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  • Hurricane Rita cases yet to reach trial

    As the 2009 hurricane season looms, insurance companies continue to delay and prolong their payouts from 2008’s storms and stall trials. Cases based upon Hurricane Rita STILL have not begun to work their way through the Jefferson County, Texas, courts.

    Another Hurricane Rita insurance trial gets nixed
    By David Yates
    In four years, three hurricanes have whipped through the Golden Triangle area, leading to thousands of lawsuits by property owners who claim they were short changed by their insurance companies.

    However, not one of those filings has made it to trial yet.

    A case over a homeowner’s insurance claim for damages from 2005’s Hurricane Rita case was set to go to trial on Feb. 3, but was nixed before summoned jurors could step foot in court.

    The trial of David Scott vs. Braud, Vaughn & Williamson Insurance Agency et al has been reset for April 17.

    Scott sued the insurance provider, along with one of its agents, in November 2006, for allegedly failing to secure a policy on his Nederland rental property.

    More of the article may be read here but it is very apparent the insurance companies have zero incentive to make it easy on their policy holders to make a claim and instead work the system to limit the amount they pay out. Because of this, it is all the more important to be on top of your claims and maintain your end of the policy deal so that, in the event of a storm, your claim may be made immediately and, should the insurance company pull any games, you are ready and fully equipped to proceed with litigation.

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  • Understanding Terms: Glossary

    When going about shopping for the right policy or making sure your policy protects you in the ways you need, it is important to understand insurance terms used. In educating yourself about the legal jargon employed by the insurance companies, you can be better prepared to combat an unfair claim payment or prevent your policy from being hijacked by vague language.

    Below, courtesy of the University of Illinois, is a glossary of insurance terms, ranging from the letter G to I:

    Grace period. A period (usually 30 to 31 days) following the premium due date, during which an overdue premium may be paid without penalty. The policy remains in force throughout the period.

    Group insurance. Insurance issued to an employer for the benefit of employees or to members of an association.

    Guaranteed insurability. An option that lets the policyholder buy more life insurance at stated times in the future without a medical exam.

    Guaranteed renewable. A policy that is always renewable as long as premiums are paid. A company may raise premiums for all policyholders within a particular group.
    Guaranty fund. A state fund to pay claims of insurers when a company is insolvent.

    Health insurance. Insurance to pay for medical losses to individuals.

    Health Maintenance Organization (HMO). An organization that provides a wide range of comprehensive health care services to members who prepay of a fixed periodic fee for the service.

    Home health care. Includes a wide variety of services that bring care to the home: skilled nursing care, physical and occupational therapy, speech therapy, personal care, and the assistance of home health aides (sometimes referred to as homemakers) with chore services.

    Home inventory. A list of personal possessions, along with the date purchased, the purchase price, and any information that would help identify an item in case of loss.

    Homeowners insurance. Coverage for your place of residence and its associated financial risks. Insurance to pay for losses of personal or real property and for losses resulting from perils specified in the insurance contract.

    Hospice. A center for the care of terminally ill individuals who do not require the specialized technology available in hospitals. The hospice center may be within the hospital structure.

    Hospitalization policy. A policy that covers the hospital expenses incurred in an in-patient hospital stay.

    Indemnity income policy. An insurance policy that pays income to the insured during hospitalization.

    Industrial life insurance. Life insurance issued in small amounts, usually less than $1,000, with premiums payable on a weekly or monthly basis.

    Inflation guard endorsement. A special endorsement that increases the face amount of a homeowner’s policy on a regular basis to compensate for the increasing costs of home construction.

    Insured. The individual who is insured against loss for health, auto, life, home, etc.

    Insurability. Acceptability to the company of an applicant for insurance.

    Insurance commissioner. The central figure in regulation of the insurance industry in each state who exercises judicial power in interpreting and enforcing insurance code.

    Insurance examiner. The representative of a state insurance department assigned to audit and examine the affairs of an insurance company.

    Issue limits. The maximum disability benefit an insurer will pay any one individual.

  • Thousands of Hurricane Ike Victims Still Without Resolved Claims

    While 60 to 80 percent of damage claims have been settled as of December 10, as reported by MSNBC on January 26, thousands of Hurricane Ike victims still have not had their issues resolved. With more and more Texas residents waiting for a response from their insurer, litigation is beginning to be the only option as insurance companies drag their feet to make payouts.

    As Texas Insurance Code has time requirements in which residents are guaranteed prompt action from the insurance company, specific legal ramifications exist to compensate the insured when the policy provider fails to assist in a timely manner. The Texas Department of Insurance is looking into mediation programs that mirror those in Florida, Mississippi and Louisiana as a manner of third party resolution. However nothing is certain at this time.

    What is certain, however, is that Hurricane Ike victims need assistance and need it now. Insurance companies often stall or delay claim proceedings in order to make policy holders feel “grateful” when the payment finally does arrive. This payment, though, oftentimes is inadequate and not the compensation they deserve. By having an attorney look into their claim and the process it has taken up to this moment, those individuals that were affected by Hurricane Ike can be ahead of the curve if or when litigation is necessary.

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  • Recession Looks to Raise Policy Premiums

    According to NOLA.com, where Katrina raised prices and handicapped policy holders with higher premiums, the national recession is continuing the trend.

    In an article published today on NOLA.com, the specter of rising costs has many people facing the hard decision of paying more or cutting coverage.

    Insurers can’t make the investment returns they’ve made in the stock market in recent years and they’re unable to raise new money from investors, so they can’t support as many policies on their books. Meanwhile, reinsurance rates have risen as companies try to buy more coverage and because 2008 was the second-worst year for disasters worldwide, costing the insurance industry more than $50 billion.

    With few options for raising capital, insurers need to shed policies from their books and raise rates to make the numbers work.

    In the event of a hurricane, this shortened coverage means that damage will no longer be reimbursed and families will face even worse hardships than they do today. With policy holders cutting coverage, though, agents may become more vague with what policies do and don’t cover. This is extremely problematic for individuals who are unfamiliar with insurance law and raises the importance of having a full understanding and conversation with your agent, as well as the assistance of an attorney if the worst happens and your claim is denied unreasonably.

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  • Understanding Terms: Glossary

    When going about shopping for the right policy or making sure your policy protects you in the ways you need, it is important to understand insurance terms used. In educating yourself about the legal jargon employed by the insurance companies, you can be better prepared to combat an unfair claim payment or prevent your policy from being hijacked by vague language.

    Below, courtesy of the University of Illinois, is a glossary of insurance terms, ranging from the letter D to F:

    Deductible. The amount of covered charges an individual must pay before the insurance company begins payments. Insurance company can only require individual to pay 50% of the basic health services.

    Depreciation. The decrease in the value of the property due to use, deterioration, or the passage of time.

    Disability. Physical or mental handicap resulting from sickness or injury. It may be partial or total.

    Disability income insurance. Insurance that provides periodic payments to replace income when an insured person is unable to work as a result of illness, injury, or disease.

    Discharge planning. Under managed care, facilitates the transfer of a patient to a more cost-effective care facility after it is deemed that the patient no longer needs to remain in the hospital.

    Dividend. A return of part of the premium to policyholders of insurance from a participating company when earnings exceed costs.

    Double indemnity. An insurance policy clause that pays the beneficiary double the actual value of the contract in case of accidental death.

    Dread disease insurance. A health insurance policy that protects against medical expenses resulting from a certain dreaded disease such as cancer.

    Eligibility period. A specified length of time, frequently 31 days, following the eligibility date during which an individual member of a particular group is eligible to apply for insurance under a group life or health insurance policy without a medical exam.

    Elimination period. The period of time before insurance benefits begin. Endorsement. A policy feature that increases the coverage of a standard insurance policy.

    Endowment insurance. A plan of life insurance that pays a definite sum of money to the policyholder after a specified number of years. If the policyholder dies before the end of that time, the policy pays a beneficiary.

    Exclusions. Specific conditions or circumstances listed in the policy for which the policy will not pay claims or benefits.

    Face amount. The amount that a life insurance policy will pay at death or when the policy matures.

    FAIR Plan. A program to provide homeowners insurance coverage to individuals who have been refused coverage by at least three insurance companies.

    First-dollar Coverage. A hospital or surgical policy with no deductible.

    Floater endorsement. An addition to a policy that adds coverage for specific personal property item(s) that are movable (such as jewelry).

    Free-look period. The time you have to look at a policy and return it to the insurer for a full refund.

    Full replacement policy. A homeowners policy that pays to replace, rebuild, or repair damaged property at the cost of replacing the property (up to the policy maximum).

  • State officials call into question State Farm’s “plight”

    In further developments to State Farm’s desired exit from providing insurance to customers in Florida, the state’s insurance regulators have begun investigating and questioning just how reasonable the insurer’s claims are.

    Insurance regulators question State Farm’s dire claim
    By Paige St. John
    State Farm, Florida’s second-largest home insurer, pleads poverty as it attempts to exit the state and send more than 700,000 customers scrambling for coverage.
    Company officials say they are losing $20 million a month. After being denied a 47 percent rate increase late last year, continuing to operate in Florida “would have resulted in insolvency,” said State Farm Florida CEO James Thompson.

    But a review of the company’s regulatory filings suggests a different picture:

    Over the past decade, State Farm Florida collected $2.6 billion more in premiums than it paid out in claims. State Farm says all that money has been used to pay expenses.

    In the past four years, State Farm Florida has moved $2 billion out of Florida to its parent company for reinsurance, paying its parent to assume nearly all of its hurricane risk.

    The full text of the article may be read here.

  • Couple underpaid by insurer after Katrina receive additional $500,000

    When James and Gladys Kemp Lisanby felt they did not receive the proper amount they deserved from their insurance company after Hurricane Katrina severely damaged their home, they did what many Gulf Coast residents are unfortunately too scared or unsure to do: they got a lawyer. And they won.

    After receiving over $900,000 in 2008 for their suit of policy limits for their losses and punitive damages as a result of deliberate underpayment, the Lisanbys received an additional $500,000 in January of 2009, bringing their total awardance to over $1.4 million. The additional $500,000 was awarded to compensate legal costs and case fees. The Mississippi couple successfully sued their insurance company, United States Automobile Association, after USAA paid the Lisanbys approximately $45,000 for damage done to the structure and property located on the second floor.

    The important message sent by the Mississippi courts is simple: the law will help defend Gulf Coast residents when they are hit by underpaying insurance companies. Various cases similar to the Lisanbys’ have gone through Louisiana and Texas courts.

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  • Understanding Terms: Glossary

    When going about shopping for the right policy or making sure your policy protects you in the ways you need, it is important to understand insurance terms used. In educating yourself about the legal jargon employed by the insurance companies, you can be better prepared to combat an unfair claim payment or prevent your policy from being hijacked by vague language.

    Below, courtesy of the University of Illinois, is a glossary of insurance terms from the letter C:

    Case management. An approach designed to provide effective treatment to meet the specific needs of people with serious medical problems. Benefits not traditionally covered (for example, medical equipment) may be provided to promote cost-effectiveness.

    Cash value (Cash surrender value). The amount available in cash to be borrowed against or obtained in cash if a life insurance policy is canceled.

    Catastrophic. Caused by a great and sudden misfortune such as a serious accident or illness.

    Chore Services. Minor household repairs, cleaning, meal preparation, and yardwork.

    Chronic illness. An illness marked by long duration or frequent reoccurrence such as arthritis, diabetes, heart disease, asthma, and hypertension.

    Claim. A formal notice to an insurance company requesting payment of an amount under the terms of a policy.

    Coinsurance. A clause or provision that requires the insured to share in a certain percentage of medical expenses such as 80/20 or 90/10 (the insurance company pays 80%/90%; the insured pays 20%/10% of expenses), sometimes called co-insurance.

    Collision insurance. Insurance to pay for damages to one’s own car in case of an accident.

    Comprehensive auto insurance. Insurance to cover losses resulting from a stolen car or for repairs if the car is hit by a falling object or damaged by fire, flood, or vandals.

    Comprehensive major medical insurance. A policy offering the coverage of both a basic and a major medical health insurance policy. It is characterized by a low deductible amount, a coinsurance feature, and high maximum benefits.

    Convertible term insurance. Term insurance giving the consumer the right to exchange it for cash value insurance without a medical exam.

    Coordination of Benefits (COB). The specific term used to describe how benefits will be paid when a consumer has more than one health insurance policy. The two policies combined cannot pay more than 100 percent of total allowable expenses.

    Co-payment. An amount insured must pay in order to receive a service, which is not fully prepaid.

    Cost sharing. Policy provisions that require individuals to pay, through deductibles and co-insurance, a portion of their health insurance expenses.

    Covered expenses. Those specified expenses paid for under the terms of a specific policy.

    Credit life insurance. Term life insurance issued through a lender or lending agency to repay the lending institution if the borrower dies.

    Custodial Care. Assistance with bathing, dressing, eating, taking medicine, and similar personal needs. People without medical skills or training can provide custodial care.

    Customary and reasonable. A charge that does not exceed the regular or normal charge for a given service in a locality where it is provided.

  • Understanding Terms: Glossary

    Understanding Terms Used in Insurance Claims
    When going about shopping for the right policy or making sure your policy protects you in the ways you need, it is important to understand insurance terms used. In educating yourself about the legal jargon employed by the insurance companies, you can be better prepared to combat an unfair claim payment or prevent your policy from being hijacked by vague language.

    Below, courtesy of the University of Illinois, is a glossary of insurance terms, ranging from the letter A to B:

    Actuary. A person professionally trained to apply probability and statistics to the practical problems of insurance and related fields.

    Accident insurance. A form of health insurance that insures against financial loss resulting from an accident.

    Accidental death and dismemberment insurance. Insurance that pays the insured in the event of death or loss of limb or eye resulting from an accident.

    Actual cash value. A claim settlement method in which the insured receives payment based on the current replacement cost of a damaged or lost item, less depreciation.
    Acute care. Care that is usually short term and recuperative.

    Adjustable life insurance. Insurance that lets the policyholder change the plan of insurance, raise or lower the face amount of the policy, increase or decrease the premium and lengthen or shorten the protection period.

    Agent. A representative of one or more companies who sells insurance. Annuity. A contract that provides an income for a specified period of time.

    Application. A signed request for insurance, giving information about the prospective policyholder.

    Appurtenant structures. Buildings not attached to a house.

    Assigned benefits. An arrangement whereby your physician accepts payment directly from the insurance company.

    Assigned risk pool. A state program through which people, unable to get auto insurance elsewhere due to poor driving or accident records, can buy coverage at higher rates.

    Automatic premium loan. A provision in a life insurance policy that any premium not paid by the end of the grace period (usually 31 days) is automatically paid by a policy loan if there is sufficient cash value.

    Automobile insurance. Insurance that pays for loss to individuals or property from an auto accident, theft, or other perils specified in the insurance contract.

    Beneficiary. The person named in a life insurance policy to receive the insurance proceeds at the death of the insured.

    Blue Cross. An independent, mutual for profit membership corporation providing coverage for hospital care.

    Blue Shield. An independent, mutual for profit membership corporation providing coverage for surgical and medical care.

    Broker. A person who represents insurance buyers, not companies.

  • State Farm withdraws from Florida’s Property Insurance market

    Per the Wall Street Journal, State Farm is dropping all of its homeowner policies in the state of Florida. Citing the difficulty of remaining stable in an area that has seen serious hurricane damage in the past decade, State Farm had as many as 700,000 homeowners policies as of September 30th.

    One of the most important things to note is State Farm’s choice to withdraw came after Florida regulators refused to accept State Farm’s request to rase rated by 47%. This rate rise would have significantly helped the company’s profits in the wake of a series of hurricane seasons that have driven more people for coverage.

    In the wake of this withdrawal, it is important for policy holders in the Gulf Coast to remain vigilant on their payments and not accept rate increases blindly. State Farm’s actions in Florida could easily occur in states like Texas and Louisiana where hurricanes Gustav and Ike caused millions of dollars of damage to policy holder’s homes and property. Care must be taken to use an insurance provider that is proven and tested by previous disasters or widespread damage in order to guarantee that your policy will be handled properly.

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