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Texas Court Addresses What Constitutes an “Itemized” Appraisal Decision

On Tuesday of this week, a unanimous panel of Texas’ intermediate level appellate court rejected arguments that an appraisal award that set forth lump sum replacement cost, depreciation, and actual cash value amounts for real property, personal property, and additional living expense was not sufficiently “itemized.”  In Cantu v. Southern Ins. Co., 2015 Tex. App. LEXIS 8847 (Aug. 25, 2015), it also rejected the policyholder’s contention that a court, having appointed an umpire when the two appraisers were unable to agree, was without authority to remove him and select a replacement.  The decision is not currently reported on WestLaw. The insured’s home was damaged by 2011’s massive Bastrop County Complex Fire.  After disputes arose over the amount of loss, the

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Posted in Arbitration and Appraisal, Fire, Wildfire

Hurricanes vs. Wildfires — 2015’s Dramatic Contrast

Two of this blog’s four rotating headers depict a hurricane and a fire as examples of potentially-destructive types of property damage, and the hurricane season (June through November) and the wildfire season (late spring through mid-fall) are both well under way.  This year has brought good news to the east coast with respect to the former and catastrophically bad news to the west coast with respect to the latter. There are obviously many reasons for this.  The west is undergoing a historically severe drought; the snowpack in California is currently 5% of what it should be.  The region is also suffering from extreme heat; 2015 is the second warmest year ever recorded in Alaska, and temperatures in the west as

Posted in Fire, Hurricane, Wildfire

Texas Court Rejects Ambiguity Arguments Bottomed on a Single Phrase

Last Thursday in King v. Burwell, 2015 WL 2473448, 2015 U.S. LEXIS 4248 (U.S., Jun. 25, 2015), Chief Justice Roberts explained that “[a] provision that may seem ambiguous in isolation is often clarified by the remainder of the statutory scheme” when construing a law.  In the same fashion, it is inappropriate to find ambiguity residing in a single phrase in a contract of insurance when the meaning can be clarified by referring to the policy as a whole.  That was the teaching of a recent opinion by a unanimous panel of Texas’ intermediate level appellate court in 3109 Props. L.L.C. v. Truck Ins. Exch., 2015 WL 3827580, 2015 Tex. App. LEXIS 6146 (Tex.Ct.App., Jun. 18, 2015). The insured was filmmaker

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Posted in Ambiguity, Fire, Newly-Acquired Property, Wildfire

Ninth Circuit: Under Arizona Law Mudslide Can Be Covered as the Direct Result of Fire

Last Friday, a unanimous panel of the Ninth Circuit held that loss from the excluded peril of mudslide occurring one month after a wildfire could be covered as the “direct” result of the blaze.  In Stankova v. Metropolitan Prop. & Cas. Ins. Co., 2015 WL 3429395, 2015 U.S. App. LEXIS 8935 (9th Cir., May 29, 2015),  it reached that result even though Arizona has not adopted the efficient proximate cause rule, saying that it did not need to apply that doctrine to determine that the mudslide “could have been directly and proximately caused by the wildfire.” It also blithely ignored anti-concurrent causation (ACC) language, which is given effect in Arizona, as “inconsistent with Arizona’s standard fire insurance policy, which insures

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Posted in Anti-Concurrent Causation, Causation, Direct Physical Loss or Damage, Efficient Proximate Cause, Exclusions, Flood, Mudslide, Wildfire

Arizona Court: Argument that All Business Income Loss Caused by a Wildfire is Covered is “Off Base”

Several weeks ago in White Mt. Communities Hosp., Inc. v. Hartford Cas. Ins. Co., 2015 WL 1755372, 2015 U.S. Dist. LEXIS 50900 (D. Ariz., Apr. 17, 2015), an Arizona federal court underscored that business interruption losses flowing from a wildfire are only covered to the extent that they stem directly from physical loss or damage to the policyholder’s property.  In other words, loss of income due to the fire in general is beyond the scope of such coverage absent a causal nexus with repairs necessitated by the blaze. The policyholder White Mountain owned a hospital in Springerville, Arizona.  On May 29, 2011, a blaze was started by an abandoned campfire in the nearby Bear Wallow Wilderness Area.  The wildfire ultimately

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Posted in Business Interuption, Causation, Contamination, Direct Physical Loss or Damage, Fire, Smoke and Soot, Wildfire
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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