Zalma on Insurance
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Insurance Claims professional presents articles and videos on insurance, insurance Claims and insurance law for insurance Claims adjusters, insurance professionals and insurance lawyers who wish to improve their skills and knowledge. Presented by an internationally recognized expert and author.
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July 09, 2024

In search of profit, insurers have decimated their professional claims staff. They laid off experienced personnel and replaced them with young, untrained, unprepared people. A virtual clerk replaced the old professional claims handler.

Process and computers replaced hands-on human skill and judgment. Money was saved on the expense side of the business by paying lower salaries. Within three months of firing the experienced claims people gross profit increased. The accountants were happy. The quarterly profits increased. None of the happy people were insurance professionals. None of them understood how a professional claims adjuster saves the insurer by establishing a fair amount of loss, avoiding payment for items not lost or overvalued, and by avoiding losses for which no coverage was provided by the policy.

The promises made by an insurance policy are kept by the professional claims person. Keeping a professional claims staff dedicated to excellence in claims handling is cost-effective over long periods of time. A professional and experienced adjuster will save the insurer millions by resolving disputes, paying claims owed promptly and fairly, and by so doing avoiding litigation and claims of breach of contract and breach of the covenant of good faith and fair dealing.

The professional claims person is an important part of the insurer’s defense against litigation by insureds against insurers for breach of contract and the tort of bad faith. Claims professionals resolve more claims for less money without the need for either party to involve counsel. A happy claimant satisfied with the results of his or her claim will never sue the insurer.

Incompetent or inadequate claims personnel force insureds and claimants to public insurance adjusters and lawyers. Every study performed on claims establishes that claims with an insured or claimant represented by counsel cost the insurer more than those where counsel is not involved.

Prompt, effective, professional claims handling saves money for both the insured and the insurer and fulfills the promises made when the insurer sold the policy.

Insurers who believe they can handle first or third party claims with young, inexpensive, inexperienced and untrained claims handlers should be accosted by angry stockholders whose dividends have plummeted, or will plummet, as a result. When an insurer compromises on claims staff, profits, thin as they may have been previously, will move rapidly into negative territory. Tort and punitive damages will deplete reserves. Insurers will quickly question why they are writing insurance. Those who stay in the business of insurance will either adopt a program requiring excellence in claims handling from every member of their claims staff, or they will fail.

Insurance is a business. It must change — this time for the better — if it is to survive. It must rethink the firing of experienced claims staff and reductions in training to save “expense.” Insurers should, if they wish to succeed, adopt a program to promote excellence in claims handling that can help insurers keep the promises made by the insurance policy and avoid charges of breach of contract and the tort bad faith in both first and third party claims.

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KEY FACTS:

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The case involves an insured, the Christian Care Center (Plaintiff) and its insurer American Alternative Insurance (Defendant) in a coverage dispute.

Loss Event:

Plaintiff’s property sustained damage due to a storm on April 27, 2020.
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Plaintiff submitted a claim to Defendant on February 2, 2022, which was denied on July 29, 2022.

Lawsuit:

Plaintiff sued alleging breach of contract and violations of Chapters 541 ...

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Live chatted 10/10/2025
October 10, 2025
Failure to File Suit Promptly is Fatal

See the full video at and at and at https://zalma.com/blog plus more than 5200 posts.

Private Limitation In Accordance With Statute Defeats a Claim

Post 5204

There is No Good Reason to Delay Filing Suit

In Christian Care Center v. American Alternative Insurance Corporation, Civil Action No. 4:25-CV-00321-O, United States District Court, N.D. Texas, Fort Worth Division (October 6, 2025) a private limitation of action provision effective barred the suit.

KEY FACTS:

Plaintiff and Defendant:

The case involves an insured, the Christian Care Center (Plaintiff) and its insurer American Alternative Insurance (Defendant) in a coverage dispute.

Loss Event:

Plaintiff’s property sustained damage due to a storm on April 27, 2020.
Insurance Claim:

Plaintiff submitted a claim to Defendant on February 2, 2022, which was denied on July 29, 2022.

Lawsuit:

Plaintiff sued alleging breach of contract and violations of Chapters 541 ...

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In an insurance dispute following damage caused by Hurricane Ida to Vina Cleaners’ property. Vina Cleaners was insured under a commercial policy with the Defendant, Ohio Security Insurance Company. Vina Cleaners assigned its rights ...

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In Starr Indemnity & Liability Company v. Scottsdale Insurance Company, No. 24-CV-3309 (PKC) (TAM), United States District Court, E.D. New York (September 30, 2025) the parties C.C.C. and HCC filed actions against Scottsdale in New York state court regarding Scottsdale’s insurance coverage obligations.

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Hector David Campoverde sustained injuries from a scaffold fall at a construction site in Brooklyn, New York, on September 14, 2015. Campoverde, an employee of Vazquez Bro Restoration Inc., was working for C.C.C. Renovation Inc., a subcontractor of L&M Builders Group LLC.

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Declaratory Judgment:

Starr sought a declaratory judgment regarding Scottsdale’s obligations under the 2014-2015 and 2015-2016 policies.
Abstention ...

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October 15, 2025
Zalma’s Insurance Fraud Letter – October 15, 2025

ZIFL – Volume 28, Issue 20

THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL

Read the full article at https://lnkd.in/gt5Kyumz, See the full 18 page issue of ZIFL at https://lnkd.in/gBUgEBmP, and at https://zalma.com/blog plus more than 5200 posts.

Zalma’s Insurance Fraud Letter (ZIFL) is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at https://lnkd.in/gVT5G9s

The Contents of the October 15, 2025 Issue of ZIFL Includes:

Zalma’s Insurance Fraud Letter (ZIFL) continues its 28th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/

The Contents of the October 15, 2025 Issue of ZIFL Includes:

Insurer’s Attempt to Obtain Summary Judgment Against Fraudsters Fails

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