Insurance Companies

May 8, 2007

Insurance Defense Lawyers: Who’s Your Daddy?

We are handling a red light/green light auto accident case that occurred in Towson, Maryland a few years ago that resulted in substantial permanent injuries to our client. Trial is a few months away. The insurance company for the Defendant is the Maryland Automobile Insurance Fund (MAIF). Their attorneys recently moved to bifurcate the trial into two separate trials for liability and damages.

The Defendant’s attorneys would not seem to benefit if the case is bifurcated. Their concerns–the cost and effort of the liability case–is of no consequence to their client. So, practically, why was this motion filed?

If the case is bifurcated, the chance of a bad faith claim against MAIF evaporates; it would offer its $100,000 (a large policy for MAIF, parenthetically) policy limit in the event Plaintiff prevailed on liability because, as Defendant’s motion tacitly concedes, this case’s value exceeds MAIF’s coverage. While bifurcation would be a loss for Plaintiff, it would also be a loss for the insured Defendant who will lose any leverage that he has to encourage MAIF to settle or any claim he has against them for bad faith should they not make reasonable efforts to settle. Should the case be bifurcated and Plaintiff prevails on liability, Plaintiff will proceed on with the damages trial that will probably result in an excess verdict. This would leave MAIF in fine shape, fully insulated from a bad faith claim and protected from allegations it failed to properly defend their insured by, for example, having a defense medical examination performed on the Plaintiff. The defendant would be left holding the bag.

April 5, 2007

First Party Bad Faith Passes the Maryland Legislature

by Ronald V. Miller, Jr.

The Maryland Senate has passed House Bill 425 and the Maryland House of Delegates today also passed the bill, which puts a new requirement of good faith for insurance companies dealing with their insureds. The bill now heads to Governor O’Malley for his signature. The Governor has previously pledged support for the bill.

This issue has been a reoccurring topic on the Maryland Personal Injury Lawyer Blog. See this post and this post. My partner, Laura G. Zois, testified before the Maryland Senate and House of Delegates about three weeks ago on this very issue. I know that after the bill passed the Maryland Senate, there were a lot of lobbying efforts from the insurance companies to keep it from passing in the House of Delegates. They pushed the vote back, and I began to doubt whether Maryland would join most states that already have first-party bad faith. I’m thrilled the Maryland Assembly put the interest of Maryland injury victims and consumers ahead of the insurance company and their lobbyists.

This is a huge win for victims and their attorneys who are fighting to get injury victims a fair recovery for their injuries and the benefits of the insurance contract for which they are paying premiums.

August 14, 2006

New Maryland Insurance Coverage Case

by Ronald V. Miller, Jr.

Last month, the Maryland Court of Special Appeals issued its opinion in Maryland Casualty Co. v. Hanson. The issue in the case involved whether multiple exposures to lead-based paint over multiple years constituted multiple occurrences such that the insurance policies would stack or whether the policy’s “limitation of liability” provision defining continuous exposure as one occurrence, thus limiting the amount of insurance coverage. This is a classic long-term toxic exposure case involving many insurance policies. The question is which insurance carrier(s) is/are on the risk and whether the policies stack.

The issue, in this case, is whether the continuous trigger theory applies. The continuous trigger is a relatively recent idea in the law that deals with the problem of repeated injury. Under this theory, a loss occurs for insurance coverage during any time of exposure. It is sometimes called the triple trigger because coverage is invoked in one of three ways: initial exposure, continuing exposure, or by a manifestation of loss.

In the underlying case in Maryland Casualty v. Hanson, the plaintiffs were children exposed to lead paint at a property owned by the defendant on North Central Avenue in Baltimore, Maryland. The exposure to lead-based paint was over six years, spanning several insurance policies.

June 21, 2006

Requests for Recorded Statements: One Suggestion on How Attorneys Should Respond

by Ronald V. Miller, Jr.

In a comment to my May 22, 2006 post on giving recorded statements to insurance companies, Atlanta personal injury lawyer Ken Shigley makes a great point about how lawyers can knock insurance companies off their moral high ground when an injury victim’s car accident lawyer refuses to give a recorded statement. In the same way that innocent people accused of a crime feel compelled to talk to police because they do not want to look like they have something to hide, personal injury lawyers felt a little uncomfortable when refusing to allow a recorded statement. The refusal makes the lawyer feel like he or she has something to hide, even when there is nothing to hide. Every lawyer (okay, most lawyers) wants to be a straight shooter, willing to lay their cards on the table. But giving a recorded statement is against the attorney’s client’s interests, even when the attorney knows that the client was not at fault for the accident and has been seriously injured in the car accident.

Instead of refusing the request, Ken suggests that personal injury lawyers offer that both parties meet to give recorded statements. The insurance adjuster invariably has to refuse the request because it is against company policy to allow for a recorded statement. Ken points out the result is the same, but it knocks the insurance company off its high horse and makes the lawyer “feel good.”

This might be an obvious point to some, but I am asked for a recorded statement several times a week, sometimes (but not usually) with a condescending “what does your client have to hide?” tone, and have never thought to give this response. I literally just used it with a Nationwide adjuster about 10 minutes ago.

June 12, 2006

Is Uninsured Motorist Coverage Available in Maryland for an Intentional Car Accident?

by Ronald V. Miller, Jr.

A Virginia lawyer wrote me last night asking about a client that was injured in a motor vehicle accident in Maryland.

Apparently, the car accident was a by-product of road rage that reached a point where the Defendant arguably intentionally rear-ended the Plaintiff’s car. The Defendant apparently admits positioning his car to retaliate against the Plaintiff but claims the contact was unintentional. The insurance company is refusing to defend or indemnify the case because it claims the Defendant’s recorded statement to them admits that the conduct was intentional.

The lawyer’s question is whether uninsured motorist coverage is available to this Plaintiff in Maryland. Assuming that the Plaintiff did not intentionally cause the car accident, the answer is yes. Section 19-501(c) of the Maryland Annotated Code of Insurance requires only that the Plaintiff did not intentionally cause the traffic collision. Continue reading

June 6, 2006

State Farm Settlement Day

by Ronald V. Miller, Jr.

Today, for the first time in ten years, State Farm’s Baltimore office conducted a “Settlement Day” hosting eight Maryland law firms at their offices to settle State Farm auto and truck accident cases. The day was a success for our office; we settled 70% of the cases up for discussion. Other personal injury attorneys that I spoke to who attended also reported substantial success. One Maryland accident lawyer told me he settled all but one of his law firm’s car accident cases.

The day was also a success because it is productive for attorneys to meet the adjusters they deal with regularly. Even if we had settled none of our cases, it would have been worthwhile just to meet the adjusters. Everyone I met was very courteous and hospitable, even in those cases where we could not agree (the larger cases were the most difficult). The adjusters also tolerated my “evil empire” jokes well.

When I was doing pharmaceutical defense work, I would often fly across the country for an hour meeting with an expert. Other attorneys would also ask why a phone call would not suffice. But I always thought you can establish a much higher quality relationship and understanding with a person who you can see in person.

January 16, 2006

Maryland Automobile Insurance Fund Fraud

by Ronald V. Miller, Jr.

Maryland Attorney General J. Joseph Curran announced this week the guilty pleas of three sisters indicted in a scheme to defraud the Maryland Automobile Insurance Fund (MAIF) of over $65,000. MAIF said that more could have been stolen but “paper records” from before 1994 have been destroyed.

The sisters schemed to fraudulently add additional personal injury plaintiffs to actual Maryland auto accident claims and then write settlement checks to phantom injury plaintiffs with names close to the MAIF employee’s sisters and their family members. After about ten years, MAIF got wise to the fraud.

Sound off about your experience with MAIF (now called Maryland Auto Insurance)