As a State Farm policyholder/owner, I am glad that they had the integrity to deny claims relating to their concurrent causation clause…i.e. living by the terms of their policy and not bowing to emotional appeal/slander of Scruggs group.
I know what my policy covers and what it doesn’t. I don’t want my rates going up because some two-bit judge decides that the policy should cover things that were not intended to be covered and were not rated for in the premium calculations.
Most exclusions in a policy are there for specific reasons, either the coverage is better provided for elsewhere (NFIP for example)or because the cost of including coverage for that issue would be cost prohibititive. The concurrent causation clause exists to eliminate the gray area between a covered event & a non-covered event. Explain to me exactly how an adjuster is supposed to be able to determine the correct indemnification of the wind portion of a slab claim. Explain how the actuaries are supposed to include that data into the rate calculations.
Abslutely, according to the terms of the legal contract. The are entitled to no less and no more. Too many people think they are entitled to payments that are not covered in the contract. If the companies don’t pay what the customer is entitled to they should be punished. If the companies pay more than they should under the contract they are poor business people.
The concurrent causation clause was struck down due to being ambiguous and against public policy. To deny something which is clearly covered in one section (wind) which is impossible to be independently discerned from another peril, just b/c the second event occurs, is fraudulent and a weak attempt to get out of contractual obligations. These are claims that other companies have paid for years and is against public policy. State Farm knew the concurrent causation clause was not enforceable, if litigated, but chose to do so anyway. Take this scenario. A dwelling has wind damage today and before the adjuster can get out, tonite the house falls into a sinkhole. Under the theory of concurrent causation, the claim would be denied in all states but FLA and CALIF. (Feel free to correct me if there are otehr states where sinkholes are possibly covered).
Joe, I hope you weren’t trying to respond to something you think I said with this post. I know nothing about this coverage or exclusions and have never commented on it. All I have ever said is that we all need to abide by the contract. Pay if it is covered, don’t pay if it isn’t. If the court says it’s covered in the end, that’s fine with me. I’m staying out of any technical arguments where I have no expertise. I wish a few other posters would, but they are entitled to an opinion regardless of my opinion of their opinion since this is an opinion post.
Nobody: The post was more at those like State Farm Policyholder and others who want State Farm to abuse INSUREDS.
BTW, from the inception of insurance, persons owning a policy have always been refered to as INSUREDS. In the last 10-15 years State Farm has begun the use of the term POLICYHOLDER. Are the afraid to admit the person owning the policy is an INSURED????? The policy itself refers to INSUREDS rather than policyholders. This makes them appear to go into the process with a bias against the INSURED. Again Nobody, if the shoe don’t fit, don’t try to wear it. No harsh comments directed at you if not discusssing your words.
You are apparently unable to read. Let the courts decide. It’s in their hands. Unless you are a judge in addition to being an adjuster you have no say in any of this. All I have ever said is let the courts decide. It’s in their hands. If State Farm is wrong they will be punished. Where is the ambivalence there? I will no longer read or respond to your idiotic rants about this company. You need mental treatment.
Joe, Nationwide’s concurrent causation language is the subject of an appeal in MS (Leonard v. Nationwide). Concurrent causation language has not been struck down everywhere, as your post seems to infer. Do you know for a fact that this language/issue has been tried in every jurisdiction? This is not a sarcastic question. I’m curious to know what you know about this subject in states other than OK, MS & LA.
Using your example of wind damage followed the next day by a sinkhole. If a non-covered event follows that closely to a covered event (wind), the home is still a total loss. How can ANY adjuster determine how much wind damage there was? (Again, no sarcasm here.) How can the policyholder be indemnified for the wind loss when they themselves cannot prove the damages that arose from the wind damage? Situations such as this are the basis for concurrent causation language, isn’t it?
This leads into the recent 5th Circuit Court of Appeals ruling on VPL (Valued Policy Laws), which attorneys and policyholders have been using to rape carriers (ALL carriers) when there are concurrent causation issues. Is it OK for policyholders to get full value of the policy/property when the a portion of the loss was caused by a non-covered event even if the covered event did not total the property?
I’m not going to debate bonuses, pay, profits, etc. I am just trying to understand your position on why it is OK for policyholders and attorneys to interpret the policy way beyond what was ever intended, but it is not OK for carriers to rely on the approved wording in a policy to deny a claim.
As far as concurrent causation, I have worked claims all over the US and the only times I have ever run across it was in hurricanes and as far back as 1994 in Hurricane Opal, concurrent causation was not applied. The courts sometimes do use good sense. I repeat from my earlier post; Why should a legitimately owed claim be able to be denied in its entirity just because another loss occurs? I paid losses in FLA in Opal with “CONCURRENT CAUSATION.” The courts look at the past and what has been universally accepted, ie “public policy” and use it in their rulings. If it has been a common practice in the past, why should State Farm now be able to unilaterally remove coverage?
The engineers tell us that they can “GUARANTEE” (and SF accepts this as gospel) that all of the damages were from flood to allow State Farm to escape from any exposure, so why can’t they determine a reaonable wind damage from examining adjacent property? How can they guarantee the dwelling was destroyed by flood and not wind? Was there a wind meter at the dwelling where the loss occurred? Was ther a measuring device at the dwelling for flood levels? Just think about it; why are engineers infalable when their answers are on the side of the carrier and not questioned? The allegations, apparently borne out by actual engineer reports in this instance, are that when the reports support the insured, the carrier has them changed. I have read some of the actual reports and understand why the carriers are being questioned in court. The engineer’s work in Katrina was very shoddy. When it helps the carrier the engineer is a hero and makes good money, but when it favors the insured, it is a different story. He is not called back again.
The only place where I ever heard of the valued plicy being wrongly applied was in FLA. It was quickly corrected by the legislature. You should check the valued policy statute in MS and LA as neither has wind as a covered peril for valued policy to kick in. Alabam has no valued policy statute. As far as a recent ruling on Valued Policy on the 5th Circuit, I am not familiar, but I would suggest that if that is the case, it is due to the carrier not proving their case, ie SHODDY ENGINEER REPORTS. If this case originated from Louisiana, they have some strange jurispurdence such as direct action, no full spousal immunity, assumed negligance if the loss eminates from your property and many others.
You did not really answer my questions. I used your examples on concurrent causation (the wind damage & sinkhole). You responded that you have only seen the concurrent causation clause applied in hurricanes. Why then did you use wind and sinkhole as an example. I also asked how an insured can prove what was covered vs. non-covered damages, again based on your example. You did not answer that.
As to the 5th Circuit decision on VPL, it is a New Orleans case, arising out of Katrina. Oh, by the way…it is in favor of State Farm. It is not a case where State Farm did not prove their case or relied on engineer reports. It is a case where policyholders are seeking the full value of their destroyed home where there was wind & water damage from Katrina, despite the fact that water is not covered under the policy. The 5th Circuit upheld 2 circuit court decisions holding the VPL does not apply when the loss arises out of covered & non-covered perils.
There is an article in yesterday’s Times Picayune on this case.
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As a State Farm policyholder/owner, I am glad that they had the integrity to deny claims relating to their concurrent causation clause…i.e. living by the terms of their policy and not bowing to emotional appeal/slander of Scruggs group.
I know what my policy covers and what it doesn’t. I don’t want my rates going up because some two-bit judge decides that the policy should cover things that were not intended to be covered and were not rated for in the premium calculations.
Most exclusions in a policy are there for specific reasons, either the coverage is better provided for elsewhere (NFIP for example)or because the cost of including coverage for that issue would be cost prohibititive. The concurrent causation clause exists to eliminate the gray area between a covered event & a non-covered event. Explain to me exactly how an adjuster is supposed to be able to determine the correct indemnification of the wind portion of a slab claim. Explain how the actuaries are supposed to include that data into the rate calculations.
Abslutely, according to the terms of the legal contract. The are entitled to no less and no more. Too many people think they are entitled to payments that are not covered in the contract. If the companies don’t pay what the customer is entitled to they should be punished. If the companies pay more than they should under the contract they are poor business people.
The concurrent causation clause was struck down due to being ambiguous and against public policy. To deny something which is clearly covered in one section (wind) which is impossible to be independently discerned from another peril, just b/c the second event occurs, is fraudulent and a weak attempt to get out of contractual obligations. These are claims that other companies have paid for years and is against public policy. State Farm knew the concurrent causation clause was not enforceable, if litigated, but chose to do so anyway. Take this scenario. A dwelling has wind damage today and before the adjuster can get out, tonite the house falls into a sinkhole. Under the theory of concurrent causation, the claim would be denied in all states but FLA and CALIF. (Feel free to correct me if there are otehr states where sinkholes are possibly covered).
Joe, I hope you weren’t trying to respond to something you think I said with this post. I know nothing about this coverage or exclusions and have never commented on it. All I have ever said is that we all need to abide by the contract. Pay if it is covered, don’t pay if it isn’t. If the court says it’s covered in the end, that’s fine with me. I’m staying out of any technical arguments where I have no expertise. I wish a few other posters would, but they are entitled to an opinion regardless of my opinion of their opinion since this is an opinion post.
Nobody: The post was more at those like State Farm Policyholder and others who want State Farm to abuse INSUREDS.
BTW, from the inception of insurance, persons owning a policy have always been refered to as INSUREDS. In the last 10-15 years State Farm has begun the use of the term POLICYHOLDER. Are the afraid to admit the person owning the policy is an INSURED????? The policy itself refers to INSUREDS rather than policyholders. This makes them appear to go into the process with a bias against the INSURED. Again Nobody, if the shoe don’t fit, don’t try to wear it. No harsh comments directed at you if not discusssing your words.
You are apparently unable to read. Let the courts decide. It’s in their hands. Unless you are a judge in addition to being an adjuster you have no say in any of this. All I have ever said is let the courts decide. It’s in their hands. If State Farm is wrong they will be punished. Where is the ambivalence there? I will no longer read or respond to your idiotic rants about this company. You need mental treatment.
Joe, Nationwide’s concurrent causation language is the subject of an appeal in MS (Leonard v. Nationwide). Concurrent causation language has not been struck down everywhere, as your post seems to infer. Do you know for a fact that this language/issue has been tried in every jurisdiction? This is not a sarcastic question. I’m curious to know what you know about this subject in states other than OK, MS & LA.
Using your example of wind damage followed the next day by a sinkhole. If a non-covered event follows that closely to a covered event (wind), the home is still a total loss. How can ANY adjuster determine how much wind damage there was? (Again, no sarcasm here.) How can the policyholder be indemnified for the wind loss when they themselves cannot prove the damages that arose from the wind damage? Situations such as this are the basis for concurrent causation language, isn’t it?
This leads into the recent 5th Circuit Court of Appeals ruling on VPL (Valued Policy Laws), which attorneys and policyholders have been using to rape carriers (ALL carriers) when there are concurrent causation issues. Is it OK for policyholders to get full value of the policy/property when the a portion of the loss was caused by a non-covered event even if the covered event did not total the property?
I’m not going to debate bonuses, pay, profits, etc. I am just trying to understand your position on why it is OK for policyholders and attorneys to interpret the policy way beyond what was ever intended, but it is not OK for carriers to rely on the approved wording in a policy to deny a claim.
Posted On: August 8, 2007, 8:34 pm CDT
Posted By: Nobody Important
I don’t know or care about State Farm.
I just read them like they are written.
Sam:
As far as concurrent causation, I have worked claims all over the US and the only times I have ever run across it was in hurricanes and as far back as 1994 in Hurricane Opal, concurrent causation was not applied. The courts sometimes do use good sense. I repeat from my earlier post; Why should a legitimately owed claim be able to be denied in its entirity just because another loss occurs? I paid losses in FLA in Opal with “CONCURRENT CAUSATION.” The courts look at the past and what has been universally accepted, ie “public policy” and use it in their rulings. If it has been a common practice in the past, why should State Farm now be able to unilaterally remove coverage?
The engineers tell us that they can “GUARANTEE” (and SF accepts this as gospel) that all of the damages were from flood to allow State Farm to escape from any exposure, so why can’t they determine a reaonable wind damage from examining adjacent property? How can they guarantee the dwelling was destroyed by flood and not wind? Was there a wind meter at the dwelling where the loss occurred? Was ther a measuring device at the dwelling for flood levels? Just think about it; why are engineers infalable when their answers are on the side of the carrier and not questioned? The allegations, apparently borne out by actual engineer reports in this instance, are that when the reports support the insured, the carrier has them changed. I have read some of the actual reports and understand why the carriers are being questioned in court. The engineer’s work in Katrina was very shoddy. When it helps the carrier the engineer is a hero and makes good money, but when it favors the insured, it is a different story. He is not called back again.
The only place where I ever heard of the valued plicy being wrongly applied was in FLA. It was quickly corrected by the legislature. You should check the valued policy statute in MS and LA as neither has wind as a covered peril for valued policy to kick in. Alabam has no valued policy statute. As far as a recent ruling on Valued Policy on the 5th Circuit, I am not familiar, but I would suggest that if that is the case, it is due to the carrier not proving their case, ie SHODDY ENGINEER REPORTS. If this case originated from Louisiana, they have some strange jurispurdence such as direct action, no full spousal immunity, assumed negligance if the loss eminates from your property and many others.
You did not really answer my questions. I used your examples on concurrent causation (the wind damage & sinkhole). You responded that you have only seen the concurrent causation clause applied in hurricanes. Why then did you use wind and sinkhole as an example. I also asked how an insured can prove what was covered vs. non-covered damages, again based on your example. You did not answer that.
As to the 5th Circuit decision on VPL, it is a New Orleans case, arising out of Katrina. Oh, by the way…it is in favor of State Farm. It is not a case where State Farm did not prove their case or relied on engineer reports. It is a case where policyholders are seeking the full value of their destroyed home where there was wind & water damage from Katrina, despite the fact that water is not covered under the policy. The 5th Circuit upheld 2 circuit court decisions holding the VPL does not apply when the loss arises out of covered & non-covered perils.
There is an article in yesterday’s Times Picayune on this case.