February 5, 2010 by Zale.

When you have been involved in an accident and your vehicle has been damaged, the question of whether or not the vehicle is a total loss often comes up. Generally the average individual has not had to deal with this situation before. Therefore, I would like to take a few moments and touch on the topic. I will refer to Tennessee law, however, many of these principles are fairly universal.

What is a “Total Loss”? It is when the value of the repairs exceeds a certain percentage of the value of the vehicle. In Tennessee there is a statue which addresses this. Tenn. Code Ann § 55-3-211(9) defines a “salvage vehicle”, which is what your damaged vehicle has now become, as:

“…any passenger motor vehicle which has been wrecked, destroyed, or damaged to the extent that the total estimated or actual cost of parts and labor to rebuild or reconstruct the passenger motor vehicle to its pre-accident condition and for legal operation on the roads or highways exceeds seventy-five percent (75%) of the retail value of the passenger motor vehicle, as set forth in a current edition of any nationally recognized compilation (to include automated databases) of retail values.”

Therefore, in my experience, the 75% mark in Tennessee is generally threshold for a total loss. For example, if you vehicle is worth $10,000 and the value of the repairs is $7,500, its a total loss.  However, I do not know of any rule preventing an insurer from using a lower threshold.

What often complicates this process is the way most vehicle damage estimates are written. Most of them are written with the anticipation that there will be at least one additional estimate written, that additional estimate is called a supplement. So, if the shop writes a $6,800 estimate for the above vehicle, it may not technically be a total loss at the time the estimate is written. This occurs because most insurance companies want their estimates to be written on “visible damage”. After the shop tears down the vehicle, that is when they can see the additional damage and the supplement is written. Therefore, just because the initial estimate says $6,800, that does not mean that that is the maximum amount of the damage to the vehicle. It just means that is the visible damage to the vehicle.  (At one time, appraisers could use their experience and common sense to write estimates of hidden damage, but rarely do companies allow them to use their common sense any more.)

Based on the above, I have seen shops write, what I thought, were intentionally low initial estimates and then issue three to four supplements after having the vehicle in the shop. Some of those vehicles might have been better off as total losses, but then the shop would not have gotten paid to fix them.

So there’s the basic concept of a total loss, which often goes unexplained to the average consumer.  If you have any questions as to a related topic, such as the evaluations run by the insurers or determining the retail or market value of your vehicle, please feel free to post a comment.

Posted in Insurance Practices, Insurance Law | 1 Comment »

December 17, 2009 by Zale.

Since I was an insurance adjuster for over a decade, I enjoy dealing with insurance related disputes.  They don’t come up all the time, but when they do, they can be very stressful for the client.

Here is a recent Tennessee case dealing with such a dispute.  This appears to be what’s known as a “construction defect” claim where the insurer denied coverage.  I handled a few of these.  They’re pretty complex.

In this scenario, the proper way to get the court to determine coverage is known as a Declaratory Judgment Action.  In this case, the plaintiffs made other claims like “bad faith”, “Tennessee Consumer Protection Act” and that sort of thing, but for me, the heart of this case is that the court DID GIVE THEM INSURANCE COVERAGE at the end of the day.

Posted in Litigation, Insurance Practices, Insurance Law, Business Law | No Comments »

August 31, 2009 by Zale.

Tennessee is typically a pretty conservative state when it comes to people being injured on the premises of a business.  However, the case law in Tennessee does not let a business owner completely escape liability for the bad acts of an individual on the business property.  If it can be proven that the business had some culpability for the acts of that person, even if those acts are criminal, then the business can be held liable for the acts of that person.

Recently a plaintiff won $10 Million, yes Million, against Ruby Tuesday.  What did Ruby Tuesday do wrong?  It sold alcohol to an already intoxicated person, who then beat the stew out of the customer / plaintiff.  Wow!  That makes one wonder if Tennessee is as conservative at the insurance defense bar once thought it was.

Posted in Litigation, Injury Law, Insurance Law, Business Law | No Comments »

August 18, 2009 by Zale.

Some folks think that rear end automobile accidents are a “shoe in” to win.  Over my years as an adjuster, covering most of the southeast and even some of the southwest, I’ve seen them lost from time to time.  Attorneys and claimants alike would think I was crazy when I would bring it up, but it does happen.

Here’s the latest case of this nature that I’ve seen.  Apparently the plaintiff won the issue regarding the defendant being at fault, but the plaintiff lost on the issue of any of the injuries being related to the accident.  Why?  Well, it appears to have been a fairly minor accident and the plaintiff appears to have had a history of medical problems, which lead up to this accident.  In short, the jury didn’t believe the plaintiff.

At the end of the day, its still a popularity contest and you never can predict what a jury will do.

Posted in Litigation, Injury Law, Insurance Law | No Comments »

March 19, 2009 by Zale.

In this recent case, the plaintiff argued that the insurance policy was ambiguous when it came to the meaning of “regular use” of a vehicle.  See if the injured party had “regular use” of a vehicle that was not listed on his personal insurance policy, ie, his police patrol car, then there was no Uninsured or Underinsured Motorist coverage under his personal insurance policy.

The plaintiff’s argument here is something along the lines of Bill Clinton question the meaning of the word “is”.  Generally when someone attacks an insurance policy, they claim the wording is ambiguous.  Sometimes it is.  This argument was successful at the trial court level, but not at the Court of Appeals level.

What do we learn from this case? In Tennessee, it is generally a safe bet that if there’s a common, plain way to read an insurance policy, that’s the way it is going to be read.  This is unfortuneate for the plaintiff, but fortuneate for the rest of Tennessee.  The reason is that if courts start rewriting insurance policies, then insurance rates will go up to make up the difference.

Posted in Injury Law, Insurance Law | No Comments »

February 27, 2009 by Zale.

In an injury case in Tennessee where there is  hospital lien, it is a big deal.  Why?  Tenn. Code Ann. §29-22-101.  It gives the hospitals a “big stick” to wield against insurance companies, specifically automobile insurance companies.

In this case,  Nationwide felt the wrath of the The Med under this statute.  The Med, who is very well informed regarding this statute, recovered their entire lien amount of $33, 823.02 when the automobile insurance policy only had $5,000 in coverage.  Trust me, that’s every adjuster’s nightmare.  When anyone recovers more than the coverage on the policy, insurance companies just come apart at the seams.

So, if you are wondering why an adjuster is more concerned about your hospital bill than any other bill, its becase of Tenn. Code Ann. §29-22-101.

Posted in Injury Law, Insurance Practices, Insurance Law | No Comments »

February 27, 2009 by Zale.

You don’t have to read this blog long to know that I am somewhat critical of slip and fall claims.  Why?  Because the courts are highly critical of them.   With that being said, there are valid slip and fall claims, even if they are few and far between.

Take this case for example.  When a business encourages the throwing of peanut shells on the floor as part of their image, they should not be surprised when someone falls on one of the shells.  Furthermore, a jury should get the opportunity to decide whether or not that business should be held liable for the person’s injuries.  Who knows, maybe the jury will see that the person who fell should have been more attentive.  But the case should still be allowed to go to the jury.

In this case, the trial court in Davidson County, Tennessee granted the restaurant Summary Judgment finding that the “restaurant did not owe a duty to patron because the presence of the peanut shells was not a latent or hidden condition and did not create a defective or dangerous condition which presented a foreseeable risk of serious injury.”  Fortunately, the Tennessee Court of Appeals did not agree with the trial court’s decision.

I think the Court of Appeals got this one right.  (I’m sure they can all breathe easier now.) They did not give the plaintiff a “pass” on her case.  She still has to convince a jury that the restaurant is liable for her injuries.  But at least now she will have the chance to present her case to the jury.

Posted in Litigation, Injury Law, Insurance Law, Business Law | No Comments »

January 3, 2009 by Zale.

The problem is lack of consistency.  In some instances, they will offer you money on cases that you never dreamed they would.  Those are good days.  In other instances, they make terrible offers or even denials on very viable cases.

They claim that this is due to every claim being different.  I think there are more subtle reasons like:

• How well the claims staff, including the manager and claims analyst, is trained. Many people would be amazed at how poorly and inconsistently claims operations are trained.
• How much the insurance company simply wants to close claims. Insurance company “sales” are a good thing for everyone.
• Whether or not the claimant or attorney has upset the adjuster. Don’t bite the hand that you want to feed you, if at all possible.  Sometimes its just unavoidable.
• The current trend of the company or industry regarding making fair offers or making a point.  Insurance companies watch and imitate each other.  Each one goes through trends of first, “look how much we are cutting claims costs” then “we need to reduce our number of claims”. Often, they never figure out that the two are related.
  
• Whether or not the company or adjuster is seeing every single claim as fraudulent.  Which was the culture at Allstate.  Everything to them seemed to be fraud.
• Or even matters as arbitrary as whether or not its the end of the month or the end of the year.  Often this is the best time to push for the closure of a claim, since insurance companies adjust their mandated reserves at the end of each month.

So what’s my point?  If you value your claim, you’ll talk to an attorney about it, before its too late.

Posted in Negotiations, Litigation, Injury Law, Insurance Practices, Insurance Law | No Comments »

December 17, 2008 by Zale.

Insurance adjusters are hired to investigate and resolve claims on behalf of the insurance company.  If the settlement is cheap, then they have done their job.  They are not interested in the claimant’s well being or best interests.

One questionable tactic I’ve been seeing lately is the adjuster telling the claimant that the insurance company won’t consider the claim until after the first year or that the claimant has until the end of the first year to get in all their paperwork.  In Tennessee, the end of the first year means the end of the statute of limitations period.  So, by waiting the year, the claimant is now out of luck, if the claimant didn’t file a lawsuit.  (I wish I could get this statement in writing from the insurance company.  I believe that would constitute bad faith.)

So, I know that the adjuster may be nice and personable, but its for a reason.  Its to try to keep the claimant “under control” and to keep the settlement low.  I’ve never seen a low settlement be in a claimant’s best interest.

I know that there are more and more pro se cases being filed and plenty of self help solutions available.  Is it really worth it to try and handle your case on your own?  The insurance company hired and trained an adjuster to handle your claim.  Don’t you think you ought to hire someone too?

Posted in Injury Law, Insurance Practices, Insurance Law | No Comments »

November 16, 2008 by Zale.

It has been suggested to me that I should take just about any injury case that comes up, even if I don’t see merit in the case.  I disagree with this approach.  I only take cases that I believe have merit.  To do otherwise would support frivolous litigation.  It also does a disservice to the client.  If they have a bad case, the attorney should be the first to tell them.

Posted in Litigation, Injury Law, Insurance Law | No Comments »