Monthly Archives: April 2014

California Court Holds an Adjuster May Be Personally Liable for Misrepresentations Made to the Insured

Earlier this month, an intermediate level California court rejected arguments that an insurance company’s adjuster owes no independent duty to the policyholders and cannot be liable even for “appalling” misconduct if he is acting within the course and scope of his employment. According to the panel, the adjuster occupies the same “special relationship” with the insured as the insurance carrier does, and he can, therefore, be independently liable for the tort of negligent misrepresentation during the adjustment. In Bock v. Hansen, — Cal.Rptr.3d —, 2014 WL 1315314 (Cal. App. 1st Dist. Apr. 2, 2014), Michael and Lorie Bock submitted a claim to their insurerafter a 41-foot, 7,300 pound tree limb crashed onto their home. The insurer assigned an adjuster, Craig Hansen,

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Posted in Investigation, Loss Adjustment

Florida, Georgia and Texas Appraisal Update: Is Causation A Coverage Question For The Court or A Damages Question for The Panel?

In most jurisdictions, underlying coverage issues must be resolved prior to invoking appraisal in a first-party property claim.  The question of what constitutes a coverage issue (typically reserved for a court’s judicial determination) and what constitutes a damage issue (appropriate for an appraisal panel’s consideration), however, is not always readily apparent. A routine subject of this particular appraisal debate is whether causation is a coverage or a damages inquiry, and recent decisions under Florida, Georgia and Texas law are evident of two things: (1) the determination of the issue is, in large part, factually dependent; but (2) the debate is far from over. In a recent appellate decision, Citizens Prop. Ins. Corp. v. Denetrescu, 2014 WL 1225124, — So.3d —

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Posted in Arbitration and Appraisal, Causation, Preservation and Protection, Wear and Tear

Tenth Circuit Holds That Two-and-One-Half Years and Two-and-One-Half Million Dollars Do Not Constitute Prejudice

In BSC Holding, Inc. et al. v. Lexington Ins. Co., — Fed.Appx. –, 2014 WL 929194 (10th Cir., March 11, 2014), the Tenth Circuit recently underscored  how difficult it can be for an insurer to demonstrate prejudice as a result of late notice.  The District of Kansas had granted summary judgment to Lexington, but the Court of Appeals reversed and sent the matter back to the lower court, holding that “substantial prejudice” had not been shown despite the fact that the policyholder had waited two-and-one-half years to notify the carrier and had spent $2.5 million dollars before doing so. Lyons Salt Company owned a salt mine in Kansas.  In January 2008, mine workers detected an inflow of water into the

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Posted in Investigation, Notice, Water
About The Property Insurance Law Observer
For more than four decades, Cozen O’Connor has represented all types of property insurers in jurisdictions throughout the United States, and it is dedicated to keeping its clients abreast of developments that impact the insurance industry. The Property Insurance Law Observer will survey court decisions, enacted or proposed legislation, and regulatory activities from all 50 states. We will also include commentary on current issues and developing trends of interest to first-party insurers.
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