How Insurance Companies Settle Cases

Back to the book page

To quickly search for key terms, use your browser's 'Find' function, found in the 'Edit' menu.

Table of Contents

 1.      Introduction to the Claims Game

 2.      The Fundamentals

 3.      Creating the Claims File

 4.      Investigating Coverage

4A.     Researching Opposing Insurance Defense Counsel

 5.      The Factual Investigation

5A.     How to Check the Financial Health of Defendant’s Insurer

 6.      Using Insurance Consultants and Experts

 7.      Settlement Negotiations and Compromises

7A.     How to Succeed at Settlement Conferences

7B.     Common Negotiating Mistakes

 8.      Techniques Not Found in Claims Manuals

8A.     Claim Complaints: The Art of Being a Squeaky Wheel

 9.      Claims Denials

9A.     Claim Evaluation Software

10.     Action Letter Outlines

11.     Releases and Covenants

12.     How to Estimate Bodily Injury Settlements

13.     Underinsured Motorist Coverage

14.     How to Take a Claims Representative’s Deposition

15.     Bad Faith—Bad News

15A.   Extraordinary Bad Faith Cases

15B.   Common Claim Myths

16.     Settling the $5,000 to $75,000 Bodily Injury Claim

17.     Uninsured Motorist Claims

18.     The Claims Department and the Claims Manual

EXPANDED TABLE OF CONTENTS

Chapter 1. Introduction to the Claims Game

§100  In General—David and Goliath Relationship

§101   Where Is the Money to Pay Claims: Is It Always at the Insurance Company?

§102   Why Does It Take so Long to Receive Payment?

§110  The Games Played in Wrongfully Denying Claims

§111   The Objective: Settlement and Payment

§112   The Means to an End—Salesmanship

§113   The Salespeople

§114   The Product—Pain and Suffering (Damages)

§115   Packaging a Settlement Demand to an Insurer

§116   Reciprocal Presentations

§117   Trading Settlement Demands and Offers

§118   Selling the Settlement Demand

§119   No Settlement Means Substantial Future Costs Leading Up To Trial

§120  Avoiding Bad Faith

§120.1    How to Avoid Bad Faith Conduct

§130  The Players

§131   The Plaintiff—A Fortuitous Person

§132   The Insured—Who Is Protected Under the Policy?

§133   The Agent or Broker—Middleman

§134   The Insurer—Protector

§135   The Adjuster—Bull or Bear

§135.1    Adjusting the Adjuster—Why Many Adjusters Have Lost Contact With Their Claims

§136   The Attorney—Adversary or Assistant

§137   The Insurance Commissioner—Regulator

§138   The Courts—Can Give Authority to Issue Broad Discovery Orders on Other and Similar Claims Files

§139   Agent/Broker Liability

§139.1    Liability of Agent or Broker to Insurer

§139.2    Liability of Agent or Broker to Insured

§139.3    Liability of Agent or Broker to Third Parties

§139.4    Damages

§140  The Rules of the Game

§141   Showing of Good Faith

§150  Duties Owed by the Parties

§160  Common Insurance Industry Acronyms

§170  Locating Old Policies—Insurance Archeology

§170.1  What Standards Do Claim Handlers Apply to Verify Coverage if a Claim Is Presented?

§170.2  Company Loss Runs

§171   Insurance Premium Payment Records

§172   Certificates of Insurance

§173   Prior Company’s Sales/Mergers

§174   Annual Reports, Financial Statements and Staff Reports

§175   State Insurance Departments and Former Law Firms

§176   Insurance Company Computers

§177   Broker Correspondence and Accounts Payable Files

§180  Rescission—The Ultimate Defense to Claims

§181   Misrepresentation or Fraud in Marine Coverage

§182   Misrepresentation or Fraud in Life or Disability Coverage

§190  Insurance Fraud

§191   Claim Withdrawal—Is It a Legitimate Practice? Or Is It Blackmail?

Key Points to Remember

Chapter 2. The Fundamentals

§200  In General

§201   Why the Application Is Important

Sample: Automobile Application for Insurance

Sample: Homeowners Application for Insurance

§202   The Application as an Escape Device

§203   The Application as a Negotiating Tool

§204   Rescission

§205   Post-Claims Underwriting

§206   Slow Processing Resulting in Coverage—Friend or Foe, You Get No Dough!

§210  The Automobile Accident

§211   The Policy Comes Alive

§211.1    Claims by the Insured

§211.2    Claims by the Claimant

§211.3    Notice Is Notice

§212   Is Notice of a Claim or Occurrence to the Agent the Same as Notice to the Insurance Company?

§212.1    Conflict of Interest—Agent Acting as the Adjuster

§212.2    Coverage Adjustment

§212.3    Factual Investigation

§212.4    Two Estimate Adjusting

§212.5    Minor Claims Only

§213   Prompt Reporting by the Agent

§213.1    Notifying the Claims Department

Sample: Accord Form

§213.2    Service Is the Product

§214   Initial Claim Avoidance by the Agent—Does the Agent Have a Conflict of Interest?

§214.1    Referral to the “Other Carrier”

§214.2    Talking the Insured Out of a Claim

§214.3    Bad Faith by the Agent of the Insurer

§220  Agent’s Initial Report to Claims Department

§221   All Lines of Coverage Confirmed

§222   Policy Number Verified

§223   Limitations

§230  Facts of the Accident

§230.1    Date and Time of Loss

§230.2    Location of Loss

§230.3    Driver’s Name

§230.4    Permissive Driver

§230.5    Vehicle Description

§230.6    The “Black Box”

§230.7    Alternative Vehicle

§230.8    Exclusions—Intentional Acts

§230.9    Insured’s Attitude

§230.10   Hardships

§231   Agent’s Request for Status—Identification

§232   Agent’s Bonus Plan Jeopardized

§240  Answers to Frequently Asked Questions About Claims Adjusters and Insurance Companies

§250  Forms of Insurance Companies

§260  Parts of the Whole Insurance Company

§270  Anatomy of the Insurance Contract

§280  Insurance Company Attitudes Toward Payment of Claims and Why Some Companies Pay More Than Others

Key Points to Remember

Chapter 3. Creating the Claims File

§300  In General

§301   How the Claims File Is Created

§302   Real and “Dummy” Files Created

§302.1    Claim Filed With an Administrative Date of Loss

§303   Coverage Documentation

§304   Duties of Primary Insurers Owed to Excess Insurers

§310  Fact Finding Team Assignments

§320  Local and Companywide Claim Numbers

§321   Multiple Claims Offices

§330  Late Reporting Problems—Liability Claims

§331   By the lnsured

§332   By the Agent

§333   By the Broker

§340  Checklist for Coverage Investigations—Automobile, Environmental, Construction, and Job Site Injury Claims

§350  Checklist for Factual Investigations

§360  “First Call” Settlements

§361   Diary Dates

§362   Non-Waiver Guidelines—When Are They Valid?

§363   Reservation of Rights Guidelines—What Is a Proper Reservation?

Sample: Reservation of Rights Letter

§364   Advice of Counsel Defense Through Use of Independent Attorney Letter

§365   Carbon Copy Notice—May Be Evidence of a “Home Office” Claim File

§366   Claim Reserves and Dates of Loss and Why They Are Important

§366.1    Individual Reserves Are Made for Each Line of Coverage

§366.2    Reserves for Legal Costs

§366.3    Claim File Reserves on “Wasting” Policies

§370  Attorneys Involvement in the Claim Process: Is the Attorney Playing Adjuster?

§380  Proofs of Loss (POL) and Examinations Under Oath (EUO)

§380.1    Insurance Company’s Policy

Sample: Proof of Loss (Homeowner)

Sample: Proof of Loss (Automobile)

§380.2    Waivers

§380.2.1  Money Limits

§380.2.2  No Fraud Suspected

§390  Verifying the Timely Handling of the Claims File

§391   Date/Name Stamping

§392   Contact Rules With the Claimant and Insured

§393   Agent Contact and Status Reports

Key Points to Remember

Chapter 4. Investigating Coverage

§400  What Is Insurance Coverage? What Is the Difference Between Potential and Actual Coverage? And Can the Insurer Waive a Coverage Defense?

§401   The Policy

§402   Coverage Analysis

§403   Policy Interpretation

§404   Reasonable Intent of Insured

§405   Reduction in Coverage

§406   Marketing Brochures and Advertising

§407   Duty to Defend

§408   Trigger of Coverage

§409   Reserved

§410  Fiduciary Disclosure by the Insurer

§411   Good Faith and Fair Dealing

§412   Independent or Cumis Attorney Disclosure

§420  Documents Necessary for a Coverage Investigation

§420.1    Insured’s File

§420.2    Application for Insurance

§420.3    Agent’s Files

§420.4    Underwriter’s Files

§420.5    Coverage Question Investigation File

§420.6    Factual Investigation File

§420.7    Promotional\Advertising Materials

§420.8    Insurance Commissioner’s File

§420.9    Declaration Sheet

§420.10   Insurance Endorsements

§420.11   Underwriting Manuals

§420.12   Outside Legal Opinion

§420.13   Drafting History of Policy Forms

§430  Obtaining the Necessary Statements

§440  Policy Defenses

§440.1    Reserved

§440.2    No Insurable Interest

§440.3    Occurrence Not Within Term Policy Period

§440.4    Undefined Policy Terms

              §440.4.1    Vague or Ambiguous Policy Terms

§440.5    Failed Policy Conditions

              §440.5.1    The Bankruptcy Clause

              §440.5.2    Duty to Cooperate

              §440.5.3    The No Action Clause

              §440.5.4    The Other Insurance Clause

              §440.5.5    Notice of Occurrence and Lawsuit

              §440.5.6    The No Assignment Clause

              §440.5.7    The Voluntary Payments Clause

              §440.5.8    The Subrogation Clause

§440.6    Policy Exclusions

              §440.6.1    Burden of Proof on Exclusions

              §440.6.2    Expected and Intended Injury

              §440.6.3    Contractual Liability

              §440.6.4    Pollution Exclusion

              §440.6.5    Automobile Exclusion

              §440.6.6    War Exclusion

              §440.6.7    Damage to Owned Property

              §440.6.8    Damage to “Your Product”

              §440.6.9    Damage to “Your Work” or “Faulty Workmanship”

              §440.6.10  Unenforceable Exclusionary Clauses

              §440.6.11  Business Pursuits Exclusion

              §440.6.12  Policy Exclusion Riders

§440.7    Claims for Emotional Distress

§440.8    Policy Limits, Aggregate Limits, and Exhaustion

              §440.8.1    History of Policy Limit Insurance Forms

              §440.8.2    Exhaustion: When Insurer Can Withdraw From Defense

              §440.8.3    Claim Payment Allocation and Policy Exhaustion Issues

§440.9    Prorating Coverage

§440.10   Vehicle Ownership, Maintenance, Use, of Operation

§440.11   Pre-Existing Condition

§440.12   Prejudice

§450  Contract Defenses

§450.1    Fraud/Recission: Voiding the Policy

§450.2    Mistake and Reformation

§450.3    Policy Cancelled

§450.4    Renewal or Cancellation of Coverage

§450.5    Covered Malicious Torts

§450.6    Partial Defenses Liquor Liability Exclusion

§460  Third-Party Liability Policies: Specialized Issues

§461   Duty to Defend

§462   Obligation to Provide Defense for Claims

§463   Duty to Defend and Independent or Cumis Counsel

§464   Duty to Indemnify

§465   Deductibles and Self-Insured Retentions

§466   Stop Losses and Aggregate Deductibles

§467   Beware of Allocation Games on Deductibles and SIR’s

§470  Good Faith Coverage Investigation

§471   Alternative Coverage Investigation

§472   Numerous Theories of Denial—Waiver

§480  Alternative Dispute Resolution

§481   Four Basic Methods

§482   Declaratory Relief Action

§490  First Party Property Claims

§491   Scope of Coverage: All Risk or Specified Peril?

§491.1    Investigation of a Property Claim

§491.2    Proof of Loss Requirements

§491.3    Submitting and Completing Proof of Loss Form

§491.4    Defects in Proof of Loss

§491.5    Examinations Under Oath

§491.6    Actual Cash Value

§492   Collapse and Imminent Collapse

§493   Concurrent Causation

§494   Computer Viruses and Software Coverage

§495   Mold Claims

§495.1    What Is Mold and Why Has It Become an Insurance Issue?

§495.2    First-Party Mold Claims

§495.3    Are Third Party Claims Covered?

§495.4    Additional Research

§4100  Title Insurance Claims and Coverage

§4101 Standard Form Title Insurance Policies

§4102 Applicable Insurance Code Statutes and Regulations for Title Insurance

§4103 Basic Title Insurance Terms and Definitions

§4104 What a Title Insurance Policy Covers and Does Not Cover

§4105 What Is the Title Insurer’s Obligation if a Defect Is Found?

§4106 Benefits Payable Under a Title Insurance Policy

§4110  Investigating Reinsurance Coverage

§4111 What Is Reinsurance?

§4111.1   Primary Purpose: To Spread Loss

§4111.2   Secondary Purpose: To Allow Insurer to Write More Business

§4112 Non-Admitted Insurers

§4113 A Very Brief History of Reinsurance

§4114 Lack of Case Law on Many Reinsurance Issues

§4115 Understanding Reinsurance and Reinsurance Terminology

§4116 How Reinsurance Contracts Work

§4117 Notice and the Following the Fortunes Rule

§4117.1   More on Following the Fortunes

§4118 Is Bad Faith or Punitive Damages Claims Covered by Reinsurance?

§4119 How Reinsurance Can Affect an Insurance Claim

§4119.1   Insolvency of Ceding Insurer

§4120  Coverage Under Personal and Commercial Umbrella Policies

§4121 When Does an Excess or Umbrella Insurer Have an Obligation to Pay Under Its Policy?

§4122 Horizontal vs. Vertical Exhaustion

§4123 Insolvency of Primary Insurer

§4124 If Primary Insurer Refuses to Defend Its Policyholder Leaving Excess Insurer Alone

§4125 If Primary Insurer Is Defending But Refuses to Contribute Towards Settlement Within Its Own Limits

 §4130  Coverage Under Claims Made Policies

§4131 What Is a Claims Made Policy?

§4132 Reporting Period

§4133 Retroactive Date

§4134 Claim and Potential Claim

§4135 How Does a Claims Made Policy Differ From an Occurrence Based Policy?

§4136 Issues for Specific Types of Claims Made Policies

§4136.1   Directors and Officers Coverage

§4136.2   Limitations on D&O Coverage- Application Terms and Exclusions

§4136.3   Employment Practices Liability Coverage (“EPLI”)

§4136.4   Environmental Impairment Liability Coverage

§4136.5   Professional Liability Policies

Key Points to Remember

Chapter 4A. Researching Opposing Insurance Defense Counsel

§400A          In General

§410A          Search Martindale-Hubbell

§420A          Review Firm Web Page

§430A          Search Internet

§440A          Ask Other Attorneys

§450A          Watch Out for “Coordinating Counsel”

§460A          Research the Attorney’s Written Papers, Articles, Periodicals, and Filed Pleadings

§470A  Search State Bar Websites

Chapter 5. The Factual Investigation

§500  Role of the Claims Adjuster/Representative

§501   Contact and Control

§501.1    Introduction of a Plaintiff’s Attorney

§502   The Preliminary Investigation—Scope of Investigation

§502.1    Favorable Facts

§502.2    Unfavorable Facts

§503   Duty to Disclose Coverages and Reservations of Rights

§503.1    Duty to the Claimant

§503.2    Duty to the Policyholder

§503.3    Agent’s Duty to Insurer

§510  Incident Statements (Signed, Unsigned or Recorded)

Sample: Automobile Loss Notice

Sample: Homeowners Loss Notice

§510.1    Checklist for Injury Evaluation

§510.2    Should Plaintiff’s Counsel Let the Adjuster Take the Plaintiff’s Statement?

§511   No Personal Contact—Just Forms

§512   Insured Driver

§513   Witness in Insured Vehicle

§514   Witness in Adverse Vehicle

§515   Known Independent Witnesses

§515.1    Police Officers’ Statements or Interviews

§515.2    Tow Truck Drivers

§515.3    Ambulance Driver

§515.4    Unknown Scene—Canvassed Witness

§520  Insurance Claim Forms Documentation

§520.1    Medical Authorization

              Sample: Medical Authorization

§520.2    Dental Authorization

              §520.2.1    Special Notice

§520.3    Employment Records Authorization

§520.4    School Records

§520.5    Advance Payments—Med Pay

§520.6    Releases (Partial or Final)

§520.7    Indexes

              §520.7.1    Bodily Injury

                              Sample: Claimant’s Index Report

              §520.7.2    Vehicle

              §520.7.3    Large Fire Losses—PILR

§521   Documentation of Bodily Injury Claims

§521.1    Medical Bills

§521.2    Medical Reports

              Sample: Medical Report

§521.3    Lost Wage Reports

              Sample: Request for Employee Information

§521.4    Police Reports

§521.5    Death Certificate

§521.6    Coroner’s Report

§521.7    Criminal and Civil Court Records

§522   Photographs

§522.1    Insured Vehicle (by Adjuster)

§522.2    Claimant’s Vehicle (by Adjuster)

§522.3    Police Department—Vehicles

§522.4    Police Department Scene

§522.5    Police Department—Injured Parties

§522.6    Private Photos

§530  Classification of Parties

§531   First Party

§532   Third Party

§533   Both First and Third Party

§534   Experts and Expert Witnesses—Accident Reconstruction Experts

§534.1    Seat Belt Experts

§534.2    Auto Accident Reconstruction Experts

§534.3    Medical Defense Doctors—Can They Commit Bad Faith?

§534.4    Independent Medical Examiner (“IME”)

§535   Independent Adjusters/Investigators

§536   Examination Under Oath Statements

§540  A Settlement Demand in Excess of Policy Limits

§541   Bodily Injury Claims

§541.1    Value of Each Claim

§541.2    Prorating/Compromise

§541.3    Interpleader Action in Federal Court

§542   Property Damage Claims

§542.1    Value of Each Claim

§542.2    Prorating/Compromise

§550  When Multiple Insurance Policies Cover the Same Loss

§550.1    Insured Driver’s Policy (Third Party Coverage)

§550.2    Insured Driver’s Policy (Non-Owned Auto)

§550.3    Insured Driver’s Policy (First Party—Under/Uninsured)

§550.4    Insured Driver’s Policy (Primary, Secondary and Under/Uninsured Coverage)

§550.5    Insured Driver’s Policy (Rental Car)

§550.6    When Excess Insurers Must Pay if There Are Multiple Retained Limits

§551   Anti-Stacking Rule and Non-Cumulation Clauses

§552   Homeowner’s Policy

§553   Drop Down Insurance

§560  Assessing Comparative Fault

§561   Phantom Vehicles

§562   Landowners

§570  Maintenance of the Claim File

§571   30/90 Day Diary

§571.1    Reverses as a Bad Faith Tip-Off

§580  Liens and Assignments—“Notice Claimants’’

§581   Medical Liens

§582   Worker’s Compensation

§583   Prior Attorney Representation

§584   Banks/Mortgage Companies

§585   Auto Body Repair Shops

Sample: Auto Body Shop Assignment of Benefits

§590  Unfair Claims Settlement Practices

§591   Misrepresentation/Communication

§592   Reasonable Standards/Prompt Settlement

§593   Repetitive Documentation/Extortion

§594   Forced Litigation/Sham Arbitration

§595   Altered Application

§596   Disclosing Paid Benefits

§597   Directly Advising Against Representation

§598   Statute of Limitations—Insurers Must Generally Provide Notice of Expiration to Policyholders

§599   Improper Investigation

Key Points to Remember

Chapter 5A. How to Check the Financial Health of Defendant’s Insurer

§500A          In General

§510A          Insurer Rating Sources

§520A          Rating Resources

§530A          IRIS Tests

§540A          A Primer on Insurer Insolvency

§550A          What to Do When Warning Signals Flash

§560A          How to Secure Funds Before the Insurer Goes Into Receivership—Make the Insurer
                      Post a Bond

Key Points to Remember

Chapter 6. Using Insurance Consultants and Experts

§600  Is an Insurance Consultant or Expert Necessary?

§610  Timing: Usually the Sooner an Expert Is Retained, the Better

§620  How to Locate an Insurance Expert

§621   Word of Mouth

§622   A National Directory of Experts

§623   Reported Cases at the Trial Level

§630  Interviewing the Expert

§631   By Telephone

§632   Face to Face

§633   The Expert’s Curriculum Vitae (CV)

§634   Expert’s Prior Cases

§635   Will the Expert Qualify?

§636   Does Expert Believe He or She Can Be an Asset to the Case?

§640  Fees, Expenses and Timing of Payments

§641   Retainer Fees

§642   Different Fees for Different Services

§643   Trial Testimony and Standby Fees

§644   Travel Fees (Advanced or Not)

§645   Retention Agreements

§646   Contingency Agreements

§647   Accounting of Expert’s Fees and Expenses

§648   Dispute Resolution of Fees/Costs

§650  Scope of the Expert’s Retention

§660  What Is the Expert to Opine On

§661   Relationship Between the Agent and Insured

§662   Formation of the Insurance Contract (Where, When, and How)

§663   Is the Claim Covered?

§664   Insurance Industry Customs and Practices

§664.1    Insurance Product Marketing

§664.2    Solicitation and Formation of Insurance Contract by Agent/Broker and Agent/Broker’s Duties in Application Process

§664.3    Representations by the Agent/Broker at Formation of Insurance Contract

§664.4    The Insurer’s Underwriting Department’s Underwriting Guidelines

§664.5    Issuance of the Insurance Policy

§665   Submitting and Processing of Insurance Claim

§665.1    Promptly?

§665.2    Thoroughly?

§665.3    Objectively?

§666   Avoidance of Appearance of Conflict of Interest Within Claims Department?

§667   Avoidance of Appearance of Conflict of Interest Within “In-House” Counsel Department

§668   Insurance Bad Faith Claims

§668.1    Processing

§668.2    Investigation

§668.3    Disclosure

§668.4    Coverage Investigation

§668.5    Objective Factual Analysis

§668.6    Coverage Analysis

§668.7    Low-Ball Issues

§668.8    Stonewalling Issues

§668.9    Wrongful Denial of Claim Issues?

§670  Special Investigation Unit—Insurer’s Fraud Unit

Key Points to Remember

Chapter 7. Settlement Negotiations and Compromises

§700  In General

§700.1    Characteristics of a Good Negotiator

§700.2    Negotiation Tips

§700.3    The Seven Social Sins of Negotiating

§701   The Beginning of the Sale

§701.1    Settling Smaller Cases Over the Phone

§702   Open Communications—Issues

§702.1    Coverage Issues

§702.2    Liability Issues

§702.3    Limit Issues

§702.4    Damage Issues

§702.5    Commitment from the Insurer

              Sample: Letter of Admission

§702.6    Documentation of Commitment

§702.7    Reasonable Demands

§702.7.1  Time Limits

§702.7.2  Damages

§702.7.3  Assessment of Liability

§702.7.4  Monetary Damages

§703   Out of Court Dollars

§704   Reciprocal Good Faith Duties

§704.1    Prompt Response to Settlement Demand

§710  Reasonable Settlement Defined

§711   Sources of Standards

§712   Bilateral Duty to Start Negotiations

§713   Innovative Ways to Settle a Case

§714   Proving Pain and Suffering and Hedonic Damages to the Insurance Company

§720  Support/Documentation of the Settlement Demand

§720.1    Demand vs. Offer to Settle

§720.2    Facts: Police Reports/Statements

§720.3    Law(s): Vehicle Code/Negligence

§720.4    Comparative Fault

§720.5    Damages: Documents/Reports

§720.6    Computations and Conclusions

§720.7    Reasonable Response Time

§730  Written Communications Only—Demands

§730.1  Full Disclosure

§730.2  Failure to Advise Insured

§740  A Trap for Attorneys: Comparative Fault and Policy Limits

§740.1  Negotiate Against the Value of the Case

§750  Compromise Considerations for the Insurer

§760  Compromise Considerations for the Plaintiff

§770  Compromise Considerations for the Plaintiff’s Attorney

§780  Maintaining Your Relationship With the Adjuster

§790  Checklists for Preparing Bodily Injury Settlement Packages

§790.1    Fact Gathering Checklist

§790.2    Fact Documentation Checklist

§790.3    Analysis

§790.4    Packaging the Settlement Demand

§790.5    Selling the Settlement Package

§791   How to Arrive at a Demand Figure

§791.1    Itemizing Compensation for Pain and Suffering

§791.2    Determining Lost Wages

§791.3    Loss of Enjoyment of Life Damages

§792   Settlements and Compromises—The Ten Commandments

Key Points to Remember

Chapter 7A.  How to Succeed at Settlement Conferences

§700A  In General

§710A  Know Your Audience—Determine What Is the Most Appropriate Forum for Your Case to Settle

§720A  Be Prepared

§730A  Be Brief

§740A  Welcome and Anticipate Questions

§750A  Be Flexible and Innovative

§760A  Send a Lone Ranger, Not a Mongol Horde

§770A  Be Assertive, But Not Abrasive

§780A  Believe in Your Case

§790A  Know Your Aims

Chapter 7B.  Common Negotiating Mistakes

§700B  In General

§710B  Failure to Read Medical File Closely

§720B  Overpricing Claim Value

§730B  Lack of Objectivity

§740B  Fuzzy Demands, Using a Value Range

§750B  Running Up Specials

§760B  Assuming You Know How All insurers Value Cases

§770B  Failure to Properly Investigate Facts

§780B  Hubris

§790B  Loose Lips

§7100B        Mistaking Form for Substance in Demand Presentation

§7110B        Using Warped Sounding Boards

Chapter 8. Techniques Not Found in Claims Manuals

§800  The Claims Representative Has the Power

§810  Lowballing—Paying Less Than What Is Known To Be Owed

§811   Lowballing the Claimant

§812   Lowballing the Attorney

§813   Lowballing and Forcing an Arbitration

§814   Lowballing the Property Damage Claim and Its Effect on Personal Injury Damages

§814.1    Handling Property Claim Gratis

§814.2    To Recover Fee, Ask Client for Lien

§814.3    Why Insurers Lowball Property Claims

§814.4    One Adjuster for Both Claims

§814.5    Insurer’s Strategy for Reducing Property and Bodily Injury Payouts

§814.6    Misleading Photos

§814.7    Ignoring Hidden Damage

§814.8    Incomplete Appraisals

§814.9    Insured’s Vehicle Damaged While Client’s Is Not

§814.10   Total Loss Payout

§814.11   Unrealistic Costs for Parts

§815   Forcing Policyholders to Sue to Get Coverage to Which They Are Entitled

§820  Unreasonable Delays

§821   The Indicators of Poor Claims Management

§830  Stonewalling—Friend or Foe, You Get No Dough!

§831   “Benefits Delayed” Are “Benefits Denied”

§831.1    Unfair Leveraging

§831.2    Excess Coverage

§831.3    Economic Pressure

§831.4    Claims Maze

§831.5    Need Insured’s Cooperation First

§831.6    Nickel and Dime the Claimant

§831.7    Musical Chair Claim Adjusters

§831.8    Some Now—All Later

§831.9    Waiting for the Insured’s Contribution

§831.10   Setting Up the Claimant

§831.11   Fabricated Denial

§832   Stonewalling the Attorney

§833   Stonewalling the Insured

§840  Intimidation

§841   Retaliation

§842   Attacking the Claimant

§843   Social Duress and Blackmail

§850  Digging Into the Settlement Technique Grab Bag

§850.1    Seasonal Settlements

§850.2    Guidelines for Waiver of Bad Faith Claims in Settlements

§850.3    Backlog Settlements

§850.4    Nuisance

§850.5    Factoring

§850.6    Refusal to Negotiate

§850.7    The Hard Ball

§850.8    The Nice Guy Approach

§850.9    The Principled Approach

§850.10   Carrot and Stick—Example of Improper Claim Payments Tactics by an Insurer

§860  Bad Faith Litigation Checklist

§870 Checklist of Unfair Claims Settlement Practices

§880  Pretext Investigations

Key Points to Remember

Chapter 8A.  Claim Complaints: The Art of Being a Squeaky Wheel

§800A  Why Insurance Companies Behave Differently From Other Private Companies

§810A  How Do You Complain?

§820A  Document Complaints

§821A Letter to Adjuster

§822A Letter to Supervisor

§823A Letter to Home Office

§830A  Follow Up

Chapter 9. Claims Denials

§900  In General

§910  First Party Denials

§911   No Insurable Interest

§912   No Coverage

§913   Expiration of Statutes of Limitation and Tolling Issues Related to Suing an Insurer

§914   Failed Condition of Policy

§914.1    Late Notice by Insured of Insurance Claim

§914.2    No Cooperation—Failure to Submit to Examination Under Oath

§914.3    No Proof of Loss

§915   Fraud by Insured

§916   Material Misrepresentation

§916.1    Life Insurance

§917   Intentional Act

§917.1    Criminal Act

§918   Policy Cancellations and Policy Rescissions

§919   Date of Loss Outside Policy Term and Trigger of Coverage Issues

§920  Policy Exclusions

§921   Exclusion Riders

§921.1    Driver Exclusion

§921.2    Vehicle Exclusion

§921.3    Territory Exclusion

§922   Punitive Damage, Penalties, and Fines

§923   Family Member Exclusion Void: Public Policy

§930  Word Games—Examples of How Undefined Policy Terms Can Result in Coverage

§931   Not a “Vehicle”

§932   Not an “Insured”

§933   Not an “Agent”

§934   Not an “Accident”

§935   Not a “Roof”

§936   Not a Reasonable and Necessary Medical Treatment

§937   Not an “Occupant”

§938   “Use” of Vehicle; “Loading and Unloading”

§939   “Employee” v. “Independent Contractor”

§940  Third Party Denials

§941   No Coverage in Force

§942   No Liability on the Part of the Insured

§942.1    A Trap for the Insurer

§943   Fraud

§944   No Cooperation

§945   The Running of the Statute of Limitations

§946   Intentional Act

§946.1    Intent Difficult to Prove

§950  Duty to Defend Versus Duty to Indemnify: What Is the Difference?

§951   Dangerous Stand by Insurer

§960  Blind Denials

Key Points to Remember

Chapter 9A. Claim Evaluation Software

§900A  Insurers Use of Claim Valuation Software

§910A  Xactimate Software—Used to Estimate Building Repairs

§920A  Colossus

§930A  Jury Verdict Research; Free Verdict Reports Available

§940A  Caveats and Opportunities

§950A  Beware of GIGO—Garbage In Garbage Out

Chapter 10. Action Letter Outlines

§1000  In General

§1001 Voluntary Motivation

§1002 Involuntary Motivation

§1003 Ten Tips for Writing Effective Letters

§1010  Letters by the Attorney

§1011 Letter to the Adverse Motorist

§1012 Letter to the Agent

§1013 Introductory Letter to the Claims Representative

§1014 Letter to an Unresponsive Claims Adjuster

§1015 Letter to the Home Office of the Insurance Company

§1016 Letter to the Insurance Commissioner

§1017 Discovery Letter to the Insurance Adjuster

Sample: Discovery Letter to Insurance Adjuster

§1020  Time Limit/Policy Limit Demand Letters

Sample: Time Limit/Policy Limit Demand Letter to Adjuster

§1021 Property Damage Considerations

§1022 Additional Considerations

§1030  Settlement Demand Letters

Sample: Settlement Demand Letter to Adjuster

§1040  Letters by the Insurance Company

§1041 Statute of Limitations Letter

§1042 Reverse Bad Faith Letters

§1050  Summary Checklist for Effective Demand Letters

§1060  Soft Sell

Key Points to Remember

Chapter 11. Releases and Covenants

§1100  In General

§1101 Release or Covenant Not to Sue

Sample: Release of All Claims

§1102 Releases and Covenants Functioning as Contracts

§1110  How a Release Works

§1111 Who and What Is Released? 

§1112 Bargaining for Fair and Adequate Consideration

§1113 Determining the Legal/Mental Capacity of the Claimant

§1113.1   Obtaining Court Approval

Sample:   Parents’ Release and Indemnity Agreement

§1120  Specific Releases

§1121 Open/Limited Release

§1122 Signed Releases

§1123 Witnessed/Notarized Releases

§1124 When No Release is Signed—Walk Away Settlements

§1125 Signing Multiple Releases

§1126 Recording Releases Over the Telephone—A Very Questionable Practice

§1127 Reserving Extra Contractual Damages

§1128 Good Faith Release and Multiple Parties

§1129 Parents Release Indemnity Agreement

§1130  Breaking the Written/Signed Release

§1131 Fraud or Misrepresentation in the Inducement to Sign a Release

§1132 Reformation of the Release

§1133 Good Faith Settlement Exposure

§1133.1   Sliding Scale Rule

§1140  Covenants Not to Execute and Assignments

§1150  Mary Carter Agreements

§1160 Release of the Claim and Bad Faith

§1170 High Low Agreements

Key Points to Remember

Chapter 12. How to Estimate Bodily Injury Settlements

§1200  In General

§1201 What Is a Settlement Offer?

§1202 What Is the Scope of Bodily Injury Settlements?

§1203 What Is the Basis of Bodily Injury Settlements?

§1203.1   Disputed Liability or Damages

§1203.2   Undisputed Liability or Damage

§1210  Categories of Bodily Injury Damages

§1210.1   Current Damages

§1210.2   Future Damages

§1210.3   Rehabilitation Damages

§1210.4   Punitive Damages

§1210.5   Loss of Enjoyment of Life Damages

§1210.6   Loss of Inheritance

§1210.7   Loss of Consortium

§1220  Thirteen Steps in Evaluating a Bodily Injury Claim

§1220.1   Step One: Legal Liability of the Defendant

§1220.2   Step Two: Credibility and Quality of the Plaintiff

§1220.3   Step Three: Credibility of Plaintiff’s Doctor

§1220.4   Step Four: Pre-Existing Injuries

§1220.4.1  No Accounting

§1220.4.2  Independent Accounting

§1220.4.3  Double Conditional Accounting

§1220.4.4  Single Conditional Accounting

§1220.5   Step Five: Current Medical Expenses

§1220.6   Step Six: Current General Damages

§1220.6.1  Low Range Example

§1220.6.2  Mid Range Example

§1220.6.3  High Range Example

§1220.7   Step Seven: Current Lost Wages or Income

§1220.8   Step Eight: Future Medical Expenses—Projected

§1220.9   Step Nine: Future General Damages

§1220.9.1  Low Range Example

§1220.9.2  Mid Range Example

§1220.9.3  High Range Example

§1220.9.4  Special Note: Lifetime General Damages

§1220.10 Step Ten: Future Lost Wages or Income—Projected

§1220.11 Step Eleven: The Vocational/Professional Rehabilitation Expenses

§1220.12 Step Twelve: Punitive Damages

§1220.13 Step Thirteen: Loss of Enjoyment of Life Damages

§1230  Physical Capacities Evaluation

§1231 Some Plaintiffs May Be Barred From Recovery for Pain and Suffering

Key Points to Remember

Chapter 13. Underinsured Motorist Coverage

§1300  Elements of Coverage

§1301 The Insured Claimant’s Auto Policy Must Contain Coverage

§1302 The Claimant Must Sustain a Bodily Injury

§1303 The Claimant Must Be Legally Entitled to Recover From the Underinsured Motorist

§1304 The Underinsured Motorist Must Be Insured—Otherwise an Uninsured Motorist Claim

§1305 The Underinsured Motorist Must Have Bodily Injury Coverage With Limits Less Than the Claimant’s Underinsured Limits

§1306 The Insured Claimant’s Insurer Stands in the Shoes of the Underinsured Motorist

§1306.1   Potential Conflict of Interest

§1306.2   Avoiding Bad Faith by the Insurer

§1307 Arbitration of Disputes

§1307.1   Legal Liability

§1307.2   Damages

§1307.3   Total Damages—Not Policy Limits Damages

§1310          Procedures and Statute of Limitations Issues

§1311 The Insured Claimant’s Bodily Injury Claim Must Be in Excess of the Underinsured Motorist’s Policy Limits

§1312 Putting the Underinsured’s Insurer on Certified Written Notice of Underinsured Coverage Claim

§1313 File Suit Against Underinsured Motorist

§1314 Get “Permission” From the Underinsurance Insurer to Settle With Underinsured Motorist

§1314.1   Exception

§1320  Offset and Exclusions

§1321 Excess Bodily Injury Claims of Both Policies

§1322 Computation of the “Total” Value of the Bodily Injury

§1322.1   Reasonable Expectation of the Insured Claimant—Policy Limits Due Without Offset

§1322.2   Collateral Source Doctrine May Apply—No Offset

§1322.3   Exhaustion of Primary Limits of Liability

§1323 Exclusions

§1330  Minors

§1331 Most Policy Time Limits Apply Equally to Adults and Minors

§1340  Stacking Policies

§1341 Multiple Vehicles on a Single Policy

§1342 Multiple Policies for Multiple Vehicles Issued to the Insured

§1343 Independent Multiple Policies

§1350  Distinguishing Uninsured From Underinsured Motorist Coverage

§1360  Subrogation

§1370  Underinsured Motorist Carriers Bad Faith Conduct

§1380  Special Notes

§1390  Punitive Damages

Key Points to Remember

Chapter 14. How to Take a Claims Representative’s Deposition

§1400  Pre-Deposition Homework

§1410  Subpoenaed or Requested Documentation

§1410.1   The Claims File and Loss Reserves

§1410.2   The Claims Manual

§1410.3   The Policy Manual

§1410.4   The Claims Representative’s Personnel File

§1410.4.1  Job Description

§1410.4.2  Goals for Previous Year of Employment

§1410.4.3  Goals for Current Year of Employment

§1410.4.4  Promotions or Demotions—Why?

§1410.4.5  Case Load Count

§1410.4.6  Enrolled Courses and Education

§1410.4.7  General Duties and Responsibilities

§1410.4.8  Longevity-Old Timer or Rookie?

§1410.4.9  Why Was the Claims Representative Assigned This Particular File?

§1410.4.10          The Attorney/Adjuster

§1410.5   The Insurance Policy—Make Sure You Have a Complete Copy

§1410.5.1  Endorsements

§1410.5.2  Amendments

§1410.5.3  Policy Jacket

§1410.5.4  Declaration Sheet(s)

§1410.5.5  Application

§1410.6   Loss Reserve History

§1410.6.1  Original

§1410.6.2  Changes

§1410.6.3  Discoverability

§1410.6.4  Reinsurance Documents

§1410.7   The Agent’s Policy File

§1410.8   The Agent’s Claims File

§1410.9   The Reinsurance Treaty

§1410.10 The Reinsurance Claims File

§1410.11 The Underwriting File

§1410.12 Training Manuals/Publications

§1410.13 The Marketing/Advertising Brochures

§1410.13.1          Promises Made to Induce New Business

§1410.14 Consumer Surveys/Spot Checks

§1410.15 Special Reports

§1410.15.1          Reinsurer

§1410.15.2          Pacific Coast Index Bureau

§1410.15.3          Property Insurance Loss Register

§1410.15.4          Suit Committees

§1410.16 Insurer’s Philosophies

§1410.16.1          Service

§1410.16.2          Peace of Mind

§1410.16.3          Trust

§1410.16.4          Compliance With Unfair Claims Practices Acts

§1410.17 Employee’s Orientation Manual

§1410.18 Log of Public/Policy Holder Complaints

§1410.19 Register of Complaints

§1410.20 Company Guidelines for Letter Writing

§1410.21 Chart of Claims Network—Chain of Command

§1410.22 Financial Reports

§1410.23 Ethical Codes to Which the Insurer Subscribes

§1410.24 Outline: Request for Production of Documents

§1410.25 Bad Faith Lawsuits

§1410.26 Reserves

§1410.27 Video Magazines

§1420  Interrogatories to the Claims Representative

§1430  The Deposition Notice

§1431 Has the Claims Representative Brought All Claims Files?

§1432 Have the Claims Representative Bring the Claims Manual

§1440  The Deposition—Introduction

§1440.1   Video Depositions

§1440.2   Setting the Stage for Your Examination

§1450  The Deposition—Foundation

§1460  The Deposition—The Case in Chief

§1470  Spoliation of Evidence

§1480  Attorney-Client Privilege

§1490  Special Deals Between Insurers and Court Reporters

Key Points to Remember

Chapter 15. Bad Faith—Bad News

§1500          General Principles and Definitions

§1500.1   Scope of Coverage

§1500.2   Origins of Bad Faith Actions

§1501 Bad Faith

§1501.1   Non Insurance Companies — HMO

§1502 Extra-Contractual Damages

§1503 Assignment of Bad Faith

§1504 Lien Rather Than Assignment

§1505 A Working Definition of Bad Faith

§1505.1   The Unreasonable

§1505.2   Withholding

§1505.3   Policy Benefits

§1505.4   Without Proper Cause—Excuse

§1505.5   Equitable Subrogation by an Excess Insurer

§1506 Alter Ego: Parent and Subsidiary Corporations

§1510          The Four Major Areas of Bad Faith

§1511 Wrongful Denial of Coverage

§1511.1   Failure to Indemnify the Insured for Property First Party Claims

§1511.2   Failure to Defend the Insured and Pay Settlements and Judgements on the Insureds Behalf

§1511.3   To the Claimant

§1512 Unreasonable Delay of Benefits

§1513 Underpayment of Claimed Benefits

§1513.1   Intentional

§1513.2   Negligent

§1520          First Party Bad Faith

§1521 Implied-in-Law Covenant

§1521.1   Use of Unfair Claims Practices Statutes

§1522 Fiduciary Duties Owed the Insured

§1523 ERISA

§1524 Premature Arbitration by Insurer

§1524.1   Bad Faith Arbitration

§1525 Third Party Beneficiaries—When Can They Claim Insured Status?

§1526 Additional Insureds

§1530          Bad Faith Wrongful Death

§1540          Theories of Extra-Contractual Damages for First Party Claimants

§1541 Common Law Bad Faith

§1542 Examples of Unreasonable Withholding

§1542.1   Deceptive Claims Practices

§1542.2   Intimidation Claims Practices

§1542.3   Failure to Communicate

§1542.4   Failure to Educate

§1542.5   Capricious Cut-Off of Benefits

§1542.6   Arbitrary Declaratory Relief

§1542.7   Failure to be Objective

§1542.8   Distorted Policy Interpretation

§1542.9   Unreasonable Delay of Payment

§1542.10 Failure to Thoroughly Investigate

§1542.11 Failure to Reconsider Denial

§1542.12 Breaches of Unreasonableness During Litigation

§1542.13 Failure to Settle When Liability Is Reasonably Clear

§1542.14 Incompetence of Insurer’s Investigator

§1542.15 Extortion

§1542.16 Encouraging Adjusters to Practice Lowballing Insurance Claims

§1542.17 Failure to Defend

§1542.18 Bad Faith/Negligent Defense

§1542.19 Interference With the Insured’s Representation

§1542.20 Forcing Claimant Into Arbitration

§1543 Breach of Fiduciary Duty

§1543.1   Service

§1543.2   Peace of Mind

§1543.3   Trust

§1544 Statutory Bad Faith

§1545 Exception to the “Fairly Debatable Rule”

§1546 Denial of Claim Based on Void Exclusion

§1547 Fraud

§1548 Insurer’s Negligent Release of the Insured’s Claim Against a Third Party

§1549 Negligent Referrals

§1550          Theories of Extra-Contractual Damages for Third Party Claimants

§1550.1   Fraud, Deceit, Misrepresentations

§1550.2   Intentional Infliction of Emotional Distress

§1550.3   Excess Judgments

              §1550.3.1  Excess Insurer’s Bad Faith Claim Against Primary Insurer

§1550.4   Trial of Bad Faith Claim Before Coverage Issue

§1550.5   Third Party Beneficiary

§1550.6   Statute

§1550.7   Case Law

§1550.8   Lack of Coverage Under Policy

§1550.9   Reserved

§1550.10 Strict Liability

§1551 Coaching the IME Doctor

§1552 Information Sharing by SIUs

§1560          Defenses to Bad Faith Actions

§1561 Statutory Privilege

§1562 No Unreasonable Withholding

§1563 Release of Bad Faith

§1564 Mandatory Arbitration

§1565 Claims Representative’s Reliance on Advice of Counsel

§1566 Statute of Limitations

§1566.1   “Time to Sue” Policy Provision

§1567 Comparative Bad Faith

§1568 Federal Pre-Emption

§1568.1   Exceptions

§1569 Workers’ Compensation Exclusive Remedy

§1569.1   Exceptions

§1570          Damages

§1571 Tort or Extra-Contractual Damages

§1572 Contractual Damages

§1572.1   Non Adjunct Bad Faith Cases

§1573 Punitive Damages

§1574 Warning Signs of Punitive Damages

§1575 Emotional Damage Need Not Flow From Economic Loss

§1576 Treble Damages Under RICO

§1580          Bad Faith Liability When There Is No Coverage

§1590          Public Bad Faith Fines

§1591 Defendant—Independent Adjusting Firms

§1592 Tort Reform Has no Effect on Insurance Premiums

Key Points to Remember

Chapter 15A. Extraordinary Bad Faith Cases

§1500A    Introduction

§1501A     Campbell v. State Farm Insurance

                §1501.1A  Update

§1502A     Middler v. State Farm Insurance Companies

§1503A     State Farm Fire and Casualty Company v. Superior Court (Taylor)

                §1503.1A  Declarations of Amy Zuniga in State Farm v. Superior Court

                §1503.2A  Declaration of Amy Zuniga in Stoliar v. State Farm

§1504A     Robinson v. State Farm Mutual Automobile Insurance Company

§1505A     Betty Olson v. State Farm Mutual Insurance Company

§1506A     Allstate Insurance Company's 9000 Reconsideration Claims

§1507A     State Farm Auto Insurance Company Takes a $1.2 Billion Hit

§1508A     Teresa Goodrich v. Aetna U.S. Health Care of California, Inc.

§1509A     Diamond v. General American Insurance Company

Chapter 15B.  Common Claim Myths

§1500B  In General

§1501B  Myth #1:  “Threatening to File Suit Will Soften Adjuster’s Position”

§1502B  Myth #2:  “Insurers and Adjusters Use ‘Three-Times-Specials’ Formula”

§1503B  Myth #3:  “It’ll Be More Expensive to Defend Than to Settle”

§1504B  Myth #4:  “Time Limit Demands Usually Expedite Adjuster Responses”

§1505B  Myth #5:  “Adjusters Receive Bonuses Based on What They ‘Save’ Off a Claim”

§1506B  Myth #6:  “Adjusters Cannot Evaluate Cases as Well as Attorneys”

§1507B  Myth #7:  “The Insurer Denied My Claim; However, I am Confident That the Claim Is Covered. If I Ask the Insurer to Reconsider, I Probably Will Not Have to Sue to Get Coverage”

§1508B  Myth #8:  “A Wrongful Denial of a Claim Will Automatically Subject the Insurer to Punitive Damages”

§1509B  Myth #9:  “The Insurer Must Have a Reasonable Basis for Denying the Claim Because It Issued a Long Letter Explaining That the Claim Is Denied”

§1510B  Myth #10:  “I Was Treated so Badly by the Insurance Company That I am Certain a Lawyer Will Take My Case on Contingency”

§1511B  Myth #11:  “If I Sue the Insurance Company, It Will Teach Them a Lesson and They Will Not Do the Same Thing to Other People”

§1512B  Myth #12:  “I lost the Insurance Policy Copies That Prove I Have Used This Insurance Company for the Last Twenty Years, and the Insurer Is Required to Have Saved Copies”

§1513B  Myth#13:  “The Adjuster Working on May Claim Is Probably Well Trained and the Insurer Would Not Use the Adjuster if the Adjuster Did Not Know What He/She Was Doing”

§1514B  Myth #14:  “The Adjuster Working on the Claim Is Directly Employed by My Insurance Company”

§1515B  Myth #15: “My Claim Is Clearly Covered and the Insurer Has Not Asserted Any Policy Limitations, Defenses or Exclusions; Therefore, I Should Expect the Claim to Be Paid Within the 30-Day Period Prescribed by Most Insurance Regulations”

§1516B  Myth #16: “The Insurer Says the Policyholder’s Conduct Related to the Claim Was Intentional and Therefore They Are Justified in Denying My Claim

Chapter 16. Settling the $5,000 to $75,000 Bodily Injury Claim

§1600  Introduction: The “Bread-and-Butter” Case

§1610  This Is Not the Lottery

§1620  Limited Partnership

§1630  Funding the Settlement

§1640  Finding the Funder

§1650  Preparation for Preliminary Negotiations

§1660  The Sale—What the Case Is Worth

§1670  Hypothetical Case From Start to Finish

§1671 Sample: Settlement Letter to Adjuster re Hypothetical Case

§1672 Analysis of Demand Letter

§1673 Conclusion

§1673.1   Attorney’s Liability-Settling Too Low

§1680  Trying the “Bread and Butter” Case

Chapter 17. Uninsured Motorist Claims

§1700  Introduction

§1710  Definition of Uninsured Motorist Vehicle

§1711 Causal Connection of Bodily Injury

§1720  Definition of Insured

§1721 Third Party Beneficiaries

§1730  Uninsured Motorist Coverage

§1731 Limits of Liability

§1732 Stacking Coverage

§1733 Property Damage

§1734 Offset Procedures

§1735 Notice to Insurer

§1736 Relatives

§1737 Joint and Several Liability

§1738 Physical Contact

§1740  Statute of Limitations

§1750  Discovery

§1760  Arbitration

§1761 Amounts Recoverable in Arbitration

§1770  Subrogation

§1780 Exclusions

§1790  Offsets

Chapter 18. The Claims Department and the Claims Manual

§1800  Insurance Is a Transfer of Risk for Money Involving Loss Ratios

§1810  What the Policy Promises

§1811 What the Agent Said the Policy Promises: Is It a Managing General Agent?

§1812 What the Advertising Implies That the Policy Promises

§1813 What the Courts Say the Policy Promises

§1814 Implied Promises—Minimum Standards

§1815 Four Corners of the Philosophy

§1815.1   Service

§1815.2   Trust

§1815.3   Protection

§1815.4   Peace of Mind

§1820  Who Carries Out Promises—The Claims Department

§1821 The Claims Department—The Leak in the Dike

§1830  The Claims Manual

§1831 General Topical Sections

§1831.1   Forward

§1831.2   Draft Authority

§1831.3   Components of a Prompt, Thorough, Objective File: Example—Automobile Claim

§1831.4   Statements

§1831.5   Desirability of Risk

§1831.6   Index Bureau

§1831 7   Releases

§1831.8   Lien Laws—Attorneys, Doctors and Hospitals

§1831.9   Time Limit/Policy Limit Demands

§1831.10 Federal Tort Claims Act

§1831.11 Alternative Settlement Options

§1831.12 Advances for Medical Payments and Wage Loss Claims

§1831.13 No Release

§1831.14 Admitted Ambiguity in Policy

§1831.15 Like Kind and Quality Parts

§1831.16 Depreciation Tables and Betterment

§1831.17 Glass Breakage

§1831.18 Conference Report on Fair Insurance Claims Adjustment—Preamble

§1831.19 Guiding Principles Relating to Auto Insurance Claims

§1831.20 Statement of Principles in Determining Damage to Vehicles

§1831.21 National Conference of Lawyers and Liability Insurers Guiding Principles

§1831.22 First Call Bodily Injury Settlements

§1831.23 Denial of Claim

§1831.24 Concurrent Insurance Coverage

§1831.25 Comparative Negligence

§1831.26 Non-Waivers

§1831.27 Boilerplate Policy Defenses

§1831.28 Permissive User

§1831.29 Subrogation

§1831.30 Arbitration

§1831.31 Inter-Insurance Arbitration Agreement

§1831.32 Staffing Ratio—Adjusters to Caseload

§1831.33 Education

§1831.33.1          Claims Schools

§1831.33.2          On-the-Job Training

§1831.33.3          Continuing Education

§1831.34 Those Other Doctors

§1831.35 Coverage Inclusions and Exclusions

§1831.36 Excess Liability Insurer’s Duties Are Triggered Prior to Primary Policy Exhaustion

§1832 Counsel’s “Claims Manual”

§1840  The Claims Representative as a Witness

§1850  Reservation of Rights Letter

Sample: Reservation of Rights Letter

§1860  Proof of Loss

§1870  Investigation Practices

§1871 “Questionable” Claims

§1872 Investigations That Violate Claims Manual

§1880  Claim Department Payment Policies Can Vary

Key Points to Remember

Table of Cases

Index