obtain Tort Damages Insurance companies seldom deny a claim without a reasonable basis for the denial. Regardless, when a claim is denied, the insured feels a need to sue … Continue reading

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Does Breach of Warranty Void Insurance Coverage?

Strict Compliance With Marine Insurance Warranty is Required Marine insurance contains warranties – promises by the insured for future conduct on which the policy relies – and if breached would cause the policy to be void. Such warranties are usually … Continue reading

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When Is a Landslide a Fire?

Ninth Circuit Finds Fire To Be Direct Cause of Landslide that Destroyed House Those of us who live in the western United States see wildfires on a regular basis. Fire is a named peril and is covered by a simple … Continue reading

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The Amount of Fraud Influences Sentence

Zalma’s Insurance Fraud Letter June 1, 2015 In this, the eleventh issue of the 19th year of publication of Zalma’s Insurance Fraud Letter (ZIFL) Barry Zalma, on June 1, 2015 continues the effort to reduce the effect of insurance fraud … Continue reading

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