Changes to Insurance Clauses - Pe

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Changes to Insurance Clauses - Pe Powered By Docstoc
					CHANGES TO POLICIES AND
   OTHER IMPORTANT
    UNINSURED AND
UNDERINSURED INSURANCE
       CLAUSES
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Scott B. Cooper
SCHMIDT KRAMER.COM
209 State Street
Harrisburg, PA 17101
(717) 232-6300
scooper@schmidtkramer.com
TRADITIONAL
   UNINSURED/
       UNDERINSURED
          ARBITRATION
             CLAUSES
POST KOKEN CLAUSES
      NEW USAA ENDORSEMENT

“Arbitration”

“The Arbitration provisions for Uninsured
Motorist Coverage and Underinsured
Motorist Coverage are deleted in its
entirety.”
       New Allstate Language

   “If the insured person and we do not agree
    on that person’s right to receive damages or
    on the amount, then upon mutual consent,
    the disagreement will be settled by
    arbitration….If the insured person and we do
    not agree to arbitrate, then the disagreement
    will be resolved in a court of competent
    jurisdiction.”
      New State Farm Language

The insured and we must agree to the
 answers to the following two questions:
 (1) is the insured legally entitled…(2) If
 the insured and we agree that the answer
 to (1) is yes, then what is the amount of
 compensatory damages that the insured is
 legally entitled to recover….
WHAT IF NO AGREEMENT?
State Farm (cont’d)

  If there is not agreement on the answer
   to either then the insured shall: 1. file a
   lawsuit, 2.consent to a jury trial if
   requested by us, 3. agree that we may
   contest both liability and damages and 4.
   secure a judgment in that action.
NEW CHUBB LANGUAGE

• “that the matter may be arbitrated.”
• “Should either party demand arbitration,
 each party will select an arbitrator….”
     New AMICA Language
Old Language:
 Either party may make a written
 demand for arbitration.

Post Koken Language:
 Both parties must agree to
 arbitration.
ISO Personal UM & UIM Arbitration Clause
AUTHORIZATIONS AND MEDICAL
         PAYMENTS
     State Farm’s Authorization

Includes medical, psychological,
 psychiatric, chiropractic, osteopathic…
Can get EDR information or anything
 else..
The company can basically disclose the
 information to anyone it wants for “their
 review and professional opinion.”
Valid for duration of claim.
          Liberty Mutual’s HMO for
                   PIP!
   Insured eligible for “Preferred Provider Network”.
   You get a discount off of treatment!
   Example: If you have $1,000 of medical coverage
    under your policy and a non-PPN provider provides
    medical treatment that totals $1,000 you policies
    medical benefit is exhausted BUT using the PPN the
    provider contracts for the 20% discount and they pay
    $800 so you still have an additional $200 on your
    benefits.
THE “INSUREDS” DEMAND
DECIDES IF ARBITRATION
    APPLIES CLAUSE
    Amount of Damages Determines
              Arbitration
“If the amount of damages the „insured‟
 demands is $--------- or less, both parties
 will select a single arbitrator…..If the
 amount of damages the „insured‟ demands
 is more than $-------, each party will select
 an arbitrator.”
Connecticut is $40,000
Powers of Arbitrators in Policy
      Allstate Language
• No arbitrator shall have the
  authority to award punitive damages
  or attorney’s fees
             Who pays Fees?

   “All arbitration expenses and fees, not
    including counsel or adjuster fees, will be
    paid as determined by the arbitrators.”

Alaska (1997)
   Each party will pay the expenses it incurs and
    bear the expenses of the third arbitrator equally,
    unless the arbitration costs are awarded to the
    prevailing party by the arbitrators.”

New Mexico (1997)
WHERE DOES ARBITRATION
     TAKE PLACE?
          AMICA LANGUAGE

Unless both parties agree otherwise,
 arbitration will take place in the county in
 which the insured lives.
              ALLSTATE
 “Unless you and we agree otherwise,
  arbitration will take place in the
  county in which your address shown
  on the Policy Declarations is located.”
New Exclusion/Limitation
      Language
        Chubb’s “Collector” Language
   Collector Vehicle Usage: We do not cover any
    person for damages arising out of the
    ownership, maintenance, or use of a collector
    vehicle when it is:
    Used for any person‟s primary or backup
    transportation or errands, driven to work or
    school, driven by any person under the age of
    25 years, used as a shared-expenses car pool,
    used in any business or occupation, or used to
    participate in any road rally, gymkhana, sports
    event or timed event of any kind.
        State Farm Filings

 “relative” has been changed to “resident
  relative”
 Due to Hoffman v. Troncelliti, now a
  person who had limited tort is treated as
  full tort if injured while occupying a
  vehicle owned by a resident relative to
  which the full tort alternative applies.
        State Farm (cont’d)
   Under Liability added a “household” exclusion to
    exclude injury to family members caused by other
    family members.
   UM covered now will apply if insured not hit the
    insured or the vehicle the insured is occupying if the
    facts of the accident can be supported by
    “disinterested witnesses”.
   Changed definition of “insured” to include all named
    insureds, rather than first named insureds.
    Passengers and resident relative are no longer
    covered while in a non-owned vehicle driven by an
    insured.
     Allstate New Language
 Now has language which says “bodily
  injury to anyone while in, on, getting into
  or out of or when struck by a motor
  vehicle owned or leased by you or a
  resident relative which is not insured for
  Uninsured Motorist Coverage under this
  policy.”
 Now also has same change for non-owned
  regular use of you or a resident relative.
DUTIES AND OBLIGATIONS
       OF INSURED
       State Farm Language

   If the company requires, persons answering
    questions under oath may be accompanied
    only by their legal representative.
               Nationwide
 The insured must:
   Submit to oral examination under oath as
    often as we require with good reason.
   Be examined by doctors, including doctors
    examining the insured for rehabilitation
    purposes…chosen by us as often as we
    require with good reason.
STATUTE
          OF
               LIMITATIONS
New UM SOL Commercial Policy Clause


 Any legal action against us under
 this coverage form must be brought
 within 4 years after the date of the
 “accident.” However, this paragraph
 does not apply to an “insured” if,
 within 4 years after the date of the
 “accident”, we or the “insured”
 have made a written demand for
 arbitration in accordance with the
 provisions of this endorsement
     Allstate General Provisions Change

“No one may bring an action against us
 unless:…..b) the action is commended
 within one year of the date the cause of
 action accrues.”
Allstate New Language

   No one may pursue arbitration under Part 3 –
    Uninsured Motorist Insurance……unless the
    demand for arbitration is made within four
    years after the date of the accident.
              New UIM Commercial SOL Clause

b. Any legal action against us under this coverage form
   must be brought within 4 years after the date of the
   “accident.”
c. Paragraph 2b of this condition does not apply to an
   “insured” if, within 4 years after the date of the “accident”,
        (1) we or the “insured” have made a written demand
   for arbitration in accordance with the provisions of this
   endorsement or,
        (2)The “insured” has filed an action for “bodily injury”
   against the owner or operator of the “underinsured motor
   vehicle” and such action is:
                (a) Filed in a court of competent jurisdiction;
                        and
                (b) not barred by the applicable state statute
                        of limitations.
        State Farm Policy Filing
   Legal action for UM and UIM coverage must be
    brought within two years after the date of the
    accident, and only after filing a lawsuit in
    accordance with the Deciding Fault and Amount
    Provision.
   Also there is a choice of law provision that the law of
    Pennsylvania controls if there is a disagreement as
    to the interpretation and application of the policy, but
    Illinois applies as to interpretation and application of
    Mutual Conditions or the Participating Policy
    provision, whichever one applies to the car policy.
The UIM SOL Kicker
   In the event that the four year time
    limitation identified in this condition
    does not apply, the applicable state
    statute of limitations will govern legal
    action against us under this coverage
    form.
   Apply Rosenthal Third Circuit Decision from
    April 20, 2007
      Power to Enter
Amount of Award In Excess of
           Limits
• “The arbitrators shall have no
  authority to award an amount in
  excess of the limit of liability.”
Can you Assign?
NATIONWIDE

 No interest in this coverage can be
  transferred without our written consent.
  However, if the policyholder dies, this
  coverage will continues in force for the
  rest of the policy period.
UIM – Transfer of Rights
   If we make any payments…involving an UIM
   vehicle and the “insured” recovers from another
   party in a separate claim or suit, the insured shall
   hold the proceeds in trust for us and pay us back
   the amount we have paid less reasonable
   attorneys fees, costs and expenses….
Our rights under this provision do not apply…if we:
a. Have been given prompt written notice of a
   tentative settlement…, and
b. Fail to advance payment to the “insured in an
   amount equal to the tentative settlement within
   30 days.
SEE YA NEXT YEAR!!

				
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posted:10/17/2010
language:English
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