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BT Policyholder Protection Blog
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24 Apr 2015 YOU WANT MORE THAN ‘FULL COVERAGE’

A recent Indiana Supreme Court case addressed the question of what it means to ask an insurance agent for “full coverage.” At renewal time, policyholders often tell their insurance agent that they want “full coverage.” That term means different things to different people. The policyholder may be thinking of its property insurance limits in case a fire destroys the building and contents. They do not want to be underinsured– they want “full coverage.” At the same time, the agent may be thinking in terms of the types of coverage needed to fully insure the policyholder’s business (employment practices, business interruption, environmental, cyber, CGL). The agent may think in terms of the risks the policyholder needs to be insured against so they have “full coverage.”  …

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04 Feb 2015 Insurance Company Favorite: The “Loss Adjustment Expense”

As you’re evaluating your company’s liability insurance program for 2015, consider closely the application of the policy’s deductible.  Specifically, take a look for any endorsement that defines “Allocated Loss Adjustment Expense,” or “ALAE,” to make sure the language matches up with what you think you are purchasing.   Liability policies are usually sold with some form of deductible, which remains the policyholder’s obligation in the event a claim is asserted against the policyholder. In assessing its risk tolerance, an insurance purchaser may buy policies with higher or lower deductibles. The deductible applies to the insurance company’s obligation to indemnify for claims asserted against the policyholder.  But most often, it does not apply to the costs of defense. In other words, the defense obligation purchased by…

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25 Nov 2014 Do We Have Coverage for This? Sometimes it’s worth getting a second opinion

Do you have coverage for claims?  Here is a perfect example of a situation where you might not want to take no for an answer. Recently, a firm client received a letter from the U.S. E.P.A. advising of an underground environmental contamination which appeared to be coming from their property and would require significant remediation.  When the firm client called its insurance broker, he advised that the client had no coverage for the claim, because it was excluded from coverage by the pollution exclusion in their commercial general liability policy.   When the client turned to Barnes & Thornburg LLP for help, we submitted the claim to several of the client’s commercial general liability insurers.  With the notice of claim, we provided the insurers with…

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13 Jun 2014 “Race to the Courthouse” Forum Shopping Strategy

  On behalf of a firm client, Barnes & Thornburg LLP attorneys Bob Devetski and John Fischer, working with local counsel, defeated Travelers’ “race to the courthouse” forum shopping strategy. Travelers’ strategy in the case is not an isolated incident, but seems to be a more prevalent practice of forum shopping to defeat their policyholders.   In 2011, rather than responding to the policyholder’s request for coverage of an environmental contamination lawsuit, Travelers filed a pre-emptive declaratory lawsuit in Iowa (whose law on the issue of insurance policy pollution exclusions Travelers believed is much more favorable to insurance companies). Travelers filed suit in Iowa a few days before the policyholder sued for coverage in Indiana, essentially winning the race to the courthouse of their choice….

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14 May 2014 Insurance Claim? Be Prepared for Insurance Company Forum Shopping

  Because the insurance industry is subject to different laws in different jurisdictions, it is possible for the same claim under the same policy language to be covered in one state, and not covered in another.  Thus, insurers who write policies in different states identify which states are more favorable for certain types of claims or for certain policy language.  So when they are placed on notice of a policyholder’s claim from a jurisdiction that is not friendly to insurers in general, or to their policy language in particular, they may look to other possible jurisdictions in which to engage their policyholder in a coverage battle, hoping to defeat coverage by applying more favorable law, in a more favorable forum.   This is the scenario…

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