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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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February 19, 2025
Post Procurement Fraud Prevents Rescission

Rescission in Michigan Requires Preprocurement Fraud
Post 4999

Read the full article at https://lnkd.in/gGCvgBpK, see the full video at https://lnkd.in/gern_JjU and at https://lnkd.in/gTPSmQD6 and at https://zalma.com/blog plus 4999 posts.

Lie About Where Vehicle Was Garaged After Policy Inception Not Basis for Rescission

This appeal turns on whether fraud occurred in relation to an April 26, 2018 renewal contract for a policy of insurance under the no-fault act issued by plaintiff, Encompass Indemnity Company (“Encompass”).

In Samuel Tourkow, by David Tourkow v. Michael Thomas Fox, and Sweet Insurance Agency, formerly known as Verbiest Insurance Agency, Inc., Third-Party Defendant-Appellee. Encompass Indemnity Company, et al, Nos. 367494, 367512, Court of Appeals of Michigan (February 12, 2025) resolved the claims.

The plaintiff, Encompass Indemnity Company, issued a no-fault insurance policy to Jon and Joyce Fox, with Michael Fox added as an additional insured. The dispute centers on whether fraud occurred in relation to the renewal of this policy on April 26, 2018.

Michael Fox was involved in an accident on December 26, 2018, which led to a lawsuit filed by David Tourkow on behalf of Samuel Tourkow. Encompass rescinded the policy, alleging material misrepresentations about the garaging location of Michael’s vehicle. Michael then filed a third-party claim against Sweet Insurance Agency, alleging negligence.

The trial court initially granted summary disposition in favor of Encompass and Sweet, but this decision was appealed. The appellate court found that the trial court erred in its conclusions regarding preprocurement and postprocurement fraud and that Michael’s due process rights were violated.

THE TRIAL COURT’S GRANT OF SUMMARY DISPOSITION IN FAVOR OF ENCOMPASS WAS ERRONEOUS

The Foxes argued the trial court erred by granting summary disposition in favor of Encompass and abused its discretion by declaring the April 26, 2018 renewal policy void ab initio.

The circumstances under which an insurer may invalidate an insurance contract based on fraud in Michigan now requires a court to separate fraud into two broad categories based on when it occurred:

1 fraud that occurred before the parties entered into an insurance contract (preprocurement fraud); and
2 fraud that occurred after the parties entered into an insurance contract (postprocurement fraud).

If fraud occurred before the parties entered into the insurance contract (preprocurement), then rescission is available as a remedy. If fraud occurred after the contract was signed, but before litigation began, then rescission is available as a remedy only if the fraud substantially breached the contract. Finally, if fraud occurred after litigation began-which necessarily also means that it occurred after the contract was signed- then rescission is not available as a remedy.

In sum, the trial court erred by granting summary disposition in favor of Encompass based on the trial court’s erroneous conclusion that preprocurement fraud occurred in relation to the vehicle involved in the accident, a Ford F-150.

The Court of Appeals concluded that it follows that the trial court abused its discretion by holding the renewal policy was void ab initio on the basis of the alleged fraud. The decision in favor of Encompass was reversed.

The trial court erred by granting summary disposition in favor of Encompass.

ZALMA OPINION

Rescission is an equitable remedy based upon the concept of fairness. In most states a misrepresentation of a material fact, like where a vehicle is garaged, is grounds for rescission even if the misrepresentation was innocent or unintentional. In Michigan, however, the Court of Appeals explained that rescission requires evidence of fraud in the inception of the policy before the policy was issued. In this case, the fraud about the garaging of the vehicle happened after the policy was issued so there was no right to rescind in Michigan.

(c) 2025 Barry Zalma & ClaimSchool, Inc.

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00:07:58
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You Plead Guilty You Must Accept the Sentence

In Commonwealth Of Pennsylvania v. Mark D. Redfield, No. 20 WDA 2025, No. J-S24010-25, Superior Court of Pennsylvania (September 19, 2025) the appellate court reviewed the case of Mark D. Redfield, who pleaded guilty to third-degree murder for killing April Dunkle with malice using a rifle.

Affirmation of Sentence:

The sentencing court’s judgment was affirmed, and jurisdiction was relinquished, concluding no abuse of discretion occurred.

Reasonable Inference on Trigger Pulling:

The sentencing court reasonably inferred from the guilty plea facts that the appellant pulled the trigger causing the victim’s death, an inference supported by the record and consistent with the plea.

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September 25, 2025
Prelitigation Communications Privileged

The Judicial Proceedings Privilege
Post 5196

Posted on September 25, 2025 by Barry Zalma

See the full video at and at

Judicial Proceeding Privilege Limits Litigation

In David Camp, and Laura Beth Waller v. Professional Employee Services, d/b/a Insurance Branch, and Brendan Cassity, CIVIL No. 24-3568 (RJL), United States District Court, District of Columbia (September 22, 2025) a defamation lawsuit filed by David Camp and Laura Beth Waller against Insurance Branch and Brendon Cassity alleging libel based on statements made in a letter accusing them of mishandling funds and demanding refunds and investigations.

The court examined whether the judicial proceedings privilege applieD to bar the defamation claims.

Case background:

Plaintiffs Camp and Waller, executives of NOSSCR and its Foundation, sued defendants Insurance Branch and Cassity over a letter alleging financial misconduct and demanding refunds and audits. The letter ...

00:07:56
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September 24, 2025
Untrue Application for Insurance Voids Policy

Misrepresentation or Concealment of a Material Fact Supports Rescission

Post 5195

Don’t Lie to Your Insurance Company

See the full video at and at https://rumble.com/v6zefq8-untrue-application-for-insurance-voids-policy.html and at https://zalma.com/blog plus more than 5150 posts.

In Imani Page v. Progressive Marathon Insurance Company, No. 370765, Court of Appeals of Michigan (September 22, 2025) because defendant successfully established fraud in the procurement, and requested rescission, the Court of Appeals concluded that the Defendant was entitled to rescind the policy and declare it void ab initio.

FACTS

Plaintiff's Application:

Plaintiff applied for an insurance policy with the defendant, indicating that the primary use of her SUV would be for "Pleasure/Personal" purposes.

Misrepresentation:

Plaintiff misrepresented that she would not use the SUV for food delivery, but records show she was compensated for delivering food.

Accident:

Plaintiff's SUV was involved in an accident on August ...

00:07:48
September 09, 2025
The Dishonest Chiropractor/Physician

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Post 5185
Posted on September 8, 2025 by Barry Zalma

See the full video at https://lnkd.in/gePN7rjm and at https://lnkd.in/gzPwr-9q

This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers.

The Dishonest Chiropractor/Physician

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This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the ­­­Perpetrators than any Other Crime.

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September 08, 2025
The Dishonest Chiropractor/Physician

How a Need for Profit Led Health Care Providers to Crime
Post 5185
Posted on September 8, 2025 by Barry Zalma

See the full video at https://lnkd.in/gePN7rjm and at https://lnkd.in/gzPwr-9q

This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers.

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How a Need for Profit Led Health Care Providers to Crime

See the full video at and at

This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the ­­­Perpetrators than any Other Crime.

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September 03, 2025

Barry Zalma: Insurance Claims Expert Witness
Posted on September 3, 2025 by Barry Zalma
The Need for a Claims Handling Expert to Defend or Prove a Tort of Bad Faith Suit

© 2025 Barry Zalma, Esq., CFE

When I finished my three year enlistment in the US Army as a Special Agent of US Army Intelligence in 1967, I sought employment where I could use the investigative skills I learned in the Army. After some searching I was hired as a claims trainee by the Fireman’s Fund American Insurance Company. For five years, while attending law school at night while working full time as an insurance adjuster I became familiar with every aspect of the commercial insurance industry.

On January 2, 1972 I was admitted to the California Bar. I practiced law, specializing in insurance claims, insurance coverage and defense of claims against people insured and defense of insurance companies sued for breach of contract and breach of the implied covenant of good faith and fair dealing. After 45 years as an active lawyer, I asked that my license to practice law be declared inactive ...

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