From the November 2001 Update
Chapter 1. Introduction to the Claims
Game
§100 In General
§110 The Game
§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
§116 Reciprocal Presentations
§117 Dual Adjustments
§118 The Sale
§119 No Sale—Go Straight to Trial
§120 Avoiding Bad Faith
§120.1 How to Avoid Bad
Faith Allegations
§130 The Players
§131 The Plaintiff—A Fortuitous Person
§132 The Insured—Protectee
§133 The Agent—Middleman
§134 The Insurer—Protector
§135 The Adjuster—Bull or Bear
§135.1 Adjusting the
Adjuster
§136 The Attorney—Adversary or Assistant
§137 The Insurance Commissioner—Regulator
§138 The Courts—The Means of Last Resort
§140 The Rules of the Game
§141 Showing of Good Faith
§142 Fair Dealings
§143 Settlement—Voluntary or Involuntary
Methods
§150 Duties Owed
§160 Common Insurance Industry Acronyms
§170 Locating Old Policies
§171 Insurance Premium Payment Records
§172 Certificates of Insurance
§173 Prior Company’s Sales/Mergers
§174 Staff Reports
§175 State Insurance Departments and Former Law
Firms
§176 Insurance Company Computers
§180 Rescission—The Ultimate Defense to Claims
§190 Insurance Fraud—New Interest in an Old Problem
§190.1 Claim Withdrawal
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
§207 Ratification of a Known Misrepresentation
– Waiver
§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 Adjusting by the Agent
§212.1 Conflict of Interest
§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
§214.1 Referral to the
“Other Carrier”
§214.2 Talking the Insured
Out of a Claim
§214.3 Bad Faith
§220 Agent’s Initial Report to Claims Department
§221 All Lines of Coverage Confirmed
§222 Policy Number Verified
§223 Limitations
§224 Policy Exclusions
§224.1 Unreasonable
Insurance Clauses
§224.2 Ambiguous Clauses
§225 Policy Exclusion Rider(s)
§226 Cancellation—Nonpayment of Premiums
Sample: Cancellation Notice
§227 Negligent Misrepresentation of Coverage by
Agent
§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
§230.11 Special
Facts—Important People
§230.12 Agent’s
Opinion—Instructions
§230.13 Bodily Injury
§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 Anatomy of the Insurance Industry
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
§303 Coverage Documentation
§304 Duties of Primary Insurers Owed to Excess
Insurers
§310 Fact Finding Team Assignments
§311 Coverage Claims Questions
§311.1 Independent Team
Assignment
§311.2 Avoiding Conflict of
Interest
§311.3 Objective
Investigation
§311.4 Separate Claims
Offices
§320 Local and Companywide Claim Numbers
§321 Multiple Claims Offices
§330 Late Reporting Problems
§331 By the Insured
§332 By the Agent
§333 By the Broker
§340 Checklist for Coverage Investigations
§350 Checklist for Factual Investigations
§360 “First Call” Settlements
§361 Diary Dates
§362 Non-Waiver Guidelines with Specificity
§363 Reservation of Rights Guidelines with
Specificity
Sample: Reservation of Rights Letter
§364 Independent Attorney Opinion Letter
§365 Carbon Copy Notice
§366 Preliminary Reserves
§366.1 Lines of Coverage
§366.2 Legal Costs
§367 Agent’s Bad Faith Exposure
§367.1 Delays
§367.2 Denials
§370 Controlling the Attorney
§380 Proofs of Loss
§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 In General
§401 Reasonable Expectation of the
Insured—Intent
§401.1 Pre-Tender Defense
Costs
§401.2 Conspicuous, Plain
and Clear Notice of Change in Policy
§401.3 Marketing Brochures
§402 Insurer’s Duty to Avoid Conflict of
Interest
§402.1 Avoiding Potential
Conflicts
§402.2 Special First Party
Conflict of Interest
§403 Agent/Broker Liability
§403.1 Status as Agent or
Broker
§403.2 Standard of Care
§403.3 Damages
§403.4 Liability to Third
Party
§403.5 Liability to Insurer
§410 Fiduciary Disclosure by the Insurer
§411 Good Faith and Fair Dealings
§412 Cumis-Attorney Disclosure: Third Party
§413 Cumis-Attorney Disclosure: First Party
§413.1 Rationale: Unequal
Bargaining Power
§420 Documents Necessary for a Coverage Investigation
§420.1 Insured’s File
§420.2 Application for
Insurance
§420.3 Agent’s File
§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 Policy
Endorsements
Sample: Endorsement
§420.11 Underwriting Manuals
§420.12 Outside Independent
Legal Opinion
§420.13 Drafting History of
Policy Forms
§430 Obtaining the Necessary Statements
§440 Policy Defenses
§440.1 Intentional Conduct
by the Insured
§440.2 No Insurable Interest
§440.3 Occurrence Not Within
Term
§440.4 Undefined Policy
Language
§440.5 Failed Policy
Condition
§440.6 Exclusions
§440.6.1
Ambiguous or Deceptive Headings for Exclusions
§440.7 Not a Bodily Injury
§440.8 Policy Limitations
§440.9 Manifested Losses
§440.9.1
Undiscovered Manifestation
§440.9.2
Discovered Manifestation
§440.10 Failure to Plead
Damages
§440.11 Prorating Coverage
§440.12 Vehicle
Ownership, Maintenance, Use, or Operation
§440.13 Pre-Existing
Condition
§440.14 Prejudice
§450 Contract Defenses
§450.1 Fraud/Rescission:
Voiding the Policy
§450.2 Mistake and
Reformation
§450.3 Policy Cancelled
§450.4 Elimination of
Coverage
§450.5 Covered Malicious
Torts
§450.6 Partial Defenses
§460 Occurrence Issues
§470 Good Faith Coverage Investigation
§471 Alternative Coverage Investigation
§472 Numerous Theories of Denial—Waiver
§473 Exclusions Must Be Conspicuous, Plain and Clear
§473.1 Family, Household
Exclusions Void as Against Public Policy
§474 Stacking of Auto and Homeowners Liability
Coverage
§480 Alternative Dispute Resolution
§481 Four Basic Methods
§482 Declaratory Relief Action
§490 Special Areas of Conflict of Coverage
§491 Minor’s Compensation
§492 Answering the Question of Concurrent Causation
§493 Y2K Claims
§493.1 Introduction
§493.2 First Party Coverage:
“Tangible Injury”?
§493.3 Time of Occurrence
§493.4 Damage to
Insured’s Product
§493.5 Sue and Labor
Clauses: An Old Approach to a New Problem
§493.6 Intended Usage and
Expected Injuries
§493.7 Directors and
Officer’s Liability
§494 Computer Virus-Homeowners
Coverage-Malicious Mischief/Vandalism
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”
Chapter 5. The Factual Investigation
§500 In General
§501 Contact and Control
§501.1 Introduction of a
Plaintiff’s Attorney
§502 The Preliminary Investigation
§502.1 Favorable Facts
§502.2 Unfavorable Facts
§503 Duty to Disclose Coverages
§503.1 Duty to the Claimant
§503.2 Duty to the Insured
§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
§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 Forms and 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
Sample: Authorization
§520.5 Advance Payments
Sample: Receipt for
Advance Payment
§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 Non-Waiver Agreements
Sample: Non-Waiver
Agreement
§521.8 Reservation of Rights
Letters
§521.9 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
§534.1 Seat Belt Experts
§534.2 Auto Accident
Reconstruction Experts
§534.3 Medical Defense
Doctor
§535 Independent Adjusters/Investigators
§536 Examination Under Oath Statements
§540 Excess Policy Limits
§541 Bodily Injury Claims
§541.1 Value of Each Claim
§541.2 Prorating/Compromise
§541.3 Interpleading
§542 Property Damage Claims
§542.1 Value of Each Claim
§542.2 Prorating/Compromise
§542.3 Interpleading
§550 Primary/Secondary/Umbrella Policies
§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 before Primary Insurer Pays Limits
§551 Anti-Stacking Rule
§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
§572 Reverse Bad Faith Letters
Sample: Bad Faith Letter #1
Sample: Bad Faith Letter #2
Sample: Bad Faith Letter #3
Sample: Bad Faith Letter #4
§573 Comparative Bad Faith
§580 Liens and Assignments—“Notice Claimants’’
§581 Medical Providers
§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 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
§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
Chapter 6. [Reserved]
Chapter 7. Settlement Negotiations and
Compromises
§700 In General
§700.1 Characteristics of
Good Negotiator
§700.2 Negotiating Tips
§700.3 The Seven Social Sins
of Negotiating
§700.4 Bodily Injury
Evaluation Form
§701 The Beginning of the Sale
§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
§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
§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 In General
§810 Lowballing
§811 Lowballing the Claimant
§812 Lowballing the Attorney
§813 Lowballing at Arbitration
§820 Unreasonable Delays
§821 Poor Claims Management
§830 Stonewalling
§831 “Benefits Delayed” is “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 Rubber Ball Express
§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
§850 Digging Into the Settlement Technique Grab Bag
§850.1 Seasonal Settlements
§850.2 Bad Faith Inclusion
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
§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 In General
§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 Coverages
§913 Policy Statute of Limitations
§914 Failed Condition of Policy
§914.1 No Report by Insured
§914.2 No Cooperation
§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
§919 Date of Loss Outside Policy Term
§920 Policy Exclusions
§921 Exclusion Riders
§921.1 Driver Exclusion
§921.2 Vehicle Exclusion
§921.3 Territory Exclusion
§922 Punitive Damages, Penalties, and Fines
§923 Family Member Exclusion Void: Public Policy
§930 Word Games
§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 Denials
§951 Dangerous Stand by Insurer
§960 Good Faith Stipulated Judgment After Refusal to Defend
§970 Blind Denials
§980 Overinsurance
Key Points to Remember
Chapter 9A. Claim Evaluation Software
§900A In General
§910A Voice of the Jury
§920A Colossus
§930A Jury Verdict Research
§940A Caveats and Opportunities
§950A Beware of GIGO
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 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 Oral Releases
§1121.1 Open 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
§1127 Reserving Extra Contractual Damages
§1128 Good Faith Release and Multiple Parties
§1129 Parents Release Indemnity Agreement
§1129.1 Court Approved
Settlements with Minors
§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
Sample Form: The Pain Questionnaire
Sample Form: Neck Disability Index
Sample Form: Physical Capacities Evaluation
§1240 Sample Bodily Injury and Negotiation Work Sheet
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 Procedure
§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 Documentation
§1410.1 The Claims File
§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
Claims Handling History
§1410.4.11
The Attorney/Adjuster
§1410.5 The Insurance Policy
§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
§1506 Alter Ego: Parent and Subsidiary Corporations
§1510 The Four Major Areas of Bad Faith
§1511 Wrongful Denial of Coverage
§1511.1 To Indemnify the
Insured
§1511.2 To Defend the
Insured
§1511.3 To the Claimant
§1512 Unreasonable Delay of Benefits
§1513 Underpayment of Claimed Benefits
§1513.1 Intentional
§1513.2 Negligent
§1514 Retrospective Premiums
§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 Beneficiary-Insured
§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 Return of Third
Party Bad Faith in California
§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
§1510B Myth #1: “Threatening to File Suit Will Soften
Adjuster’s Position”
§1520B Myth #2: “Insurers and Adjusters Use
‘Three-Times-Specials’ Formula”
§1530B Myth #3: “It’ll Be More Expensive to Defend Than to
Settle”
§1540B Myth #4: “Time Limit Demands Usually Expedite Adjuster
Responses”
§1550B Myth #5: “Adjusters Receive Bonuses Based on What They
‘Save’ Off a Claim”
§1560B Myth #6: “Adjusters Cannot Evaluate Cases as Well as
Attorneys”
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
§1735 Notice to Insurer
§1736 Relatives
§1737 Joint and Several Liability
§1738 Physical Contact
§1740 Statute of Limitations
§1750 Discovery
§1760 Arbitration
§1770 Subrogation
§1780 Exclusions
§1790 Offsets
Chapter 18. The Claims Department and the
Claims Manual
§1800 How Promises Are Made to Insured
§1810 What the Policy Promises
§1811 What the Agent Said the Policy Promises
§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
§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
§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
§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 Procedures and Investigation in Violation of
Manual
§1880 Claim Department Budgets
Key Points to Remember
Table of Cases
Index |
