Homeowners Insurance Tips After Hurricane Sandy

treedamage.jpgIn the aftermath of Hurricane Sandy, many people are assessing damage to their homes, cars and property. Insurance losses across the country are already estimated at $7 billion to $15 billion, while total losses will easily exceed $50 billion. If you are affected, it is important to act promptly. If you made it through the storm with property intact, now is a good time to plan for future hurricanes.

The lawyers at Breakstone, White & Gluck offer these tips:

Contact your insurance company. If you suffered damage, immediately contact your insurance company. Call your agent, or call the company directly. Let them know what damage you suffered, and ask them to send claims forms. If the damage is extensive, you may find it useful to hire a public adjuster to catalog and estimate your damages.

File the claim. Obtain as much supporting information as you can, such as receipts and photographs if you have one. If you did an inventory of your home, that will be useful proof.

Cooperate with the adjusters. A field adjuster will visit your property to assess the damage to your home or your vehicles. Provide any additional information they need.

Understand your insurance policy.Nobody likes reading insurance policies (well, we know a few lawyers who enjoy that, but nobody else), but the policy will spell out the steps you must take during the claims process. Follow those steps to protect your rights in the event of a dispute of the money you are owed. Failure to cooperate or to follow claims procedures may lead to a denial of your claim.

Tree damage may be covered. Standard homeowners insurance policies cover damage if a tree falls on your home or a garage, shed or fence on your property. If it hits a neighbor’s property, then their policy or yours may cover it. If it just lands in your yard, it is likely that you will have to bear the entire cost of its removal.

Beware of Short Statute of Limitations. Contract claims in Massachusetts generally have a six-year statute of limitations. But it is likely that your insurance policy has provisions governing disputes that are much shorter, often just months after the insurance company makes its tender of settlement. If there is a dispute, get legal help quickly!

Make Sure You Are Protected for the Next Big Storm

Inventory your property. Filing a claim is easier if you know what you own and have documented it, including writing a list and taking pictures or a video. Keep a back-up copy of everything in a safe place away from the house. For help, the Insurance Information Institute has online software you can find at www.knowyourstuff.org.

Understand your policy. Have your agent or broker explain key provisions, exclusions, and other options. For liability insurance, consider adding an umbrella. For property damage, consider earthquake insurance.

Know your insurance policy’s hurricane deductible. Massachusetts is one of 18 states which allows homeowners insurance companies to set a specific deductible for hurricane damage.

Consider flood insurance. Flood-related losses are only covered if you have flood insurance. Standard homeowners and renter policies cover damage from wind and wind-driven rain that enters a home. But damage from water on the ground or seeping into a basement is not covered. This will be the main reason many victims of Hurricane Sandy will not have insurance coverage.

In fact, only about 20 percent of homeowners who should have flood insurance actually have the coverage, according to the Insurance Information Institute. Meanwhile the average residential flood results in $30,000 in damage, according to the National Flood Insurance Program. Consumers can learn more at www.floodsmart.gov.

Car Insurance. If you have a comprehensive auto insurance policy, flood damage to your car should be covered. But motorists carrying only liability coverage will not be covered.

Please explore some of our other articles on insurance basics. The policies you have protect you from claims, cover your property losses, and in many cases pay you for damages caused by others who may be underinsured. Usually it is worth the extra cost to have that peace of mind.

Understanding and Buying Massachusetts Car Accident Insurance

What Every Massachusetts Bicyclist Needs to Know About Car Insurance
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Study: Insurance Industry Pushes for ‘Hard Market,’ Rate Increases

house_200.jpgA new study shows the property/casualty insurance industry creates periodic crises in which insurance becomes unaffordable or unavailable. It alleges the industry is currently trying to create such a crisis now to drive up profits.

The study was undertaken by the Americans for Insurance Reform (AIR), a coalition of nearly 100 consumer and public interest groups which represent more than 50 million people. Casualty and property insurance is important because it provides coverage for accidents for individuals, businesses and governments. Rate hikes could stifle their ability to operate and prevent accident victims from obtaining fair compensation.

The Study
The study is called “Repeat Offenders: How the Insurance Industry Manufactures Crises and Harms Americans.” It presents data showing the typical insurance rate cycle for and the dramatic rise in insurers’ current surplus – the amount insurers set aside to pay estimated future claims. In 2010, the insurers had an all-time high $580 billion surplus on hand, more than double the amount in 1996.

The United States has been in a “soft market,” since 2006, during which insurance rates have been stable and dropped in states where no tort reform has been enacted.

But the AIR report states in early 2011, the insurance industry began pushing the country into a “hard market,” when rates skyrocket and become unaffordable. It says the insurance industry is attempting to use Hurricane Irene as another push into a hard market. The next step, AIR says, is the insurers will deny the cycle’s existence and hire lobbyists who call for tort reform legislation.

Call for Action
AIR is releasing its report to all 50 state insurance commissioners, the new Federal Insurance Office and key members of Congress. It calls for the following steps to protect property owners, car owners and business owners who carry insurance as well as accident victims:

Data Disclosure. AIR calls on the industry to provide meaningful insurance data to state insurance departments. They ask that officials be allowed to substantiate or refute allegations about the industry’s health for accident coverage and recent legal action.

State Repeal of Anti-Competitive Laws. AIR said states should enact stronger regulation and oversight of the industry, while also repealing anti-competitive laws.

Repeal Federal Anti-Trust Exemption. The AIR calls on Congress to repeal the federal anti-trust exemption under the McCarran-Ferguson Act and have the new Federal Insurance Office review the impact of the McCarran-Ferguson Act on consumers.
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Massachusetts Car Insurance Tips for College Students

Massachusetts Car Accident

carphoto_web.jpgEach September, thousands of college students in Boston, Cambridge and across Massachusetts settle into campus life. And many students enjoy the extra freedom of bringing a car from home to school.

But students often make one costly mistake in the transition to college life. Students who have Massachusetts car insurance policies are required to inform their insurance companies about where the car is primarily kept. Otherwise, if there is a car accident, the insurance company might disclaim coverage, leaving the accident underinsured or uninsured completely. Students who fail to report their change of address and get into a car accident can be denied the Optional Insurance coverages on their policy.

Even if a student relocates a short distance, such as from Dedham to a dorm in Boston, he or she must inform the car insurance company where the vehicle will now be kept. The reason? Car insurance companies rate the coverage — and therefore the cost — on where the car is principally kept. If the car moves from a low-rated area (with fewer accidents) to a higher-rated area, the cost goes up. And if you are not paying the premium for the place where the car is principally kept, the insurance company has the legal right to disclaim coverage. And that can be harsh.

Optional Insurance Coverages Potentially At Risk Include:

Bodily Injury: This protects you from claims against your personal property if you cause a serious car accident.

Uninsured Auto: This coverage protects you and the people in your car if the person who causes the motor vehicle accident has no insurance.

Medical Payments: The first $8,000 in medical bills and lost wages are covered under the Personal Injury Protection (PIP), part of the Compulsory Coverage all Massachusetts drivers must purchase. Medical Payments provides policy holders extra protection for medical and health insurance.

Collision Comprehensive: If you are involved in a car accident, this coverage insures the damage to your vehicle.

Insurance issues can be very complicated, and you should not hesitate to call your agent if you have any questions.

Click here to read our article, “Understanding and Buying Massachusetts Car Accident Insurance.”

Another resource is, “Frequently Asked Questions on Auto Insurance,” by the Massachusetts Consumer Affairs and Business Regulation office.

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Boston Welcomes New Bike Share Program

Boston has a new bicycle sharing program, implemented on July 28th, and it is off to a great start. The program, which is known as Hubway, stations bicycles throughout the city at terminals. You can rent a bike for a short period of time, or become a member and have a year of privileges.

Nicole Freedman and David White at the Government Center Hubway Station in Boston

Hubway is another step in making Boston a bicycle-friendly city. The city, under the inspiration of Mayor Menino and with the guidance of Olympic cyclist and Bicycle Program Director Nicole Freedman (shown at right with David White, at the Government Center Hubway Station), has expanded its bicycle lanes and its bicycle parking, and it now has added convenient bicycle rentals. 

Hubway deploys 600 bicycles at around fifty stations around the city. A bike can be picked up at one station and parked at another, making the program convenient for commuters, students, and tourists. There is even an phone application called Spotcyle which gives up-to-the-minute data on which terminals have bikes or available parking docks.

David White, one of the attorneys at Breakstone, White & Gluck, called these efforts “great steps to making Boston a safer place to ride your bicycle.” The program will also reduce pollution and promote fitness.

White explained, “Cycling becomes much safer as motorists become more aware of bicycles sharing the roadways. Populating the city with hundreds more bicycles will actually increase safety for all bicyclists.”

Hubway also promotes safe cycling by urging cyclists to always wear a bicycle helmet, and to always observe traffic laws, which apply equally to bicyclists. 

White urges Boston cyclists to observe Massachusetts bicycle laws (read more here). He also urges cyclists to check their automobile insurance policies to make sure they have adequate uninsured and underinsured motorist coverage, which provides protection if there is a bicycle accident (read more here). 

Congratulations to the City of Boston and Hubway!

Massachusetts Court Rules Against Insurer in Bad Faith Case – Victory for Consumers

The Massachusetts Appeals Court recently ruled that Metropolitan Property and Casualty Insurance Company may have violated state law when it failed to make prompt payments on a no-fault claim. The ruling reversed a trial court decision, and remanded the matter to the trial court for further proceedings on the plaintiff’s claims against the insurance company for bad faith.

Importantly, the court stated that the emotional distress the plaintiff claims she suffered could be considered as part of her damages under the Consumer Protection Act, M.G.L. c. 93A. There is very limited authority in Massachusetts for emotional distress damages in claims under M.G.L. c. 93A.

The facts of the case were straightforward. Ms. Chery was injured in a car accident and obtained medical treatment. Metropolitan was responsible for personal injury protection (PIP) benefits, but failed to pay the bills within thirty days, as required by M.G.L. c. 90, Sec. 34M. The plaintiff filed suit, claiming violations of c. 90, c. 93A, and c. 176D, which governs claims and settlements. The insurance company eventually paid the bills, then claimed it could not be liable for its bad faith claims handling. The District Court judge agreed and plaintiff appealed.

The Appeals Court agreed that the claimant had no further right under the insurance contact itself, as the bills had been paid. However, the court found that there was evidence of bad faith, and the simple payment of the bills did not cure the harm caused by the delay. Among other things, the plaintiff had to file suit, incur litigation expenses, and suffer the unreasonable delay. The plaintiff also claimed that she suffered emotional distress, as her bills were put into collection, and she worried about her credit being affected. The court specifically ruled that the emotional distress damages, even though not readily quantifiable, may be considered compensable under Massachusetts law.

The case was a victory for Massachusetts consumers.

The case is Chery v. Metropolitan Property and Casualty Insurance Company, Massachusetts Appeals Court No. 10-P-103 (June 16, 2011).

We Help Consumers Who Have Been Injured by the Bad Faith of Insurance Companies

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A Marketplace of Haves and Have Nots–Massachusetts Healthcare System Plagued with Cost Inequalities

The state Attorney General is in the preliminary stage of a systematic review of the Massachusetts healthcare system and has already made some startling discoveries about healthcare costs. Martha Coakley’s office found significant cost variations among hospitals and physicians based on factors other than quality of care.  Although the investigation is still ongoing, Attorney General Coakley has expressed concern about affordable and accessible healthcare if the identified systematic failures are not addressed and has urged policymakers to implement cost containtment measures.

As part of the investigation, the Attorney General’s office reviewed documents from insurance companies and healthcare providers representing the bulk of the healthcare market in the state to examine healthcare costs and costs drivers. Specifically, the Attorney General examined insurance contract prices between insurance providers and hospitals between 2004 and 2008. The concern is that although Massachusetts has improved access to the healthcare market–97 percent of the population has healthcare coverage–this improvement could be compromised by cost increases.  Attorney General Coakley warned if left unchecked, price disparities in the market could create a  provider marketplace dominated by expensive “haves” as lower priced “have-nots” are forced to close down or consolidate with higher priced providers. 

The initial findings of the investigation showed that:

  • In the same geographic area and across similar levels of service, prices paid by insurance carriers to hospitals and physician groups varied, at the extreme in excess of 200%.
  • Price variations are not correlated with quality of care, complexity of the illness or population being served, extent of patients on Medicare or Medicaid, or whether the provider is an academic or research facility.
  • Price variations are correlated with the relative market position of the hospital or physician group as compared to hospitals within a geographic region or within a group of academic medical centers.
  • Price variations on a per-member, per-month basis are not correlated with the method of payment (e.g. globally or fee-for-service).
  • Price increases cause most of the healthcare cost increases in the state.
  • Contracting practices distort the commercial healthcare market and reinforce disparities in pricing.
  • The report noted that health care costs are increasing much faster than wages.

The investigation is expected to be completed by March 16th and the findings will be presented to the Massachusetts Office of Health and Human Services, Division of Healthcare Finance and Policy.   

For more information on Massachusetts’ unique approach to healthcare access, see the following website on the state mandate and statute.  If you need to obtain health insurance coverage, see the following guide to choosing a health plan.

If you have questions about medical negligence or medical malpractice, please feel free to contact our firm for a free consultation at 800-379-1244 

Massachusetts Homeowner Found to be Not Liable for Subcontractor’s Damages

The Massachusetts Appeals Court recently reviewed a case in which the defendant homeowner, Johnson, hired a contractor to remove several trees from her land. The contractor subsequently hired a subcontractor/crane operator, West, to help with the project. The crane was damaged during the work, and the crane operator sued the homeowner. The jury found in his favor. His case was before the Appeals Court to determine whether the homeowner was liable for his damages.

Johnson had several conversations with the general contractor about the exact location of her septic system, which was important for him to know in order to safely remove the trees. The contractor apparently conveyed information about the septic system to his subcontractor, the crane operator. The day the crane arrived, Johnson noticed that it was set up in the location of the septic system. Though she was a surprised, she did not interfere with his work.

Soon after, the crane’s outrigger pierced the septic system and the crane tipped over, causing damage to the crane and to the house. The crane operator sued Johnson, cliaming that she had a duty to warn him about the septic system.

The Appeals Court determined there was no duty. Even though Johnson may have been suspicious of the crane’s placement, she did not have a further duty to give warnings. She retained no control over the work in general, and crane operator’s work in particular. Her only duty to the general contractor was to give accurate information about the septic system, which she did. It was the responsibility of the original contractor to oversee the actions of the crane operator.

Accordingly, the crane operator’s case was dismissed. The case is West v. Johnson, Mass. App. Ct. No. 08-P-130 (2009). 

As a homeowner, how can I protect myself from these types of lawsuits?

An important consideration in determining liability is control: the less control you have over a situation, the less likely it is that you will be liable for damages. One of the many benefits of hiring a general contractor to help with a residential construction project is the shift of liability from you to the contractor. If a contractor agrees to oversee all aspects of subcontractor performance, the homeowner will likely have no direct contractual agreements with the subcontractors and, therefore, retain no control over their work.

Before hiring a contractor, be proactive. Ensure that they are registered with the state, and are carrying adequate insurance. Review the details of your contract, don’t be afraid to ask questions, and ask for proof of his/her registration and insurance certificates. Browse the additional links below for more tips on how to choose a contractor. 

Additional links:

Homeowners FAQ’s – The Massachusetts Executive Office of Public Safety and Security
Choosing a Professional Contractor – The Eastern Massachusetts Chapter of the National Association of the Remodeling Industry

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Massachusetts Claimant Permitted to Bring Second Suit Against Insurer Alleging G.L. c. 93A Insurance Bad Faith

In a case decided late last year, the First Circuit Court of Appeals determined that a Massachusetts company would be permitted to bring a second lawsuit against its insurance company seeking damages for unfair and deceptive practices, a violation of G.L. c. 93A, Sec. 11. In the case, Andrew Robinson International, Inc. v. Hartford Fire Insurance Company, 547 F.3d 48 (2008), the court determined that the earlier declaratory judgment action in a state court action was not a bar to the second action, which sought monetary damages against the insurance company.

The first case between the parties was a delcaratory judgment action. The plaintiff sought a determination that the insurance company was required to pay for the damages suffered when the business premises were contaminated with lead-laden dust from a remodeling project in a neighboring office. The insurance company argued the claim was barred by a pollution exclusion clause. The state court disagreed, and entered judgment for the plaintiffs. The insurer paid.

The second action sought damages for unfair and deceptive acts in violation of c. 93A, frequently referred to as a bad faith insurance claim. Hartford removed the case to Federal court (diversity jurisdiction) and then moved to dismiss the case, arguing it was improper to allow the plaintiffs to bring a second suit. Hartford argued that the claim was barred under principles of res judicata, and that plaintiffs could not split their claims.

The Appeals Court found no Massachusetts case directly on point, so did its best to determine what Massachusetts would likely do. It found that the action was not barred, carving out a special exception for declaratory judgments. Ordinarily, however, when claims arise from the same transaction and occurrence, a plaintiff is wise to bring all claims in a single action; the exception saved the day for these plaintiffs.

Read More on this case: Read More on this case: First Circuit Court of Appeals Allows c. 93A Case to Proceed Against Insurance Company; Previous State Suit Did Not Bar Claim

Massachusetts Health Care Crisis Driven by Backroom Deals between Hospitals and Insurance Companies

Thanks to an excellent series of articles in the Boston Globe, we now have some clear insight into what is driving the unconscionable increases in health insurance in Massachusetts: Secret agreements between the Partners HealthCare system and insurance companies. And while doctors and their insurance companies are quick to blame medical malpractice cases for exploding health care costs, the real increases can easily be blamed on the profit-driven expansion at Partners and increases in profits for insurance companies.

As the Globe has reported in a series of articles on the power and growth of Partners, the hospital corporation is now so large and powerful that it can freely bully insurance companies. The first up, Blue Cross and Blue Shield, which freely agreed to the demands of Partners in a “gentlemen’s agreement” sealed with a handshake. A handshake? Yup, their lawyers were apparently too nervous to put the deal in writing.

The result: an increase of 70% in Blue Cross insurance rates over the last eight year. Not surpisingly, their profits have soared. If you are like most Massachusetts residents, you have not seen pay increases approaching anything like that. And most hospitals that compete with the Partners affiliates have not seen similar increases, instead suffering blows to their bottom lines.

Using its clout, according to the Globe report, Partners also whipped other insurance companies into line, threatening to stop accepting patients insured by Tufts Health Plan, and others, unless they gave Partners a major boost in reimbursement rates.

Where is the money going? Partners keeps its profit margin low by spending hundreds of millions on expansions. The cost of the new cardiac center at the Brigham and Women’s Hospital was $382 million. A new building is popping up at Massachusetts General Hospital at the price of $686 million.   These numbers all dwarf the costs of medical malpractice claims in Massachusetts. (And whatever happened to the notion that these giant health care corporations were supposed to be “non-profit”?)

What does this mean for Massachusetts consumers? Your health insurance costs will continue to skyrocket, Partners will continue to corner the market for medical care in Massachusetts, their doctors will earn more, but the quality of your care will be no better and community hospitals will be threatened by Partners juggernaut. That’s right, you pay more but get care that is no better than average, and lose health care choices in the bargain.

It is time for our legislators, the Governor, and our Attorney General to crack down on costs of health care that are driving Massachusetts consumers towards bankruptcy.

At Breakstone, White & Gluck we are concerned about health care quality, health care costs, and the truth about medical malpractice in Massachusetts. If you have a malpractice matter you would like to discuss with an experienced attorney, please contact us, toll free, at 800-379-1244.

More Information

A handshake that made medical history
, Boston Globe, December 28, 2008 (third article in series)

Massachusetts Courts Protect the Rights of Passengers Injured in Hit-and-Run Accidents With a Broad Interpretation of Uninsured Motorist Insurance Policies

This week, the Massachusetts Appeals Court continued its trend of expanding insurance coverage for victims injured in hit-and-run car accidents when it granted a trial to an 18-year-old woman who suffered injuries in a car accident as a passenger in a taxi cab.

In this case, the plaintiff suffered neck injuries when the taxi cab in which she was riding rear-ended another car. Although the drivers spoke to each other to assess the damage to their vehicles, neither driver called the police or exchanged information. The plaintiff, who did not think she was hurt, took down no information. In addition a police report was never filed.

After unsuccessfully trying to track down the identity of the cab driver after the accident, the plaintiff’s attorney filed a claim for uninsured motorist benefits under her mother’s insurance policy to cover the cost of her injuries. The policy provided coverage for accidents involving “uninsured or hit-and-run autos.”

The trial court dismissed the case on summary judgment, ruling that the insurance company was not liable. However, the Massachusetts Appeals Court said, “Not so fast,” and explored the question of whether or not the taxi cab in which the plaintiff was riding could be considered a hit-and-run vehicle.

In short, the answer is yes: the taxi cab could be considered a hit-and-run vehicle. The courts have broadly interpreted the phrase “hit-and-run” in order to protect victims like this passenger. In previous cases, the Supreme Judicial Court has found that uninsured motorist claims were viable in other, similar scenarios:

  • A driver is forced off the road and into a guardrail by an oncoming vehicle, despite the fact the two cars never made contact with each other; and
  • A passenger in a car that is rear-ended realizes that he is injured, hours after the two uninjured drivers had gone their separate ways after concluding that there was no property damage or injuries.

In summary, the court held, “a passenger in an at-fault vehicle who is injured in an accident and who, unaware of her injuries… leaves the vehicle without obtaining identifying information about the vehicle is entitled to recover under the hit-and-run provisions of the policy.”

Importantly, however, the court noted that if a passenger realizes immediately after a car accident that he/she has been injured, the passenger is under an obligation to obtain identifying information from the driver(s), as long as his/her injuries are not so grave as to prevent an exchange of information.

The court also rejected the insurance company’s claim that it was prejudiced by late notice. The court said this was a factual determination to be made at trial.

The name of this case is Pilgrim Insurance Co. v. Molard. Other key cases in this area of insurance law include Surrey v. Lumbermens Mut. Cas. Co., 384 Mass. 171 (1981) and Commerce Ins. Co. v. Mendonca, 57 Mass.App.Ct. 522 (2003), which each address the bulleted scenarios above.

Uninsured motorist insurance is statutorily required in the state of Massachusetts in order to provide financial protection to those injured by other negligent drivers.

Important Consumer Tips 

  • If you are in a car accident and are wondering what to do, it is usually best to err on the side of caution, and obtain identifying information from the other drivers. For more tips about what to do if you are in an accident, visit the Mass. Registry of Motor Vehicles’ Driver’s Manual page.
  • Always notify your insurance company promptly if you are in an accident, even if you are a passenger is somebody else’s car.
  • Make sure you have enough car insurance to protect yourself if you are injured. You should have enough uninsured and underinsured coverage on your cars to protect yourself from injuries caused by other drivers. Please see our car accident insurance information for Massachusetts drivers.

If you were injured as a passenger in a car accident, or are the victim of a hit-and-run accident, call the Massachusetts injury attorneys at Breakstone, White & Gluck at 800-379-1244 for a free consultation.