Articles Posted in General Insurance Dispute Information

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The Second Circuit Court of Appeal recently affirmed the rejection of Uninsured Motorist coverage from his mother’s automobile insurance, effectively denying him that kind of coverage for an accident where he was hit by another driver.
21-year-old Michael Tillman was driving his 1995 Dodge Ram pickup truck when he was struck from behind by Tommy Pritchard in 2008. Prichtard’s insurance company paid its policy limits to Tillman, who then sought more recovery from his mother’s insurance company, USAgencies. Paris carter, Tillman’s mother, had a policy in effect at the time of the accident and added the Dodge Ram to the policy shortly before Tillman’s accident.

However, before Carter added the Dodge Ram to her policy, she had rejected Uninsured Motorist Bodily Injury (“UMBI”) coverage when she completed an application for the policy. The policy to which she sought to add her son’s pickup truck did not include UMBI coverage and the truck would also not include that coverage. Tillman, however, argued that the insurance agent should have issued a new policy covering his truck because the agent was given the pickup’s title, which listed Tillman as the owner, and that she knew he did not live with his mother; he also argued that Carter could not effectively reject UMBI coverage for him without his written consent.

The Court of Appeals affirmed the lower court’s decision to dismiss the case summarily because there was no factual issue as to whether Carter rejected UMBI coverage for the Dodge Ram in her policy with USAgencies. The policy document, which Carter signed to reject UMBI coverage, explained that her choice to do so applied both to vehicles described in the policy at that time and to “. . .all reinstatement or substitute policies until [she] make[s] a written request for a change in [her] Bodily Injury Liability Coverage or UMBI Coverage.”

Moreover, the Louisiana legislature has passed statutes which announce that “[a]ny changes to an existing policy, regardless of whether these changes create new coverage, except changes in the limits of liability, do not create a new policy and do not require the completion of new uninsured motorist selection forms.” The Court rejected Tillman’s argument that Carter’s rejection of UMBI coverage might be invalid, citing the rebuttable presumption that Carter’s signed completion of the insurance form means that she knowingly rejected it. The Court reasons that the law is clear: one who signs a document is presumed to have done so with knowledge of its contents, regardless of whether they actually read it.

Further, the Court holds that the insurance agent had no onus to write a separate policy for the Dodge Ram when Carter did not request or direct the agent to obtain. The Court cites the principle that it is the client’s duty to determine the coverage needed, advise the agent of those needs, and to review the policy to determine whether it meets their needs. Lastly, the Court rejects Tillman’s argument that his mother, Paris Carter, could not reject UMBI coverage for him without his written consent. In addressing the authority he cites, the Court clarifies that the rejection requires only the written consent of the policyholder when such a rejection is executed on his behalf.

Though it’s a tough rule, it is important to read the documents you sign, especially when it comes to insurance coverage. Like many people, Ms. Carter might have signed rejection of the UMBI coverage in order to lower her insurance premium. In doing so, she allowed USAgencies to disclaim coverage for injuries sustained by uninsured motorists. However, if you’ve been injured in an automobile accident, you should seek out legal representation to fish out your best interest from these often complicated insurance provisions.

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The Louisiana Supreme Court decided a case recently which undercuts a major exclusion of many automobile insurance policies because it conflicts with what the State Legislature announced was in the best interest of the public. Many such policies contain various exclusions from coverage, including the one litigated over here: automobile business.

Sensebe v. Canal involved an auto accident where Sensebe was injured when her vehicle was rear ended by a pickup truck on the I-10 twin span bridge in St. Tammany Parish. Deborah Boudreaux was driving the pickup to her employer, an auto shop named Top Hatch, to have the seat covers replaced with leather. Gregory Hyneman was the owner the truck and had it insured with Mississippi Farm Bureau Casualty Insurance Company.

Hyneman’s policy with Farm Bureau contained an “automobile business” exclusion, which Farm Bureau argued applied here and excluded coverage on the pickup during the accident. They reasoned that Ms. Boudreaux was driving the pickup while employed by Top Hatch and as such, the pickup was not covered at the time of the accident.

The District Court agreed with Farm Bureau and dismissed them from the case, but the Court of Appeals reversed that decision by interpreting the insurance policy so as to not exclude the installation of upholstery as automobile business, but rather an after-market upgrade and not an automobile repair or service.
The Louisiana Supreme Court, however, considered the “automobile exclusion” as violating Louisiana Public Policy, which the State Legislature announced requires coverage for permissive drivers – those drivers who operate the covered vehicle with the permission of the policyholder. Because this is Louisiana’s highest court, it sets an important precedent for providing coverage for those injured by vehicles driven by permissive drivers. The Court reasoned that such exclusions, including their broader category of “business exclusion”, violate the legislature’s goal to create a comprehensive scheme to protect injured victims of careless drivers. The Court cautioned that the enforcement of such exclusions would result in motorists being allowed to drive in and out of coverage, depending on the purpose of a particular excursion.
The legislature also included some exceptions to “omnibus coverage”, the required coverage for all vehicles. The owner, they write, may exclude a person if the owner obtains and maintains another policy which provides coverage for the excluded person. Also allowed for exclusion are spouse and other household residents of the policyholder. The LA Supreme Court read these as being the only allowed exclusions from omnibus coverage because the legislature would have included others if it had wanted to allow others. The automobile business exclusion, therefore, was not allowed by the legislature and the fact that it conflicts with the omnibus public policy means it cannot be enforced. The Court sent the matter back down for litigation to continue, denying Farm Bureau’s request to be summarily dismissed from the case on the basis of that exclusion.

The legislature passed the Louisiana Compulsory Motor Vehicle Liability Security Law to pronounce its goals and requirements for automobile insurance, implicitly noting the high cost of automobile-related injuries. Thankfully, the scheme they have passed requires coverage for all drivers except for those noted allowable-exclusions (those otherwise covered by the owner and members of the same household). The idea is to require liability coverage for every vehicle that, by the very nature of driving, might injure someone else. In this case, the Louisiana Supreme Court has signed on to this goal and is enforcing this idea. Those injured in automobile accidents can now worry less about falling through a loophole in the insurance policy of the person who injured them.

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Insurance policy terms may appear to be easily understandable and concise. However, the interpretation a lay person may give to an insurance policy agreement’s meaning versus a court’s interpretation of the same policy, may substantially differ. It is true that under Louisiana law, words in a contract are presumed to have the plain and ordinary meaning they are generally given. However, an insurer may bear the burden of proof and demonstrate that a certain provision in an insurance policy exempts coverage for such an event in question.

A recent decision by Louisiana’s Second Circuit Court of Appeal, explored the meaning of an insurance policy in order to determine whether or not the insurer was responsible for the plaintiff’s additional damages. The court looked at the totality of the circumstances to aid their decision. The facts are as follows:

In DeSoto Parish, a series of connected collisions occurred which permanently injured one man, and killed another. The chain of events started with Mr. Mike Miles McCauley, who was employed by the defendant, Steve Kent Trucking Inc., he traveling in his 18-wheeler on Highway 5 through DeSoto Parish. Mr. McCauley dropped his cell phone on the floorboard of the truck and decided to retrieve it, at this point he crossed the center line of the highway, then overcorrected and lost control of the vehicle. The 18-wheeler turned over on its side and onto a vehicle, driven by the plaintiff, Henry Washington, who was traveling in the opposite direction on Highway 5. As a result of the size and ass of the 18-wheeler, Mr. Washington’s vehicle was pushed into a small body of water, the 18-wheeler was still sliding at this point and collided with a car driven by Allan C. Richard, who was killed instantly. Mr. Washington suffered numerous serious injuries which left him permanently incapacitated.

Mr. Washington at trial, sought to recover for numerous damages as a result of the serious injuries he incurred from the accident. Mr. Washington sought past and future mental and physical pain and suffering; past and future physical disability and physical impairment; past and present and future loss of enjoyment of life; past and present and future medical expenses; and the loss of economic opportunity. The trial court entered a judgment allowing Mr. Washington’s curator to settle claim arising from the accident for $4.5 million. The defendant insurer, Greenwich paid $4 million and Steve Kent Trucking, Inc., paid $500,000. The only claim left at this point, was the plaintiff’s claim against defendant insurer Greenwich for an additional $1 million in coverage remained. Greenwich filed a motion for summary judgment and subsequently won, as a result of the interpretation of a term in the policy agreement. The defendant insurer, Greenwich was released from liability to the plaintiff on the basis of the court’s interpretation of one single phrase within the policy, “one accident.”

The defendant insurer relied on the company’s interpretation of the policy agreement in order to evade additional liability to the plaintiff. The defendant argued that the policy specified a $5 million “per accident” limit and that an accident is defined as “the continuous or related exposure to the same exposure to the same conditions resulting in bodily injury.” Greenwich also contended that the limit was a combined single limit.” Essentially, this means that according to the policy agreement, if there are multiple parties that are involved within event, their ability to collect for any resulting damages will be combined and they may all collect no more than $5 million collectively. The court reasoned that there was one accident in this matter, although there were two collisions. Greenwich’s liability was limited to no more than $5 million per accident, thus, the company had paid the policy limits by settling with Mr. Washington for $4 million and the second fatally injured driver’s survivors for $1 million. Therefore, according to the court’s interpretation, the defendant insurer had fulfilled their contractual obligation under the policy and were dismissed. Obviously, the plaintiff was not satisfied with this result in consequence to the numerous future medical procedures needed as a result of the accident, so he appealed the decision.

The appeal consists of essentially a battle of interpretations. On the one hand, the plaintiff assert that under the language of the policy, “accident” and “loss” are different and alternative bases of coverage. Further, they urged that Mr. Washington and Mr. Richard, the deceased second driver involved, sustained separate losses and the policy limit is $5 million per loss. The focal concern of the court, is whether or not the $5 million policy limit is to be applied to each person who suffers bodily injury or death, not all such persons. On the other hand, the defendants assert that the plain, ordinary meaning that Louisiana asserts shall be given to contract terms, is that “per accident” a maximum of $5 million shall be allocated. Here, even though there were two victims, they were involved within one incident that caused such injury, thus, they fulfilled the policy limit by allocating between the two victims, a total of $5 million.

Interpretation of an insurance policy is usually resolved by a summary judgment motion, which is what the defendant insurer claimed. When determining whether a policy affords coverage for an incident, the insured bears the burden of proving that the incident falls within the policy’s terms. The court determined that a lack of coverage under the insurance policy was appropriate because there was no reasonable interpretation of the policy, and when applied to the undisputed material facts shown by the evidence supporting the motion, coverage was not additionally afforded to the plaintiff.

The court in this case, made their determination based on the totality of the circumstances. The accident or occurrence was explored in order to determine the extent of the harm, the seriousness of the injuries, and the insurance coverage in light of the facts presented by the various factors involved. The 18-wheeler fatally killed one man as a result of sliding into the man’s vehicle, and caused the other driver to become permanently incapacitated. These injuries occurred from one event, by one negligent act of the driver, and therefore, was not going continue or persist in injuries to the plaintiff. rather, the plaintiff was suffering as a result of the one act by the driver, thus, according the court’s interpretation of the insurance policy, the plaintiff and the deceased driver’s survivors together, obtained $5 million from the injuries they sustained from the tragic accident. Thus, the insurer fulfilled their contractual obligations and were not responsible for any additional amounts urged by the plaintiff.

Interpretation is a powerful tool, as this case illustrates, contractual terms may be difficult and hard to understand.

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In a variety of states, including Louisiana, penalties are imposed on insurers who arbitrarily or capriciously fail to pay a claim. If an insurer behaves in a manner that could be construed as being in “bad faith,” they will face a host of possible penalties. Specifically, the insurer has duties to fulfill, such as paying the amount of any claim due any insured within thirty days respectively. However, determining whether or not the insurer is in bad faith is a two way street, the insured/claimant also has to satisfy certain burden(s) of proof. The court will take into consideration the totality of the circumstances, explore each parties behavior and provided proof, and will thus make their decision.

In a recent Louisiana appellate decision, the court denied finding an insurer in bad faith for denying the plaintiff additional damages. The damages sustained stemmed from an incident that occurred in Winn Parish, Louisiana. Specifically, a five year old boy was crossing Highway 167 to board a school bus when he was struck and injured by a vehicle driven by a minor. Apparently, the minor driving failed to heed the stop sign on the bus which was activated, nor slow down. The force of the impact caused the young boy to be thrown an estaimted distance of 65 feet. His injuries were quite serious, including a broken left femur, damage to the spleen, and severe lacerations to the face and neck. The injured boy had to remain in a full body cast for a number of weeks and incurred substantial bullying from classmates as a result of his visibly scarred facial appearance. The jury awarded damages to the plaintiff for the following: past special damages, future special damages, past general damages, future general damages, and loss of earning capacity.

The plaintiffs in this matter filed a motion for judgment notwithstanding the verdict (JNOV), and in the alternative, sought a new trial. After a hearing, the trial court granted the plaintiff’s JNOV and nullified the jury’s verdict. The court awarded $100,000 initially to the plaintiff; however, after the hearing, the damages were increased to a total of $600,000. This was a $500,000 increase in the amount of total damages to the plaintiff. However, the trial court, without explanation also ruled that the insurer was not in bad faith under Louisiana law in its handling of the plaintiff’s claim. Additionally, the judgment gave the insurer credit for all sums paid to date and further taxed all costs to the insurer. The defendant insurer appealed on the basis that the trial court erred in granting the plaintiff’s motion for JNOV, which increased the jury’s award by $500,000. On the other hand, the plaintiff asserted that the trial court correctly granted the motion for JNOV, but abused its discretion in awarding insufficient damages, specifically in the categories of general damages and loss of earning capacity.

The first issue the court explored was whether or not the JNOV ruling was correct. There is one main question that must be asked to determine whether granting the motion for JNOV was appropriate: do the facts and inferences point so strongly and overwhelmingly in favor of the moving party that reasonable men could not arrive at a contrary verdict? if the answer to that question in the affirmative, then the trial judge was correct in granting the motion. However, if a reasonable person in exercising impartial judgment might reach a different conclusion, then it was error to grant the motion and the jury should be reinstated. Here, the jury’s verdict awarded only special damages and no general damages. The court had to determine whether or not a jury could award one and not the other. The decision held that the jury’s verdict which failed to award general damages was “illogical and inconsistent, representing an abuse of discretion.” Addressing only the future medical expenses and ignoring the past special medical damages illustrated a large problem with the damages awarded the plaintiff. In fact, the court reasoned that the jury was confused in filling out the verdict form without consideration of the previously tendered insurance payments as instructed by the form. Thus, the trial court was correct in granting the JNOV and overruling the jury’s verdict.

Lastly, the plaintiff claimed that the insurer acted arbitrarily, capriciously, and without probable cause in failing to unconditionally tender more than $190,000 in payment of the damages. The plaintiffs alleged that they made numerous demands supported with medical proof, however, the insurer failed to comply. Under Louisiana law, La. R.S. 22:1892, an insurer owes a duty of good faith and fair dealing to its insured. As such, an insurer has an affirmative duty to adjust claims fairly and promptly to make reasonable efforts to settle claims with the insured. The statute provides that if an insurer is found to have acted in bad faith, several penalties are available to the claimant. First, the plaintiff must clearly show that the insurer was in fact arbitrary, capricious, and without probable cause in refusing to pay. Bad faith hinges on whether or not the insurer is aware of specific facts in making their decision not to satisfy a claimant’s damages. The basis of the plaintiff’s argument for additional damages from the insurer, was the fact that the little boy would suffer extensive mental difficulties in the future. The dilemma in such an argument, was the fact that the alleged future mental injury was Attention Deficit Disorder (ADD), which the defendant insurer argued was not a result of the injuries sustained when he was hit by the motor vehicle. The court reasoned that ADD could not be directly attributable to the incident in question and as a result, the insurer was not found to have acted arbitrarily, capriciously, or have acted without probable cause in denying such additional future damages.

Thus, insurers do have an affirmative statutory duty to act in good faith towards claimants. Insurers are prohibited from refusing to pay claims without a reasnable basis. The bad faith statute is designed to protect individuals who have been injured from having their claims declined without any reasonable basis.

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A recent ruling by the Second Circuit Court of Appeal for the State of Louisiana ordered the Bossier Parish Police Jury to repair the pipes running under the land that the plaintiffs, Steven and Melanie Petchak, own in Bossier Parish. It was also ordered to pay damages to the plaintiffs for damage to their house.

Mr. and Mrs. Petchak bought Lot 363, which was part of a subdivision plat (Subdivision No. 5), in 1994. In the conveyance records for Subdivision No. 5, several drainage easements, or rights of way, were referenced. These included a 25-foot easement running north to south and a 10-foot easement running east to west. The 10-foot easement extended 5 feet into the Petchaks’ lot. In 1978, the Bossier parish Police Jury had enacted a resolution which agreed to maintain the drainage facilities of Subdivision No. 5. Additionally, Ordinance 509 of Bossier Parish stated that the Police Jury were to forever have a right of way in order to maintain the drainage channels, and that no buildings were to be erected on the right of way.

The house that the Petchaks bought was built between 1983 and 1985, and the Petchaks purchased the home in 1994. They soon noticed a sinkhole developing on their property, and found out that the previous owner had noticed a different sinkhole, in a different place. The previous owner had called the Police Jury, who filled in the sinkhole twice, first with dirt and later with concrete. The Petchaks called the Police Jury about the new sinkhole, which was then filled in with dirt.

Ten years later, in 2005, the Petchaks began to notice problems with their home, including broken windows, sticking doors, and damaged flooring, walls, and woodwork, which were concentrated at the part of the house closest to the sinkholes. A new sinkhole appeared, and the Petchaks hired a civil engineer to inspect the house, who recommended that the drainage system be repaired before attempting to repair the home’s foundation.

In January 2006, the parish engineer offered to fix the drainage system, but only if the Petchaks would agree to sign a release for any past and future damages associated with the problem, which the Petchaks refused to do.

After more investigation, it was discovered that the pipe was not constructed in accordance with good engineering practices. Despite the pipe changing direction, the parish had not installed junction boxes, which would have stabilized the joint and prevented the separation of the concrete. Because the pipe did not contain any junction boxes, experts believed that either water was escaping or dirt was infiltrating in, causing destabilization of the soil around the drain. The drain was likely bedded in a granular fill, which is a quick-to-erode material, instead of the usual clay. All of this together caused a massive loss of support soil from under the foundation of the house and resulted in damage to the house.

The Second Circuit Court of Appeal decided that the recordation of the easement and Ordinance 509 created duties on the part of the Police Jury to maintain the drainage system as well as a burden on the owner of the land to let the Police Jury onto the land when required. Although the suit would not have been allowed if it were a tort suit under sovereign immunity, it was allowed to go forward because it was based on the special relationship between the Petchaks and the Bossier Parish Police Jury created by the easement. The court also pointed out that prospective owners usually do not conduct underground surveys of the condition of the utilities in easements. Additionally, the Petchaks knew that the right of way existed, could see the manhole cover which was evidence of the right of way, and trusted that the easement would not make the condition of their property worse. The court also found that the Police Jury constructively knew of problems with the drainage system by 1992, when the first sinkhole was reported, so it could not at this time claim lack of knowledge.

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In a recent post, we reviewed the Nolan v. Mabray case which discussed the requirement under Louisiana law that an insurance company must mail a written notice of its intent not to renew an existing policy at least thirty days prior to the policy’s expiration. La.R.S. 22:636.6. The purpose of the notice is to provide the insured sufficient opportunity to obtain insurance with another company before the existing policy expires. In the event of a dispute, the insurer faces the initial burden to prove that it mailed the required notice. Then, the property owner may rebut this presumption by offering evidence that the notice was never delivered. The ultimate factual determination must be made by the jury. The recent case of Johnson v. Louisiana Farm Bureau Casualty Insurance Co. offers another look at the rule’s application.

In 2001, Janice Johnson bought a homeowner’s insurance policy from the Louisiana Farm Bureau Casualty Insurance Company (“Farm Bureau”) for her home in Campti. She set up a bill-pay debit arrangement with her bank under which her monthly premiums were automatically paid to Farm Bureau. In 2006, after completing a routine inspection of Johnson’s property, Farm Bureau decided not to renew the policy when it expired the following July. Accordingly, on May 2, 2007, Farm Bureau mailed a written notice of non-renewal to Johnson and the policy expired on July 10, 2007. Tragically, Johnson’s house was destroyed by fire on November 7, 2007. Farm Bureau rejected Johnson’s subsequent claim for total loss on the grounds that she did not have a policy in place at the time of the incident. Johnson filed suit on July 24, 2008 seeking monetary relief for the losses she sustained in the fire. In her petition, Johnson asserted that she was covered by the
policy and that she was not notified that the policy had expired until after the fire. Farm Bureau responded with a general denial, arguing that Johnson was provided with written notice of non-renewal and that the policy was not in effect at the time of the fire. At the conclusion of a jury trial, the jury found Farm Bureau had properly mailed the non-renewal notice on May 2, 2007 as required under Louisiana law. However, it also found that the notice had not been delivered to Johnson. The trial court entered judgment in favor of Johnson and awarded her damages in the amount of the policy limits: $297,000 less a $500 deductible. Farm Bureau appealed, contending that the jury “committed manifest error” and was “clearly wrong” in determining that the non-renewal notice had not been delivered.

The Third Circuit Court of Appeal reviewed the trial record which contained the evidence Johnson offered to rebut the presumption of delivery. Johnson testified that she always opens every piece of mail she receives except for her bank statements, and that she never received the notice Farm Bureau. Johnson’s testimony was corroborated by her sister, who often picked up Johnson’s mail from the post office box which was Johnson’s registered address on her insurance policy. In response to Farm Bureau’s argument that Johnson should have known that her policy was expired because the company stopped withdrawing payments in May 2007, Johnson stated that she did not routinely open mail from her bank or reconcile her checking account. The court noted that “the jury was able to take [all of this] testimony into consideration” in making “a determination of the credibility of the witnesses.” Mindful of its duty to “afford great deference to the factfinders’ determinations,” the court concluded that, “although some of the testimony presented is questionable,” it could not find “manifest error in the jury’s credibility determination nor in their determination that the notice of non-renewal was not delivered to Johnson.”

The Johnson case, much like the Nolan case, turned on the critical role that the jury plays in settling issues of fact. Even if an appellate court believes after reviewing the record that its credibility determination is more accurate than the jury’s, it cannot substitute its own view unless it finds that the jury’s conclusion was based on testimony “so absurd that a reasonable person would not credit it.” Clearly, in this case, Johnson’s even somewhat suspect testimony did not rise to this level.

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The sad fact is that everyday accidents happen on our nation’s roads. Especially tragic are ones where a family member is killed. Combined with the pain of losing a
loved one comes the burden of dealing with insurance policies, who is insured and who is uninsured at the time
of the accident and trying to get coverage. In prior posts. we have discussed how liability is hard to assign at times, especially when it takes a fact-finder to establish who is at fault. In this Louisiana court case, an insurance company refused to pay uninsured/underinsured motorist (UM) liability coverage to the daughter of the deceased driver of a vehicle which was struck by an oncoming motorist.

In March of 2006, Donald Anderson was killed in a car accident when his car was hit by an oncoming motorist, Gordon Pugh, Jr. During the time of his death, Donald Anderson was within the scope of his employment with Labor Finders. Labor Finders had a liability insurance policy issued by National Union which was in effect at the time of Anderson’s accident. After the accident, Anderson’s daughter filed a survival and wrongful death action naming Pugh and his insurer as the defendants. Several months later in December, Anderson amended her petition to include National Union as the defendant. Anderson claimed that since her father was insured under the liability policy issued by National Union to Labor Finders at the time of the accident, then he was entitled to the mandated uninsured/underinsured motorist (UM) insurance. National Union denied this fact while Anderson was able to settle the claims with Pugh’s insurer. National Union filed for summary judgment and the trial court stated that their policy was clear, unambiguous and that under the terms the policy provided, Donald Anderson was not an insured at the time of the accident to whom it could afford coverage. Therefore, the trial court granted summary judgment in favor of National Union leaving Anderson with nothing after her father’s death.

Summary judgments are reviewed based on material facts in order to avoid a full scale trial. The courts grant this motion when there is no issue as to material facts, and the moving party is entitled to judgment as matter of law. In this case, it was up to the Anderson to show that the insurance company was not entitled to judgment as a matter of law.

Insurance policies in the state of Louisiana function much like contracts, and are, therefore, interpreted as such. When the court interprets an insurance policy, it generally interprets the intent of the parties in forming the contract. In order to get to the common intent of the parties, the court looks primarily at the language of the insurance policy; Louisiana courts have struggled with this because at times, the technical meaning of the words is hard to differentiate from the generally prevailing meaning. If words in an insurance contract have a “technical meaning” then this meaning must be applied when the contract is interpreted. In addition to interpreting the meaning of words, each provision and section of this contract must be interpreted in light of the other provisions. Matters become more complex here because one provision cannot and should not be interpreted at the expense of another. Should the court find that words in an insurance contract are clear and explicit, it must strictly apply those words as written. Things become more difficult when ambiguities in the contract still remain even after the general rules of the contract have been applied; this may cause problems for both the policy holder and the insurance company.

All liability insurance policies issued in the state of Louisiana are required to issue UM coverage equal to the amounts in liability coverage when there is no express waiver of reduction of the UM coverage. This type of policy only requires that the person be injured by a UM. To simplify this complexity, there exists a test to determine whether a person qualifies for UM coverage under liability insurance. The test is to determine whether this person would be covered if they were liable for the accident.

In this case, National Union maintained that Donald Anderson was not an insured under the original terms of the National Union Policy. A section of the policy clearly stated that all Labor Finders’ employees (which Anderson was at the time of the accident) were insured as long as they were within the score of their employment at the time of the accident (Anderson met this criteria as well). A reader can see that the plain language of the contract points to the fact that Anderson was insured at the time of his accident, unless there was some exclusion.

The caveat here is that insurers have the right to limit coverage in any way they desire as long as these limitations are clearly set forth in the contract. It is at times like these that you need a professional in the field who will know how to maximize coverage. Coverage exclusions are construed strictly against the insurer. In the current case, the policy contained an Endorsement which stated that National Union shall not pay for any damage which arises out of aircraft, auto or watercraft injury owned or operated by the insured. Anderson fell into this exclusion because his injury and subsequent death arose out of the operation of his own vehicle. While Anderson fell into a clearly stated exception in the policy, many other endorsements are more ambiguous and require thorough interpretation and scrutiny.

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Insurance policy coverage can be very confusing regardless of how simple televisions commercials may claim it can be. Sometimes insurance companies limit their liability by setting a time period within which the policy applies. In other circumstances, insurance policies limit their liability by creating categories of actions that can be instituted against it. For example, if an insurance policy states that it protects a health care provider for one year after the policy begins, this may mean that 366 days later a patient is out of luck if the doctor performs malpractice. Some insurance companies create distinctions on the types of actions that fall under the policy. For example, coverage can extend either based on occurrence or claims.

The distinction here is important, especially as it relates to the time period to bring a claim. If an insurance policy begins on January 1 and ends on December 31, the malpractice occurs on November 10, and the plaintiff files suit in March of the next year, the definitional difference is important. If the policy is occurrence based, the plaintiff will likely have no problem. In an occurrence based policy, coverage extends to any malpractice which occurred within the policy period. In our set of facts, since the malpractice occurred on November 10, it is covered because it is within the policy period. In a claims based policy, coverage extends to any claim that is filed within the insurance coverage period. In this case, although the malpractice took place within the time period of the insurance policy, the claim was not filed until after the coverage period had extinguished. Thus, in out facts, if the policy was claims based, the insurance company would not be liable for the malpractice.

In a recent case, Dewayne Wright v. Willis-Knighton Medical, the plaintiff, Ms. Wright suffered cramps, a coma, insulin shock, and stroke as a result of medical malpractice. The mother of the plaintiff filed suit on behalf of Ms. Wright. She filed initial suit against the facility, Willis-Knighton Medical. At a later date she amended her brief and added the ER doctors to the suit as well. Later, the plaintiff discovered that the insurance policy did not include the health care facility and only included the medical practitioners who decided to join under the coverage. The doctors that she added under the amended brief were originally protected by the coverage.

The problem for the plaintiff begins, though, when the insurance company that she sued later based its policy with the doctors on a claims based basis. Only the claims that were filed within the insurance coverage period were covered. Unfortunately for Mr. Wright, the period ended the day before the brief was amended. Mr. Wright argued that because the doctors were employed by Willis-Knighton, they were solidary defendants. However, because the policy did not cover the medical facility there is no legal basis to extend the coverage of the policy more than the contract states. Thus, because the coverage period had expired by the time the claim was brought against the insurance company and doctor, the claim failed to meet the requirement within the policy’s scope and thus must fail in court to make the insurance provider liable for the alleged malpractice.

This case shows that if you feel that your rights have been violated or that you have been injured because of medical malpractice that you should seek legal counsel as soon as possible. By waiting before speaking to an attorney you increase the chance that time may run out on your ability to protect your rights.

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The purpose behind having insurance is to help injured parties get relief. In a world without insurance, every accident has the potential to be the financial ruin of the party judged to be at fault. Insurance policies have the effect of creating a large pool of money that can be used to provided financial backing in the post accident period. However, insurance policies will not have the effect of covering every accident that occurs in every circumstances. For example, can we expect to allow an individual who uses his vehicle as a weapon to gain the benefits of his car insurance policy? Answering questions like this are at the cornerstone of lawsuits seeking compensation when tragedy strikes in unfortunately complex ways.

Strong public policy in Louisiana indicates that any accident that occurs in the course of committing a crime should not be protected by insurance. In fact, for obvious business reasons, most insurance policies limit the insurance company’s liability with a crime exception. The Ruston City Court, Parish of Lincoln, State of Louisiana, had this concept in mind when it made a recent decision.

The defendant, Shedrick Green, was driving down a road while he was feuding with another individual in another car. At one point, the party in the other vehicle pulled into a parking lot, at which time Mr. Green pulled out a gun and began shooting. After shooting at the other vehicle, he got back into his car and continued driving. At the next stop sign, he drove into the intersection without stopping at the stop sign and his vehicle collided with the vehicle that the plaintiff, Latasha Potts, was driving. At the trial court level, Ms. Potts sued both Mr. Green and his insurance company. The trial court ruled that driving through the intersection was part of a continuation of a criminal activity. The insurance policy on the vehicle driven by Mr. Green stated that the policy did not extend to criminal actions. Thus, the trial court ruled that the insurance company was not liable because of the criminal nature of the vehicle’s use.

However, upon appeal, the appellate court looked at the circumstances differently. Mr. Green was arrested for assault and battery. According to the facts set out by the trial court, the assault and battery were completed when Mr. Green shot at the other vehicle and drove away. Any action taken after that was not in the course of a criminal activity. If Mr. Green had been charged with fleeing the scene of a crime, there could be a chance that the accident with Ms. Potts was a criminal activity. Parties who are involved in an accident expect to be protected against normal acts of negligence on the part of a driver. In this case, Mr. Green drove down the road and negligently failed to realize that he needed to stop at the stop sign. Thus, the accident with Ms. Pott was as a result of Mr. Green’s negligence, not his prior criminal actions. Criminal law should not be used as a tool to limit civil liablity. Thus, the appellate court overturned the trial court decision.

Insurance policies have the potential to deal with many different areas of law. The facts of this case show an interlocking of civil, contract, and criminal law all in one case. Thus, it is essential or any person who has been involved in a car accident to seek legal advice. Simply settling with an insurance company may not be the most effective way to retain your rights. By consulting with an attorney, finding where the law is flexible or is not as simple as first glance can mean a significant amount, like in this case.

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The Fourth Circuit Court of Appeals in New Orleans recently affirmed that a policyholder was covered by his Homeowner’s policy for injuries inflicted during a brutal accident where another was seriously injured. While leaving a party, Hurst – the policyholder – fashioned a lock pick out of wire to open the door of his truck in which he had locked his keys. After gaining access, he flung away the wire and it bounced off the back of his truck and into the open window of another departing guest, Ms. Baker, injuring her severely.

Hurst held two liability insurance policies with Liberty Mutual: a $300,000 Homeowner’s policy and a $30,000 Automotive policy. The injured Baker sued Hurst, Liberty Mutual Insurance, and her own Uninsured Motorist carrier: Allstate. Through procedural motions, both Baker and Liberty Mutual asked the lower court to make a determination as to whether Hurst was covered by the higher limit homeowners’ policy at the time of the accident.

The Homeowners’ policy included a provision excluding coverage for personal liability and medical payments for bodily injury “arising out of the ownership, maintenance, use, loading or unloading of motor vehicles.” The heart of the issue became whether Hurst’s use of the wire to gain access to his vehicle and throwing it into his truck bed was “use or loading of the vehicle” such that it would bar the coverage of the Homeowners’ policy.

The lower court ruled that Hurst’s throwing of the metal object onto the hard surface of the truck bed had no connection to the use of the truck; it was the disposal of the object itself that was negligent. This is because courts consider the role the vehicle played in the entire scheme. Here, the Fourth Circuit reasoned that the vehicle must be central to the theory of liability and that here it was not – the flinging of the wire was at the heart of Hurst’s liability for injuring Baker. Applying the relevant legal standard from a case called Carter, the Court considered whether (1) the conduct of the insured was a proximate cause of the injury (it was); and (2) whether it was a use of the automobile (it was not). The Court therefore ruled that the exclusion for automobile use did not apply and Hurst’s conduct at the time of the accident.

Homeowners’ policies often include higher limits for liability than do automotive or other policies that people who injure you might have. Given the tragic nature of Ms. Baker’s injury, it is somewhat clear why she sought the Homeowners’ $300,000 policy coverage and why Liberty Mutual sought to deny coverage on that claim.

Legal expertise is very often required to achieve the best outcome for your injuries because insurance companies like Liberty Mutual will skillfully and zealously attempt to limit the amount payable to injured persons – as they did here.

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