Insurance Dispute Lawyer Blog

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Governments traditionally were immune from lawsuit. That has changed. In certain circumstances, governments may be held liable for the damage they cause. A coulee flooded homes in Lake Charles after Hurricane Rita, although the area is protected by a drainage district that operates pumps and pipes to ensure drainage. The Louisiana Court of Appeal affirmed a jury award against the drainage district in Bordelon v. Gravity Drainage District No. 4 of Ward 3 of Calcasieu Parish, No. 10-1318 (La. Ct. App. 3 Cir. 10/5/11).

Drainage district employees typically stayed in pump houses during hurricanes, but in July 2005, Louisiana state officials determined that no evacuation site in Calcasieu Parish could withstand a category 4 or 5 hurricane. The drainage district has automated pumps run by electricity, but if the power went out, the diesel-fueled backup pumps required human operation. Hurricane Rita was expected to hit land as a category 4 or 5 hurricane. The district decided to allow its employees to evacuate with their families to Opelousas, Ville Platte, and Lafayette. The whole area south of Interstate 10 in Lake Charles was a part of the evacuation.

Rita unexpectedly weakened to category 3 when it made landfall on Friday, September 24, 2005. Electrical power was wiped out across a wide area. The drainage district's electric pumps at Pithon Coulee stopped at 9 p.m. No one was in the pump house to start the diesel pumps. When residents returned the next morning, their homes were fine, but the coulee waters were rising. Drainage district employees had yet to be recalled. The houses began flooding from the rising coulee waters after 3 p.m. Saturday. Early on Sunday, the district workers returned. They turned on the pumps at 8:30 a.m. By noon, the coulee was below flood stage.

Twenty-four homeowners sought damages from the district because it failed to plan a way to automate the diesel pumps and because its decisions during Hurricane Rita resulted in flooding. The district argued it was protected by governmental immunity under Louisiana Revised Statutes. A jury awarded the homeowners $1,570,219.60, although it recognized that the liability of the district's insurer, American Alternative Insurance Corporation, was limited to $1 million. The drainage district and its insurer appealed.

Courts strictly interpret immunity statutes to limit their reach. Two statutes may protect the district. The Louisiana Homeland Security and Emergency Assistance and Disaster Act provides immunity when a government is "engaged in any homeland security and emergency preparedness activities" as a part of complying with the Act. An unpublished court of appeal decision persuasively limits immunity to actions taken during an emergency, but not before. Based on that decision, the jury decided against the drainage district because it failed to have a plan in place before the hurricane's forecasted arrival. The court of appeal agreed. "A failure to plan for an emergency is not an emergency preparedness activity under the statutes conferring immunity for such activities." The district was not immune for not having a plan to keep pumps running when the pump houses were not staffed and power was out.

Louisiana state and local governments also are not liable "based upon the exercise or performance or the failure to exercise or perform their policymaking or discretionary acts when such acts are within the course and scope of their lawful powers and duties." Immunity exists for policymaking or acts for which a choice is acceptable within the government's delegated powers. If the act is "not reasonably related to the legitimate governmental objective for which the policymaking or discretionary power exists," or was done criminally or in some way intentionally, immunity does not apply.

The Louisiana statute is patterned after the Federal Tort Claims Act. A two-part test determines if immunity applies. Did the government employee have discretion, a choice, or did law require the employee to follow a certain course of conduct? If a specific action is mandatory, no immunity applies. If the employee has a choice, was that discretion "grounded in social, economic or political policy"? If not, the government may be liable. Louisiana has adopted the federal test for the state governmental immunity statute.

The court of appeal recognized that planning is an act of discretion, and ensuring employee safety above concerns to protect property "is clearly within the discretion of the district." But, automating the diesel pumps had never been considered, although it would cost only $40,000 and the money was available. By statute, "the drainage district shall make adequate provision for the drainage of all lands and property affected thereby." The district was required to provide adequate drainage of all property. The failure to consider a feasible alternative to ensure compliance with a statutory mandate prevented immunity for the effects of not automating the pumps. The court of appeal affirmed the district court jury verdict.

If you believe you have been harmed by a government, it is hard to know what to do. Government duties come from statutes and regulations, and governments may be protected from lawsuits. But not always. A lawyer will be able to review your claim and determine the government's authority and potential liability.

Continue reading "Calcasieu Parish May Be Liable For Damages Resulting from Failure to Ensure Drainage After Hurricane" »

Those living in low-lying areas and near rivers often seek, and often obtain, flood insurance. Many of the policies granted come from insurance providers that have opted into the National Flood Insurance Program (NFIP). Under this program, property owners are issued flood insurance through the Federal Emergency Management Agency (FEMA). The federal government, in an effort to expand the NFIP, created the Write Your Own program. These policies provide identical coverage as regular NFIP insurance, except they are administered through local insurance companies. These insurance companies increase community awareness of the NFIP in return for expenses related to claims written and processed. FEMA retains all responsibility for claim losses.

These policies, like any other insurance policy, are only active for the policy period. However, once the policy period has expired, FEMA and Write Your Own insurers typically extend a grace period of thirty days. This means that if the policy holder pays a renewal premium within thirty days of the policy's expiration, the renewal will be retroactive, essentially covering the gap between the policy expiration and the payment of the premium. If the policy holder fails to pay the renewal premium before the grace period ends, then the policy terminates at its original expiration date and no grace period claims can be processed under it.

This retroactive policy renewal was the issue in Campo v. Allstate Insurance Company. Here, Campo's flood insurance expired and Allstate sent him notice of the expiration along with the option of retroactive renewal. During this grace period Campo's property was damaged by Hurricane Katrina. Due to the excessive number of claims arising from Katrina, FEMA increased NFIP grace periods from thirty days to ninety. Campo contacted Allstate and procured an insurance check to cover his living expenses. No further discussion of policy renewal took place. Campo's ninety day grace period expired without any renewal premium payment. Therefore, when Campo filed his insurance claim it was denied as the policy was not retroactively renewed to cover the damage caused during the grace period. Campo sued Allstate claiming that Allstate had negligently misrepresented the status of his policy.

The only way to succeed on a claim of negligent misrepresentation by an insurance company is to show that the insurance company had a legal duty to supply correct information, that that duty was breached, and that damages resulted from justifiable reliance on that misrepresentation. In most cases, as in Campo's, the third prong of this test is the most difficult to satisfy. The reasoning behind this is simple: policy holders have access to correct information through the policy contract that they possess. Thus, courts may find damages flowed from an unjustified reliance on the misstatement because the policy itself is clear.

Yet, under this test, Campo succeeded on his damages claim in district court. The U.S. Court of Appeals for the 5th Circuit, on the other hand, reversed in favor of Allstate. The reasoning behind this decision is that Campo was fully aware that he was required to pay a premium in order to obtain the retroactive renewal of his policy. In conversations with Allstate, Campo failed to discuss the renewal, and, in addition, the check provided by Allstate during the grace period was not a promise that it would pay Campo's claim. In short, the court viewed Campo as being responsible for knowing the terms of the insurance policy he held. Insurance policy holders have access to the terms of their policy and are therefore in a position to familiarize themselves with relevant provisions.

Since much of Louisiana is prone to flooding, it is important to protect yourself by obtaining flood insurance. However, once a policy is issued, be sure to read through the terms and know the conditions of renewal. When a policy expires, it is the policy holder's responsibility to take action for renewal.

Insurance disputes such as these are complex and best left to an experienced practicing attorney.

Continue reading "U.S. 5th Circuit Court of Appeals Clarifies Retroactive Renewal of Flood Insurance" »

In insurance, an assignment is the transfer of legal rights under an insurance policy to another party. The legality of assignments became a major issue in the aftermath of hurricanes Katrina and Rita. During this period, the federal government, in an effort to aid rebuilding efforts, issued money through the Road Home program to homeowners who held underinsured properties. In exchange, these homeowners were required to assign their rights to insurance claims under their policies to the the state of Louisiana. The purpose of this assignment was to prevent homeowners from fraudulently receiving duplicate payments. However, the program incentivized insurance companies to estimate damages too low, which in turn forced homeowners to take the higher amount offered through the Road Home program.

The shortfall created within the Road Home program forced the state of Louisiana to bring suit against insurance companies through the policy rights assigned to the state by homeowners. In essence, the state sought to recoup actual insurance claim damages that the homeowners were rightfully owed had they not opted into the Road Home program. Though most, if not all, of the homeowner insurance policy contracts contained an anti-assignment clause, the state maintained that it had the right to post-loss assignment. Therefore, it is critical to distinguish between a pre-loss assignment and a post-loss assignment.

A pre-loss assignment occurs when one transfers a legal right under an insurance policy to another before the injury or loss occurs. An example of a type of pre-loss assignment is found in cases when life insurance is assigned to a bank as collateral for a loan. Here, the assignment has occurred before the loss, in this case the death of the original policy holder, and any benefits that accrue at the time of death are used to repay the bank first. These types of assignments typically require consent from the insurer, but are usually barred by anti-assignment clauses.

A post-loss assignment, on the other hand, is the transfer of a legal right under an insurance policy to another party after the injury or loss occurs. Post-loss assignments frequently give the third party transferee the ability to file a claim against the insurance company for any loss accrued by the original policy holder. Many insurance companies try to block such assignments through broad anti-assignment clauses found in policy contracts. Such clauses were found in most Katrina and Rita policies, and insurance companies pointed to these sections in an attempt to avoid paying actual damage costs homeowners thought they rightfully assigned to the state.

While national jurisprudence holds that pre-loss anti-assignment clauses are valid in favor of contract law and public policy, anti-assignment clauses related to post-loss assignments are held to be invalid. The reasoning behind this difference primarily lies with public policy considerations. A pre-loss assignment, for example, may increase the risk beyond the point that the insurance company had originally contracted for and with a party the insurance company had not originally contracted with. A post-loss assignment, on the other hand, simply assigns an accrued right to payment after a loss has already occurred. There is no change in risk as the loss has already occurred, and since payment is to be made it matters none to whom the payment is made.
The Supreme Court of Louisiana holds that such public policy concerns are better suited for the legislature. However, the Court does state that clauses prohibiting post-loss assignment must be written in clear and unambiguous language. If the language in the policy contract is unclear, then, in accordance with laws regarding contracts of adhesion, the language will be construed against the insurance company and in favor of the insured. If you have entered into a contract with an insurance company and are looking to assign your rights under the policy to a third party, turn to the language in the contract itself. Though there is not specific set of words or test used to determine "clear and unambiguous," your own judgment is a good starting point in determining whether or not you have the right to assignment.

Though your own judgment is an excellent place to start, insurance law is very complicated and is best suited for a practicing attorney.

Continue reading "Supreme Court of Louisiana Rules on Hurricane Katrina Insurance Policies' Anti-Assignment Clauses" »

Insurance policies routinely include provisions that are intended to limit the scope of the insurer's coverage in the event of a claim by the policyholder. For instance, most homeowner's insurance policies exclude coverage for fire damage that results from the policyholder's deliberate arson. Commercial premises insurance policies, which commonly also include coverage for loss of business income, can carry similar limitations. The recent case of Berk-Cohen Associates, L.L.C. v. Landmark American Insurance Company in the U.S. Court of Appeals for the Fifth Circuit provides an instructive example of how insurance policies are "construed using the general rules of interpretation of contracts" by the courts.

Berk-Cohen Associates, L.L.C., as the owner of the Forest Isle Apartments in New Orleans, maintained an insurance policy to cover the complex with the Landmark American Insurance Company. The policy covered property damage but specifically did not cover losses at Forest Isle "caused directly or indirectly by Flood.” In the case of a covered cause of loss, such as wind damage or fire, the policy insured Berk-Cohen against both the property damage and the resulting lost business income. However, the scope of the income protection excluded any income that would have been earned directly as a consequence of any "favorable business conditions caused by the impact of the Covered Cause of Loss on customers or on other businesses." In other words, Berk-Cohen could not profit by a widespread calamity that was also the source of a property damage claims. Forest Isle suffered a series of misfortunes, including a tornado, a vehicle strike, and--most significant--damage from Hurricane Katrina. Following the hurricane, Landmark compensated Berk-Cohen for damages caused by wind but not flood. Concerning Berk-Cohen's claim for lost business income, Landmark argued that it was not responsible for the increased rents that resulted from the extensive flooding around the city because flood damage was excluded from the policy. Accordingly, Landmark "declined to increase its calculation of lost business income to the extent that any foregone income arose from flooding." Berk-Cohen initiated litigation and, following a bench trial, the district court held that, notwithstanding the flood damage exclusion in the policy, Landmark should have considered the business conditions attributable to flooding in other buildings when computing the business income that Berk-Cohen lost as a result of the wind damage to Forest Isle. On appeal, the Fifth Circuit upheld the district court's opinion. It noted that the “Covered Cause of Loss” that gave rise to Berk-Choen's property damage claim was wind. Consequently, the policy language prohibited Berk-Cohen from recovering for lost business income as a result of wind damage suffered by customers or other competing businesses. But, "any increase in customers’ demand or reduction in competitors’ supply due to flooding at other properties is a permissible factor in calculating lost business income." (Emphasis supplied.) The court refused to permit Landmark to exclude coverage for flood damage by the policy language while at the same time invoking the same source of damage to reduce Berk-Cohen's business income recovery. To do so would "extend[] the flood exclusion beyond its function," since the policy specifically permits the income calculation to consider "favorable business conditions." Accordingly, the court "decline[d] to use a limitation on coverage"--that is, flooding--"to alter the calculation of damages for a covered loss"--the lost income. The Fifth Circuit concluded that the "policy ... excludes coverage for flood damages at the Forest Isle property. The flood exclusion does not, however, prevent Berk-Cohen from recovering lost business income due to the favorable business conditions arising from flood damage to other buildings."

This case demonstrates that applying the "normal cannons of contract interpretation" can work to the benefit of the insured. As with any contract, the insurance company is bound by the plain meaning of the policy language, even if it means that excluding coverage for one claim will open the door to liability for another. The lesson here is that a knowledgeable and experienced attorney is invaluable to anyone who is involved in a dispute over insurance coverage.

Continue reading "Hurricane Damage at New Orleans Apartment Leads to Dispute Over Insurance Coverage Calculation" »

As previously discussed in Part I, the case of Charles Ebinger, et ux. v. Venus Construction Corporation, et al. focuses on the time period in which a claim for damages can be brought against a contractor and the time period in which a contractor may bring an indemnifying action against a subcontractor. This Part, however, focuses on the Louisiana Supreme Court's reasoning as to how it interpreted the applicable statute of limitations.

The Ebingers moved into their newly built home in April of 1997. On October 9, 2003, the Ebingers filed suit against Venus Construction alleging defects in the home's foundation had caused cracks in the drywall, tile, brick walls, and floor. Venus Construction filed its indemnity claim on September 22, 2006 against the engineer and subcontractor that supplied the foundation.

First the Court determined when the cause of action arose. The Court determined that "regardless of the length of the peremptive period, it [the peremptive period] began when the owners took possession of the house or filed an acceptance of the work." In this case, a certificate of occupancy issued on April 22, 1997, and therefore, that is when the peremptive period began. At the time the Ebingers moved into their home, the original statute was in place and thus the Ebingers would have ten (10) years to file a claim.

Second, the Louisiana Supreme Court looked at the language of the statutes to determine whether the superseding statutes were written to act retroactively or have prospective application. Though the peremptive period was ten years at the time the statute of limitations began to run, the legislature amended the governing statute in 1999, substituting 'seven' for 'ten' years as the peremptive period. Further, this Act stated "the provisions of this Act shall have prospective application only and shall apply to contracts entered into on or after the effective date of this Act." Thus, at this time, the Ebingers would still have a valid claim through the original ten year peremptive period because the amended statute had only prospective applicability, not retroactive applicability, as specifically written in the Act by the legislature. Next, the Court looked at the second revision of the Act in 2003 which substitute 'five' for 'seven' years and did not maintain the 'prospective application' language. The Court states that the legislature's actions in drafting a law are knowing and intentional, and thus, if the legislature meant for the 'prospective application' language to continue, then the legislature would have included it in the Act. However, because the legislature did not, the Court's interpretation is that the 2003 Amendment supersedes the original statute and makes the peremptive period five years, even for those causes of action that arose back when the ten and seven year periods were applicable.

Third, the Court examines Constitutional rights to Due Process and determines that the statute of limitations is a procedural law and as long as it does not disturb a vested legal right, a right that at the moment may be expressed, then the statute of limitations (peremptive period) may be applied retroactively. In the end, the Ebingers' claim is not perempted even though it was filed two months after the 2003 Amendment because the Ebingers' right to sue had vested the moment they attained the certificate of occupancy. However, as for Venus Construction, "the mere expectancy of a future benefit," for Venus Construction in this case the right to file a claim for indemnification, "does not constitute a vested right." Therefore, Venus Construction's right to file a claim for indemnification did not vest until a judgment was entered against Venus Construction, and thus the peremptive period has run for Venus Construction to file a claim for indemnification against the subcontractor.

Continue reading "Keeping Up with Your Louisiana Home's Construction Defects (Part II) - Understanding Statutes " »

Being able to be involved in the design and building of a new home can be an exciting experience. But there is nothing more special than seeing the home's construction completed and fully furnished. After all of this, there can be nothing more upsetting than the discovery that the new home has building defects. Imagine settling in and noticing some part of the home's structure misshapen or cracking at the seams of walls or floors, or perhaps even a foundation or structural supports that have improperly settled or misplaced. The focus of Charles Ebinger, et ux. v. Venus Construction Corporation, et al. focuses on the time period in which a claim for these damages can be brought against a contractor and the time period in which a contractor may bring an indemnifying action against a subcontractor.

The crux of this follows what happens from the time that the building has completed through when litigation is brought against the contractor, and in the event the contractor is found liable, then the indemnification proceeding the contractor would most likely bring against any subcontractor who may be at fault for the imperfect work. However, this is complicated by taking into account the statute of limitations that exists to bring about such a suit. And this is further complicated when taking into account the revisions of the statute of limitations by the legislature.

In short, and to be clear, 'to indemnify' means to compensate for damages or losses sustained and to pay for expenses incurred through the litigation. Thus, in the event that a contractor, one who oversees and employs the various subcontractors for a specific job, is found to be liable for damage that exists in a specific construction unit, then, if it is through no fault of the contractor, but is the fault of one of the subcontractors and his or her oversight of his or her unit and specific job, then the contractor may seek to have his or her losses, in this case through litigation and a damages award against the contractor, paid by, or reimbursed by, the subcontractor.

A statute of limitations is a specific statute enacted by the legislature that basically states when it is too far away in the future of when an event originally happened to seek legal recourse. Usually, the statute of limitations begins to run when the complainant knew or should have known of the event or damages, as is often seen in torts cases. In this case, as will be later discussed in more detail, the statute of limitations until peremption began at ten (10) years and over the course of two revisions, became five (5) years.

Peremption, which is a large focus of this case, is the extinguishment of the right to bring a cause of action against another. Peremption is synonymous with a statute of limitations in that both, in this case, would prevent either the homeowner from bringing an action for damages against a contractor, or the contractor from bringing an action for indemnification against a subcontractor. Reading this, one may ask, why wouldn't the homeowner just bring a suit for damages against the subcontractor. There are two answers to this question, neither requiring an in depth discussion:

A. The contractor is the one hired to perform the job. In this case, that job is to build a house. In turn, however, because the contractor is usually unable to perform all the necessary duties, the contractor hires subcontractors to perform the separate duties (foundation, carpentry, electrical, plumbing, etc.). Thus, it is the contractor who has a contract with the homeowner while the subcontractor has a contract with the contractor.

B. Because the homeowner has a contract with the contractor and not the subcontractor, the party who may in fact be the cause of the damage, a party may bring an action against the contractor for any construction defects because the Law allows the contractor to, in turn, bring a suit for indemnification against the subcontractor who may in fact be at fault for the defect or damage.

Now that the background information has been laid down and described, it is time to turn to the legal issue of when is a cause of action perempted when the statute of limitations has been revised twice. For this discussion, please continue on to Part II. If, however, instead more information or legal services are required at this moment please contact the Berniard Law Firm for further information or legal services.

If a homeowner insures his home and then suffers damage to the structure, the process of making a claim and being paid for the loss can be long and frustrating. Frequently, the insurance company will arrive at its value of the loss and attempt to persuade the homeowner to accept that value, even if it doesn't reflect the homeowner's actual costs of repair. In such a case, the homeowner should check his policy for an "appraisal clause." This provision provides for an alternative method for setting the value of the property damage. An appraisal procedure requires the homeowner to obtain an independent appraiser to survey the damage and assign a value to the loss. Similarly, the insurance company must hire an independent appraiser to perform the same analysis. The two appraisers must petition the court for the appointment of an umpire who will then oversee the negotiation of the settlement based on the two appraisals. Once any two of the parties--the appraisers and/or the umpire--agree as to the value of the loss, the matter is settled.

In Louisiana, like other states, flood insurance policies are underwritten through the National Flood Insurance Program (NFIP) and administered by the Federal Emergency Management Agency (FEMA). The NFIP authorizes private insurance companies to issue policies and handle the claim settlement process. Claims are actually paid by the federal government. FEMA requires that all NFIP flood insurance policies include an appraisal clause.

After their was heavily damaged by flood in Hurricane Katrina, William and Cynthia Dwyer filed a claim with their flood insurer, Fidelity National Property and Casualty Insurance Company. The Fidelity policy was issued through the NFIP. The Dwyers disagreed with Fidelity's offer of settlement and took the dispute to the District Court for the Eastern District of Louisiana. The court entered judgment for the Dwyers, and on appeal by Fidelity, the Fifth Circuit Court of Appeals vacated the judgment and ordered the parties to submit to the appraisal process as outlined in the policy. The Dwyers and Fidelity sought appointment of an umpire, who then submitted to the district court an appraisal that included the amount of actual damage to the Dwyer home as well as a "mark-up for overhead and profit" intended to cover the cost of a general contractor to make the repairs. Fidelity accepted the umpire's figure on damages but objected to the addition of the mark-up because the Dwyers had already sold the house and would not have any role in the repair itself. The Fifth Circuit agreed with Fidelity that "the award of overhead and profit was erroneous" and noted that "Fidelity told the district court that absent the improper award of overhead and profit, it agreed with the umpire’s appraisal." Thus, determining that Fidelity and the umpire were in agreement on the amount of the loss, the court entered judgment ordering Fidelity to pay the Dwyers $1,552.51. This amount represented the umpire’s appraisal amount less the erroneous overhead and profit, the policy deductible, and the amount Fidelity had already paid out to the Dwyers.

The appraisal process seeks to take the potentially emotional settlement of an insurance claim out of the hands of the homeowner and the insurance company and leave the decision to disinterested, expert third parties who have no connection to the outcome. Although the process is generally more cost-effective and expedient than litigation, a homeowner should consult with an experienced attorney to ensure the procedure is properly followed and his rights are protected.

Continue reading "Dispute Over Hurricane Katrina Home Repair Shows Role of Appraisal Process in Insurance Settlements." »

Homeowners across the Louisiana coast were affected by Hurricane Katrina. Many of those affected are still dealing with the stressful experience of rebuilding their homes, communities, and lives. Homeowners insurance is a boon to many when natural disaster strikes. Unfortunately, insurance companies do not always make recovery of benefits easy on the afflicted homeowner. The insurance recovery process can be overwhelming, and may be complicated by the often necessary instigation of litigation. Insurance negotiations can be complicated by differing interpretations of policy provisions. Many different provisions governing recovery are involved in insurance contracts. The interpretation of the language of the contract by the court plays a pivotal role in deciding the amount of damages an insured is entitled to recover.

The recent Fifth Circuit Court of Appeals case French v. Allstate Indemnity Co., illustrates that the recovery of damage benefits from an insurance company is not always a straight forward process. In French , homeowners in Slidell, Louisiana sued their homeowners insurance provider, Allstate Indemnity Co., to recover additional damages resulting from wind damage to their residence caused by Hurricane Katrina. The plaintiffs initially won a judgment in their favor in the United States District Court for the Eastern District of Louisiana , but they appealed, arguing that they were entitled to additional damages beyond the original award. The insurance company paid less than the full amount of the liability limit under the homeowners insurance policy. The District Court held that, since their repair costs would exceed their policy limit, they were entitled to at least the full limit and awarded them judgment accordingly.

On appeal, the plaintiffs argued that they were entitled to further damages under two provisions of their policy, an Extended Limits Endorsement provision and an Additional Living Expenses provision. They argued that the lower court erred in denying them recovery under these provisions. The court applied Louisiana case law which dictates that the language of the policy controls and “constitutes the law between the insured and insurer.” When an insurance contract is subject to interpretation "'[w]ords and phrases ... are to be construed using their plain, ordinary and generally prevailing meaning,’ unless the words have acquired a technical definition." The appellate court reviewed the original award to determine if the lower court erred in their interpretation of these provisions and in denying recovery to the plaintiffs.

The Extended Limits Endorsement allowed for a certain amount of additional damages above and beyond the actual cash value of the insured’s home. The court found that the language of the provision indicated that, in order to recover under this provision, the insured had to show they had repaired or replaced their damaged property. They must also have insured their home to 100% of its value. The plaintiffs did not meet either of these requirements, and the court found the denial of an additional award under this provision was appropriate.

The Additional Living Expenses provision allowed for recovery of damages for "the reasonable increase in living expenses necessary to maintain [a] normal standard of living when a direct physical loss we cover . . . makes your residence premises uninhabitable." The court determined that the plaintiffs had to show additional living expenses they had actually incurred. Since they had not yet begun repairs on their home, and continued to live in the residence, they were properly denied additional recovery under this provision.

Knowledge of the interpretation of insurance contract provisions is important when negotiating an insurance settlement or in litigation for recovery of damages. If you or a loved one has been affected by Hurricane Katrina you need an experienced law firm to help you navigate negotiations with your insurance company and to represent you in court should it be necessary. If you are looking for legal representation, the Berniard Law Firm has experience working with the victims of Hurricane Katrina and their families as well as a variety of storm and general insurance dispute issues.

Continue reading "Insurance Contract Interpretations and the Affect on Recovery of Damages " »

The Gulf Coast has seen its share of hurricanes and tropical storms, unfortunately, and nearly everyone who lives in our region knows someone who has been adversely affected by the damage these acts of nature cause. Whether a home, car, business or other form of property, many suffered devastating losses that left the future unclear. While those with insurance may have felt more relieved than those without, the fact remains that a wide variety of uphill battles exist.

If you are a Louisiana resident who suffered any type of injury relating to a storm, whether it was to your person or property, the courts have held a mixture of results that both reinforced and hindered claimants. Just a few weeks ago, a lawsuit was filed in Louisiana against Allstate Insurance in conjunction with a whistle blower alleging improper actions by the company.

The case, which is still pending in the courts, claims that Allstate cheated the federal government by creating false data that steered the majority of costs toward the National Flood Insurance Program. The lawsuit accuses Allstate, a major participant in the government's Write Your Own Program, of fabricating damage documents. Allegedly, Allstate "substantially inflated" the flood portion of damages while "substantially deflating" the homeowners insurance claims. This means that the company may have also been shifting numbers away from the claims of homeowners, forcing them to either settle for the offer substantially less than they deserved or hire attorneys to get them proper compensation.

The suit states that "Allstate thus knowingly presented, or caused to be presented, ... fraudulent claims for substantially inflated flood insurance benefits" covered by the federal flood insurance program. This is outrageous and, if true, against the law given the fact insurance companies should not be allowed to benefit at your expense. Louisiana residents have rights, and the law on their side, in circumstances where they have been wronged by a company they have trusted. A knowledgeable attorney can help you try to recover money that you are owed but were cheated out of by Allstate or another insurance company.

This is not the last we will hear of this lawsuit. Allstate and other insurance companies will continue to be challenged in court if they have committed wrongs against citizens of Louisiana. The Berniard Law Firm defended thousands of insurance policy holders against companies that delayed payments. Additionally, if you have information about Allstate or any other insurance company that shows they may have tried to defraud the government or the people, you need to contact an attorney immediately. Often, as a whistle blower, you can recover monetary damages or a portion of the amount the government recovers because of your valuable information.

If you believe you have not received the financial compensation you deserve or that an insurance company is leading you astray with improper offers, contact our offices today. An unfortunate reality is that insurance companies will pull a variety of 'games' while dealing with claims that, in the end, do not represent the interests of the customers who submitted their monthly payments faithfully expecting only what they were due. If you are receiving the run-around, or for more information on insurance company delays, contact the Bernaird Law Firm today.

As many Gulf Coast residents unfortunately know, standard homeowner's insurance policies do not include coverage for flooding. In order to assist property owners in Louisiana and other states in protecting themselves against floods from hurricanes, tropical storms, and other severe weather, Congress created the National Flood Insurance Program (NFIP) in 1968. NFIP offers flood insurance to homeowners, renters, and commercial property owners in communities that participate in the NFIP. In order for a community to be eligible to participate, it must agree to adopt and enforce certain building standards that are designed to reduce the risk of flood damage. According to the NFIP, flood damage is reduced by nearly $1 billion each year as a result of the floodplain management standards implemented by these communities. Also, structures that are built to NFIP standards experience approximately 80 percent less damage annually than those not built to the standards. The Federal Emergency Management Agency (FEMA) manages the administrative functions of the NFIP, including the claims process. As one Katrina victim recently learned, homeowners who file claims under the NFIP must closely follow the rules contained in their policies.

Violet Collins, a resident of New Orleans, maintained a flood insurance policy through the NFIP to cover her house and its contents. The structure was insured for $225,000 and the contents for $12,500. When the home sustained flood damage during Hurricane Katrina, Collins contacted FEMA to provide notification of the damage. FEMA sent an adjuster to her house to inspect the damage and arrange for payment from FEMA. Collins later submitted additional documentation for damage that the adjuster had overlooked, and FEMA issued her two more checks. Some time later, Collins filed a suit against the NFIP which alleged that the payments on her flood claims were insufficient. The NFIP filed a motion for summary judgment on the basis that Collins failed to file a proof of loss as required by the insurance policy and was therefore barred from seeking additional money. The district court granted NFIP's motion, and Collins appealed.

After reaffirming that it must "strictly construe and enforce" the flood policy's requirements, the Fifth Circuit Court of Appeals asserted that "an insured's failure to provide a complete, sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer's obligation to pay what otherwise might be a valid claim." Gowland v. Aetna, 143 F.3d 951, 954 (5th Cir. 1998). The court noted that, ordinarily, the proof must be submitted within 60 days of the loss, but that FEMA extended the window for Hurricane Katrina claims to one year. Nevertheless, Collins never submitted any proof of loss; the court examined Collins's arguments for why she was not required to file one. Her first argument was that FEMA had waived the requirement altogether, a contention that the court quickly dispensed with by citing well-settled case law on the same question. Second, Collins asserted that the NFIP waived the filing requirement in a letter she received from an insurance adjuster. However, the court concluded this was not possible because "federal regulations provide that no provision of the policy may be altered, varied, or waived without the express written consent of the Federal Insurance Administrator," which was not given. Finally, Collins argued that because she suffers from a debilitating eye disease, she was excused from observing the filing requirement. In response, the unsympathetic court stated that "Collins, however, fails to explain why Louisiana tort law would apply to her claim for flood insurance proceeds or why, if applicable, this would exempt her from our precedent requiring strict compliance with the ... proof-of-loss requirements." Accordingly, the court affirmed the district court's dismissal of Collins's suit.

This case serves as a reminder that, even in the aftermath of such massive natural disasters as Hurricane Katrina, flood victims are still expected to follow the specific requirements of their NFIP insurance policies when seeking payment for flood-related losses. Although it may seem cruel to reject a flood victim's appeal for a fair pay-out, the courts have put policyholders on notice that they will not entertain requests to alter the terms of the policies. For this reason, victims of any flood should seek the help of a qualified attorney who can help them navigate the steps required to fully collect on their flood insurance policies.

Continue reading "Court to Katrina Flood Victim: Follow the Rules When Making an Insurance Claim" »

For those Louisiana residents, whether you live in Lake Charles, Shreveport, Baton Rouge, New Orleans, Kentwood or any other of the great cities across this state, looking for more information on their possible personal injury claim, check out our blog dedicated to these legal matters:

Louisiana Personal Injury Blog

This blog discusses the legal issues relating to Admiralty/Maritime law, Animal/Dog Bites, Car Accidents, Chemical/Industrial Spills, the intricacies of Expert Testimony, Insurance Disputes, employee rights under the Jones Act, Legal Duty, Civil Lawsuits, Criminal prosecution, Medical Malpractice, Mesothelioma/Asbestos, Motorcycle Injury, Negligence, Offshore Accidents, Product Defects, Chinese Drywall, Strict Liability, Workers' Compensation and Wrongful Death. All of these issues are crucial to citizens rights and residents of Louisiana.

To better understand the complexity of the law, contacting an attorney is crucial. However, to get a better understanding of the general issues, we hope this resource is invaluable. Feel free to browse this legal resource dealing with a variety of harms or damages you may have suffered in order to understand how your issue matches up with the law.

If you would like to speak with an attorney, check out our contact information. We represent Louisiana residents across the state and would be happy to discuss with you how to move forward with your unfortunate circumstances.

The New Orleans area has been dealing with a cold streak that, according to the National Weather Service, may actually get worse. The NWS in Slidell has issued a warning of extreme cold temperatures in the area from Thursday to Sunday morning. This will mean many residents and citizens in the area and around it will experience a chill to an extreme that rarely is felt.

While some areas of Louisiana and Mississippi may see snow, moisture is not as much of a concern as the chill that follows. Per the NWS report

ALL OF THE MOISTURE WILL MOVE OUT OF THE AREA BY THURSDAY EVENING AND THEN THE GREATER ISSUE ARRIVES...VERY COLD TEMPERATURES. AN ARCTIC AIRMASS WILL CONTINUE TO MOVE IN AND REMAIN OVER THE AREA FROM THURSDAY NIGHT THROUGH SUNDAY.

THE AIRMASS IS NOT EXPECTED TO MODIFY CONSIDERABLY. THE AIRMASS IS EXPECTED TO BRING VERY COLD TEMPERATURES TO THE AREA THAT COULD BE COMPARABLE TO THE ARCTIC OUTBREAK OF EARLY FEBRUARY 1996...BUT NOT AS LOW AS THOSE EXPERIENCED DURING THE 1985 AND 1989 ARCTIC OUTBREAKS.

The potential for ice and poor driving conditions means motorists need to take extra precautions this weekend to prevent car accidents. Some tips from AAA for winter driving include

Avoid driving while you're fatigued. Getting the proper amount of rest before taking on winter weather tasks reduces driving risks.

Never warm up a vehicle in an enclosed area, such as a garage.

Make certain your tires are properly inflated.

Never mix radial tires with other tire types.

Keep your gas tank at least half full to avoid gas line freeze-up.

If possible, avoid using your parking brake in cold, rainy and snowy weather.

Do not use cruise control when driving on any slippery surface (wet, ice, sand).

Always look and steer where you want to go.

Use your seat belt every time you get into your vehicle.

As always, our firm hopes everyone handles this cold snap carefully and safely. For more information on the cold front, check out the NWS website at weather.gov or read the recent weather warning in full here.

The Wall Street Journal, in its editorial section yesterday, commended Judge Duval for finding the Army Corps of Engineers at fault for the flooding of areas of New Orleans. The editorial, entitled 'A win for New Orleans,' celebrates the win as an opportunity for those whose homes flooded to receiving financial settlements to make up for the inability of the Corps to develop and operate adequate water projects.

The lawsuit was brought by seven plaintiffs. Judge Duval ruled against the plaintiffs from New Orleans East but awarded $720,000 to those from St. Bernard and the Lower Ninth.

The judge's decision could lead to thousands of people joining class actions seeking billions of dollars in damages. Lawyers for the plaintiffs are calling on the federal government to offer a universal settlement with the people of New Orleans. The Obama administration and members of Congress should listen. While there are limits on how much people should expect -- the government is strapped for cash, after all -- it's difficult to see what purpose would be served by dragging this case through appeals all the way up to the Supreme Court. Unless the government has a persuasive defense for the negligence decried by Judge Duval, it would be better to settle now.

This is a good sign that the national press is following Gulf Coast issues closely and hopefully people get the results they are looking for in terms of more Corps attention and effort into improving the water systems. Any progress and attention to issues relating to New Orleans and its recovery, though, is positive and hopefully will help lead to those efforts that prevent the devastation of Katrina from occurring again.

While the Gulf Coast rarely sees snow in the winter months, safe driving is crucial as precipitation arrives in the form of rain and sleet. Though these tips are offered by the Iowa Department of Transportation, they still remain absolutely relevant given the ability of cold weather to cause unsafe driving conditions despite a lack of snow or hail.

Do not overestimate your ability in bad driving conditions.

Slow down. Wear seat belts. Never drink and drive.

Put extra distance between you and the car in front of you.

Don't slam on the brakes. The wheels could lock, causing your car to slide.

If your car starts to slide, turn your wheels in the direction in which it is sliding to straighten it out.

Drive on interstates and one-way roads, whenever possible.

Turn on your lights to see and be seen.

Clear snow, sleet and ice off the headlights, tail lights, mirrors, and license plates. Stop the car when necessary to keep the windows clear.

Be aware that bridges, ramps, and overpasses may freeze first.

Check the windshield wipers to make sure they are not frozen to the windshield.

Consider replacing your original wipers with heavy-duty ones.

As always, safe driving in adverse conditions is much more important than arriving to a destination faster. Should you be involved in a car accident, keep close records of all the details and contacting a legal expert are crucial. Our office deals in personal injury and legal representation matters and would gladly discuss your rights in the event of such an accident.

In the meantime, our offices only hope that ice and sleet will not be an issue this holiday season in the Gulf Coast!

Hurricane Ida is moving into the Gulf and current tracking has the storm reaching the Gulf Coast late Monday evening. WWL reports Ida is gaining strength over the warm Gulf water while also downgrading into a tropical storm.

For more information on Ida as it becomes available, check out the National Weather Service's National Hurricane Center site dedicated to the storm, located here, or continue to check into this blog.

While much of the nation has been spared any sort of adverse weather as a result of tropical storms or hurricanes, insuring one's home is not the only way precaution may be taken by people, regardless on where they live. One helpful tip is to avoid any sort of delay or detriment to travel enjoyment by insuring your trip or vacation.

Article writer Michelle Higgins recounts various trips she has taken and the security insurance now provides. She writes

Several years passed before we returned to the Caribbean in hurricane season. In October 2007, my husband and I rented a house on the island of Vieques in Puerto Rico. The three-bedroom home was perched on a hilltop, and its pool offered clear views of the bioluminescent bay and remote beaches. The October rate was a bargain, and other than a few afternoon showers, we escaped any foul weather.

This year, we decided to press our luck again. Why? Because we were getting hurricane insurance.

Basic travel insurance typically covers hurricanes or other unexpected weather events. This can offer peace of mind to travelers going to a storm-prone region. If a hurricane shuts down the airport or wipes out the hotel, for example, you don’t lose the money you spent on the vacation.

But some companies have started going a step further, offering more specific storm-related benefits like hurricane-warning protection. With this type of insurance, travelers don’t have to wait until a hurricane ruins their vacation to get their money back. Rather, hurricane-warning coverage generally allows cancellation of a trip within 24 hours of departure if the destination is under an official hurricane warning from the National Hurricane Center.

The article goes on but the general idea is that a variety of situation-specific provisions exist. By researching before your trip and looking into anything a travel agent or the company you are buying through, or in the event it is a trip just researching the internet or your rental car company, valuable time and money can be preserved. Some companies might let you go on the trip again while others may simply reimburse a portion of your trip. Either way, being an educated traveler can be quite helpful when hurricanes sweep through, if they do. And if they don't, at least knowing you're protected can make travelers less wary about the weather day to day.

Per the Examiner, storms may finally reach the Gulf Coast.

A new system taking shape has a fairly high chance of becoming a depression, and possibly tropical storm, on either September 1 or 2, according to the National Hurricane Center. It is located east of Puerto Rico near the Lesser Antilles. The good news is this: the persistent trough over the east will likely steer this tropical cyclone away from the U.S. coast just as we saw with “Bill” and “Danny”. The system has a very low chance of affecting Texas based on expected steering winds.

National Hurricane Center

A little bit of 'News in Short'

Miami Herald: more tax benefits for Chinese drywall victims

Scientific tests have shown that toxic China-made drywall installed in homes beginning in 2001 emits harmful gases that corrode copper wiring and other parts of people's homes. In addition, these gases harm people's health, making many homes uninhabitable. Homeowners must not be left to shoulder this burden alone...

Although the casualty loss deduction allows victims to deduct the home's loss of market value from their taxes, the current tax code does not allow them to deduct for the additional living expenses incurred when homeowners must move and live elsewhere to escape toxic drywall emissions.

Levee plans in doubt

Frustration and less-than-kind words were expressed at two state coastal restoration and protection meetings recently because of a letter sent to the U.S. Army Corps of Engineers that raised questions about construction-related permits for at least two portions of a long-awaited, massive levee system in Terrebonne Parish.

The letter, dated Aug. 13 and signed by the Coalition to Restore Coastal Louisiana and the Lake Pontchartrain Basin Foundation, outlined concerns the environmental groups have voiced for several years about the entire Morganza to the Gulf project, which would cover lower parts of Terrebonne and Lafourche parishes.

Just a helpful reminder that buying a weather radio may be a good idea before it is a necessity. Various sites around the internet are selling them, as are businesses in areas around the Gulf Coast, and some decent deals might be something to jump on. One site, for instance, is selling a model for 50% off, only $18 + shipping. The model includes features such as

Receives all 7 NOAA Weather/Hazard Channels
Telescopic Antenna
Uses 4 “AA” Batteries (Not Included)
AM/FM Weather Band Radio Receiver
120V AC Adapter Included for Desktop Operation
Emergency Alert Siren
Handle For Easy Carrying
Earphone Jack

Just something to consider while things are quiet (and hopefully remain that way!)