Category: Corban V USAA

Judge Senter dismisses jury briefly, suggests State Farm settle with Bossier (can you belive it?)

State Farm attorney Ben Mullen said the Mississippi Supreme Court only recently clarified that insurance companies bear the burden to prove water caused a loss before payment is denied.

Senter corrected him, saying, “That’s been the law since 1910, counsel.”

Anita Lee – of course – has the story for the Sun Herald – and what a story it is!  According to Lee, it all started when Bossier had just finished presenting evidence that he should be paid policy limits of $650,000 on his Hurricane Katrina claim.

Senter dismissed the jury, then heard State Farm’s argument that the policyholder’s case was so weak the judge should dismiss it without rebuttal from the insurance company. Senter rejected the motion, then suggested State Farm consider making an offer to policyholder Reginald “Ed” Bossier that would end the trial.

Senter said the record so far includes “some pretty tough stuff” pertaining to the insurance company. “See what you can come up with,” Senter told the attorneys, “and everybody can come out of this with a degree of honor.” Continue reading “Judge Senter dismisses jury briefly, suggests State Farm settle with Bossier (can you belive it?)”

What’s the score? No, not the Saints game, I know they won – I’m talkin’ Katrina litigation and then some

So, what’s up besides the Saints? Well, for starters there’s the trial of Bossier v State Farm that got underway yesterday after the jury was seated mid-afternoon.  The grapevine reported there was time for opening statements (with no personal commentary re: Bossier’s motion in limine) and one witness before Court ended for the day.   The second day began at 10am and hopefully I’ll get another grapevine report or there will be something in the Sun Herald.

State Farm filed an an 11th hour trial brief, but  an interesting one nonetheless, that sets forth the Company’s position on the meaning of the Corban decision:

State Farm anticipates that Plaintiff at trial may attempt to satisfy his burden of proof merely by pointing to the totality of damage to his house at the conclusion of Hurricane Katrina. Continue reading “What’s the score? No, not the Saints game, I know they won – I’m talkin’ Katrina litigation and then some”

Jim Brown on Chinese Drywall, the Pollution Exclusion and Corban

Thursday, October 15, 2009
Baton Rouge, Louisiana

BLEAK LOUISIANA INSURANCE CLIMATE IN MONTHS TO COME!

There should be plenty of good news on the property insurance front, both in Louisiana and throughout the gulf south. Hurricane season is over, the third year in a row without the threat of a major storm. One would think this would be both good news and the beginning of price drops. But that’s not the case. There are bad financial storm clouds arising that bode ill for Louisiana policy holders in the coming year. Look for higher rates and less coverage. Here are some of the problem areas.

The new troubling insurance buzzword for homeowners? Chinese drywall. Thousands of Louisiana homes have been infested with defective drywall from China that was imported during the construction boom following Katrina to meet heavy demand. For reasons yet unknown, the drywall was contaminated with various sulfur compounds. This reaction causes quick metal corrosion allowing plumbing and appliances to fail. The foul odor that follows makes these homes unlivable and expensive to repair, and the defective sheetrock has to be torn out.

So you call you insurance company – right? Unfortunately, in most cases, insurance companies have been rejecting drywall claims, and even going so far as to not renew the homeowner’s policy. Property insurance companies, particularly in Louisiana, argue that drywall damage was not a “sudden event” like wind damage or flooding. Since 1984, insurance companies have been adding “pollution exclusion” to all their homeowner policies, stating that no coverage exists when a pollutant cases damage. Drywall problems, according to the insurance industry, cause damage over a period of time, and therefore the homeowner should have taken action for damage control.

This is not supposed to be the case in Louisiana. The Louisiana Insurance Department, back in the late 1990s, specifically defined the scope of such exclusion more narrowly than most states and allowed it to be applied “only to those injuries or damage caused by environmental pollution.” Simply put, nothing like drywall damage should be excluded, said the Insurance Commissioner at that time (obviously, a pretty bright guy). The Louisiana Supreme Court followed the Insurance department’s reasoning in the landmark case of Doerr v. Mobil Oil Corp. in 2000. Continue reading “Jim Brown on Chinese Drywall, the Pollution Exclusion and Corban”

Insurance Law Hawaii reviews Corban decision – Impressed with the clarity of the analysis

The Mississippi Supreme Court shined in its analysis of the term “concurrently.”

At the top of the SLABBED blogroll and now dear to our heart as well, Insurance Law Hawaii writes Corban Presents Well-Reasoned Analysis of Anti-Concurrent Causation Clause:

Having now read the full Corban decision, I am impressed with the clarity of the analysis set forth in the opinion.  See Corban v. United Services Automobile Assoc., 2009 Miss LEXIS 481 (Miss. Sup. Ct. Oct. 8, 2009).  The Mississippi Supreme Court carefully considered the facts, offered a common sense analysis to the anti-concurrent causation clause, and determined the provision had no application to the facts at hand.  The case has implications for Hawai`i because homeowners’ policies issued here typically include an anti-concurrent causation clause. Continue reading “Insurance Law Hawaii reviews Corban decision – Impressed with the clarity of the analysis”

The Price We Pay For “Pro-Business” Courts

As I’ve said in prior posts, I firmly believe Americans can no longer claim we’re “a government of laws not of men” as John Adams, our 2nd US President once pronounced. Adams’ words came to epitomize the venerable “rule of law” in America. In his era, the critical debate was “rule of law” vs. “rule of man.” The prospect that America might become “a government of men not of laws,” is exactly what Adams and our founders feared most, and warned us to stay away from. In their day, “rule of man” referred to the British King George III, who . . . well, just take a look for yourself:

In 1776, the year of our Declaration of Independence, Thomas Paine anonymously wrote a pamphlet titled Common Sense which stated: “in America, the law is king. For as in absolute governments the King is law, so in free countries the law ought to be king; and there ought to be no other.” Adams, a contemporary of Paine, expounded on Paine’s Common Sense, and made sure the Massachusetts Constitution of 1780 included the words “a government of laws not of men.”

In Adams’ and Paine’s day, the King was law, and he served no one except himself. Today, billionaire monopolies are the “King makers.” By purchasing our legislatures, individual judges and elected officials, they bastardize “the rule of law.” Their aim is make America a government of men, not law. This is what happens every day in Latin America, and why we call them “third world.” If we acquiesce, and accept their bastardization of America’s founding premise, we’re right back where we started in 1776. Put another way:

we cannot let this ↓ Continue reading “The Price We Pay For “Pro-Business” Courts”

Dean Starkman – SunHerald

Dean Starkman’s very fine writing about the insurance industry’s response to Hurricane Katrina, Insurance Transparency Project blog, continues to be an invaluable resource for SLABBED.  In fact, it was my search for something he’d written that led me to the Columbia Journalism Review where I found (much to my delight)  SunHerald’s Lee, Times-Pic’s Mowbray: Still on it

One of the true pleasures of reporting on the insurance industry’s response, or non-response, to Hurricane Katrina was meeting, and reading the reporting of, the principal Gulf-area papers’ reporters on the insurance angle, Rebecca Mowbray of the Times-Picayune and Anita Lee of the SunHerald of Gulfport and Biloxi, Miss.

It is heartwarming to see them still on the case, four years later. It is heartbreaking to read what they are reporting.

Mowbray: “Report dubs FEMA poor watchdog”

That one, from September 22, is about how the government fails to supervise the private insurers who administer the federal flood program under a “private-public partnership” (always a good idea to check your wallet when you read those words):

FireShot capture #104 - 'SunHerald's Lee, Times-Pic's Mowbray_ Still on it _ CJR' - www_cjr_org_the_audit_sunheralds_lee_timespics_mowbr_php

That’s for expenses, people. Insurers under this program bear no risk. What financial product comes with a 66% load? Continue reading “Dean Starkman – SunHerald”

Chip Merlin asks Why is the property insurance industry against its own customers?

Many of my retail corporate clients and their general counsel have told me that if they advertised and then performed in the manner of their insurer, the federal and state trade commissions would be holding “bait and switch” hearings. But, this is exactly the type of treatment insurance executives are calling for when they support the propaganda against their own customers through spokespersons such as Hartwig.

I am not the only one to have noticed this…The editors of Slabbed were pretty blunt about what they think about Hartwig.

Chip linked two recent SLABBED posts –  Bam Bam’s The Push Back on Corban – “You’re gonna pay for this” and Sop’s Da Corban spin continues: AIA prefers denial while the National Underwriter carries III press release calling it news – and added his thoughts as he raised the question Why Is the Property Insurance Industry Against Its Own Customers?

The response by Robert Hartwig of the Insurance Information Institute to the landmark Corban decision typifies how executives at many insurance companies feel about their customers. If not, Hartwick would be out of a job. Here is his quote taken from Anita Lee’s article: Continue reading “Chip Merlin asks Why is the property insurance industry against its own customers?”

Judge Senter applies Corban, issues trio of Orders in Bossier v State Farm

Attention now turns to several dispositive motions filed by Plaintiff concerning [77] the issue of the anti-concurrent cause clause in the subject insurance policy; [79] the issue of windstorm; [82] the dwelling extension coverage; and [83] “accidental direct physical loss” suffered by Plaintiff.

At the time these motions were filed, some of the issues were the subjects of an appeal to the Mississippi Supreme Court, Corban v. United Services Automobile Assoc…; the Supreme Court issued an opinion on October 8, 2009, and rejected the principal conclusions reached by the United States Court of Appeals of the Fifth Circuit in Tuepker v. State Farm Fire & Casualty Co…and Leonard v. Nationwide Mutual Insurance Co… However, that does not mean that Plaintiff is entitled to the requested relief.

In addressing Bossier’s dispositive motions, one of the three Orders he issued in Bossier v State Farm last Friday, Judge Senter enters the conversation on the impact Corban will have on the remaining policyholder claims in litigation.

While the Mississippi Supreme Court did not agree with the Fifth Circuit’s interpretation of the anti-concurrent cause clause found in homeowner insurance policies, especially with respect to the “in any sequence” portion of the provision, the decision did not change the essence of this Court’s approach regarding the meaning and–for practical purposes–inapplicability of the anti-concurrent language.

The Mississippi Supreme Court expressly adopted this Court’s analysis in Dickinson v. Nationwide Mutual Fire Insurance Co…Now that the Mississippi Supreme Court has issued its decision, this Court sees no reason to delay trial, for the intention to follow Dickinson and the interpretation of the anti-concurrent cause language has been consistently clear and has merely been affirmed by Corban.

The Mississippi Supreme Court did not go as far as Continue reading “Judge Senter applies Corban, issues trio of Orders in Bossier v State Farm”

Da Corban spin continues: AIA prefers denial while the National Underwriter carries III press release calling it news

Robert Hartwig isn’t the only prostitute (I mean shill) who will say or do anything (and I mean anything) for the right amount of money. Not to be left out and preferring denial over Hartwiggian threats the AIA issued the following press release: (Nowdy isn’t it about time we got some more hits out of Montana on my post about former Bush Groupie Marc Racicot)

The decision issued yesterday in the case of Corban v. USAA by the Mississippi Supreme Court confirms that the water damage exclusion and anti-concurrent causation (ACC) clause – two key issues in Hurricane Katrina litigation — are valid provisions of the insurance contract and will continue to be important to insurers in adjusting wind versus water claims, says the American Insurance Association (AIA).

“First, and most importantly, the Corban decision reaffirms the longstanding flood exclusion provision found in most homeowners’ insurance policies, that expressly excludes coverage for hurricane driven water (or storm surge),” said James Whittle, AIA Assistant General Counsel. “The water damage or flood exclusion has now withstood every post-Katrina court challenge, and remains a part of regulator-approved insurance contracts throughout the country.” .

“Second, the court upheld the use of the ACC clause that was at issue before the court,” said Whittle. “With this ruling the court has provided meaningful guidance to consumers and insurers. Nothing in this decision changes the important role that insurers play in recovery by adjusting claims according to their contracts with policyholders.”

Meantime the National Underwriter has emerged from their months long Corban slumber carrying a III / AIA press release billed as a news story. While I don’t necessarily buy into James’ harsh critique of Anita Lee’s report on Corban it is worth pointing out Anita Continue reading “Da Corban spin continues: AIA prefers denial while the National Underwriter carries III press release calling it news”