Q: …Can you give me a description of what, in you experience and knowledge of adjusting claims, what does concurrent causation mean to you in handling a claim?
A: Any loss that occurs with the covered loss and a non-covered loss whether it be before or after or during is not covered. [Exhibit C; Savoy depo at pp. 32-33; http://bit.ly/bAjCJ1].
Savoy further explains the application of the concurrent cause part of the policy,
Q. OK and when you say that something is not covered if the cause of the loss is combined to create a loss in any sequence of events; is that correct?
A. That’s my understanding.
Q. Ok. And is that a method with which you have applied the concurrent causation exclusion over your experience over the eleven, twelve years?
A. Yes. [Exhibit C; Savoy Depo at p. 33; http://bit.ly/aOCPI8].
From the oral arguments in Corban, of which Lynda is obviously not familar. In Nationwide’s world it wasn’t the covered peril that controls, rather the mythical uncovered peril that might have destroyed the property had that pesky covered peril not occured.
JUSTICE PIERCE: So you’re sequencing, if 95 percent of the home was destroyed, and then we have the event of the storm surge, then you would not pay a dime?
MR. LANDAU: Your Honor, if we prove that the storm surge was sufficient to cause – we have that burden, again, and that is absolutely crystal clear.
If we can prove that the storm surge was sufficient to cause all of this, it is no answer then to say, ‘Yeah, but I’m going to show it — I’m going to have somebody come in and say, “Look, guess what, the window was broken before the storm surge came and then wiped away the whole house.
The last post told how big insurance (let’s call it “BIG-I”) created Insurance Services Office (ISO) as their industry shill. ISO became the “handlers” if you will of various puppet commissioners. Among other things, ISO finessed rate increases and designed trap door policies (“coverage parts”). (Gruesome, I know, but it’s their word not mine). Frankly ISO did whatever Salvatore “BIG-I” said do. Of course ISO was BIG-I cause it was owned and controlled – as a non-profit if you can believe it – by BIG-I. Thing was nobody really seemed to notice or care.
Well remember how that Georgia cracker almost capsized BIG-I, went hog wild and damn near destroyed the Sherman exemption all by hisself? That was a real tipping point in BIG-I history, back in ’44, but thanks to a secret industry formula, lobbyists + cash = act of Congress (L+$=AOC), BIG-I was sitting upright again. McCarran-to-the-rescue in ’45. We’d just finished whupping a boatload of Kraut butt and everybody’s pretty happy. Momma got a toaster, baby’s got a biscuit, and daddy . . . a shy-knee-new Dynaflow.
Another 40 years pass, and this time it’s ISO who almost wrecks the ship. See in those 40 years insurance went from something you might consider taking out if you just wanted, to full blown Jersey style marketing: we got an offer of coverage you can’t refuse. And we couldn’t refuse, but not cause of Bruno. Forty years of running wild, untouched by fed regulation or anti-trust, BIG-I had by now hijacked so many legislatures you couldn’t buy a house, go to the hospital, get surgery, drive a car, get a loan or anything else unless you first bought insurance. (Wonder why it never got reclassified as a special purpose contract or public interest contract, you know, something making it subject to some regulatory terms; it sure ain’t my idea of a negotiated, voluntary contract).
A big welcome back to our readers from San Antonio with a word that y’all seem quite the legal masochists pumping meritless legal positions that will certainly insure another big verdict as happened in the Lisanby case. Anita Lee has the Sun Herald story on yesterday’s hearing at the Mississippi Supreme Court:
A USAA Insurance attorney conceded in arguments Tuesday before the Mississippi Supreme Court that insurance companies bear the burden to prove a hurricane’s tidal surge damaged a house in order to deny coverage for hurricane damage under an all-perils policy,
But policyholders also hope the high court finds that an “anti-concurrent cause” clause in homeowner policies should not be applied to hurricanes. Insurance companies cited the ACC clause to deny coverage for Hurricane Katrina’s wind damage when tidal surge, excluded from coverage, contributed to the loss. USAA claims the clause should apply in the case the Supreme Court is considering, Corban vs. USAA.
It is the first wind vs. water case argued before Mississippi’s high court. The full nine-member court heard the oral arguments, which attorneys say is unusual in a civil case. Three-judge panels generally review civil cases. Continue reading “Anita Lee covers Corban”
Since I’m not a lawyer, I really just have one standard and that’s does an argument or decision make sense. A lot of these decisions just don’t. Why?
Judge Helen “Ginger” Berrigan of Louisiana’s Eastern District Federal Court is one judge I had in mind when responding to Chip Merlin’s comment on the need to better educate judges trying Katrina insurance cases.
However, I don’t believe Judge Berrigan needs educating. Instead, it appears she’s contracted the highly contagious strain of 5th Flu that causes Leonard hallucinations and delusions of coverage.
Now, I’m not a doctor either; but, I could tell Judge Berrigan was was coming down with something when I read the Order and Reasonsshe issued in Adams v Lexington. So, I examined the docket and several of the documents; and, then, I read her history.
Based on what I learned, I suspect she had a natural immunity to the 5th flu as she showed no symptoms of Leonard hallucinations in her reasoning when she threw a wrench into FEMA’s effort at redemption with an order barring FEMA from trying to reclaim some of the money it had thrown at anyone claiming to be a Katrina victim.
Water, water everywhere
nor any drop to drink.
Water, water everywhere
now insurance won’t sink.
The word game started with water – lots and lots of water – lifted by Katrina’s powerful winds, waves became walls of water – collapsing with such force water went further inland than shown on any flood map. New Orleans, the Big Easy, became the only bowl it never wanted and, those playing the word game began calling Katrina, the windstorm, the Great New Orleans Flood.
Immediately after Hurricane Katrina came ashore, and before anyone could possibly assess the damage, the insurance industry began pushing the message that the damage was caused by flooding, rather than wind. “The fact that a government-run levee fails and creates a flood does not create a liability for private insurers,” said Robert Hartwig, chief economist with the Insurance Information Institute in New York. “I would say on dollar terms, at least among homes, the majority is related to floods.”
The distinction was important because wind damage is covered under homeowner policies – flooding is not. Industry representatives took the message one step further when they tried to spin the story as “The Great New Orleans Flood”.
The phrase first appeared in a press release issued by insurance industry Risk Management Solutions (RMS), just three days after Katrina made landfall. RMS claimed that the following would account for at least 50% of the anticipated total economic losses, and that, “The 2005 Great New Orleans Flood has developed into the most damaging flood in U.S. history.
The best place to hide a needle is in a haystack of needles.
From the time my children were old enough to doubt there really was a Santa Claus until the older two were grown, I can only recall one year that none of the three found where I was hiding their Christmas presents – the year I wrapped their gifts and set them under the tree.
Frankly, I was surprised they didn’t figure out my scheme; but nowhere near as surprised as I was the OIG couldn’t find the scheme to shift cost to the NFIP – much less as shocked as I was to learn investigators from MID couldn’t find it either.
Maybe both investigations were looking for a needle in a haystack when every element of the scheme was in plain view, a needle hidden in a haystack of needles. Pick them out one by one, put the elements together and you’ll see what the Rigsby sisters saw – the scheme.
My kids made looking for their gifts an insiders game with a legitimate reason ready to cover if they were caught. One searched the car, I can’t find my math book; another the closets, I’m looking for my sweatshirt; the little one they sent under the beds, I’ve lost my tennis shoes.
Wind versus water is an insiders game, too. It can be played as a word game or a mind game, a blame game, a power game; even a monopoly game with players swapping property cards purchased with printed paper that passes for money. Continue reading “The Scheme”
This actually makes too much sense to hold up but who knows. Thanks to our friends on the Cameron Parish School Board ordinary people won a very important battle against big insurance. Our readers no doubt recall how the 5th Circuit slaughtered the concept of anti concurrent causation in Leonard v Nationwide while ruling the policy clause was not ambigious.
In a case with fact patterns evidently very similar to the Mississippi case Broussard v State Farm the Federal District court has ruled out self serving after the fact experts for insurers:
This inquiry is factual. RSUI relies upon Nelson’s adjustment to justify its failure to pay. Nelson did not begin adjusting until August 2007. CPSB filed suit in September 2006, and thus RSUI cannot now rely on Nelson’s reports to justity its failure to pay prior to August 2007 because whether an action is arbitrary, capricious, or without probable cause depends on the facts known to the insurer at the time of its action.
Our readers may remember we have covered the developments in this case here and here. Today Anita Lee reports the Mississippi Supreme Court has agreed to hear the appeal from Judge Dodson’s courtroom on whether the anti concurrent clause is ambiguous and thus unenforceable. Alternatively the state Supremes could ratify the 5th Circuit’s reasoning in Tuepker and/or Leonard or they could muck things up badly.
Again I think Justice Jess Dickinson’s vote will be the interesting one to watch as this case unfolds. Now for Anita Lee’s report:
The Mississippi Supreme Court has agreed to decide how an insurance policy should be interpreted in a wind vs. water dispute over Hurricane Katrina claims.
In Corban vs. USAA, Long Beach policyholders argue the insurance company should cover wind damage to their property, regardless of damage caused by water. Water damage is excluded from coverage. USAA and other insurers argue that policy language also excludes coverage for a combination of wind and water.