Zalma on Insurance

https://zalma.com/blog Inherent Vice Inherent vice relates to internal decomposition or some quality which brings about the object’s own injury or destruction, not an extraneous cause. [Employers Casualty Company v. Holm, 393 S.W. 2d 363, 367 (Tex. Civ. App. 1965).] The subjective test for fortuity raises questions regarding whether the inherent vice exclusion is effective. Latent Defect A latent...

Exclusions https://zalma.com/blog An exclusion is a provision of an insurance policy referring to hazards, perils, circumstances, or property not covered by the policy. Exclusions are usually contained in the coverage form or causes of loss form used to construct the insurance policy. One common exclusion is a clause that prohibits coverage for an intentional loss. In some states, like California,...

Differences between Property and Liability PoliciesAs the California  https://zalma.com/blog Supreme Court observed in both Garvey v. State Farm Fire and Casualty Co., 48 Cal. 3d 395, 770 P.2d 704, 257 Cal. Rptr. 292 (Cal. 1989), 48 Cal.3d at p. 399, fn. 2, 257 Cal. Rptr. 292, 770 P. 2d 704, and Prudential-LMI, 51 Cal. 3d at pp. 698-699, 274 Cal. Rptr. 387, 798 P. 2d 1230, a first party insur...

Merry Chirstmas – Happy Hanukah  & May the Winter Solstice be Peaceful & Mild https://zalma.com/blog A Christmas Fable of Insurance Fraud Most insurance criminals, unlike Raymond, know about the lack of staff, how overworked and underpaid adjusters are, and would never sign a release. The insurance criminal would either try to bribe the SIU investigator or sue the insurer for bad fait...

A Video Explaining “Other Insurance” Clauses in Liability Insurance Policies https://zalma.com/blog There are three basic types of other insurance clauses. They can be broadly identified as pro rata clauses, excess clauses, or escape clauses. Porata Clauses Pro rata clauses usually provide that if other insurance exists, the insurer will pay its pro rata share of the loss. Payment is usually made...

Modern Tax Law Makes Punitive Damages Only For The Benefit Of The Lawyers https://zalma.com/blog In Gary L. Greenberg and Irene Greenberg v. Commissioner of Internal Revenue, No. 25420-07. (U.S.T.C. 01/24/2011) the United States Tax Court dealt with a recipient of insurance bad faith punitive damages who tried to avoid tax on the award. As a result, the recipient of the award of punitive damages f...

The Lawyer Who Violates the Rules of Professional Conduct Must Be Disciplined https://zalma.com/blog When a lawyer violates the Rules of Professional Conduct, he or she can be disciplined by the local bar association and/or the state’s supreme court. Each state has its own disciplinary system managed by a group of investigators, lawyers and administrative law judges. A lawyer who settled a case wi...

Insurance Contract Law https://zalma.com/blog In a typical contract, one party has a duty to perform (construct a building, deliver goods, convey real estate, pay indemnity) and the other party has a duty to pay money.  Breach by the performer may take the form of nonperformance, defective performance, or delay in performance.  The primary purpose of damages for breach of a contract is t...

INSURANCE AS A NECESSITY AND THE LAW OF UNINTENDED CONSEQUENCES https://zalma.com/blog Neither the courts nor the governmental agencies seem to be aware that in a modern, capitalistic society, insurance is a necessity. No prudent person would take the risk of starting a business, buying a home, or driving a car without insurance. The risk of losing everything would be too great. By using insurance...

How to Read Your Homeowners Insurance Policy https://zalma.com/blog Your home is likely your most valuable asset, and a homeowners insurance policy is an important part of protecting your home and your belongings. If you have a mortgage on your home, your lender probably required you to get an insurance policy that will protect the lender’s interest. Because it provides such broad coverage includi...

Control on Punitive Damages https://zalma.com/blog The US Supreme Court has clearly stated that “[p]unitive damages may properly be imposed to further a State’s legitimate interests in punishing unlawful conduct and deterring its repetition.” [BMW of North America, Inc. v. Gore, 517 U. S. 559]. These damages often exceed the fines assessed by the state if the same person had acted criminally to da...

What is an Adjuster? https://zalma.com/blog An “adjuster” or “insurance adjuster” is by statutory definition, a person, co-partnership or corporation who undertakes to ascertain and report the actual loss to the subject-matter of insurance due to the hazard insured against. Insurance companies create, by issuing an insurance policy, a contractual obligation to pay its insureds’ valid claim. To do...

The Third-Party Liability Claim https://zalma.com/blog See the full video at https://youtu.be/Ia5UQlvS758 The investigation of a liability insurance claim is conducted to fulfill the promise made by the insurer to defend and indemnify the insured in the event of a contingent or unexpected loss resulting in the injury to person or property as a result of actions of the insured. To fulfill the promi...

ZALMA’S INSURANCE FRAUD LETTER DECEMBER 1, 2020 https://zalma.com/blog Read the full Zalma's Insurance Fraud Letter at https://www.linkedin.com/pulse/zalmas-insurance-fraud-letter-december-1-2020-barry-zalma-esq-cfe-1c and see the full video at https://youtu.be/Phva0x6RNYQ and  at  https://rumble.com/c/c-262921  and at https://zalma.com/blog plus more than 3500 posts. Evidence of A...

The Development of the Implied Covenant of Good Faith and Fair Dealing https://zalma.com/blog The Covenant of Good Faith and Fair Dealing is a general assumption of the law of contracts, that people will act in good faith and deal fairly without breaking their word. When insurers use shifty means to avoid obligations or deny what the other party obviously understood was a violation of the duty of...

A Video Explaining Some Appellate Decisions on the Equitable Remedy of Rescission https://zalma.com/blog Resure, Inc. v. Superior Court In Resure, Inc. v. Superior Court, 42 Cal. App.4th 156, 49 Cal. Rptr.2d 354 (Cal. App. Dist.2 01/31/1996) the California Court of Appeal dealt with a problem raised by statute and who won the race to the courthouse. Resure, Inc., filed a complaint for rescission a...

There Must be a Special Unit of Insurance Fraud Prosecutors in the Offices of the Attorneys General https://zalma.com/blog The legislatures of the various states, the United States Congress, the National Association of Insurance Commissioners, The National Insurance Crime Bureau and insurance industry groups have finally decided that the war against insurance fraud is worth fighting. Until the sta...

The Staged Loss https://zalma.com/blog  Some losses are fictions created for the sole purpose of presenting a claim like those engaged in by convicted attorneys in my book, Insurance Fraud, Volume I. The number of variations on types of staged losses are limited only by the imagination of the insurance criminals. Some of the variations follow: AUTOS Staged Theft. A staged theft occurs when “t...

The Six Key Questions Whose Answers are Needed to Complete Every Statement or EUO https://zalma.com/blog  Every interview is directed toward determining the answer to six questions: Who? What? When? Where? Why How These key questions are answered, the professional will know all that  is necessary to decide to agree to or decline to pay a claim. The EUO  can only be a success after a...

The Need for the Advice of the Coverage Lawyer Who Takes the EUO https://zalma.com/blog A well-executed EUO is not only one of the insurer’s most effective weapons against fraud. It can also be highly instructive for the adjuster. If an attorney is responsible for performing the examination, the adjuster must make clear that it is his or her obligation to provide sufficient factual information sup...

Considerations for Early Settlement https://zalma.com/blog t is an axiom followed by almost every attorney that the sooner a suit is settled the less it will cost the defendants. Invariably as suits drag on, as discovery is received and analyzed, the positions of the parties become less amenable to compromise. If defendants and their counsel believe that liability against the defendant is reasonab...

The Importance of Statutes of Repose https://zalma.com/blog Generally, in California and many other states, a lawsuit alleging a latent construction defect must be brought within three or four years (depending on the theory of recovery) after the plaintiff discovers, or should have discovered, the defect. The California Legislature capped the open-ended nature of this “discovery” rule when it enac...

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California’s Fair Claims Settlement Practices & Regulations https://zalma.com/blog  California Insurance Code Section 790.03 (h) (a)   In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may...

The Public Adjusting Profession https://zalma.com/blog When insured’s are busy professionals they simply do not have the time or patience to deal with the details of a first party property claim. The public insurance adjuster exists to assist insureds in the presentation of a claim to the insurer. The public insurance adjuster is, in most states, licensed by the state insurance department. The ins...