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JWill
USA
28 Posts |
 Posted - 01/25/2004 : 14:05:24
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Within all polices is the clause stating, "Suit Against Us". A couple of questions concerning this clause.
1). What does it mean actually?
2). Considering state mandated special provisions, how does it affect the claim?
3). Does it actually mean that once this period has expired, can the claim be reopened?
Your thoughts ladies and gentlemen. State specifics aren't required here, just an open discussion.
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J. Williams |
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JimF
USA
1014 Posts |
Posted - 01/25/2004 : 15:06:50
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Basically this policy provision means what it says (and I don't mean that in a sarcastic way).
Subject to local case law or court decisions, this provision provides a one year time limit for an insured to bring an action against an insurer. This time limit might vary by state.
Further, and more importantly, the limitations that policy provisions must be met prior to bringing suit, means that an insured must comply with policy provisions such as preparing an inventory of loss, submitting a Proof of Loss, and where the amount of damages is at issue, pursuing the appraisal provisions of the policy before instigating litigation.
In some states, this provision may also include language which prevents third party claimants from directly naming the insurer in actions against an insured.
With regard to your last question, it is not at all that unusual to see a complex or commercial claim not close within a year.
For a claim previously closed, it would seem that each claim would have to be examined on it's own merit, and especially in light of local law. And while there might be limits on bringing a legal action against the carrier, there might not be a limit to reopening a claim which a carrier could clearly see was reasonable in basis.
Hope this helps. |
Edited by - JimF on 01/25/2004 15:13:56 |
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JWill
USA
28 Posts |
Posted - 01/28/2004 : 01:52:55
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| Thanks Jim, no sarcasim taken. |
J. Williams |
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KileAnderson
USA
875 Posts |
Posted - 01/28/2004 : 08:48:54
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| Jim, here is the real question. Is the provision a get out of jail free card for the carrier. What I mean by that is, even though it doesn't state anywhere in the policy that there is a time limit to file a claim, can the carrier take the stance of "well, yes you have a ligitimate claim, but it has been more than a year so you can't sue us, so we are going to deny the claim." That I think is the real question. |
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Manmut
USA
26 Posts |
Posted - 01/28/2004 : 09:44:05
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I think the law in each state will define when the clock starts ticking for this provision. In Wisconsin, state law imposes a one year limit on bringing suit against an insurer. The courts here have ruled that the law intends the one year limit to begin from the date of the loss, not the date the loss is reported.
An insurer, however, can be estopped by its own conduct from from arguing this defense. If an insurer delays or draws out a claim, it may have estopped itself from using the one year limitation imposed by law. For example, in Fischer v. Harmony Town Ins. Co., 24 N.W.2d 887 (Wis. 1946), the insurer was late in providing Proof of Loss forms, never objected to the signed forms, convinced the insured to enter appraisal, and never denied its liability throughout negotiations. The court found that this behavior convinced the insured to delay any suit.
I believe that the true test of whether to accept a newly filed claim that is over a year old is whether, by waiting so long, the insured has, to a significant degree, negatively impacted the ability of the insurer to properly investigate the claim. As long as the insurer can still perform a detailed investigation, I think the claim should be accepted. |
Patrick W. Laws |
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CCarr
Canada
1200 Posts |
Posted - 01/28/2004 : 10:00:09
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Kile, I do think the notion of a "time limit" to file a new claim is addressed in a HO policy.
Although it is not addressed in a 'cut and dry' method as other matters are, it still exists regarding "notice" of a claim.
In Section I - Conditions - Your Duties After Loss, "In case of a loss .... you must see that the following are done: (a) Give prompt notice to us ...."
That whole issue has split over the years into two big piles of litigation. First, as above, the "prompt notice", the filing of the new claim; and second the time periods relative to presenting substantiation or the guts of the claim after reporting.
But keeping with your theme, a time limit to file a new claim, I would suggest it is addressed as noted above in the policy.
How that then gets into the web of the other Condition - Suit Against Us, is how two or more measures of time conflict.
First, one must give "prompt notice", a phrase open to some interpretation and a litigator's delight; as part of the required compliance with the policy.
Then, the other measure of time that blends into this is that the action must be started within one year after the date of loss. This part has its own pile of additional litigation regarding the application of these measures of time, but primarily surrounding "date of loss" versus "prompt notice" versus discovery of the loss.
So, I don't think there is a cut in stone answer to the question you raise regarding a potential carrier stance, relative to the topic policy Condition.
But, time limit to file a new claim is addressed in the policy, as noted. |
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katadj
USA
315 Posts |
Posted - 01/28/2004 : 10:04:56
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Reading the posed question it appears that there are several.
1) What does “suit against us “ mean.
That is very basic as JF pointed out, that all provisions of the policy be met before one can bring suit. It does not mean that one cannot file suit.
2) Considering State mandates, how does it affect the claim?
As each State has their specific “Statute of Repose”, the wording of that will affect the initial question.
3). Does it actually mean that once this period has expired, can the claim be reopened?
The normal limitations for re-opening of a closed file, for valid reasons is one (1) year from the date of closure, subject again to the written contract and laws of the State.
For the most part the policy requires one to file a claim in a timely manner. That can mean from when the loss is discovered or within the “Statute of Repose”.
As the State Statute can vary from 1 to sometimes 10 years, and may differ between residential and commercial policies in some states, it is incumbent on the policyholder to have the proper interpretation. There are also provisions in many policies that differentiate between a “standard” loss and a “catastrophic” loss and the Statutes can vary.
The carrier can take the position of denying the claim, due to an excess time limit, but when that happens the insured may the right to bring suit, in some cases.
It is difficult at best to be aware of all of the nuances of all of polices in each state, so our continuing education, research and interaction is a paramount concern.
Oft times an attorney may have to be engaged to sort out some of these issues.
The never ending pursuit of excellence in adjusting is as evasive as the wind.
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KileAnderson
USA
875 Posts |
Posted - 01/28/2004 : 12:40:11
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| I understand the duty to promptly notify the carrier. That part is as clear as mud. I would think that the reasonable man standard would probably say about a week from the discovery of the loss would be reasonable, but what about 10 days? Also, what if the discovery of the loss comes on day 366 after the DOL? Can the carrier then say, "sorry, you can't sue us over it, so we won't pay."? |
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Steve H
Switzerland
30 Posts |
Posted - 01/28/2004 : 13:42:57
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In addition to what has been stated above:
1). What does it mean actually?
It is called the Suit Limitation Clause (SLC) and it means that no suit or new claim can be brought after the stated period, which is usually one year. In that sense, it is "a get out of jail free card" for the carrier, but it is applied differently from state to state.
2). Considering state mandated special provisions, how does it affect the claim?
In some states, it is written in stone. Re: Late reported claims: Unless the insd was literally out of the country and living in a cave and unable to know there was damage to report, the one year is strictly enforced and no claim can be brought or suit filed even a day after that time limit. In these states, the courts have called the SLC a contractual statute of limitations.
In other states, the SLC has been overruled by statute. I think Michigan, e.g., says that the limitation is the seven year contract limit.
3). Does it actually mean that once this period has expired, can the claim be reopened?
The claim can only be reopened if the carrier has done something to toll the statute/SLC limit for a period of time and then only for the length of time that the statute was tolled. It is always tolled for the period between the time that the carrier is put on notice and the date the claim is denied. It begins at the loss date, which can also be the date of discovery in some states.
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Suit Against Us
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