People regularly do stupid things that cause someone else an injury. Then the inevitable lawsuit gets filed, and then an insurance clam gets filed, too. But occasionally, the courts get it right in their decisions, and we get to make fun of the plaintiffs and defendants.
My friend Randy Maniloff is a genius attorney, a partner in the Business Insurance Practice Group at White & Williams in Philadelphia. He recently wrote an article that showcased these court decisions, and gave me permission to share them with you.
So, in order of dumbness (lowest to highest), here is the Top Ten Funniest Coverage Decisions of 2008:
10. A motivational speaker repeatedly urged a seminar participant to break a board with her bare hands. After she tried and was successful only in injuring her hand, she sued the speaker. In Reese v. Alea London Ltd., the Court decided that the speaker’s policy had a Professional Services exclusion that precluded coverage. I guess “mind over matter” doesn’t include lumber. I also guess you can be “board” to tears in this guy’s seminars.
9. The insured was playing around his backyard pool and tried to throw someone in the pool. However, he miscalculated the strength he’d need to complete the throw, and instead threw the victim onto the pool’s steps, seriously injuring the victim. State Farm denied coverage. In State Farm Fire & Casualty v. Superior Court, the Court decided that coverage was owed since the insured’s only intent was to get the victim wet. Note to the insured: next time you want to get a woman wet, take her out for dinner and dancing.
8. The insured got into a fight, and got his hand stuck in the glass of a sliding glass door. He shot the glass to free his hand and the bullet ricocheted into the chest of a woman inside the house. In Shelter Mutual Insurance v Wheat, the Court decided there was no coverage because the injury was not caused by an “accident.” In other news, Bob Vila will be hosting a memorial service for the door.
7. The insured business hired violent offenders to go door-to-door and sell magazines. Their aggressive sales tactics caused.injuries and at least one death. In Nautilus Insurance Company v. Reuter, the parties are waiting to see which way the Court interprets the policy term “occurrence” to figure out if there’s coverage. The Girl Scouts need to hire these guys for next year’s cookie drive.
6. A middle school student caused injuries to a teacher’s aide when, in the middle of a cafeteria food fight, he struck the aide with a garbage can. In Medrano v. State Farm Insurance Company, the Court decided that the insurer had to provide defense under the Homeowners policy because the Complaint implied that the injuries were unintentional. In the student’s defense, he couldn’t tell the difference in the garbage or school cafeteria food.
5. A karaoke singer was waving around an ice cream scoop (her microphone?) when it flew out of her hand and hit someone, causing injuries. In Nationwide Mutual Fire Insurance v. Kim, the Court decided that the insurance company had to provide defense for the singer under her Homeowners liability coverage, since the Court didn’t buy the argument that the injuries weren’t because of negligence. I wonder if she was singing “Tutti Fruiti” at the time of the incident.
4. An insured restaurant had a gas grille at a tailgate party at a Jimmy Buffet concert. The gas grille wouldn’t light, so they poured gasoline on it, and the explosion caused injuries. In United States Liability Insurance Co. v. Harbor Club, the Court denied coverage to the restaurant because the incident was not on the insured’s premises. Yummy...toasted Parrotheads. I wonder if the smoke from this explosion could be distinguished from the marijuana cloud at the concert.
3. The insured caused injuries to an old friend by saying hello with his “signature greeting,” which was putting the old friend in a headlock and squeezing his head while asking him how he was doing. In Sanford v. Century Surety Co., the Court denied coverage because the injury was not caused by an accident and the “assault and battery” exclusion applied. Imagine how the insured must greet those who are not his friends.
2. The homeowner caused injuries and one death to party guests when the host used gunpowder as a propellant to shoot his potato gun. In Kiser v. Coffee, coverage was denied because injury was reasonably expected from this intentional act. The potato in question is now in a low earth orbit, visible in a clear night sky.
And the Number One Funniest Coverage Decision of 2008 is....
1. The insured’s minor son injured his friend by kicking him twice in the groin after learning that his friend’s sister did not like him. In American National Property & Casualty v. Hanna, coverage was denied because the injury was not caused by an accident. Love hurts.....
A big “thank you” to Deborah Richards, Geri Lumsden and Jarrett Smith for their smart-assed assistance with the one-liners in this article.
Stay tuned. I’m sure there will be plenty of court cases in 2009 for our next Top Ten List!
Tuesday, February 3, 2009
Home Foreclosures: How To Protect Your Home During Foreclosure
America is going through a foreclosure meltdown which will only get worse in the short run. Tens of millions of loans are in default, and the lenders either have foreclosed or are in the process of foreclosure.
However, there are some very real issues that you need to deal with during a foreclosure. Failure to address these issues could result not only in you losing your house, but being caught uninsured at the time of a disastrous loss, like a house fire.
Stated another way...what would you do if you had a major fire, wind or water loss during a foreclosure? Are you sure you’re covered?
First, let’s look at homeowners insurance and your loan escrow account.
If your homeowners insurance is being paid by your lender through an escrow account, that’s fine. However, if your loan is in foreclosure, you cannot be sure that the premium is being paid by that lender. If you have stopped making loan payments, you have also stopped adding money to your escrow account. Your homeowners insurance could have lapsed for non-payment.
So, the lender will “force place” a policy covering your home, but only for the loan balance, and charging it against your loan amount. But that policy will only cover the dwelling, no contents or liability coverage. The lender is only interested in protecting their loan.
But, sometimes, lenders make errors and premiums don’t get paid. So, your strategy to protect yourself is to make sure that the premium on your homeowners insurance is paid, even during a foreclosure.
But I recommend that you keep the policy in place just a little while after the foreclosure has been completed. Why?
Because we’re now learning that many foreclosures are being done without proper documentation by the lenders. Some highly placed politicians have noticed this, and are starting to make waves.
Rep. Marcy Kaptur (D- Ohio) is the senior woman in the House of Representatives, and the longest serving Democratic woman in House history. Her district includes Toledo, which these days is looking more and more like a ghost town.
Kaptur has recently been seen on CNN, promoting the “Produce The Note” initiative. In a recent interview, she stated that many mortgages have been sold and re-sold numerous times by lenders. She said that a lender who is foreclosing may not even possess the original loan document with the borrower’s signature on it. The biggest problem is that because more than one lender has owned your loan, more than one lender could foreclose on you for the same loan. It’s already happened many times.
There’s a great website called Consumer Warning Network that shows borrowers how to fight back.
Go to: Consumer Warning Network
Don’t just willingly accept that your lender did the foreclosure correctly. Investigate and fight back! Your financial future could be at stake!
However, there are some very real issues that you need to deal with during a foreclosure. Failure to address these issues could result not only in you losing your house, but being caught uninsured at the time of a disastrous loss, like a house fire.
Stated another way...what would you do if you had a major fire, wind or water loss during a foreclosure? Are you sure you’re covered?
First, let’s look at homeowners insurance and your loan escrow account.
If your homeowners insurance is being paid by your lender through an escrow account, that’s fine. However, if your loan is in foreclosure, you cannot be sure that the premium is being paid by that lender. If you have stopped making loan payments, you have also stopped adding money to your escrow account. Your homeowners insurance could have lapsed for non-payment.
So, the lender will “force place” a policy covering your home, but only for the loan balance, and charging it against your loan amount. But that policy will only cover the dwelling, no contents or liability coverage. The lender is only interested in protecting their loan.
But, sometimes, lenders make errors and premiums don’t get paid. So, your strategy to protect yourself is to make sure that the premium on your homeowners insurance is paid, even during a foreclosure.
But I recommend that you keep the policy in place just a little while after the foreclosure has been completed. Why?
Because we’re now learning that many foreclosures are being done without proper documentation by the lenders. Some highly placed politicians have noticed this, and are starting to make waves.
Rep. Marcy Kaptur (D- Ohio) is the senior woman in the House of Representatives, and the longest serving Democratic woman in House history. Her district includes Toledo, which these days is looking more and more like a ghost town.
Kaptur has recently been seen on CNN, promoting the “Produce The Note” initiative. In a recent interview, she stated that many mortgages have been sold and re-sold numerous times by lenders. She said that a lender who is foreclosing may not even possess the original loan document with the borrower’s signature on it. The biggest problem is that because more than one lender has owned your loan, more than one lender could foreclose on you for the same loan. It’s already happened many times.
There’s a great website called Consumer Warning Network that shows borrowers how to fight back.
Go to: Consumer Warning Network
Don’t just willingly accept that your lender did the foreclosure correctly. Investigate and fight back! Your financial future could be at stake!
Insurance Regulation: Florida Braces As State Farm Waves Goodbye
This week, State Farm Insurance Company, the largest private property insurer in the state, announced that they are pulling out of Florida after sustaining huge losses and being denied rate increases.
I am no fan of the games and scams of the insurance industry. Even though insurance makes our modern lives and way of life possible, it is fraught with problems. Insurance companies regularly mistreat their own customers. They delay, deny and minimize claims as standard operating procedure. But they also pay a lot of claims, too, and deserve to make a profit.
Into this environment come the insurance regulators of the 50 states. They try to protect the consumer. Their regulations swing from too much to too little, just like a pendulum. But, right now in Florida, the insurance regulators’ pendulum has swung to over-regulation. The regulators and state legislators have bungled the insurance marketplace in Florida, and consumers are going to get burned.
The Florida Department of Insurance has not produced evidence that the insurance market has failed, which might explain stiff price regulation in lieu of simply allowing competition in the marketplace to regulate premiums.
During the last 15-year period, Florida insurers have been unprofitable as a group. Dozens of insurers have stopped operating in the state. Simply denying rate increases does not benefit consumers. As insurers stop writing policies in Florida, reducing competition makes consumers worse off, with higher premiums and limited choices.
In response to insurance company exits since Hurricane Andrew, Florida legislators created Citizens Property Insurance Corporation (CPIC), an unprofitable state-run insurer that sells its policies below cost. This ridiculous pricing, paired with insurer exits, makes CPIC the insurer of over half of Florida's homeowners. Because CPIC is losing money, and owned by the state, these losses will eventually require taxpayers and consumers to bail out yet another insolvent corporation.
With State Farm’s departure from Florida, CPIC may end up insuring 80% of the homes in the state. CPIC is nearly insolvent right now. All it will take is one more major catastrophic hurricane to finish it off. However, it will be the Florida consumers and taxpayers that will be finished off when they are forced by the state legislature to bail out the state-run insurer.
The over-regulation of insurance companies was also recently shown in New Jersey. Just like in Florida, New Jersey lawmakers and regulators had over-regulated the car insurance marketplace to the point that insurance companies left the state in droves. New Jersey drivers found it nearly impossible to buy car insurance at any price. In 2003, the lawmakers and regulators regained their sanity and enacted reforms that brought back competitive pricing to car insurance. Rates are dropping and citizens can once again find affordable car insurance in New Jersey.
State regulators sometimes do more harm than good. Sometimes they get it right.
I am no fan of the games and scams of the insurance industry. Even though insurance makes our modern lives and way of life possible, it is fraught with problems. Insurance companies regularly mistreat their own customers. They delay, deny and minimize claims as standard operating procedure. But they also pay a lot of claims, too, and deserve to make a profit.
Into this environment come the insurance regulators of the 50 states. They try to protect the consumer. Their regulations swing from too much to too little, just like a pendulum. But, right now in Florida, the insurance regulators’ pendulum has swung to over-regulation. The regulators and state legislators have bungled the insurance marketplace in Florida, and consumers are going to get burned.
The Florida Department of Insurance has not produced evidence that the insurance market has failed, which might explain stiff price regulation in lieu of simply allowing competition in the marketplace to regulate premiums.
During the last 15-year period, Florida insurers have been unprofitable as a group. Dozens of insurers have stopped operating in the state. Simply denying rate increases does not benefit consumers. As insurers stop writing policies in Florida, reducing competition makes consumers worse off, with higher premiums and limited choices.
In response to insurance company exits since Hurricane Andrew, Florida legislators created Citizens Property Insurance Corporation (CPIC), an unprofitable state-run insurer that sells its policies below cost. This ridiculous pricing, paired with insurer exits, makes CPIC the insurer of over half of Florida's homeowners. Because CPIC is losing money, and owned by the state, these losses will eventually require taxpayers and consumers to bail out yet another insolvent corporation.
With State Farm’s departure from Florida, CPIC may end up insuring 80% of the homes in the state. CPIC is nearly insolvent right now. All it will take is one more major catastrophic hurricane to finish it off. However, it will be the Florida consumers and taxpayers that will be finished off when they are forced by the state legislature to bail out the state-run insurer.
The over-regulation of insurance companies was also recently shown in New Jersey. Just like in Florida, New Jersey lawmakers and regulators had over-regulated the car insurance marketplace to the point that insurance companies left the state in droves. New Jersey drivers found it nearly impossible to buy car insurance at any price. In 2003, the lawmakers and regulators regained their sanity and enacted reforms that brought back competitive pricing to car insurance. Rates are dropping and citizens can once again find affordable car insurance in New Jersey.
State regulators sometimes do more harm than good. Sometimes they get it right.
Subscribe to:
Posts (Atom)
