Presentation on theme: "SPRING TRAINING FOR PROPERTY ADJUSTERS"— Presentation transcript:
1SPRING TRAINING FOR PROPERTY ADJUSTERS Mark StackhouseStackhouse AdjustmentKevin C. McNamara, EsquireThomas, Thomas & Hafer LLP
2The Everyday Plays Waivers Reservation of Rights Early Expert Retention30/45 Day StatusNon-cooperation
3More Everyday Plays Insured Statements Examination Under Oath MortgagesProof of Loss
4The Claim Businessowners Policy Insured Property – Dance Studio with stucco exteriorDate of loss reported: 7/4/14Loss discovered: 7/7/14 – section of rear stucco wall fell down; water from storms entered building and damaged main studio’s dance floorDance competition the following weekend can no longer be held at the location at a loss of at least $15,000
7Non Waiver Agreements When to Use “The Non Waiver should in no way be construed as a denial but as an acknowledgment that a question may exist concerning coverage and that Pick an Insurance Company will continue to make a good faith effort to resolve this matter. The document enables this office to continue to investigate this claim while protecting the Insured’s rights also. You will note that the Non Waiver specifically states that no rights of the Insureds are given up under the agreement.”“THAT the “Insured” does not waive or surrender any of his/her/its rights under the policy by the execution of this agreement”
8Non Waiver AgreementsCommunicating to the insuredPolicy defense?
9Reservation of Rights When to Use Policy Basis List all items that may applyCorrect – must review all endorsements and how they may modify basic policy languageCommunicating to the Insured
10Example RORThe reason for this is that the engineer’s inspection revealed that the wall fell due to the deterioration of the anchorage system which was long term and due to the infiltration of moisture behind the walls over a period of time.
11The involved policy form which is the CP contains an exclusion for certain causes of loss as follows: B. Exclusions 1. We will not pay for loss or damage caused directly or indirectly by any of the following. Such loss or damage is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the loss: d. (1) Wear and tear; (2) Rust or other corrosion, decay, deterioration, hidden or latent defect or any quality in property that causes it to damage or destroy itself; Under 1.d. above, any ensuing loss to property not precluded by any other provision in this policy is covered.
12As there is the possibility that the damage suffered is due to this excluded cause and would not be covered, the Company has instructed me to provide this Reservation of Rights Letter to you. This letter should not be construed as a denial of the claim but notice that the issue of coverage is unclear at this point and requires further investigation.
13Reservation of RightsWhen to WithdrawPolicy Defense?
14Which One Should I Use? Non-Waiver Agreement Reservation of Rights Insured Has No Obligation to SignReservation of RightsSent to InsuredOutlines possible coverage concerns
16What Expert Do I Need Requesting a Report Hypothetical Case – result of expert inspection was partial denial
17Status Letters – 30 / 45 DaysGuided in PA by Unfair Insurance Practices ActIf the investigation cannot be completed within 30 days, and every 45 days thereafter, the insurer shall provide the claimant with a reasonable written explanation for the delay and state when a decision on the claim may be expected.
18What does it look like?This is to advise you that this claim of July 4, 2014 remains open at this time. It is expected to be concluded upon:Receipt of your contractor’s estimate for replacement of the sprung dance floor;Documents related to your business interruption claim as noted in my correspondence of July 20, 2014;A review of these reports, documents and pertinent policy provisions.
19Status Letters Insured is represented – who do I send the letter to? Certified or Regular Mail?Should I call the insured before sending?
20Other UIPA Communication Guidelines New claim – within 10 days insurer must acknowledge receipt of claimPertinent communications – response required within 10 business days to correspondence from claimant***No private cause of action created, a violation of the Unfair Insurance Practices Act (UIPA) is not a per se violation of the bad faith standard. Dinner v. USAA Cas. Ins. Co., 29 Fed. Appx. 823; 2002 U.S. App. LEXIS 3408 (2002). See also Parasco v. Pacific Indem. Co., 920 F. Supp. 647, 655 (E.D. Pa. 1996).
21Non-Cooperation Letters Policy BasisWhen to UseWordingPolicy Defense?
22Non-Cooperation Letters WordingCite to policy – duties after loss“Please note that if you do not cooperate in the efforts of Pick An Insurance Company to investigate your loss, that your claim may be denied on the basis of your failure to cooperate.”Policy defense?
23Insured Statement Record Transcribe Effect on EUO Legal Requirements Providing copy to insured
24Examination Under Oath When to ConsiderStrategy / GoalsParticular area of concern
25Examination Under Oath Who Can AttendCheck Policy LanguageAs often as we reasonably require:a. Show the damaged proprety;b. Provide us with records and documents we request and permit us to make copies; andc. You, any “insured” and any one you hire in connection with your claim, must:i. Submit to examinations under oath and recorded statements, while not in the presence of any other “insured”; andii. Sign the same.
26Examination Under Oath Related Records RequestsWhat do I needEstimates you obtained for replacement of the sprung dance floor;Payroll records and 1099 forms for the last 12 months through the present for any individuals who were scheduled to work the county-wide dance competition;Records of all payments received related to any county-wide dance competition hosted at Get Up and Do It Dance Studio in the last five years;Documents related to any deposits or other costs associated with the cancellation of the county-wide dance competition at your location;Bank account records from January 2012 to present for Get Up and Do It Dance Studio.
27Examination Under Oath Consulting with expertsAuthorizations
28MortgagesInterest under the PolicyWhen to Include on Check
29Mortgages Can the Mortgagee Make a Claim Consequences of Failing to Include Mortgagee
30Proof of LossWhyWhenPolicy BasisCan it be Rejected
31Proof of Loss When would a release be more suitable Remember - An insurer may not request a first-party claimant to sign a release that extends beyond the subject matter that gave rise to the claim payment