Category(s): Federal - 08/01/2012

As the world awaits the issuance of the Federal Insurance Office’s report on regulatory modernization, mandated by the Dodd-Frank Act, we know that FIO has a lot of other balls up in the air that may be equally as important.  We got a glimpse of that on August 6 when FIO Director Michael McRaith’s Federal Advisory Committee on Insurance met at Treasury.   The meeting focused on the internationalization of insurance markets and the existing subcommittee charges given at the last FACI meeting in March.  The consulting group McKinsey & Company gave a report on trends in the international and US Markets, followed by reports by the two subcommittees.  Director McRaith reported on his office's work in the international arena and posed specific questions to the subcommittees and to a new third subcommittee looking at international regulations, specifically ComFrame.

Charles T. Richardson, Esq. - FAEGRE BAKER DANIELS LLP, (202) 997-0681 , crichardson@faegrebd.com

Category(s): Florida - 08/01/2012

In Nawaz v. Universal Property & Cas. Ins. Co., No. 4D10-4288 (Fla. 4th DCA, June 13, 2012), an appellate court has finally addressed the issue of whether an insured's public adjuster may attend an Examination Under Oath.  To view a copy of the court’s opinion, click here.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530

Category(s): Florida - 08/01/2012

In QBE Ins. Corp. v. Chalfonte Condominium Apartment Ass'n., Inc., the Florida Supreme Court issued its long-awaited decision on May 31, 2012 in response to questions certified from the United States Court of Appeals for the Eleventh Circuit as being determinative of a case pending in that court for which there was no controlling Florida precedent.  The case arises from a Hurricane Wilma insurance claim by a condominium association against its insurer, QBE.  The condo association was dissatisfied with QBE's investigation and processing of its claim and filed suit alleging various claims for breach of contract, declaratory relief, statutory policy violations and breach of implied warranty of good faith and fair dealing.  A jury ultimately found QBE liable on all claims and the trial court entered a multi-million dollar judgment against QBE.  To access the complete opinion, click here.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 08/01/2012

The Florida Office of Insurance Regulation and Commissioner Kevin McCarty continue to take a close look at the force-placed insurance market.  McCarty, the current NAIC president, has pursued hearings at the NAIC relating to this segment of the insurance industry.  In Florida, the OIR recently held a public hearing on a proposed 2.2% average rate reduction filed by a force-placed insurer.  The OIR subsequently issued a notice of intent to disapprove the rate filing, asserting that the rate reduction should have been about 35%.

Travis L. Miller, Esq. - RADEY LAW FIRM, (850) 425-6654 , tmiller@radeylaw.com

Category(s): Florida - 08/01/2012

The Florida Office of Insurance Regulation is proposing to repeal a longstanding rule that provides guidelines to be considered when penalizing insurers for violations of the insurance code.  The OIR proposes the repeal because the legislature has changed the applicable fines in many instances in the years since the rule initially was adopted.  However, the proposed repeal concerns some insurers because it will eliminate other provisions that are beneficial to the regulatory process, such as a policy statement that the OIR will not penalize insurers when they discover errors and implement corrective measures before those errors come to the attention of the OIR.

Travis L. Miller, Esq. - RADEY LAW FIRM, (850) 425-6654 , tmiller@radeylaw.com

Category(s): Georgia - 08/01/2012

On July 6, 2012, the Georgia Court of Appeals reversed the trial court’s grant of summary judgment to United Services Automobile Association (“USAA”) arising out of USAA’s denial of coverage for a theft claim by the policyholder.  The plaintiff owned a 2005 Lamborghini that was covered by USAA.  On March 4, 2008, he parked the vehicle at car dealership belonging to David Jordan, with whom he had on previous occasions sold vehicles.  On those previous occasions, Mr. Jordan would tell Mr. Byrd if there were interested buyers and then establish an agreeable price.  Afterward Mr. Byrd would sign the title to the vehicle over to Mr. Jordan.  In the instant matter Mr. Jordan’s brother, also an employee of the dealership and a man with whom Mr. Byrd had not previously dealt, sold the vehicle without contacting Mr. Byrd.  Mr. Byrd discovered this only by visiting the dealership, finding that the vehicle was gone.  On May 24, 2008, Mr. Jordan called Mr. Byrd and informed him that the vehicle had been sold and that the purchase price was $225,000 and that he had received only partial payment.  Mr. Byrd agreed to the purchase with the expectation that the buyer would pay, through Mr. Jordan, the full $225,000 sales price within 30-days.  Mr. Jordan cancelled his USAA insurance policy the same day.  Although the dealership took possession of the vehicle, its title was never signed over by Mr. Byrd.  Ultimately, the vehicle’s purchase price was not paid and the dealership closed on June 30th.  In defending the theft claim filed by Mr. Byrd, USAA asserted that the theft was of the proceeds of sale and not the vehicle because Mr. Byrd had ratified the sale of the vehicle on May 24.  The trial court agreed with USAA and found that the taking of the vehicle did not involve felonious intent on the part of the taker; i.e., theft by conversion.  In reversing the grant of summary judgment, the Appellate Court ruled that there were facts that could support the claim of felonious intent by the taker of the vehicle (a covered claim) because there was evidence of several misrepresentations including that the $225,000 sales price had actually been paid by the purchaser on May 24, the vehicle was sold without the prior consent of Mr. Byrd, and by the end of June neither of the Jordan brothers could be found and the dealership had ceased doing business.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com
Trey Sivley, Esq. - LOCKE LORD LLP, (404) 870-4657 , tsivley@lockelord.com

Category(s): North Carolina - 08/01/2012

North Carolina Senate Bill 836, signed into law by Governor Beverly Purdue on July 12, 2012, puts in place a mechanism for the public to comment on all property insurance rate filings in the state.  At least 30 days before the notice of hearing issues for property insurance rate filings, the North Carolina Department of Insurance will receive comments from the public regarding the filing.  The comments may be provided by email, mail or in person.  The bill also allows the North Carolina Commissioner of Insurance to specify the appropriate rate level or levels between the then current rate and the Rate Bureau filed rate upon a finding that the rate filed is excessive.

David K. Liggett, Esq. - RAGSDALE LIGGETT PLLC, (919) 881-2209 , dliggett@rl-law.com