by Insurance Maze » Mon Jan 14, 2008 10:30 pm
Recently I wrote a home insurance policy on a customer who told me he had no trampoline on his property. He signed the home insurance application that stated "No trampoline on the property".
When the insurance company inspected the property, guess what? - they found a trampoline in the customer's back yard.
Prior to the time the insured received the "Notice to Cancel" from the insurance company, there was an accident involving the trampoline, which seriously injured a neighbor's child.
The customer called the insurance agent to report a claim and the agent advised the customer that since there was a "material misrepresentation" on the original application, the insurance company intended to cancel the policy back to the date of issue (as though it never happened).
The customer was very angry and advised the agent that he was going to see his attorney.
A few days later, an article appeared in the local newspaper which actually "slandered" both the insurance company and the agent.
Can the agent sue the customer for "slander" or "defamation of character"?
When the insurance company inspected the property, guess what? - they found a trampoline in the customer's back yard.
Prior to the time the insured received the "Notice to Cancel" from the insurance company, there was an accident involving the trampoline, which seriously injured a neighbor's child.
The customer called the insurance agent to report a claim and the agent advised the customer that since there was a "material misrepresentation" on the original application, the insurance company intended to cancel the policy back to the date of issue (as though it never happened).
The customer was very angry and advised the agent that he was going to see his attorney.
A few days later, an article appeared in the local newspaper which actually "slandered" both the insurance company and the agent.
Can the agent sue the customer for "slander" or "defamation of character"?
Posted: Fri Feb 08, 2008 01:18 am Post Subject:
DISH dude what's that matter with you? :roll:
It's done, the E & O claim has been paid.
:lol: You know that ain't gonna cut it with this nosey bunch come on ! :PPosted: Fri Feb 08, 2008 01:17 pm Post Subject:
I just don't think that the general public has any idea of what awesome responsibilities an insurance agent takes upon himself or herself when they acutally pass the insurance licensing exam.
In an attempt to deliver the best products with the best possible service, we sometimes take "short cuts". Like, OK, we'll go ahead and bind coverage on your home and I'll come out tomorrow to take the required front and back photos. Sounds professional enough, right?
In this particular situation had the photos been taken prior to binding coverage on this home, one of two things would have happened -
(1) The policy would not have been issued.
(2) The applicant would have been required to dismantle the trampoline prior to binding insurance coverage.
Since the agent and the insurance company bound home insurance coverage, which included liability coverage, the customer had every right to expect legitimate claims to be paid.
The newspaper article was just an opinion expressed by a member of the general public.
The fact the customer actually lied was not even discussed.
In short, it is very difficult to be a good insurance agent, because we are all just "fair game".
Posted: Fri Feb 08, 2008 01:30 pm Post Subject:
Agreed Maze.....same in my profession too...lying unfortunately is common...and people hear what they want to hear many time....glad this worked out....I guess...are you saying that your E&O covered the claim?
Posted: Fri Feb 08, 2008 04:57 pm Post Subject:
Wow! Thats an awesome story. I did not expect that outcome though. The piece in the paper should have a rebuttal though.It was not fair. Is that trampoline like the smoking thing. If you get coverage then get a trampoline we don't have to tell the insurance agent about it? I hear that you cannot get coverage if you have a fireplace either .Is that true?
Posted: Fri Feb 08, 2008 05:01 pm Post Subject:
We had a home owners policy once and we got a pitbull part lab puppy. My hubby told the insurace and they promtly canceled our policy. Seems there is a list of dogs that if you own you cannot get home owners insurance. One being a pitbull. But ours was a mixed breed. Turned out she got stolen(vicious dog,right?) so we got our insurance right. Why can't an insurance company just give a person a policy and give exclusions for what is high risk?
Posted: Thu Feb 21, 2008 07:23 pm Post Subject:
Hey Maze, I was scanning through the theads and ran across your story. Wow! That is incredible.
So, based on the parameters of your case; If, on his life insurance policy, a 52 year old male claims to be a 38 year old female (in order to secure the lower premium) and dies 2 years and 1 day later (contestability period of 2 years) then the insurance company would then be required to pay the claim? HA - I don't think so. That's called Material Misrepresentation and I wish I had been investigating that case.
Posted: Thu Feb 21, 2008 07:29 pm Post Subject:
Oh, by the way;
Slander is an Oral communication of false statements that injure a person's reputation.
Libel is a false publication in writing, printing, or typewriting or in signs or pictures that maliciously damages a person's reputation.
Defamation is to damage the reputation, character, or good name of by slander or libel.
I wish I could have helped you, bud
Posted: Mon Feb 25, 2008 05:59 pm Post Subject:
Hey InsInvestigator...you picked an example that does not normally allow for denial of a claim based on fraud or misrepresentation in the application. Most states will NOT allow an insurer to cancel a policy or deny a claim due to age or gender misstatements. I know it's kind of strange, but here's an example of law (from Oregon):
743.180 Misstatement of age. A life insurance policy shall contain a provision that if it is found at any time before final settlement under the policy that the age of the insured or of any other person whose age is considered in determining the premium or benefit accruing under the policy has been misstated, the amount payable or benefit accruing under the policy shall be such as the premium would have purchased at the correct age or ages, or the premium may be adjusted and credit given to the insured or to the insurer, according to the insurer's published rate at date of issue. [1967 c.359 §382]
There are people who truly do not know their age; born in a country with bad birth records, etc. As a result, most states have laws that say the insurer can only adjust something somehow (premium, death benefit, etc.) and cannot void or cancel the contract. Using your example:
Let's say that we have a 52-yr. old man stating that he is a 38-yr. old woman just to get a better rate, and let's say that the face amount of the policy is $300,000. Doesn't matter what kind of policy it is, the law holds.
As a "38-yr. old female", let's say the premium rate is (just picking a number) $50 a month. If the insurer had know that the insured was a 52-yr. old man, let's say that the rate SHOULD have been $150 a month. The client only paid 1/3 of what he should have paid had the insurer known the correct age ($50 divided by $150). If the insured dies, the beneficiary will only receive 1/3 of the face amount, or $100,000 in this case. If the insurance company found out about this prior to the death of the insured, normally they will reduce the face amount to the amount the premium would have purchased had the company know the correct age. In this case, the amount of insurance would normally be dropped to $100,000.
Weird, huh?
Ins Teacher 8)
Posted: Mon Feb 25, 2008 06:18 pm Post Subject:
Hey Teach, I'm looking like an idiot here and for that, I'm sorry. From now on, whenever I post something where I mean to be sarcastic, I'm going to put the word SARCASM somewhere in the text. Thus was the case in my first post above. I undoubtedly should have answered that question differently instead of trying to be funny.
Thanks,
Mark
Posted: Mon Feb 25, 2008 07:02 pm Post Subject:
Hey Teach, I'm looking like an idiot here and for that, I'm sorry. From now on, whenever I post something where I mean to be sarcastic, I'm going to put the word SARCASM somewhere in the text.
InsInvestigator- you are certainly NO idiot, and I enjoy your sarcastic wit. I think you're one of the few that actually has a handle on sarcasm and are able to use it properly. If I had actually re-read the whole thread, I would have noticed it. Now who's the idiot?? :lol:
This place wouldn't be the same without your knowledge...the idiots will do themselves in over time!
InsTeacher 8)
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