376 episodes

Presentation of insurance issues relating to claims handling, insurance coverage, interpretation of insurance policy coverages, insurance fraud, and investigation. Support this podcast: https://anchor.fm/barry-zalma/support

Zalma on Insurance Barry Zalma

    • Business

Presentation of insurance issues relating to claims handling, insurance coverage, interpretation of insurance policy coverages, insurance fraud, and investigation. Support this podcast: https://anchor.fm/barry-zalma/support

    Zalma’s Insurance Fraud Letter – October 15, 2021

    Zalma’s Insurance Fraud Letter – October 15, 2021

    Zalma’s Insurance Fraud Letter Volume 25, Number 20 

    https://zalma.com/blog

    Criminal Caused Suit on Policy to Drag on for More than Six Years Court Finally Stopped an Unconscionable Level of Overlitigation  United States District Judge Gary R. Brown was faced with a legal  dispute that, perhaps because the defendant was a criminal, went on for  years without a final disposition. In Principal Life Insurance Company  v. Jason P. Brand, No. CV 15-CV-3804, United States District Court, E.D.  New York (September 29, 2021) the case was reduced to seven years on  disputes that appeared to be relatively straightforward:   

    defendant Brand obtained a disability policy in early 2012 from  plaintiff Principal Life, after being less than forthcoming about his  health history.     In June 2014 – prior to the submission of Defendant’s disability  claim on November 14, 2014 – the New York State Attorney General’s  office raided Defendant’s offices, seizing his computers and physical  files, leading to indictment on October 16, 2014 of Defendant and his  businesses, DASO Development Corp. and Narco Freedom, Inc., for  insurance fraud in the first degree and grand larceny in the second  degree, charges to which defendant would plead guilty.     Defendant filed a disability claim based upon anxiety;     Principal Life, for its part, acted quickly and rescinded the policy  and     Filed a declaratory relief action.  Proactive Insurer Has to Fight to Renew Judgment Against Convicted  Fraudster Insurer’s $7,870,557.89 Judgment Against Fraudster Stands  Insurer May Collect on Default Judgment Against Fraudster  In People of The State of California, ex rel. Interinsurance Exchange of  The Automobile Club of Southern California v. Alex Semyon Mirsky,  B297321, California Court of Appeals, Second District, Seventh Division  (September 21, 2021) Alex Semyon Mirsky appealed from the superior  court’s denial of a motion to vacate a 2013 renewal of a default  judgment and the underlying default judgment.  In 2003 the superior court entered a default judgment of over $7.8  million against Mirsky. Interinsurance Exchange of the Automobile Club  of Southern California (Interinsurance Exchange) renewed the judgment in  2013, and in 2018 it mailed notice of the renewal to Mirsky at an  address Interinsurance Exchange claimed was Mirsky’s last known address.  Mirsky filed a motion to vacate the renewal of judgment, or, in the  alterative, vacate the default judgment under Code of Civil Procedure  section 473, subdivision (d). The trial court denied the motion,  concluding Mirsky’s motion to vacate the renewal of judgment was  untimely and Mirsky failed to meet his burden to show the default  judgment was void. ClaimSchool, Inc. – Insurance Education Insurance Education from Barry Zalma  Barry Zalma Presents What Your Insurance Organization Needs. The Excellence in Claims Handling Program Good News From the Coalition Against Insurance Fraud Health Insurance Fraud Convictions Videos on YouTube and Rumble.com of Zalma on Insurance Other Insurance Fraud Convictions  

    © 2021 – Barry Zalma


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    • 18 min
    Contract Interpretation and the World Trade Center

    Contract Interpretation and the World Trade Center

    A Video Explaining the Doctrine of Reasonable Expectations   

    https://zalma.com/blog

    The act of infamy at the World Trade Center (WTC) in New York City on  September 11, 2001, is responsible for a great deal of insurance  litigation concerning, among other things, the meaning of the term  “occurrence” in first party property policies and the methodology  required of insurers when interpreting a policy of insurance. In the WTC  policies, “occurrence” was defined as follows:  “Occurrence” shall mean all losses or damages that are attributable  directly or indirectly to one cause or to one series of similar causes.  

    All such losses will be added together and the total amount of such  losses will be treated as one occurrence irrespective of the period of  time or area over which such losses occur.  Because WTC insurance issues are surrounded by the horrendous facts of  the attack, and due to the fact that some policies had yet to be printed  and delivered to the insured before September 11, 2001, the decisions  rendered in interpreting the policies had far-reaching impact. The  rulings in the WTC cases, combined with a decision of the California  Supreme Court, are changing how insurance policies are interpreted.  Since policy interpretation is essential to the presentation of any  insurance claim, the following detailed discussion is important to all  those concerned with insurance claims.  

    “Reasonable expectations” does not mean, however, that the expectations  of the insured can change or modify the clear and unambiguous language  of the policy of insurance. The Third Circuit found, in Canal Insurance  v. Underwriters, against the insured’s claim of reasonable expectations,  finding that in the context of the case before it “the refusal to look  beyond the plain meaning of the unambiguous exclusionary language to  Singh’s reasonable expectations is consistent with the interpretation of  Pennsylvania case law in our Circuit.”  For example, a case decided over 200 years ago made the point that the  reasonable expectations of the insured include the understanding that  “every [insurer] is presumed to be acquainted with the practice of the  trade he insures…. If he does not know it, he ought to inform himself.”  Similarly, more than 150 years ago the US Supreme Court in Hazard’s  Administrator v. New England Marine Insurance Co., 33 U.S. 557 (1834)  adopted the rule. It concluded that “no injustice is done if insurers  are presumed to know their insureds’ industry because it is part of  their ordinary business.”  

    © 2021 – Barry Zalma

    Barry Zalma, Esq., CFE, now limits his practice to service as an  insurance consultant specializing in insurance coverage, insurance  claims handling, insurance bad faith and insurance fraud almost equally  for insurers and policyholders.  

    He also serves as an arbitrator or mediator for insurance related  disputes. He practiced law in California for more than 44 years as an  insurance coverage and claims handling lawyer and more than 54 years in  the insurance business. 

    Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.








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    • 19 min
    Explaining the Interpretation of Insurance Contracts

    Explaining the Interpretation of Insurance Contracts

    Rules of Contract Interpretation   

    https://zalma.com/blog

    The following rules govern the construction of contracts of insurance:  If the terms of a promise are in any respect ambiguous or uncertain, it  must be interpreted in the sense in which the promisor believed at the  time of making it, that the promisee understood it. [California Civil  Code § 1649] (which provides an excellent definition of the basic rule  of interpretation followed in most states).  

    “If a written contract is so worded that it can be given a definite or  certain legal meaning, then it is not ambiguous.”  However, if “the language of a policy or contract is subject to two or  more reasonable interpretations, it is ambiguous.” Simply stated, all  contracts are interpreted equally except insurance contracts, which are  interpreted to favor the insured in the event of an ambiguity.  An insurer may not rely on an ambiguous interpretation of a policy  provision that, if construed as the insurer contends, would deprive the  insured of coverage.  When the language of an insurance contract is reasonably susceptible to  two constructions, it should be construed in favor of the insured.  It is not necessary to show that the construction against the insurer is  more logical than that against the insured; it is sufficient to show  that the construction in favor of the insured is equally reasonable with  that which favors the insurer.  

    © 2021 – Barry Zalma  Barry Zalma, Esq., CFE, now limits his practice to service as an  insurance consultant specializing in insurance coverage, insurance  claims handling, insurance bad faith and insurance fraud almost equally  for insurers and policyholders.  He also serves as an arbitrator or mediator for insurance related  disputes. He practiced law in California for more than 44 years as an  insurance coverage and claims handling lawyer and more than 54 years in  the insurance business. 

     Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.


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    • 18 min
    Number of Occurrences

    Number of Occurrences

    A Video Explaining What to Do When a Claim Includes Multiple Occurrences 

    https://zalma.com/blog

    CGL policies are written with endorsements that make the number of  occurrences highly important, especially in continuing loss cases.  deductibles or self-insured retentions are charged based on the number  of occurrences or the number of claims. policy limits can apply  individually per occurrence, individually per loss, individually per  claim, or in the aggregate over a one year period. 



    The test applied is  usually objective. [Uniroyal, Inc. v. Home Insurance Company, 707 F.  Supp. 1368 (1988); Champion International Corporation v. Continental  Casualty Company, 546 F. 2d 502 (1976), Cargill, Inc. v. Liberty Mutual  Insurance Company, 488 F. Supp. 49 (1979) Affirmed 621 F. 2d 275 (1980);  Mason v. Home Insurance Company, 177 Ill. App. 3d 454, 532 N.E. 2d 526  (1988); 64 A.L.R. 4th 688.]  A triggering injury in fact for an underlying claim may be found as  early as the time of first exposure to asbestos or silica, and may  continue progressively through the claimant's death or the date of  filing the claim, whichever occurs earlier. [Danaher Corp. v. Travelers  Indem. Co., 414 F.Supp.3d 436 (S.D. N.Y. 2019)]  In Lombard v. Sewerage and Water Board of New Orleans, 284 So.2d 905  (La.1973) and its progeny, the courts in exposure cases have applied the  “effect” test as opposed to the “cause” test in determining the number  of [Thebault V. American Home, 2015-0800 (La. App. 4Cir. 4/20/16), 195  So. 3d 113.]  A common method of allocation is referred to as the "time on the risk"  method, whereby each insurer is responsible for the pro rata percentage  of time the insurer's policy was in effect over the course of the full  time period over which loss was sustained by the insured. For example,  Edison Co. Of New York, Inc. v. Allstate Ins. Co., 774 N.E.2d 687, 695  (N.Y. 2002)] affirmed the trial court allocation of loss through  "time-on-the-risk" method, while "not foreclos[ing] pro rata allocation  among insurers by other methods."     



    © 2021 – Barry Zalma


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    • 19 min
    Insurance Underwriting

    Insurance Underwriting

    A Video Explaining the Nature of Insurance Underwriting   

    https://zalma.com/blog

    Before the insurance claims adjuster begins a claims investigation he or  she must understand the nature of underwriting because it is how an  insurance policy comes into existence.  Underwriting is defined as the process of accepting or rejecting risks.  It requires a determination by the underwriter of the risks for which  insurance is sought and the terms under which the insurance will be  written if the risk is acceptable. Underwriting insurance is a function  unique to the insurance industry which transfers the risk of loss from  the person or entity insured to the insurer.  

    Three centuries ago, insurance originally was a very personal matter. A  property owner would discuss with an individual insurer the problems,  values and risks of loss involved in a commercial enterprise. They would  then agree upon the terms under which the insurer would insure the  risk. Together they would draft a contract and the insurer would sign  his name at the bottom — he literally underwrote the insurance.  When the Lloyd’s insurance marketplace started in Edward Lloyd’s coffee  shop policies were often written in chalk on a blackboard and those who  wished to join in the insurance would sign their name and the percentage  they wished to take of the risk under the terms of the policy written  on the board.  In its original usage, underwriting referred to the operation of the  insurance business. 

    Today, in application, there is a more restricted  meaning applied to the term.  Underwriting, in modern usage, is a systematic technique for evaluating  risks that are offered to an insurer by prospective insureds. The  function of underwriting involves evaluating, selecting, classifying,  and rating each risk. Underwriting establishes the standards of coverage  and amount of protection to be offered to each acceptable risk. It  formulates and administers the rules and procedures that are used to  ensure that predetermined standards are met by underwriters.  Underwriters are the risk takers. Adjusters only become involved when  the risk becomes a loss and the adjuster is called upon to keep the  promises made by the policy created by the underwriter.  In the US underwriting has become more corporate and less individual.  Underwriters are now invariably employees of insurance companies and no  longer put their personal fortunes at risk.  

    © 2021 – Barry Zalma  

    Barry Zalma, Esq., CFE, now limits his practice to service as an  insurance consultant specializing in insurance coverage, insurance  claims handling, insurance bad faith and insurance fraud almost equally  for insurers and policyholders.


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    • 18 min
    The Construction Contract

    The Construction Contract

    A Video Explaining the Construction Contract   

    https://zalma.com/blog

    When a construction contract, like every other contract, is unambiguous,  the parties’ intent may be determined from the contract alone, and it  is the duty of the court—not the jury—to state its meaning. 

    Construction contracts are governed by the same rules as all other  contracts. When a court is called upon to interpret a construction  contract its terms are given their ordinary and generally accepted  meaning with the court working to give effect to the intent of the  parties to the contract unless the contract itself gives special meaning  to the contract.  A construction contract should always be written. It should, like all  other contracts, set forth in detail the duties and obligations of the  parties to the contract. It should communicate the scope of work to be  rendered and the extent to which each party is involved in the differing  aspects of the project.  Contracts serve as means of documenting the services and assets to be  exchanged during the course of a project. 

    The contract is important not  only to finalize the deal in the minds of the parties to the  construction project, but also to help define the performance of the  work and may even determine who bears the tax burden.  A basic construction contract is negotiated by the parties and will be  interpreted following the normal rules of contract interpretation.  

    ZALMA OPINION  

    The construction contract is the most effective means of avoiding  disputes between the owner and the builders involved in the construction  project. Whether standardized forms are used or the agreement is  written to the specifications of the parties by an experienced  construction lawyer, the contract is essential to a successful  construction effort. 

    © 2021 – Barry Zalma


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    • 17 min

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