Monthly Archives: April 2016

Cooperation Clause Breach Defeats Coverage

Insured With No Risk of Personal Loss May Not Enter Into Assignment of Case Against Insurer Minnesota allows an insurer to protect its insured – when coverage is in dispute – from a judgment excess of its policy limits. It … Continue reading

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Insurance Companies are Not Treated Equally to Those Who Sue Them

Claim of Bad Faith Enough to See Ostensibly Privileged Documents What a lawyer says to his or her client; what a lawyer thinks in preparation of the lawyers advice; what a lawyer does in preparation for litigation is usually privileged … Continue reading

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No Need to Prove Prejudice When Insured Makes Voluntary Payment

Insured’s Settlement With Claimant Destroyed Right to Insurance Benefits Insurers have the right to choose the promises it makes in a liability insurance policy. One universal contract term states there would be no coverage for a voluntary payment by the … Continue reading

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Diminished Value in California

New California Jury Instruction The California Judicial Council changed a pattern jury instruction concerning the diminution of value of a repaired automobile, as follows: 2-3900 CACI 3903J Judicial Council of California Civil Jury Instructions (CACI) > Series 3900 DAMAGES 3903J … Continue reading

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Confabulation!

Some Testimony Cannot & Should Not be Believed Sworn testimony, most believe, is either true or intentionally false. However, some people, although not actually cunning, intentional liars, are simply unable tell the truth. The condition known as confabulation is a … Continue reading

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Unambiguous Exclusion Defeats Claim for Defense

Business Policy Not an Auto Liability Policy People buy insurance for various reasons. Insurance policies limit the promises made depending on the coverage sought by the insured. Automobile liability insurance insures against risks of loss from the use or operation … Continue reading

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Fairness Controls Interpretation of “Other Insurance” Language

Escape Clause Fails Liability insurers write policies with multiple variations on the “other insurance” clause trying to deal with the problem raised when more than one insurer insures the same risk. The reason for the clause is to prevent one … Continue reading

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Failure of Promise to Pay Defeats Claim on Contract

Total Failure of Consideration Defeats Claim An insurance contract is made when promises are made between an insurer and an insured are kept. To effect a contract of insurance it is necessary that the insurer offers to insure a person, … Continue reading

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Lead Paint is a Pollutant In Georgia

Georgia Concludes Lead a Pollutant and Excluded Modern life exposes Americans to hundreds of different pollutants that are toxic to humans. Liability insurers are loathe to insure against the risk of injury caused by a toxic pollutant. Modern liability policies … Continue reading

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Insurer Must Be Allowed to Exercise Meaningful Contractual Rights

First Report After Verdict Sufficient to Avoid Coverage In a case where an insured bank that was obligated to retain counsel to defend suits against it and seek reimbursement from its insurer, was faced with a gigantic default judgment, failed … Continue reading

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Bad Faith Set-Up Fails

Insurer Only Responsible for Stipulated Judgment That is Free From Fraud or Collusion Insurers apply the terms and conditions of an insurance contract by applying the facts of the reported claim to the wording of a policy. When a policy … Continue reading

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Because a Disco Is Not a Deli Policy Rescinded

It’s Not Nice to Lie to Your Insurance Company It does not take a member of Mensa to agree that a disco is not a deli, and that the risks posed by the combination of billiards, booze, and entertainment are … Continue reading

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Panama Papers & Insurance Fraud

Zalma’s Insurance Fraud Letter April 15, 2016 In this, the eighth issue of the 20th year of publication of Zalma’s Insurance Fraud Letter (ZIFL), Barry Zalma, on April 15, 2016 continues the effort to reduce the effect of insurance fraud … Continue reading

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Broker Responsible to Insured for False Application

Insurer May Increase Premium on Audit New York appellate courts are noted for succinct and clear opinions that seem to resolve most issues presented to them with what seems like little effort. Of course, anyone who writes knows that it … Continue reading

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To Be or Not to Be an Additional Insured?

Contract Must Require Additional Insured Status Businesses require indemnity from their vendors in almost every contract. Most also require a certificate of insurance to prove that the vendor is insured and can, therefore, give confidence that claims for indemnification can … Continue reading

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Lawyers Lie to Court About Impartiality of Appraiser Defeats Award

Counsel’s Conduct Impugned the Integrity of The Appraisal Process and the Court Appraisers in a first party property dispute are supposed to be impartial. Although appointed by a party the appraiser, acting as an arbitrator, must do what is fair … Continue reading

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Criminal Conduct Defeats Insurance Claim

One Reservation of Rights is Sufficient Insurance companies faced with a claim seeking defense and indemnity that on its face appears to be due to a cause that is specifically excluded usually result in a defense provided under a reservation … Continue reading

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Additional Insured Added to Policy Without Underwriting Involvement

Stupid to Give Away Underwriting  Duty to Insured Underwriting is the process by which an insurer evaluates the risks presented to it and decides whether it is willing to take a risk that will make insurance a profitable business. Commercial … Continue reading

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Criminal Activity Should Never Be Insurable

Scofflaws Demand Insurance Protection for Their Crimes Insurance is designed to protect the persons insured against fortuitous events that are neither intended or expected by the insured. When a person is convicted of a crime it is axiomatic that the … Continue reading

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No Relief for Insured’s Lack of Diligence

Ph.D Who Failed to Read Policy Loses Suit for Coverage Most people and their lawyers forget that the covenant of good faith and fair dealing is a two way street. The insured must deal fairly and in good faith to … Continue reading

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Zalma’s Insurance Fraud Letter – April 1, 2016

Fraud Schemes No April Fools Jokes  Welcome to the March 1, 2016 Issue of ZIFL Click here to receive the current issue In this, the fifth issue of the 20th year of publication of Zalma’s Insurance Fraud Letter (ZIFL), Barry … Continue reading

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