Colorado passed a lot of pro-consumer legislation that stops insurance companies from using the terms of association in real estate insurance. 1 Denver-based attorney Merlin Law Group Jon Bukowski explained that some insurance defenders have aggressively used the property insurance co-operation provision as a sword in an attempt to obtain loss of insurance benefits.
Carriers in Colorado are becoming increasingly aggressive in terms of fraud, misrepresentation and failure to cooperate in defense. We see particularly heavy demands on theft and fire demands, and sometimes in hail / wind demands. I can give you many other examples of unreasonable requests for 30-40 line documents for materials that are completely irrelevant to the adaptation of a simple hail claim. They take unnecessary 8-hour EUOs. They are instructed to use these document requests and the EUO to put a failure to cooperate defense.
This at least limits their ability to set a trap for an unsuspecting policyholder who tries his best to cooperate. This now causes the carrier to show that the heavy request for information is reasonably needed to adjust the claim or prevent fraud. It also requires the carrier to point out why they consider it necessary and then allow the insured 60 days to remedy the alleged failure to cooperate.
I personally think this is good …
Colorado General Assembly provided a summary of the new law and what it will accomplish:
The act prevents an insurance company from using a defense that does not cooperate in an action regarding the insurer's request for information from the insured about a claim unless:
• the insurer has submitted a written request to the insured for the information.
• The information necessary for disputes is not available to the insurer without the help of the insured.
• The request gives the insured 60 days to respond;
• The written request refers to information that a reasonable person would determine that the insurer needs to adjust the insured's application or to prevent fraud; and
• The insurer gives the insured an opportunity to cure within 60 days and notifies the insured within 60 days and describes, in particular, the alleged failure to cooperate.
A failure to cooperate defense as a defense against the part of the claim that is materially and materially damaged to the extent that the insurer could not evaluate or pay that part of the claim. All languages in an insurance contract that are contrary to the document are invalid. If an insurer gives the insured time to respond or cure according to the law, the insurer is not responsible for not having paid the claim in the meantime.
How many times can an insurance company request more information and more time to examine a property insurance policy? After weeks and sometimes months, adapters send "experts" for further investigation and they often request even more information that could have been searched for after the disaster occurred. Almost a decade ago on this blog I noted: 2
Some insurance companies treat their customers horribly, with slow and delayed investigation, because companies lack a sufficient number of motivated adjusters and investigators who determine losses in good faith . Requests for tens of thousands of documents are made together with several surveys. The lawyers for some of these companies incorrectly take months to review documents and make follow-up requests for information. It is a disgusting treatment to use the "golden rule" as a measure of justice.
Laws such as those just enacted in Colorado do not happen by mistake. Colorado policyholders were injured and their political leaders stood up to stop illegal practices with consumer protection laws. Political leaders in other states should do the same so that political advantages are not lost by technical forgeries.
Today the Tuesday at 2 with Chip Merlin I will discuss this new law, the topic of loss of insurance benefits and why consumer organizations, industry associations and public interest organizations should organize to better help policyholders get insurance that works for them. I will also have a more in-depth follow-up of yesterday's related posts, Loss of benefits for insurance contracts is not preferred in the law .
I look forward to your comments and questions on this subject. Here is a link to today's session where you can hear the answers.
Thoughts for the day
I would like to rent a small cabin or cottage in Colorado and learn to ski or snowboard. And on the warmer side, I also want to rent a house in Hawaii and learn to surf!
And Colorado Song For The Day
2 Ask for assessment – get a trial and appeal Blog for real estate insurance coverage, 30 December. 2010.