Missouri Insurance Lawyer Blog

Insurance policies are complicated legal contracts between you, the policy holder, and the insurance company. Very often, when a policy holder makes a claim for damages they believe should be covered by their insurance policy, the insurance company will deny the claim citing a reason unknown or often misunderstood by the policy holder.
On December 27, 2011, the Missouri Court of Appeals, Eastern Division, decided an insurance case based on the disputed definition of "owned" and "resident". The case, Manner v. Schiermeier, et. al, and American Family Mutual Insurance Company and American Standard Insurance Company, Case No. ED96143, was a claim against the insurance companies for underinsured motorists coverage on four separate automobile insurance policies because of serious injuries suffered in a motorcycle collision.

The coverage on at least one of the insurance policies depended upon whether the injured Plaintiff "owned" the motorcycle which he was driving as that word was used in the policy. For purposes of the insurance policy, the Court of Appeals determined that even though the certificate of title was not yet in the Plaintiff's name, the undisputed facts demonstrated that the plaintiff held the motorcycle as his own possession, had paid for it, either in whole or in part; drove it; and was in the process of having title transferred to him; and had separately paid for liability and underinsured motorist insurance. Therefore the Court determined that the Plaintiff did indeed "own" the motorcycle for purposes of insurance coverage.

Continue reading "WHETHER OR NOT YOU RECOVER BENEFITS FROM YOUR AUTOMOBILE INSURANCE POLICY MAY DEPEND UPON THE DEFINITION OF A SINGLE WORD IN THAT POLICY" »

In the case of Long v. Shelter Insurance Company, the Missouri Western District Court of Appeals, held that Shelter Insurance's anti-stacking language in the underinsured motorist coverage was ambiguous because of the "other insurance" clause. The court concluded that Shelter's "excess" language in the "other insurance" clause as well as it's "other insurance in the company" provision created ambiguity when read with the policy's anti-stacking language. The court further went on to strike down the policy set off provision, holding that the interplay of the policy's declaration page, limits of liability, and its promise to pay uncompensated damages created ambiguity when viewed against the policy's set-off language.

Interestingly, on the same day the court also issued the opinion of Stewart v. Liberty Mutual Insurance Company holding in that case that the insured could not stack and that the UIM anti-stacking language was not ambiguous. In its decision, the court distinguished between the "excess" "other insurance" language in the Liberty Mutual policy from the "other insurance" provisions considered by the Missouri Supreme Court in Ritchie v. Allied Property and Casualty Insurance Company, 307 S.W.3d 132 (Mo. banc 2009). In its decision, the Western District relied on a decision which had already been partially repudiated by the Missouri Supreme Court. That decision, Farm Bureau Town & Country Insurance Company of Missouri v. Barker, 150 S.W.3d 103 (Mo. App. W.D. 2004), was noted by the Supreme Court to have not been cited in any other underinsured motorist decision since it was handed down, and to the extent it was inconsistent with Seeck v. Geico General Insurance Company, 212 S.W.3d 129 (Mo. banc 2000), Barker should no longer be followed. In a detailed decision, the Stewart court, relying on Barker, distinguished the excess provision from other provisions addressed in Ritchie and Seeck. The Missouri Supreme Court did not accept transfer of the case. However, given Ritchie's criticism of Barker, and the Western District's reliance on Barker, this issue almost certainly will be revisited in other cases. The Seeck case, which the Supreme Court cited with approval, relied on a long line of cases including Zemelman v. Equity Mutual Insurance Company, 935 S.W.2d 673 (Mo. App. W.D. 1996); Goza v. Hartford Underwriters Insurance Company, 972 S.W.2d 371 (Mo. App. E.D. 1998); Niswonger v. Farm Bureau Town & Country Insurance Company of Missouri, 992 S.W.2d 308 (Mo. App. E.D. 1999); American Family Mutual Insurance Company v. Ragsdale, 213 S.W.2d 51 (Mo. App. W.D. 2006) and Chamness v. American Family Mutual Insurance Company, 226 S.W.3d 1999 (Mo. App. E.D. 2007), which included similar language to the policy contained in Stewart, but reached opposite conclusions of Barker. Undoubtedly, insurers seeking to avoid underinsured motorist liability will avoid the language held to be ambiguous in Long v. Shelter Insurance Company, and move towards the language held not to be ambiguous in Stewart v. Liberty Mutual Fire Insurance Company in the future. Nonetheless, given the inconsistencies between the Stewart court's reliance on the Barker decision and its stark contrast with Seeck and its cases, the underinsured motorist stacking issue will continue to spawn numerous cases, and seemingly conflicting decisions.

The Missouri Department of Insurance states some insurance companies are setting unreasonable timelines for Joplin homeowners attempting to rebuild after the May 22nd tornado. The department issued a bulletin to the industry stating many home and business owners can't be expected to rebuild within the time limits required by some insurance policies.

In the bulletin, John M. Huff, director of the Department of Insurance, states the unprecedented scale of the Joplin tornado prevented many consumers from access to their property and led to a temporary building cessation. He also says the widespread devastation has left the entire area with a shortage of contractors and materials. This has clearly made it impossible for many property owners to rebuild within six months. Six months is the time frame that insurance policies require before paying full benefits.

The bulletin says insurance companies attempting to enforce deadlines of less than one year may face legal action by the department.

Per Huff: "The insurance industry has done a commendable job responding to the tornado, having paid more than a billion dollars in claims so far. At the same time, Missouri law requires insurers to provide prompt, fair and equitable settlements to their policyholders, and rigid deadlines may violate that law."

Huff expects the dollar figure for claims paid in homeowners, auto and commercial property to approach $2 billion by the time all claims are settled. Policyholders have filed nearly 18,000 insurance claims.

Read more here.

Last month, Governor Nixon signed two new laws into effect bringing additional insurance protections to consumers affected by damaging storms. The new laws provide consumers with better access to insurers and assign new rules for repair companies to avoid unscrupulous business practices.

Recently, some repair companies have begun calling themselves "insurance claims specialists" in hopes of gaining more business after a damaging storm. These repair companies offer to pay homeowner's deductibles and negotiate with the insurance companies on their behalf. The newly enacted Senate Bill 101 prohibits repair businesses from claiming insurance specialties, paying deductibles and negotiating with insurance companies.

The second new law, Senate Bill 132, guarantees insurance companies' ability to set up a mobile customer service center in storm damaged areas to help consumers get their claims filed faster. Earlier this year, insurance companies seeking to set up temporary centers were required by many cities, counties, and incorporated subdivisions and to purchase business licenses or special permits to set up their mobile centers. Thanks to the new law, Missouri insurance companies can now move quickly to set up mobile service centers wherever they're needed without bureaucratic hindrances.

For more information on these new laws, visit the Missouri Department of Insurance website.

Many Missourians have experienced devastating losses as a result of the storms that have ravaged the southern portion of the state in recent weeks. Thousands of people will be filing insurance claims and we want to help make sure those claims are handled properly by explaining a few situations that could happen with your insurance claims. Here are just a few things to take into consideration:

1. Many insurance companies use a property damage estimating software program called Xactimate. Prices in the program are updated on a quarterly basis. When a large storm strikes it is not uncommon for labor and materials prices in the area of the storm to increase, sometimes rapidly. As a result the prices in the Xactimate program may be outdated at the time of the storm because of the sudden increase in prices. Check with your insurer who uses this or similar programs to determine if they have updated their prices to reflect the increase in the prices immediately following the storm. If not, ask that they do so; otherwise your repair estimate may not accurately reflect the exact cost of repairs.

2. Standard homeowner policies provide that you are entitled to the full replacement cost for the repairs to your home. However, the insurer is only required to pay you the actual cash value of your repairs until you replace or repair your property, and then when that is done you can collect the difference between the replacement cost and the actual cash value. This difference is called the hold back. The hold back is determined by subtracting depreciation from the replacement cost estimate for your repairs. Therefore, if your repairs are estimated at $10,000 for replacement cost value, and the insurer determines that $1,000 depreciation should be subtracted from the replacement cost repair estimate, the insurer will then pay you initially only $9,000 (less your deductible). The $9,000 payment is called the actual cash value payment. Depreciation is determined by considering several factors, such as the wear and tear, age and obsolescence of the item being repaired or replaced. Insurers use a variety of schedules to determine what should be depreciated and for how much. Ask your insurance adjuster how they arrived at the depreciation rate for each item depreciated and what the depreciation rate is based upon to make sure that the appropriate depreciation rate is being applied. Make sure the adjuster is aware of the age of items to be repaired or replaced so that the proper depreciation rate can be applied. For example, the expected age of interior paint may be ten years. If you painted the inside of your house only two years ago, then the depreciation rate that should be applied to the paint job should only be 20%. If the insurer charges a higher rate you should question their depreciation reduction. Also, several items should not be subject to depreciation, such as pure labor items (i.e., remove and replace light fixture to paint room, etc.) or other items (i.e., profit, overhead, and sales tax, etc.) because these items are not subject to wear, tear and obsolescence. Read the insurer's estimate carefully to make sure that such items are not being depreciated.

3. For large losses (anything over $10,000) always get your own estimate from a local licensed general contractor who will commit to doing the work for the amount of his estimate. It is preferable that your contractor prepare an estimate on the same kind of estimating program that the insurer uses so that the two estimates can be easily compared. If there are differences between the insurer's estimate and your contractor's estimate have your contractor meet with the insurer's representative at the house to discuss the differences and have the insurer's representative explain why there are differences. Regardless, once the insurer determines what the repairs are, the insurer must pay you that amount, even though there may still be a disagreement between you and the insurer over any additional amounts that can be owed.

4. If there is a dispute between you and the insurer over the amount of the repairs consider taking advantage of the appraisal provision in the policy which is there to resolve disputes over the amount of the loss. In appraisal, you select a qualified appraiser that you pay, the insurer selects their own appraiser, which they pay, and the two appraisers select an umpire, and you and the insurance company share the cost of the umpire. The appraisal panel then determines the amount of the loss which the insurer must pay. Appraisal has some advantages, in that it can be quicker and less expensive than litigation where there is a dispute over the amount of the loss. Nonetheless, you should be careful in selecting your appraiser, and you should consider getting advice from qualified and experienced attorney on your selection as well as to how best proceed with the appraisal.

Do you have a judgment against an insurance company that is refusing to pay? You can obviously follow the general law and practices for executing on your judgment to collect the proceeds from the insurance company's assets. However, you should be aware of an alternate source of collection. Missouri Revised Statute Section 375.490 specifically provides that some or part of the judgment may be satisfied against funds held by the Missouri Department of Insurance. In the normal course of business insurers have to comply with the financial regulations and laws necessary to do business. Under these laws, depending upon the type of insurer, and the business they are engaged may have to deposit security in order to do business in Missouri. If a plaintiff has a partially or wholly unsatisfied execution, upon three days notice to the Director of Insurance, an execution may be served on the Director and the Director must dispose of said assets at the best price possible to satisfy said judgment. While this method is limited to any securities that are on deposit at the time, it is an often overlooked source for collecting funds against insurers. Almost every state in the union has a similar version of this statute which allows execution of a judgment against an insurer on funds held by the Department of Insurance as security for conducting business.

If you have an uncollected judgment against an insurance company you should be aware of these special provisions and how they can assist you in collecting what you are owed from the insurance company.

Continue reading "COLLECTING JUDGMENTS AGAINST INSURANCE COMPANIES" »

Sooner or later, it may become necessary for someone else to drive your vehicle and you want to make sure that there is insurance if they are involved in an automobile accident.

Generally, insurance follows the vehicle, not the driver. If it is your car, then the insurance coverage you have purchased for your vehicle would provide primary coverage. Any insurance policy your friend has purchased would become secondary. Primary simply means that your insurance company should pay the claim first. Then if your liability limits are exhausted, your friend's insurance should pay additional amounts up to his limits.

Please understand that if your friend is involved in an accident with your car, your rates could go up. Also, in some circumstances, if you are aware that your friend is not a safe driver and you allow him or her to drive your car, you could be held personally liable if they cause an accident that seriously injures another person.

Continue reading "Does My Friend Have Insurance Coverage If She Drives My Car?" »

Wrongful death claims allege, as their basis, that the deceased died as a result of the negligence or liability of another. The deceased's surviving relatives, dependents, or beneficiaries may bring suit against those claimed to have been responsible, seeking monetary damages to compensate for the losses. In Missouri there are classes of people who may bring the claim, depending on there relationship to the deceased. For example if your spouse is killed in a car crash, you and any natural or adoptive children would have a claim. A Missouri personal injury attorney in can advise you on whether you have a valid wrongful death claim and can help you pursue that claim to the best possible outcome. To learn more go to the wrongful death information center.

Missouri Supreme Court Continues to Hold Insurance Company Responsible for Clear Policy Language - Missouri Injury Lawyers Blog.

If you have been injured by negligence you have a personal injury claim. Depending on how the claim happened you may also have a property damage claim, such as damage to your car. If you want to pursue a claim for damages you should consult with an attorney experienced in personal injury law. Many claims can be handled without hiring a lawyer but you should always consult with a lawyer first because the law is complex and in your particular situation there may be reasons that an untrained person should not handle their own claim. For example, all personal injury claims are subject to statutes of limitations, which require that you bring your claim within the time period specified or your claim is forever barred. The general statute of limitation for personal injury in Missouri is five years, but that does not mean that is the time limit that applies to your case. Time limits can be drastically shorter depending on a variety of factors that a non-lawyer would not know. So step one is see a lawyer. Step two is asking your lawyer if this is something that they need to handle or if you could do it on your own. You may have claims or rights you don't know about so if you proceed without speaking to a lawyer you are taking a big risk.

Step three; if you proceed on your own collect all the information about how the injury happened such as accident reports, photos, witness names, addresses, and phone numbers. Get written or recorded witness statements and ask the witnesses to state what they saw, what they heard, and what they did. Finding all the witnesses may take some legwork because it's rare that all the witnesses are listed on accident or incident reports. Gather documentation to support your damages including, medical bills, and pharmacy records, lost wages, loss profits, expenses and property damage.

Once you have gathered all these documents make a demand upon the insurance company for the responsible person(s) that sets out how the incident happened, and your damages. A demand is simply a letter sent to the insurance company setting out the facts of your case and asking for an amount of money to settle your case. The letter should have the supporting information attached.

The total of all the bills, losses and expenses are called special damages. In addition to special damages you are entitled to compensation for pain and suffering. Pain and suffering is difficult to place a value on, but it is easier to get money for if you have evidence that supports the claim. Evidence includes pictures of injuries, medical records documenting pain, pain medication prescriptions, and witness testimony. Including this information in your demand will help you get the true value of your claim. If you can get a letter from your doctor setting out the injuries that you suffered as a result of the incident you should do so. If you have medical issues that pre-existed the injuries you claim from your accident then this is particularly important. Insurance companies often refuse to settle or make low offers when they believe there is evidence that you already had the injury before the accident. Any evidence you can use to support that the injury is new, different, or an aggravation is helpful.

Once you make your demand you then need to stay on top of your claim and make sure the insurance company makes a response. You also need to be responsive to the company's reasonable request for additional information. You should make your demand high enough so that you have room to negotiate down. There is no hard and fast rule for how much to demand, although insurance professionals often say 3 to 5 times special damages is typical for an opening demand. If the company makes an offer that is unacceptable you should negotiate to get to their best offer. If you can't get them to a reasonable sum, then you may wish to speak to a lawyer again. If you settle, make sure you carefully read and understand the release before you sign. Depending on your personal situation you may also have to satisfy liens of medical providers, health insurers, Medicare, Medicaid or others. You should also make proper claims under your insurance policies. If you were injured on the job or receiving social security disability you should consult with an attorney.

This article is an overview and provides tips on handling your own personal injury claim. It does not cover all the legal issues that may be presented in your particular case. This article is not legal advice and you should consult with a lawyer before proceeding on your own.

People purchase disability insurance to provide financial assistance in the event they become disabled and unable to work for a living. These policies are sometime purchased by an individual but most often they are provided as a benefit by an employer as part of a group plan. These policies are also commonly sold to professionals such as doctors and lawyers. Unfortunately, many legitimate disability claims are unfairly denied by the disability insurance companies, leaving policyholders without the benefits of a policy they have paid for.

If you have suffered a disability because of car crash or other tragedy or illness you may be entitled to benefits under your group or individual disability policy. If you insurance company denies your claim the law firm of Tatlow, Gump, Faiella & Wheelan may be able to help. To learn more visit our web site or give us a call at 1-800-264-3455.

Insurance companies have an obligation to defend and indemnify an insured under a typical liability policy. When a company is notified of the claim or suit the company should start performance of the contractual obligation which would include speaking with the insured, investigating, gathering facts, protecting evidence, hiring counsel for the insured, and responding to the claim. Sometimes under the policy language the insurance may have an exclusion under which the company does not have an obligation to defend and indemnify the insured. This is a problem for the insured, but insurance companies don't have to keep promises they don't make. Unfortunately companies don't always take a fair view of the facts or policy language and will not defend and indemnify the insured even when they should.

Many companies simply use a reservation of rights as standard operating procedure. This practice has become common and insurers often respond by sending letters reserving the right to deny coverage for as many reasons as possible and for any reason they can think of or discover in the future. Under an ROR the insurance company is saying, we will defend for now but we can still sue you in another lawsuit to get a court to decide that we don't have to defend or indemnify you. Many insurance companies also fail to honor their obligation to fairly consider settlement when an ROR has been issued. Unfortunately for the insured this means massive uncertainty, possible loss of the opportunity to settle, financial risk and additional litigation. If the insured loses both the liability and coverage lawsuit they will be liable for the judgment from the first law suit and will also have to pay the insurance company for the legal fees and expenses of the insurance company. This can lead to ruinous financial consequences and bankruptcy for most people.

The sharp practice of issuing ROR's is happening even when an insurance company receives coverage opinions favorable to the insured. To gain leverage insurance companies try to squeeze the insured by including language that expands the ROR not only to the reasons stated in the letter, but reserves the right to expand the reason for denial for any reason. The insured is also reminded that they have a duty to cooperate and if they fail to cooperate they will lose their coverage. This means the insured doesn't know what is coming next.

Insurance companies will often also use favorable dates ins such letters so that the conditional obligation that they assume under the ROR is not the date they first became aware of the claim, but a date that positions the company best for future litigation. This is particularly true if the insurance company has failed in its duty to settle before the insured made a formal demand for defense and indemnity. In Missouri many of the bad things that can happen when an ROR is issued can be avoided by rejecting the reservations. Missouri law prevents insurance companies from using threats and leverage to bully insured's to accept a reservation of rights. Under Missouri law and insured is entitled to treat an ROR as a breach because an ROR is anticipatory repudiation of the contract. Although the insurance company still has the upper hand because of its financial strength and expertise, this gives the insured the option of walking away and controlling the litigation without the insurance company's involvement. This also gives the insured a chance to resolve the claim by negotiating with the company on more equal footing, or the insured can defend or settle the underlying lawsuit on its own and then suing the company for breach of the contract. The insured can also settle the claim so that the plaintiff has the obligation to pursue the insurance company, so that the insured can settle can get out without any further risk.

The decision to accept or reject an ROR depends on many factors, and may or may not be a good decision depending on the situation. These decisions can be particularly complex for businesses as the ROR may have implications that are not immediately apparent and must be thought through with extreme care. Anyone who has received an ROR from their insurance company should consult with a private attorney knowledgeable in this area of the law.

The law firm of Tatlow, Gump, Faiella & Wheelan, LLC may be able to help if you are having a problem with your insurance company. To learn more about our law practice visit our website.

The United States District Court for the Southern District of Ohio has held that a policy clause which provided that a claim is made when the insured receives information which "could reasonably be expected to result in a claim" is ambiguous. Professionals Direct Ins. Co. v. Wiles, Boyle, Burkholder & Bringardner Co., LPA, 2009 WL 4281263 (S.D. Ohio Nov. 24, 2009). The court also held that notice of the claim, provided shortly after the claim was made but after the expiration of the original policy period, was timely where the same insurer provided coverage in both policy periods and the notice was provided within a reasonable amount of time.
The case arose from a malpractice claim which resulted in a large verdict against the insured. The insurer tried to deny coverage claiming that the insured had knowledge which would have allowed reporting the claim in the 2004 policy period but the claim was not reported until the 2004 policy period. The court found the reasonably expected language ambiguous because a reasonable insured would not think a claim likely to a related appeal was resolved.

"Premium" is defined in Black's Law Dictionary as a "sum paid or agreed to be paid by an assured to the underwriter as the consideration for the insurance." 1344 (4th ed. 1968). In Missouri the term "premium" was considered in Fidelity Security Life Ins. Co. v. Dir. of Revenue as "consideration paid by an insured to an insurer for a contract of insurance." 32 S.W.3d 527, 531 (Mo. banc 2000) (citing Black's Law Dictionary 1181 (6th ed. 1990); Webster's Third New International Dictionary 1789 (1981)). In Metro. Life Ins. Co. v. Scheufler, the term "premium received" is not "only those portions of the premiums received which are retained for (or used in) the company's business." 180 S.W.2d 742, 744 (Mo. 1944) (emphasis in original). So "premium" means the consideration paid by an insured to an insurer for a contract of insurance. In other words premium is just a fancy way of saying the money paid for the promise of an insurance company.

Interesting information on AIG.

American International Group (A.I.G.) News - The New York Times.