Articles Posted in Insurance Companies

We sent Progressive Insurance a demand letter in a case where the client had some pretty serious injuries, including 50 staples in her head to close a scalp laceration. Progressive faxed us a letter stating it cannot conclude its investigation until we obtain different bills from the medical providers that are on certain health claim forms, because Progressive wants the individual CPT codes for every visit. CPT codes are numbers assigned to every task or service a doctor may provide to a insurance lawsuit

Are CPT codes necessary for Progressive Insurance to determine whether medical care rendered was fair, reasonable, necessary, and causally related to the car accident? I think the best way to frame the question is to ask whether a jury can render a verdict without CPT codes. The answer, of course, in that I have never in my life heard testimony that included CPT codes at trial.

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The Governor signed yesterday a bill that allows auto insurance companies in cases where the at-fault driver has insufficient insurance coverage to consent to new uninsured lawsettlements against the at-fault driver without (1) limiting their right to raise any issue relating to liability or damages in an action against the insurer; and (2) admitting as to any issue raised in an action against the insurer.

The Maryland General Assembly made history with the bill: nobody is mad. Insurance companies are ecstatic and trial lawyers are indifferent.

You can read about the genesis of this bill here.

State Farm recorded another win in a family use exclusion case this week in the Maryland Court of Special Appeals, in Stickley v. State Farm.

Sad Facts of Stickely v. State Farm

This is an awful case. The plaintiff was a passenger in a car accident in Montgomery County in which her husband was killed. The plaintiff suffered catastrophic injuries. Plaintiff and her husband had coverage with State Farm, which provided typical coverage for State Farm, at least in Maryland: $100,000 per person/$300,000 per accident. The plaintiff also had a $2,000,000 umbrella policy with State Farm. The plaintiff’s counsel obviously wanted to get to the use exclusion case

Regrettably, the State Farm umbrella policy included an exclusion for personal injury claims that result from the negligence of another insured. The plaintiff’s lawyer sought a declaratory judgment, claiming that her Umbrella Policy constituted “private passenger motor vehicle liability insurance,” voiding the family use exclusion regardless of the unambiguous language of the policy.

Does the Umbrella Apply?

The question, ultimately, is whether the personal liability umbrella policy is a policy of “private passenger motor vehicle liability insurance,” requiring an insurer to offer coverage under the umbrella policy for a claim made by a family member in the same amount as the coverage made by a nonfamily member, pursuant to Ins. § 19-504.1.

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After agreeing to a defense medical exam, we received a letter from defense counsel with a draft agreed upon order to be filed with the court agreeing to the DME. This is the first time I have seen a defense lawyer try to do this.

While it is all rather harmless in most cases, why in the world would a plaintiff’s lawyer sign this? Without reference to any conditions, the client agrees to the exam without qualification for nothing in return? I wish I knew what percentage of plaintiffs’ lawyers must sign this and send it back. It must work at least occasionally, or he wouldn’t still be sending this out (unless he just wants a reason to put down .2 on his timesheet). I also think it is annoying because yodefense attorney tacticsu have to respond – you can’t let a “the doctor will bill you $600 for a missed appointment” sit out there without a response. (Well, maybe you can but I think you have to respond to set the record straight.)

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Last week, in Hendrix v. Burns, the Maryland Court of Special Appeals dealt with the question of what plaintiffs’ lawyers can admit into evidence in a car accident case when the defendant stipulates to liability.

In car accident cases, many defense lawyers loathe admitting responsibility. There is always a chance that the jury will hate the plaintiff and accept some insane version of how an accident happened.

But, the best thing that can happen for the plaintiff is for the defense lawyer to deny responsibility in a case because it diminishes the defense lawyer’s credibility on the plaintiff’s injuries. If you are plaintiffs’ counsel, you want to get the jury mad at the defendant. Jurors give more money when they are mad. This is hard in traffic collision cases because it is hard for jurors to get mad at a negligent driver who makes what they can perceive to be an accident that they could easily make themselves.defendant drunk driver

Smart attorneys for plaintiff frame the case, not as an accident, but a choice the defendant made. “The defendant in this case chose not to pay attention.” But still, we all know that we have failed to pay attention while driving and it could have, under the wrong circumstances, lead to a car accident.

In Hendrix, the call to stipulate to liability was a no-brainer for State Farm who defended the case. The defendant was drunk. He tried to flee the scene of the accident, but his damaged car wouldn’t let him. He was in the middle of some road rage dispute. A picture-perfect bad guy defendant for the jury to hate.

State Farm did what they should do, file a motion in limine to exclude the introduction of evidence that the defendant was drunk, that he had been involved in a “road rage” incident with another driver and was crazily chasing that driver when he ran the red light, that defendant attempted to flee after the accident, and also that his criminal record included DUI convictions.

Plaintiff’s lawyer did what smart ones do in a case like this. He brought a battery case for the road rage, arguing that has been put to bed since law school doctrines like transferred intent. He brought a negligent entrustment count. He also smartly argued that a part of Plaintiff’s pain and suffering was seeing the defendant drunk and trying to flee the scene of the accident. This is doing everything you could do to put your client in a position to maximize her damages.

Does this have anything to do with the level of damages in a personal injury case? It depends on your world view. If you think damages should be calculated in a hermetically sealed box, it shouldn’t be admissible. From this perspective, it shouldn’t matter whether the defendant was a crackhead on his 6th DWI or a nun with a 40 years history impeccable driving.

Yet, somehow, that she was a nun would come out on direct. Why? Because the insurance defense lawyer is trying to minimize damages by suggesting that this nun is a sweetie and she will have to pay this verdict out of her pocket.

Why do we let the nun say she is a nun? Context matters. But once you agree that the fact that she is a nun should be admitted, doesn’t the dam break open when the defendant is drunk. Isn’t that context – like the nun – that the jury should consider? Continue reading

Forbes, via Overlawyered, has an interesting article on Houston lawyer, Steve Susman’s efforts to cover lawyers on both sides of the aisle to try more jury trials… and make cases easier to try. How? Buy reaching stipulations on all the dumb things lawyers argue about.

Great idea that will never work in a vehicle accident or med mal case in Maryland. Why? Rule #1 of being an insurance defense lawyer for both in-house and outside counsel is don’t screw up by doing something outside of the box. For example, one suggestion Susman makes is to agree in advance not to depose each other’s experts. After a large verdict, every insurance company does a CSI forensics witch-hunt. “You did not depose the insurance defense lawyersplaintiffs’ experts. Why? Did you get permission for Jonathan P. Paperpusher for that decision?” Insurance companies are not promoting (in-house lawyers for car insurance companies) or doling out work to lawyers (outside counsel) who take outside-the-box risks that could backfire. Insurance companies give out a lot of love to singles hitters, but far less to home run hitters who occasionally strikeout. Continue reading

There is a bill pending in the Maryland Senate to overturn the Maryland Court of Appeals opinion in Maurer v. Pennsylvania National Mutual Casualty Insurance six years ago. This bill allows car insurance companies who have underinsured exposure because the at-fault driver has insufficient insurance coverage, to consent to settlements against the at-fault driver without (1) limiting their right to raise any issue relating to liability or damages in an action against the insurer; and (2) admitting as to any issue raised in an action against the insurer.

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U.S. District Court Judge Catherine C. Blake issued a fascinating opinion this week in Allstate v. Warns, denying a former Allstate adjuster’s motion for summary judgment in a “we think you stole our documents and provided them to the plaintiffs’ lawyer” case. The facts are juicy. It is more than worth the time to lay them out. Get some popcorn and head back over here.

Welcome back. Defendant was an Allstate claims adjuster for 33 years, handling only lead paint cases during the last 5 years of her Allstate tenure. Seemingly, the allstate lawsuit former employeevery definition of a company gal. I would think if you stay at Allstate for 33 years, you would order extra glasses of the Colossus Kool-Aid and all the other noxious potions they are concocting in the lunchroom over there.

The first clue that this adjuster had fallen off the wagon is that she invited several plaintiffs’ lawyers – including the plaintiffs’ lawyer, that will hire her in a second, who she had ongoing lead paint cases with – to a party at her house. Allstate, probably monitoring the cameras it has installed at the homes of all its employees, found out and confronted the adjuster. Later, Allstate – alleges anyway – that this same plaintiffs’ lawyer had sent her flowers, gifts, and cards while she was at Allstate. Allstate says the adjuster quit, claiming she was going through personal issues. The adjuster was next seen by Baltimore Housing Authority lawyers, no strangers to controversy themselves; passing what someone thought was a confidential Allstate instruction manual on lead paint cases at the trial table of the flower/card/gift sending plaintiffs’ lawyer. (That might not be exactly how Allstate found out. Humor me. The story reads better that way.) So Allstate sued her.

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The purpose of pre-verdict interest is to require a person who owes money to pay for the time value of money, which is the advantage received from the use of that money over time. In contract dispute cases, Maryland provides for 6% prejudgment interest.

In personal injury cases, many of plaintiffs’ damages also occur immediately. Just like contract cases, Maryland personal injury victims are deprived of the use of money to which they are entitled to receive the moment they incur the injuries. Yet tort victims get no interest on money that accumulates.

Insurance companies are premised on time value of money. Take premiums, invest the money, and – reluctantly – pay out claims later. While I think the idea that insurance companies stall to delay making payment is sometimes overblown (administrative considerations give insurance companies some incentive to move files forward), there is still no question that there is economic incentive to delay because the longer they hold the money, the more interest they will receive. Continue reading

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