Insurance Lawyer Blog

Our San Francisco insurance claim attorney know that there are many ways nature can cause problems in a state as big and diverse as ours. Last week this blog talked about a flood (see here). This week another act of nature caught our eye- wind and wind damage. In early December, hurricane force winds pummeled areas of Southern California and left hundreds of thousands without power. Estimates say the storms may have caused $40 million in damage. The Santa Ana winds toppled countless trees, especially in the hard-hit Pasadena area.

When Californians are faced with these weather emergencies, it is a good wake up call to the rest of us to ensure we are as prepared as we can be for natural disasters. People often have specific insurance coverage for earthquakes or for floods, but do you know how wind storm damage will be handled by your insurance companies?

Most homeowner’s insurance policies will include some coverage for wind damage, such as a tree falling on a house. "So long as that tree has damaged something on your house or property, your homeowner's policy will typically have some amount available for tree removal," said Candysse Miller, executive director of the Insurance Information Network of California to the Pasadena Star-News earlier this month. Other less visible kinds of damage can be more difficult to deal with. Insurance companies often try to claim things like damaged or loosened tiles or shingles on your roof due to high winds is actually caused by normal age/ wear and tear. Roof problems can lead to other expensive home issues, such as water leakage, if the roof is not properly repaired. Insurance companies may also try to claim that only some tiles or shingles need replacing, but before you agree to that make sure you know the true extent of the damage to your roof and do not accept a partial fix to a much bigger problem. You pay for your homeowner’s insurance and you deserve the full benefits you need.

More problems may arise with your car insurance. California Insurance Commissioner Dave Jones pointed out that physical damage is not always covered, and you have to choose to include it in your insurance policy. A comprehensive policy should cover damage from wind storms, while the minimum auto insurance required- liability insurance- will not.

Wind damage is fairly common and occurs in big storms all over the United States. It is important to know what exactly is covered under your insurance policies before a disaster happens, so you are informed about what you are paying for and what benefits you can expect. A San Francisco insurance lawyer can help go through your policies and make sure you have the coverage you need and can watch out for any fine print or hidden clauses that could affect your benefits.

Even being informed sometimes cannot protect you from unscrupulous insurance companies trying to deny benefits. When you are faced with substantial damage from a natural disaster, it is always a good idea to consider talking to a San Francisco insurance claim attorney. Insurance companies may be more willing to negotiate or settle claims if the claimant has an experienced attorney on their side.

In closing this week, everyone here at the Brod Law Firm wishes our clients and friends a happy and safe holiday season!

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California Flood Made Worse By Tricky Insurance Companies

California Insurance Law Fraud Basics

Our California insurance attorneys know how difficult it can be to deal with insurance companies after an unexpected disaster. When something happens that severely disrupts your life, like a major illness, death, or natural disaster, the last thing you want to think about- worry about- is dealing with an insurance company employee asking you all kinds of questions. But what is worse is when you realize that all the money you paid over the years to the insurance company is no guarantee that the benefits you expect will be available when you need them.

Our San Francisco insurance attorneys noticed one striking recent example in a CBS News story this week. It involves a California town called Capitola, the site of devastating floods earlier this year. In March, a drainpipe in Capitola burst after an average rain storm. The very next day a larger storm hit the area and Capitola was not only already dealing with a problem, but there was no pipe to drain the water anymore. For the residents of Capitola, California, their problems were just beginning.

Some residents had flood insurance, and they thought surely the hard earned money they paid to their insurance company would allow them to rebuild. But those residents discovered that when they called about their flood insurance, their insurance company told them that the situation did not count as a flood. The company claimed it was a broken pipe and directed the policyholders to their liability insurance. But they were then told by the liability insurance handlers that it was a flood, so the liability insurance does not cover the damage. This ridiculous dilemma caused not only many people to worry about their homes, but also severely affected small local businesses trying to stay afloat in a recession economy.

One insurer of a small gallery denied the claim because it stated that the damage was done by “surface water”, which is not covered under the policy. Of course, the reason there was surface water was the broken pipe and broken pipe damage should be covered. When the gallery tried to make this argument, the insurance company denied them again by claiming a clause that limits coverage 10 days before or after a flood, which is exactly when most of the damage occurs. This is just another example of insurance company trickery and using obscure clauses and fine print to cheat the policyholder out of benefits he or she has diligently paid for over the years.

For the residents of Capitola, it seems no rational argument will change the insurance companies’ minds. The only option many residents and small business owners are left with is to sue the companies to try to reclaim the damages owed to them. And Capitola residents are not alone. Situations like this with insurance companies occur all the time all across California and the United States. CBS News pointed out that if you find yourself in this type of insurance trouble, it is important to contact an insurance attorney for assistance. The Brod Firm could not agree more, and encourages anyone feeling tricked or abused by their insurance company in our area to talk to an experienced San Francisco insurance attorney without delay.

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California Insurance Law Fraud Basics

Helping Residents with California Insurance Law Issues

Our San Francisco insurance attorneys know how to deal with insurance companies who are wrongfully trying to deny consumer’s the benefits they paid for. We know how frightening it is to hear that an insurance claim is denied when you were counting on that money for critical expenses. But 2012 holds promise for a more fair insurance litigation environment when a company improperly denies a life insurance or disability claim thanks to a new law- California Insurance Code Section 10110.6. It is important to note this new law relates only to life insurance and disability insurance, and not other types of insurance. It was sponsored by Senator Ron Calderon with the support of California Insurance Commissioner Dave Jones, unanimously passed the Legislature and was signed by Governor Jerry Brown in October. A similar bill was vetoed by Governor Schwarzenegger in 2010.

As of January 1, insurance companies in California will no longer be able to reserve discretionary authority to the themselves to determine or interpret a policy and decide if a policyholder is entitled to benefits. It applies to all life and disability insurance policies that are issued, delivered, or renewed to a California resident starting in January. This gives discretion in these matters to judges, which is as it should be. Judges know the law and are impartial observers. It is common sense that it is unfair to have a party to the dispute- one who stands to earn money depending on the outcome- be the final arbitrator of that dispute. Insurance Commissioner Jones likened it to a “fox guarding a henhouse.” But that is exactly how these scenarios worked until the passing of this new law. Insurance companies used these discretionary clauses as a shield from liability for valid claims and therefore nullified bargained for benefits. Suing the insurance companies over inappropriately denied benefits was often useless. If the policy included a discretionary clause, the judge’s hands were tied and he or she had to assume the insurance companies acted correctly unless the policyholder could prove that the company’s denial of benefits was arbitrary or capricious. Even if a judge believed the policyholder should have received the denied benefits, unless the company was arbitrary or capricious the judge could offer no remedy to the policyholder, who was left disabled or grieving for a loved one often in dire financial straits.

As San Francisco insurance denial attorneys, we are thankful the new law addresses this obvious inequity and helps level the playing field for consumers. It stops the practice of biased insurance companies ignoring or overriding a doctor’s opinion about whether a policyholder qualifies for disability benefits based on their own greedy concerns for their profit margins.

Even with this new legal advancement, if you believe you were unfairly denied benefits by your insurance company you should contact an experienced San Francisco insurance lawyer in your area to discuss your case. These new laws and protections will not be useful to your situation if you do not have a legal representative in your corner to help you navigate the law and with the experience to see through insurance companies’ endless bag of tricks.

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California Insurance Law Fraud Basics

Helping Residents with California Insurance Law Issues

Our firm's San Francisco insurance attorney knows that there are a lot of small business owners in our community, and that employee health insurance accounts for a significant amount of these local business’s costs. Often, health insurance is second only to payroll as a business’s greatest expense. Usually, small business owners have an insurance broker who sets up the company’s health insurance, and that broker earns a commission on the premiums on that account. This creates a disincentive for brokers to find ways to decrease expensive premiums for the business owners because that would decrease their commission.

The new federal healthcare legislation, the Affordable Care Act stipulates that insurance companies have to spend at least 85 percent of premiums on claims for employers with at least 50 employees, and for individuals and small business with less than 50 employees, at least 80 percent must be spent on benefits and improving quality for the customer, to avoid the medical loss ratio from things like broker commissions. The new law also requires that insurance companies publicly report how they spend premiums, so consumers can see how much of their money is spent on medical care and how much is used for administrative purposes.

A smart business owner will talk with their insurance broker and ask how the broker is working to decrease the business’s health insurance costs. The amount and type of insurance claims made by the employees determines the premiums, and therefore the cost to the company. By asking the insurance company for this data on medical claims, a business owner can see where costs need to be lowered and by knowing the problem, can more easily determine effective solutions.

Aside from the federal Affordable Care Act, San Francisco small business owners are no doubt aware that the City of San Francisco also has its own Health Care Security Ordinance that affects those who do business in the city. A business falls under this Ordinance if it engages in business in San Francisco, is required to obtain a business registration certification with the city, and employs 20 or more employees per week (which also includes employees working outside of San Francisco). Nonprofits with fewer than 50 employees and small businesses with less than 20 employees are exempt from the spending requirements under the Ordinance. A covered employee is one who has worked for the employer for at least 90 days and works at least eight hours a week in San Francisco. The Ordinance proscribes the amount of money a business must spend on each covered employee per hour, which will increase in January. In the coming year of 2012, businesses with more than 100 employees will have to expend $2.40 per covered employee per hour on health care. Businesses with between 20 and 99 employees will have to expend $1.46 per covered employee per hour on health care.

With health care insurance costs so significant to local businesses, San Francisco’s small business owners cannot afford to lose money from being cheated on their insurance. Small and medium size local business should contact an experienced San Francisco insurance attorney with any concerns about mishandling or bad faith in their insurance matters, or with any questions about compliance with the new federal and San Francisco insurance laws.

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California Insurance Law Fraud Basics

Helping Residents with California Insurance Law Issues