Berkley Technology Underwriters (a Berkley Company)’s Post

The level of alleged fraud from this vendor toward the entire industry is mind-boggling based on what was done to create it and cover it up. Based on a verdict under California Insurance Code 1871 (Civil RICO essentially), this could create an extremely negative financial outcome. Expect more lawsuits by insurance companies, potential prosecution(s), CA DOI review/involvement, and possible bankruptcy filing(s). #fraud #vendor #rico

The quality of your claims intake process is far reaching – affecting call center volume, the incidence of fraud, the chance of repair cost leakage, subrogation opportunities, analytics and so much more. When you add up all the hidden costs associated with an inefficient claim intake system, the cost of upgrading becomes quite reasonable. In fact, improving your claim intake process may cost considerably less than you assume. Read more > #Claims #PCclaims #FNOL https://lnkd.in/g33T9rrB

What do you say about Claims Officers?   Over the years in the industry, claims officers are always perceived in different ways. While some see claims officers as professionals who are too rigid with policies; some other people say they are proud because they maintain their ground; some say they are not human because sometimes they do not exhibit sympathy. It is imperative to know that, there are some reasons which form the basis of a Claims officer’s decision on a particular claim (either to be indemnified or repudiated). However, it’s key to recognize that Claims Officers have a challenging task of balancing policy requirements, legal considerations, and customer satisfactions. While perceptions may vary, it's important to appreciate the complexities of their role and the need for objective decision-making within the framework of insurance policies and regulations. Consequent upon this, here are some points to consider in getting to know Claims Officers better: Adherence to Policies: Claims officers are often perceived as rigid because they adhere to the terms and conditions outlined in Insurance Policies. Their decisions are based on the contractual agreements between the policyholder and the insurance Company. Legal and Regulatory Compliance: Decisions made by claims officers are influenced by legal and regulatory requirements. They must ensure that their actions align with industry standards and comply with applicable laws. Consistency in Decision making: Claims officers strive to maintain consistency in their decision-making to treat policyholders fairly. They follow established guidelines and company protocols to ensure uniformity in handling similar claims. Risk Assessment: Claims officers conduct a thorough risk assessment to evaluate the circumstances surrounding a claim. This involves analyzing the nature of the incident, policy coverage and potential liabilities. Professionalism and objectivity: Claims officers are expected to maintain a professional and objective stance in their decision-making. While empathy is important, decisions are primarily based on facts, policies, and legal considerations. Communication Challenges: Sometimes, claims officers may be perceived as lacking sympathy due to the need for clear and unambiguous communication. They must convey decisions in a straightforward manner, which may be misconstrued as insensitivity. Claims Fraud Prevention: Claims officers are vigilant about potential fraud. This vigilance may lead them to scrutinize claims more closely, creating an impression of skepticism. Preventing fraudulent claims is essential for the sustainability of the insurance industry. Training and Guidelines: Claims officers often follow strict training and guidelines provided by their employers. These guidelines are in place to ensure consistency, fairness, and adherence to company policies. #insurance #insuranceindustry #insuranceclaims #insurancecareers #humancapital #recruiters #riskmanagement

Coverage implications of fraudulent acts under D&O policies: The article (link below) gives interesting insights into the D&O policies when a director is accused of fraud. https://lnkd.in/ebDcxu6g Typically D&O policies have a conduct exclusion which is as under: “Conduct Exclusion: The Insurer shall not be liable under any Cover or Extension for any Loss arising out of, based upon or attributable to: (i) the gaining of profit or advantage to which the Insured was not legally entitled; or (ii) the committing of any deliberately dishonest or deliberately fraudulent act, in the event that either of the above is established by final adjudication of a judicial or arbitral tribunal or by any formal written admission by the Insured. For the purposes of determining the applicability of this Exclusion, the conduct of any Insured shall not be imputed to any other Insured Person.” Therefore, the conduct exclusion only applies following a “final adjudication” or “judicial determination.” The insurer cannot deny coverage on the basis of fraud or a criminal act, until a court actually determines that there has been fraud or a crime. Until then, the insurer must pay the defense costs. Some policies also add the term “non-appealable” language, which means the defence costs will continue to be paid until all appeals are exhausted. What if the insured director is ultimately proven guilty of fraud? What happens to the defence costs already paid by the insurer? Some policies have claw back provisions which require the insured director to return the costs paid to the insurer. However, this is practically not enforceable, as the director who is held criminally liable would also be faced with huge civil liability as well with no funds at his disposal. The insured organisation may be bankrupt, unable or unwilling to pay back, so eventually the insurer would have to write off the defence costs recovery. That said, insurers seldom undertake huge exposures all by themselves, so “towers” of D&O coverage are the norm, where multiple insurers provide primary and excess coverage so one insurer does not have to foot the bill. In any case, the purpose of final adjudication language, which is to protect directors wrongly implicated in criminal trials for corporate actions, is defeated. Those who are pretty obvious to have done fraudulent dealings take advantage of this provision.

The claw back provisions have merit and can be enforced. We can seek an undertaking from the insured that they will pay back the amount if they are not successful in proving that they are not guilty of the criminal offence. If the director is found to be guilty of a criminal offence then even the civil liability can be repudiated as the policy excludes criminal acts.. Civil liability is payable even if a director is convicted of a criminal offence in cases where the directors who are not guilty of the criminal offence are sued for their negligence in preventing the fraud or criminal act who's has led to financial losses for shareholders and other parties. In such cases, the innocent director is indemnified by invoking the severability clause.

Note to defense counsel: The IT security protocols of many insurance carriers do not allow access to some file-share applications, even (especially) some popular ones. When the carrier reps tell you that they are not allowed access due to IT, don't ignore them and don't expect that they will be able to talk IT into changing the protocol. Also, the whole idea of file-share is so that documents can be in just one place and easily accessible, without everyone who needs access to a document having to download it to their own drive. If litigation will be ongoing for months and years, having a file-share app that has access that expires in fourteen days (for example) means that the carrier rep has to download and save the documents within that short timeframe or else lose access, which defeats the purpose.

FRAUD CAN DECEIVE A PERSON. BUT NOT EVERYONE, NOT ALWAYS. In Discovery Land Co., LLC v. Berkley Ins. Co., NO. CV-20-01541-PHX-ROS, 2023 WL 2503634 (D. Ariz. March 14, 2023), the insureds bought a castle in Scotland, claimed that they were defrauded by their lawyers, added insureds to their policies after a known loss, and then apparently made claims to coverage.   The two insurance carriers in the case "both filed counterclaims seeking rescission of the change endorsements, arguing Plaintiffs fraudulently added entities as joint insureds after they discovered the losses."  Discovery Land Co., 2023 WL 2503634, at *5.   The Court entered a summary judgment of no coverage for both carriers. Please read the disclaimer. This LinkedIn article ©2023 Dennis J. Wall. All rights reserved. Fraud allegations in the context of first-party cases such as Discovery Land Company are discussed in 2 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH § 11:12 (3d Edition West Publishing Co., 2023 Supplements in process).

D&O, E&O, and other professional liability insurers often raise the insurability, or rather “uninsurability” loss defense. Consistent with our prior analysis of the ways the Ohio district court erred in assessing insurability, the Sixth Circuit’s recent decision in Huntington National Bank v. AIG outlines how courts should evaluate insurability defenses, particularly in the absence of public policy rendering a loss uninsurable. https://ow.ly/3jWR50QEmeF

What capabilities does modern Case Management Software need to have to satisfy the growing needs of SIU departments? In this article, our colleague Martyn Griffiths explains 6 most important features: 1️⃣ Integration with other systems 2️⃣ Transparent dashboards 3️⃣ Customization 4️⃣ Incorporation of third-party data 5️⃣ All information in one centralized place 6️⃣ No additional burden for the IT department (low code solution) Read here the full text: https://lnkd.in/enAPh25M We thank the Insurance Fraud Bureau (IFB) for publishing this article first.

Some important considerations when picking your D&O and Cyber insurance carrier!