Zalma on Insurance

Third Party Claimant has no Right to Tort Damages for Bad Faith by Other  Party's Insurer    https://zalma.com/blog The Supreme Court of California was faced with the question of “whether  an insurance company’s breach of the covenant sounds in tort when it  retroactively overcharges a premium it knows is not owed.”  In Jonathan Neil & Associates v. Jones, a dispu...

The Duty to Defend and Potentiality   https://zalma.com/blog In the leading case of Gray v. Zurich Ins. Co. 65 Cal.2d 263, 54 Cal.  Rptr. 104 (1966) the Supreme Court of California set the basic rule  followed in most jurisdictions for deciding whether an insurer owes a  duty to defend or not. It found that insurers issuing dual-promise  policies (a promise to both defend...

The Property Damage Trigger of Coverage   https://zalma.com/blog The term "trigger of coverage" means "what event must occur for  potential coverage to commence under the terms of the insurance policy"  and "what must take place within the policy's effective dates for the  potential of coverage to be 'triggered.'" [In Re Feature Realty Litig.,  468 F. Supp.2d 1287, 1295, n...

Lawyers May Never Share Fees With a Non-Lawyer   https://zalma.com/blog The decision, In re Oheb, No. 99-C-11161 (Cal. Bar Rev. 07/16/2004) a  hearing judge’s recommended that respondent Tamir Oheb be placed on four  years’ stayed suspension and on four years’ probation with conditions,  including two years’ actual suspension. Oheb admitted that “[t]he  detailed findings o...

An Explanation of What is Needed to Obtain Insurance After Completing an  Application   https://zalma.com/blog The Underwriter  The person who makes the decision to insure or not insure a prospective  insured, in modern practice, is called an underwriter.  Unlike the  original underwriters at Lloyd’s the person with the title “underwriter”  is usually an employee...

Every Adjuster Must be Familiar With the Indicators of Fraud   https://zalma.com/blog Suspicious claims have common attributes. Insurers and their anti-fraud  organizations have collated the common attributes into lists of  indicators or red flags of fraud. The lists were created as training  aids and to be used to determine whether further investigation is  required to de...

Passover A Seder for the American Family  By Thea R. Zalma & Barry Zalma   https://zalma.com/blog For more than 3,000 years Jewish fathers have told the story of the  Exodus of the enslaved Jews from Egypt.  Telling the story has  been required of all Jewish fathers. Americans, who have lived in North  America for more than 300 years have become Americans and many...

Ethical Lawyers Should Not Take Advantage of Right to Independent Counsel    Consider Center Foundation v. Chicago Insurance Co., 227 Cal. App. 3d  547, 278 Cal. Rptr. 13 (Cal. App. Dist.2 02/05/1991) The Center for  Feeling Therapy and its therapists were sued for medical malpractice and  on various intentional tort theories. One of the Center’s insurers,  Chicago In...

The award of punitive-type damages was common in early legal systems,  and was mentioned in religious law as early as the Book of Exodus.  Punitive-type damages were provided for in Babylonian law nearly 4000  years ago in the Code of Hammurabi, in the Hittite Laws of about 1400  B.C., in the Hebrew Covenant Code of Mosaic Law of about 1200 B.C., and  in the Hindu Code of...

The Real Cost of Fraud & the Largest Residential Burglary of All  Time   https://zalma.com/blog After twelve months trying to get insurance on over $3,000,000 in  jewelry and a like amount of fine arts, a Taiwanese man who was a wanted  criminal in his own country convinced two American insurers to agree to  insure him against the risk of loss to the contents of his ho...

Every first-party property adjuster will face in his or her career  attempts to defraud the insurer for whom the adjuster works.  It is  necessary that the adjuster is aware of each type of property insurance  fraud he or she may encounter. Some, but surely not all, fraud types  follow:  Arson-for-profit.  Arson is the intentional burning of property. It no longe...

"The Compact Book of Adjusting Property Claims - Third Edition"  https://zalma.com/blog The insurance adjuster is seldom, if ever, mentioned in a policy of  insurance. The strict wording of the first p arty property policy sets the obligation to investigate and prove a  claim on the insured.  Standard first party property insurance policies, based upon the New  York Standa...

Proving Fraud by A Predetermined Treatment Protocol Articles in the March 15, 2021  Issue include the following:  RICO Action Against Medical Providers Raises Discovery Difficulties  Insurance companies who claim to be the victims of health care providers  operating in a no fault auto insurance state like Florida. In  Government Employees Insurance Co., et al. v. Mark A. C...

The role of the interviewer also involves maintaining constant control  of the situation.  https://zalma.com/blog  The professional, however, never resorts to bullying  the person interviewed. The ability to remain alert and focus his or her  attention, coupled with a facility for nimble thinking, enables the  interviewer to keep the questions directed at the specific...

The work product doctrine was recognized in Hickman v. Taylor, 329 U.S.  495 (1947) which established a qualified privilege for certain materials  prepared by an attorney acting for his or her client in anticipation of  litigation:  Were such materials open to opposing counsel on mere demand, much of  what is now put down in writing would remain unwritten. An attorney’s &n...

Selecting and Working with Defense Counsel to Protect an Insured    https://zalma.com/blog In instances where insurance claims may entail litigation, insurers must  move quickly to engage counsel. When an attorney is retained to defend a  person insured, the fact should be documented in writing by the  attorney, the adjuster, and the insured who is to be defended.  Be...

https://zalma.com/blog When a car is damaged in an accident, then repaired, the resale value  may be less than that for a comparable car that has not been damaged. In  other words, the damage results in a reduction—or “diminution”—in the  resale value of the auto. An insured’s claim for this reduction in value  may be made against a third party that negligently caused the damag...

How to Exercise the Right to Subrogation  https://zalma.com/blog The equitable doctrine of subrogation places the subrogee in the precise  position of the one whose rights are subrogated. [Wimer v. Pa. Emp.  Benefit Trust Fund, 939 A.2d 843, 853 (Pa. 2007); Chow v. Rosen, 812  A.2d 587, 590 (Pa. 2002); Pennsylvania Mfrs.’ Ass’n Ins. Co. v. Wolfe,  626 A.2d 522, 525 (Pa. 19...

Appraisal - A Means to Resolve Disputes About the Amount of Loss  https://zalma.com/blog Almost all homeowners policies contain an “appraisal” clause similar to  that in the Standard Fire Insurance Policy.  The submission to the appraisers should be in writing, instructing that  the parties do not want the appraisers to follow hard and fast,  arbitrary, or fictitious rules...

The Risk of  Arrest for Committing Insurance Fraud is Low and Profits  High   https://zalma.com/blog The Risk of  Arrest for Committing Insurance Fraud is Low and Profits  High  People who commit insurance fraud as a profession do so because it is  easy. It requires no capital investment. The risk is low and the profits  are high.  The ease with which l...

Independent Medical Examinations https://zalma.com/blog When a claimant claims an injury that does not agree with the facts of the incident claimed to have caused the injury, the adjuster will often seek the assistance of an Independent Medical Examiner (IME) to verify the extent of the claimed injury. The IME is usually a forensic physician or a chiropractor who has agreed to evaluate an injured...

The wrongful death acts in all states provide a statutory cause of action for damages suffered as a result of the decedent’s wrongful death to certain named beneficiaries, usually spouses, children, or parents. This is an independent cause of action belonging to these beneficiaries. Until recently, most jurisdictions used the so-called “pecuniary loss rule” to limit such recovery to the pecuniary...

Zalma's Insurance Fraud Letter Volume 25, No 5 Includes the Following Articles: https://zalma.com/blog  Insurance Fraud by Insurers Insurance fraud is not limited to fraud by insureds against their insurers. Much to the shame of the insurance industry, the reverse also happens. The poster child of fraud by an insurer was Martin Frankel who created a scheme he masterminded to “loot” more than...

Punitive Damages Limited by Reprehensibility of the Defendant's Conduct https://zalma.com/blog n State Farm Mut. Auto. Ins. Co. v. Campbell (2003) 538 U.S. 408, the United States Supreme Court held that "'the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant's conduct.'" (Id. at p. 419.) Moreover, in Campbell, the high cour...

The Attorney Client Protection and the Insurance Claims File Many files are discoverable or capable of being discovered. Therefore, before writing any comment in a claim file the adjuster should consider that each comment written will be directed to the “Ladies and gentlemen of the jury.” If the adjuster is not ready to read the comment aloud to a jury it should not be written in the file. Anticip...