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Legal Advice Is Needed In Coverage Questions About The Failure To Properly Notify The Insurance Company

Posted in Coverage Disputes

Advice

A classic example of the need for sound legal advice can be seen in questions of proper notice. The typical insurance policy has a notice provision. The contract requires the insured individual or insured company to give timely notice of a claim. From the perspective of an insurance company, notice is important. Early investigation gives the adjuster the chance to find out the facts. The passage of time can be harmful to a claim. Not to mention, the insurance company needs to know about losses to set reserves and make suitable financial decisions.

For some, the questions seems quite simple. The insurance policy is a written contract. If the insurance policy says prompt notice, it should be given. If notice is not timely made, then there is no coverage. They believe the breach of the contract terminates the coverage. Others would argue prompt isn’t defined. So what if the notice is one day late? The argument carries some degree of logic. If you were one day late on your mortgage payment, would you want the loan called due. Would having to pay the loan balance in full the next day be possible? It really would seem unfair to lose the house over a payment one day late.

The issue of timing as a defense to coverage is all or nothing. If late notice is a complete defense, then the insurance policy benefits are forfeited. In a large claim or a serious fact situation, the stakes are high. Denial of the coverage would be devastating to the insured.

So why wouldn’t the insured give notice of a claim? The most obvious reason is fear over loss of future coverage entirely. Policy holders worry about being able to purchase insurance. Insureds are also concerned over the increase in premiums. If the situation “goes away”, then why risk the increase in premiums. Another reason can be the belief there is really not injury or damage. Suppose the manager of an apartment complex witnesses a 28 year old trip on the sidewalk. The young man falls to the grass. He looks athletic, strong, healthy. No obvious harm is present. He says not to worry, that he is fine. Calling the agent to report a claim seems over the top, downright silly. The claim goes unreported until the lawsuit arrives.

Jurisdictions across the country have reached different conclusions.

Recent decisions in Colorado and Wyoming illustrate the tension in the law on notice. The Colorado Supreme Court has twice cut back on its previous ten-year streak of expanding coverage for insureds by refusing to allow insurers to enforce technicalities in notice clauses to prevent coverage. Colorado’s neighbor to the north, Wyoming, headed in the other direction in 2016. Most states now employ the modern rule, which requires insurers to prove prejudice before they can void coverage. In May 2016, the American Law Institute adopted the modern rule for its Restatement of the Law, Liability Insurance, a position that could be influential in the courts.

More perilous to both insurers and policy holders are the courts that change their mind and reverse the rule announced just a few years earlier. Colorado seems to have some of these shifting winds:

Last year. . . the supreme court refused to apply the notice-prejudice rule to claims-made policies. Craft v. Philadelphia Ins. Co., 343 P.3d 951 (Colo. 2015). There, an officer of an insured company sought coverage under a D&O policy approximately 16 months after the policy period expired, even though the underlying lawsuit was filed during the policy period and the case had already been settled.

This year, the Colorado Supreme Court reversed a court of appeals ruling, holding that an insured cannot obtain coverage for a settlement of a claim or even a pending case with or without notice, if the carrier objects to the settlement. Stresscon v. Travelers Indem. Co., 370 P.3d 140 (2016) (Stresscon I). In 2013, the court of appeals had expanded the notice-prejudice rule to the “no voluntary payments clause” in Stresscon v. Travelers Indem. Co., 2013 COA 131. There, a concrete subcontractor, who admitted that it caused an accident at an U.S. Army base which delayed the project, notified its insurance carrier of the general contractor’s claims. The carrier arguably refused coverage, and the insured then settled with its general contractor on a series of contract claims (after allegedly inviting the carrier to the settlement meetings) and later sued for an indemnity. The court of appeals correctly rejected this technicality and found that the concrete company was well justified in its decision to settle and thus had successfully rebutted the arguable prejudice from the late notice and was entitled to recover.

Take Away – coverage counsel needs to be used to evaluate late notice as a defense. The law is changing. As it does, the courts go back and forth trying to reach the best answer. Until the answer to the question is firmly established, there is danger in denying a claim for late notice. Always involve trusted legal counsel with knowledge and expertise in insurance matters.

In Oklahoma, we will be glad to assist you. Coverage issues have been part of our practice and we have helped resolved several late notice claims. If you have questions about what constitutes late notice, call us. Don’t take on the decision without a good attorney familiar with Oklahoma law. 918-587-1525.

Business Fires Hurt Far More Than Just The Owners Of The Company

Posted in Fire Loss

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Fires destroy property, businesses and also the livelihood of employees. The typical business is insured for loss of property and usually the interruption of business operations. But, the standard business insurance policy doesn’t necessarily cover the employees who lose their jobs due to the fire. The fire in Cleveland, Oklahoma at ICES Corporation, a aerospace parts manufacturer is an example.

Right now, about 35 people don’t have a job to go to come Monday. Mayor Brian Torres said the airplane parts manufacturer is one of the town’s largest employers.”

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The plant has grown and is considered an important part of the Cleveland community; it’s where many people in Cleveland have worked for nearly two decades.

Now, 35 hard workers don’t know what the future holds.

Fires damage the most valuable assets of the company, its hardworking people. The sudden loss of a job is financially devastating. But, it is not just the loss of a pay check that hurts. When you spend 15 -20 years of your life working as a team with other similarly like-minded people, the loss of your job is like losing a part of the family.

The owner is waiting on a determination as to the insurance and a settlement to determine whether the facility will be rebuilt or not. A satisfactory insurance claim payment may be the difference in the company reopening and the staff being able to return to their jobs. Still, even with prompt payment of the insurance claim, it will take time to restore what was formerly there.

Fires like this one happen, it is part of life we don’t like, but it is there nonetheless. This fire started while two workers were doing their job. The fire marshall reportedly said, “a malfunctioning floor buffer ignited a chemical that workers were using to clean the floor”. It is the reason for insurance coverage. You never know when or how a fire may start. Insurance is for those unexpected occurrences  businesses sometime must face. The hard working staff must also endure the damages and the loss.

Fires Were Extensive In Oklahoma At The End Of The Year

Posted in Fire Loss

The number of fires in Oklahoma as the year closed were significant. Almost everyday, you heard or read about another fire. Some days there were multiple fires. House fires, apartment fires, mobile homes, restaurant fires, businesses hit by fire, the list goes on and on. Sources such as space heaters, grease fires, fire places, electrical shortages, and many others are potentially the causes for most of these fires that occur. Whether we hear about it while watching the local news channel each day or reading the morning paper, it seems as if fires are among the most talked about topic as the last few months of the year came to a close.

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Here’s a short list of the fires reported in local news:

Oklahoma Hail Storms Are Hard For Insurers To Predict As Shown By State Farm’s Claim Count

Posted in Damages

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Hail damage hits the bottom line of an insurance company’s net profits in Oklahoma. Some years the number of hail claims is much greater, making less profits for the insurance industry. Other years the hail losses are greatly reduced. The decrease in hail claims allows insurance companies like State Farm to make greater profits. The insurance premiums charged Oklahoma homeowners for the insurance protection is not paid out in claims.

According to News Channel 4 in Oklahoma City, State Farm reported 33,790 hail storm claims in 2013 in Oklahoma. In 2014, there were only 8,089 reported losses of damage caused by hail stones. Since insurance premiums are based upon an average, profits should increase significantly when there is a decrease in the number of storms.

The news reports that State Farm says, “. . . hail is the most frequent cause of property damage, costing State Farm policyholders more than $2.4 billion in 2014.” Oklahoma homeowners well know the need for good insurance coverage to protect against these types of storm losses and claims.

As there were far fewer losses in 2014, State Farm knows it will have to be prepared for future hail loss claims:

“While last year was much quieter on the hail front, Oklahomans know all too well the rumbling under their feet with recent earthquakes and the ongoing threat of tornadoes,” State Farm spokesperson Jim Camoriano said. “State Farm stands ready to help customers, no matter what nature throws at us this year. We encourage people to visit with their insurance agent to discuss different types of weather and events that could affect their property.”Hail5

Insurance companies set aside funds for future claims, knowing the purpose of insurance is to pay claims and protect property owners. Setting aside the proper financial resources makes the claim process simple. A company like State Farm knows the claims will come and proper reserving measures assure the funds will be ready to promptly pay when the time comes.

Oklahoma insurance companies have a legal responsibility to promptly investigate and pay claims. This obligation includes hail damage claims to cars, homes, commercial properties, roofs, boats, and all types of covered property. It’s no surprise that hail losses happen. The difficult things to predict are when and where the next storm will hit. Insurance companies should be fully prepared to act with speed in the claim adjustment and payment. Based upon the company statements, State Farm customers can expect to be treated fairly in Oklahoma.

Insureds that don’t feel like they were given a fair shake file lawsuits and want their attorney fees paid. The Oklahoma insurance laws let the policyholder get back attorney fees for claims that are underpaid. Therefore, a well-documented claim file is a must. The adjuster may be asked to explain the amount paid. Since bad faith lawsuits take time, the details may not be fresh. The claim file needs to document the facts.

In summary, the lull in the number of Oklahoma hail claims has benefited the insurance industry in Oklahoma. But, don’t forget the calm before the next Oklahoma storm.

Our Oklahoma attorney firm has been litigating insurance matters for over 30 years serving Tulsa, Oklahoma City, Muskogee, Bristow, Moore, and the entire state. 918-587-1525, call now!

State Farm Loses Appeal That It Engaged In Fraud At U.S. Supreme Court

Posted in Bad Faith, Damages

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Being accused of insurance fraud is a serious offense. Regardless of the circumstances, your reputation is on the line. In this case, State Farm was alleged to have defrauded the United States government by avoiding the payment of storm claims under homeowners’  insurance policies. State Farm was said to have improperly shifted the burden for the storm damage to the Federal government, thereby reducing its own expenses. The appeal involved a procedural issue. State Farm tried to argue that disclosure of the False Claims Act lawsuit to the media instead of allowing it to remain confidential should result in the claim being dismissed.

The Supreme Court on Tuesday handed a victory to two whistleblower sisters by upholding a jury verdict that found State Farm defrauded the U.S. government when the insurance company assessed damage caused by Hurricane Katrina along the Gulf of Mexico coast in 2005.

The court ruled 8-0 to reject State Farm’s challenge to a 2015 lower court decision upholding the verdict in a 2006 lawsuit brought by sisters Cori and Kerri Rigsby under the False Claims Act, which lets people sue on behalf of the government over allegations it has been defrauded.

The United States Supreme Court issued an opinion written by Justice Anthony Kennedy, that said “the seal requirement is intended to benefit the government because it prevents those suspected of defrauding it from being alerted about a potential case alleging that fraud took place.”

As a result, “it would make little sense to adopt a rigid interpretation of the seal provision that prejudices the government by depriving it of needed assistance from private parties,” Kennedy wrote.

The Obama administration took the position of the whistleblowers who reported the misconduct.

The jury determined State Farm had committed fraud. State Farm was ordered to pay $758,000 in damages plus almost $3,000,000 in attorney fees. The jury award was appealed to the Court of Appeals who affirmed the jury verdict before the appeal was made by State Farm to the United States Supreme Court.

The overall cost to the insurer isn’t known. Undoubtedly State Farm incurred significant attorney fees and costs in the litigation attempting to avoid the judgment. It was clearly expensive litigation with a negative outcome for the insurance company.

In most jurisdictions insurance fraud, whether accusations against an insurance company or claims that the insured committed fraud, are a question of fact. The importance of whether insurance fraud is a question of law or question of fact determines who will make the ultimate decision. Questions of fact are typically resolved by a jury. Legal issues are settled by the court with the judge making the final determination. Appellate courts tend to be reluctant to reverse a decision on a question of fact if the trial transcript indicates there was a fair trial.

Fraud committed in an insurance claim usually requires a higher level of proof than a typical lawsuit. For example, bad faith in Oklahoma must be established by a preponderance of the evidence, a lower standard. Insurance fraud, however,  has a higher standard, clear and convincing evidence. In other words, the evidence and proof at the jury trial must show by clear and convincing proof that insurance fraud occurred.

The clear conclusion is insurance fraud is serious. It should never be taken lightly by anyone, an insurer or an insured. It can prosecuted both as a civil action seeking money damages or as a criminal action. Legal counsel should be retained immediately at the first indication that someone is going to accuse you of fraud or bad faith.

 

Chimney Fires Result in Death and Property Damages To Oklahoma Homes and Families

Posted in Fire Loss, Homeowners' Insurance, Property Insurance

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Fires are deadly and devastating to Oklahomans. Every year fires take lives, homes, and businesses. The cost to the insurance industry is huge. Insurance covers most types of fires unless intentionally set. Arson is a crime and no insurance policy will cover destroying property deliberately. The cause of the fire is always an important factor for the insurance adjuster. Accidental claims need to be paid. Arson fires by the insured need to be denied.

Fires can accidentally start for all sorts of reasons: candles, faulty wiring, fireworks, poor maintenance, etc. The cause of the fire is important, but preventing the fire is more so. Certain fires cannot be avoided, they just happen. Some fires, such as chimney fires can be headed off with proper maintenance.

Ashley Eldridge, Director of Education at The Chimney Safety Institute of America, reports:

A chimney deteriorated by constant exposure to weather can be a potential safety hazard. Weather-damaged lining systems, flue obstructions and loose masonry materials all present a threat to residents. Regular chimney maintenance is essential to address damage, deterioration and future high-cost repairs.

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All masonry chimney materials (with the exception of stone) will suffer accelerated deterioration as a result of prolonged contact with water. Masonry materials deteriorate quickly when exposed to the freeze/thaw process, by which moisture that has penetrated the materials periodically freezes and expands, causing undue stress. Water in the chimney also causes rust in steel and cast iron, weakening or destroying the metal parts.

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Damaging Results of Water Penetration

Water penetration can cause interior and exterior damage to a masonry chimney and, by extension, the community itself including:

• Rusted damper assemblies
• Deteriorated metal or masonry firebox assemblies
• Rusted fireplace accessories and glass doors
• Rotting adjacent wood and ruined wall coverings
• Water stained walls and ceiling
• Clogged clean-out area
• Deteriorated central heating system
• Stained chimney exterior
• Decayed exterior mortar
• Cracked or deteriorated flue lining system
• Collapsed hearth support
• Tilted or collapsed chimney structure
• Chimney settlement

Fires occur when there is not good maintenance. Some insurance policies have exclusions for damage caused by lack of proper maintenance or routine care. Aside from family safety, a routine inspection of the chimney by a qualified expert is peace of mind in many ways! It protects against fires that don’t have to happen.

Landlords and residential property managers need to protect their tenants and their properties with chimney inspections. Safety is always a primary concern. Civil liability can result in failing to properly maintain chimneys on apartments.

Our Tulsa based law firm has been involved in fire litigation and insurance claims for decades. We have assisted with all types of fire cases, innocent, legitimate claims as well as those with suspicions of arson and insurance fraud. Let us know if we can help you with your insurance claim. Call us 918-587-1525

Five Easy Ways Not To Get Sued For Bad Faith In Oklahoma

Posted in Bad Faith

smileOklahoma insurance companies are expected to act in good faith. The law requires that claims be handled fairly. The Oklahoma Supreme court has said claims must be timely paid. The Oklahoma legislature passed the Unfair Claims Settlement Practices Act that sets out minimum standards. Adjusters are required to act fairly and comply with Oklahoma law. The consequence is bad faith litigation.

Bad faith claims and lawsuits can be avoided. Good claim practices create good habits. Good habits prevent costly mistakes. Good claim handling isn’t an accident. Here are five ways to ward off complaints, prevent frustration, and steer clear of lawsuits for bad faith in Oklahoma.

1. Smile – does it sound sort of funny? Well, laugh right now while no one is looking. An individual that was highly admired and respected by me once said, “You can say anything to anyone if you say it the right way.” While none of us like to be told “No”, it happens, right? Practice letting the insured know the bad news in a nice way. Regardless of your politics, former President, Ronald Reagan, knew how to say things in a pleasant way. He would smile and say please . . . . He carried a big stick, but he was always polite. He always smiled. You might not like him or what he was going to say, but he was never rude.

2. Show Respect – Use words of respect and courtesy in your speech and your e-mails. Call me old school, but “please” and “thank you” are appreciated. “Yes sir” and “No sir”, may be out of vogue, but they are words that show respect.

Don’t interrupt when someone is talking, let them finish. You may know what they are about to say, but let them say it. Read your e-mail twice before you hit send. Never send an e-mail when you are irritated or frustrated. E-mails always sound harsher than intended. All the more reason to write to policy holders with a mind set of respect for them and their claim.

If you watch the faces of enough jurors in bad faith litigation, you come to understand respect is essential. Jurors understand that people disagree. Jurors disdain being disrespectful. Your e-mails blown up full size and projected on a screen will speak loudly to the jury if you acted in a disrespectful way.

3. Listen – yeah, yeah, yeah! You heard this before. Well, it’s true, listening is important. One of the key components in customer satisfaction is feeling important. The refusal to listen sends a clear message. The person speaking is not important. An interesting side benefit of mediations is for the plaintiff to be heard. The mediator, who seems to be important, listens to them. The ability to talk and get things off their chest is frequently just as valuable to settlement as the amount offered.

4. Help People – don’t adjust claims. The insurance industry talks about adjusting claims. The language emphasized objects rather than putting the focus on people. The business of claims involves real people, not intangible claim files. The “real people” may have damaged property to be replaced or repaired, but they are people, first and foremost.

Helping doesn’t mean just writing settlement checks for the amount requested. It means assistance and frequently includes education. People with insurance claims usually don’t have a lot of experience with claims. They don’t understand the language, much less the concepts of adjusting losses.

Don’t grow tired of taking the time to explain the process. Just like a former teacher from junior high school, you may be remembered as the one person in the entire company that really tried to help them. Years ago, we helped a doctor avoid a malpractice lawsuit. The family was reminded about kind words the doctor had said and how he had genuinely tried to help his patient. Although his mistake resulted in the death, the family recalled the physician really cared. Tears were shed by the doctor along with the family, but suit was never brought.

5. Be Fair – if you owe it, then pay it. Long ago there was an old lawyer that worked as an adjuster in the claim department. He often paid a little more on claims than he had to pay. He didn’t give the company away, but he understood the line between fair and unfair. The balance between fair and unreasonable isn’t necessarily a lot of money. In fact, it seems like a paltry sum once the attorney fee bills for defending the bad faith claim arrive. Treat insureds fairly with the amount you pay. If you don’t, the same old question always comes up. “Would you have paid your mother that amount for her claim?”

Real success in bad faith litigation in Oklahoma isn’t about sending the lawsuit to the best lawyer, it’s about not sending him the work! Oklahoma has a number of excellent attorneys ready and willing to assist with bad faith lawsuits. Attorneys prepared to file the suit on behalf of the policy holder and those willing to fight for the insurance company. Success is not about winning the lawsuit, it’s about avoiding any lawsuit at all!

Our law firm has litigated bad faith cases for decades. We are experienced in insurance litigation. If you want to settle your claims, let us help! Call us 918-587-1525

Oklahoma Home Owners Can Lessen Damage Caused By Burst Pipes

Posted in Damages, Homeowners' Insurance

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The frigid winter weather is back. It has been really cold with the result of a lot of broken water lines from the freezing temperatures. People aren’t used to the really cold weather this year. The past two years have been very mild for Oklahoma with much warmer temperatures than the past few weeks. It has meant Oklahoma plumbers have been really busy and next in line will be the insurance adjusters reaching new claims.

The damage from a broken water pipe can be severe. However, knowing what to do if you come home to find running water from a burst pipe can really lessen the amount of the damage. Tulsa’s Channel 8 reports:

Mullin CEO Robert Morris said a surprising number of people don’t know how to stop a flood until it’s too late.

“The first initial panic is trying to find where to shut the water off and minimize the damage caused by the water leak itself,” said Morris.

He added that we haven’t had serious cold for a couple of years, so we should all make sure our crawl spaces and pipes are well protected.”

The laws of physics always seem to hold true. Cold weather always finds water if it is not protected by a heat source. Running water always tries to find the lowest possible point in its travels. The combined laws of physics mean houses and businesses in Oklahoma have frozen pipes and water damage.

Insurance companies, just like plumbers, are about to get really busy!

Horse Training Facility Fire Kills 23 Horses When Barn Burns

Posted in Coverage Disputes, Damages, Fire Loss

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A fire started in a horse training facility that killed 23 horses and destroyed the property. It was reported the fire broke out in the early morning hours. The owner said six employees entered the burning barn trying to save as many of the horses as possible. Owner, Eric Reed, called his staff “heroes“. The newspaper reported there were 13 horses that survived the ordeal.

“Reed said most of the horses that died were yearlings and some were racehorses. He told the Herald-Leader that one of the horses killed in the fire was a 3-year-old filly who recently won $100,000 in a stakes race. Another horse was scheduled to race Monday in Ohio.” You can see the emotional upset in the recorded interview by a local television station.

Fires involving horse training facilities bring various types of insurance claims. A number of  possible claims come to mind seeing the interview of the tragic loss. The various losses that might produce insurance claims are the insured property of the respective owners and also potential liability claims if negligence was involved in the fire or rescue efforts.

In cases where the horses were being boarded as part of the training, the horse owners may have purchased horse mortality coverage to protect their financial interest. Horse mortality insurance comes in several forms that include most risks of loss. Theft coverage is part of some insurance policies. The value of the horse may preset at the time of application for the insurance, but the insurance company probably has a maximum limit of coverage. There may also be exclusions for race horses, certain breeds, or other concerns. Of course some insurers write insurance policies for race horse, hunter jumpers, and the more expensive animals. It an almost certainty the insurance policies will provide for the right of subrogation.

The horse owners’ insurance company may have to pay the loss, but understandably the insurer will want to recoup the amount paid out for the claim. The typical horse training farm will carry general liability insurance. “Liability insurance is available for a variety of equine related activities – ranging from a full scale commercial horse boarding, training and riding instruction operation to the back yard horse owner’s personal pleasure use.” If the insurance company paying the horse owner sues to recover, it will likely trigger the liability policy’s duty to defend. Depending on the facts and policy language, it may result in insurance coverage for indemnification of the loss.

A lot of horse trainers purchase coverage called Care Custody and Control insurance. “This insurance provides coverage for your legal liability for injury or even the death of a non-owned horse that you have in your care custody and control. (This does not include your horses or ones you may be leasing.) If you are in the business of boarding or training horses for others, it is highly recommended that this protection be added by endorsement to your Commercial Liability policy. Coverage may be included for transportation of horses which is incidental to your business.” It is a separate endorsement of coverage under a lot of insurance programs.

canstockphoto10129388The horses are not the stopping point of the insurance claims in a fire to a training or boarding farm. The business suffers the damage or loss of the barns, waters, feeders, supplies, tack, and equipment. The damage can be extensive. Barns are expensive to rebuild and equine equipment and tack are not cheap. It can be difficult to find replacement cost coverage from insurers for equine operations. Insurance written for actual cash value or ACV results in the training or boarding company having “skin in the game” and will result in uncovered losses.

Transportation equipment and vehicles are part of nearly every horse business. The commercial demands of the horse industry require moving horses around the country for races, shows, and events. The trucks, trailers, and semis may be insured by different insurers and mean claims for those losses are adjusted by others.

The losses in this fire were estimated by the owner, Mr. Reed, to exceed $2 Million. Large claims routinely create claims under Umbrella policies. Since the underlying  insurance policies will have a maximum coverage limit, the Umbrella coverage may come into play. If for example, the policy has a $1 Million per occurrence limit, the Umbrella policy may be needed to pay for damages.

It is also not uncommon for the primary insurance company to cede or reinsure part of its own risk. In large losses, the damage may involve reinsurers who will end up paying for portions of the loss encountered by the insurance company that provide the principal coverage to the horse training or boarding farm.

From the initial reports, none of the staff or caretakers of the horses were injured by the fire. In situations where an employee is burned or injured, it may create workers’ compensation claims for the business. Smoke inhalation can turn into a trip to the hospital or even a doctor late in the week. These medical expenses have to be paid by someone. In some jurisdictions, agriculture is exempted from workers’ compensation. If the employee has health insurance, the medical expenses may by paid by private health coverage.

The horse trainer will have a loss of income associated with fire. The people paying to have the horse trained or boarded will no longer be making their monthly training payments. The business will have a reduced amount of income. If business interruption insurance protection was bought, it may offer reimbursement to make up for the lost income. The facility may have borrowed money or have a line of credit for the operation. The bank or lender will expect to be paid regardless of the fire.

The types of coverage, facts and particular circumstances can call for knowledgable legal counsel to address. Coverage questions abound in the horse industry and insurance coverage available. Insurance is sometimes complicated and extensive fire claims are no exception. Retaining an attorney promptly makes sense when the size and extent of a loss are clearly going to result in issues for some time to come.

The reason business purchase insurance is to protect against devastating, unexpected damages from fires, storms, casualty losses, thefts, etc. Fortunately, some of the misfortune can be taken care of.

I Didn’t Burn My House; I Want My Insurance Claim Paid!

Posted in Fire Loss, Property Insurance

Fire3Adjusters investigating fire claims have to make a decision. The cause of the fire is important. Accidental fires are usually covered by the policy. Intentional fires are not owed. Did the building owner set the fire? Guess what, arsonists don’t admit readily to the crime. Arsonists don’t make legitimate insurance claims, but they also don’t want to go to jail. Maybe they confess on television and in the movies, but not in real life. Adjusters know the innocent policyholders don’t set fire to their structures. So what’s the problem?

The problem for the adjuster is the bad guys don’t wear black hats. The adjuster can’t tell the bad guys from you just by looking. No honest person wants an arson claim paid. It is immoral, illegal, and raises premiums for all of us. The innocent person says, “I didn’t burn down my house.” But, the adjuster doesn’t know if this is true or not.

Many insurance companies ask, “did you burn your house?” How many people say, “yes”? We don’t know the statistics. The odds are not many admit to doing it. If the answer is “yes I burned my house”, the claim will be denied. So what happens if the answer is no. The adjuster must rely upon other evidence. Ever come home and find your cat sleepy and full? Notice the milk from the left over cereal at breakfast is gone. What’s the conclusion?

Insurance adjusters make assumptions. The facts in a fire loss claim are not always clear. There may be evidence both ways. Some indications may suggest the claim should be paid. Other facts may raise eyebrows and create questions. An insurance adjuster takes all the information and forms a conclusion. If the data suggests the fire was not deliberate, then the decision is payment of the fire damages. If the evidence is suspicious or casts doubts, the claim will be denied.Fire7

Most people have never had a fire. It is a new and highly unusual experience. They desperately wish the fire had not happened. They don’t know what to do. They don’t know where to find good advice. They blunder along through the claim process in an uneducated way. They become their own worst enemy. Just like the sleeping cat, they take a lot of things for granted. They are surprised when the adjuster decides they were involved in starting the fire.

It makes sense to avoid confusion from the very beginning. Trying to fix and explain things later doesn’t work very well. Starting off on the right foot with the adjuster can be the difference between a promptly paid claim and years of litigation. If you don’t think good communication is important, then see how your next job interview goes when you mumble the answers to the interviewer’s questions.

Adjusters want to do the right thing. Adjusters like closed files. The fastest way to close a file is to pay the claim. But, adjusters don’t like to pay the bad guys. Part of the job is to prevent bogus claims. If things aren’t clear that the claim is owed, then doubts can lead to denial of the payment.

Smart people recognize their own limitations. They understand the value of sound advice. They see the need for experience. Smart adjusters seek professional help from the start. Much like the “do it yourself plumber”, things can get worse. The leaky faucet wasn’t spraying water everywhere before you tried to fix it. The insurance claim was just a fire claim until you proceeded without an experienced insurance attorney.

A fire claim is a really bad deal for everyone. Worse yet is a fire claim that could be settled – stuck in years of litigation because a “do it yourselfer” didn’t seek professional help. It is hard to believe but law school and 30 plus years of fire claims does teach you a few things. If you want to try your hand at plumbing, go for it. If you want to do your own legal work, get a second opinion. Thinking about adjusting your own fire loss claim, it’s your choice!

If you need experience with a fire insurance claim, give us a call. It is far cheaper to have a little help early in the claim than a lot of help later. Our Oklahoma attorneys can guide you through the process. Call now 918-587-1525

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