Oregon Concludes Requirement that Insured Occupy Residence Premises Only Applies to Inception of Policy
Read the full article at https://lnkd.in/gmfMRxdE, see the full video at https://lnkd.in/g54q4gwR and at https://lnkd.in/gJYJdHPG, and at https://zalma.com/blog plus more than 50,000 posts.
Post 5040
Ambiguity Makes Condition Unenforceable
In John Durkheimer and Karen Durkheimer v. Safeco Insurance Company Of Illinois, No. 3:24-cv-1333-SB, United States District Court, D. Oregon (April 1, 2025)
John and Karen Durkheimer (“Durkheimers”) sued Safeco Insurance Company of Illinois (“Safeco”), alleging claims for breach of insurance contract, breach of the implied covenant of good faith and fair dealing, and negligence per se. The Durkheimers’ residence in southwest Portland suffered significant water damage due to burst water pipes. The Durkheimers submitted an insurance claim to Safeco, the issuer of their homeowner’s insurance policy (“the Policy”). Although Safeco provided partial payment, the Durkheimers claimed additional outstanding damages. Safeco asserted, as its sixth affirmative defense, that “[t]he Policy limits dwelling coverage to the ‘Residence Premises’ . . . [and t]o the extent that [the Durkheimers] did not reside at the Premises when the Loss occurred, the Policy does not cover damage sustained to the Property.” The Durkheimers moved to strike this affirmative defense on the ground that it is insufficient as a matter of law.
The Court agreed with the Durkheimers. The phrase “owned and occupied” is merely a “description” of the property at the time the policyholder obtained insurance.
The USDC held that the insured’s lease of their residence to a third party did not forfeit coverage under a homeowner’s policy for “residence premises” where the policy defined that term as “where you reside.” The court explained that the phrase “where you reside” “could be grammatically interpreted to modify only ‘part of any other building,’ not ‘family dwelling.’”
When a policy leads to multiple reasonable interpretations, that policy does not “explicitly and unambiguously” terminate a homeowner’s policy. Even if a policy is phrased in a way that covers only family dwellings where a policyholder resides, that residence requirement applies to when the policy was first purchased, and not when a claim was filed.
The Durkheimers’ insurance policy did not specifically and unequivocally put them on notice that their coverage would end if they did not reside in the house in question and granted the Durkheimers’ motion to strike.
The Court concluded that the policy is ambiguous, and that therefore, the Durkheimers’ policy did not explicitly put them on notice that they needed to reside at the property to maintain coverage and the Court granted the Durkheimers’ motion to strike.
ZALMA OPINION
Most states have interpreted the fact that a homeowners policy requires an insured to reside in the dwelling for coverage to apply so, if the insured moves out during the policy term, the coverage is void unless the insured advises the insurer and modifies the policy to tenant occupied and pays any additional premium. The USDC, applying Oregon law found the language to be ambiguous and, therefore, reject the defense that the Durkheimers’ did not reside in the residence premises at the time of the loss but did reside there when the policy was issued. Since the weight of authority across the country is different there is a possibility that an appeal will move forward and a different result will occur.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to Newsbreak.com https://www.newsbreak.com/@c/1653419?s=01; Go to Barry Zalma videos at Rumble.com at https://rumble.com/account/content?type=all; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg
Go to the Insurance Claims Library – https://lnkd.in/gwEYk
Happy Law Day
ZIFL – Volume 30, Issue 9 – May 1, 2026
Read the full article at https://www.linkedin.com/pulse/zalmas-insurance-fraud-letter-may-1-2026-barry-zalma-esq-cfe-2tywc, see the video at at and at https://zalma.com/blog plus more than 5300 posts.
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
ZIFL – Volume 30, Issue 9 – May 1, 2026
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year and is written by Barry Zalma.
DOJ Creates National Fraud Enforcement Division
Will the Feds Take on Insurance Fraud? Possibly as Part of a National Anti-Fraud Effort
On April 7, 2026, the Acting Attorney General, Todd Blanche, issued a memorandum establishing the Department of Justice National Fraud Enforcement Division (NFED). The memo describes an ambitious, but perhaps redundant, vision for this ...
When Abalone Died As a Result of Multiple Causes The Efficient Proximate Cause Requires Payment
Post number 5345
Read the full article at https://www.linkedin.com/pulse/efficient-proximate-cause-doctrine-saves-claim-barry-zalma-esq-cfe-yndlc, see the video at and at and at https://zalma.com/blog plus more than 5300 posts.
In American Abalone Farms, LLC v. Star Insurance Company et al., H052643, California Court of Appeals, Sixth District (April 27, 2026) the Court of Appeals dealt with an insurance coverage issue that required application of the efficient proximate cause doctrine.
FACTS
American Abalone Farms, LLC ("American Abalone" ) operates an aquaculture farm in Santa Cruz County, California, raising abalone in tanks. In August 2020, the CZU Lightning Complex Fires led to a prolonged power outage and road closures near the farm. As a result, the farm’s water pumps failed, causing the death of most of the ...
Breach of a Specific Condition Precedent Is a Complete Defense
See the video at and at and at https://zalma.com/blog plus more than 5300 posts.
In United Services Automobile Association and State Farm Mutual Automobile Insurance Company v. Anthony Wenzell, 2026 CO 25 (Colo. Apr. 27, 2026) Anthony Wenzell was rear-ended in a car accident. He had a significant prior 2014 accident that required back surgery.
Wenzell claimed underinsured-motorist (UIM) benefits under three policies: (1) the tortfeasor’s liability policy, (2) his own primary UIM policy with State Farm, and (3) an excess UIM policy issued by USAA (under his brother’s policy, which contained an “other insurance” clause making USAA’s coverage excess over any collectible insurance).
After receiving the claims, both USAA and State Farm repeatedly requested that Wenzell execute comprehensive medical-release authorizations so they could obtain his full medical records and ...
It is Fraud to Make the Same Claim Twice
Read the full article at https://www.linkedin.com/pulse/fraud-make-same-claim-twice-barry-zalma-esq-cfe-c4g8c and at https://zalma.com/blog.
Chutzpah: After Being Paid for a New Roof Insured Makes Second Claim For Same Damages
Post number 5347
No One is Entitled to be Paid for the Same Loss Twice
In Mohammed Ali Khalili v. State Farm Lloyds, No. 14-25-00611-CV, Court of Appeals of Texas (April 30, 2026) Khalili maintained a State Farm Lloyds homeowners insurance policy for decades. In 2008 he filed a roof-damage claim; State Farm paid him to replace the entire roof (shingles and gutters). Khalili never replaced the roof and repeated his claim.
BACKGROUND
In 2021 he filed a second roof claim. State Farm’s inspectors found the roof “very old” with extensive non-storm-related damage. The claim was denied because (1) the damage did not exceed the deductible and (2) State Farm had already paid for a full roof replacement.
PROCEDURAL HISTORY
State Farm filed motion for summary...
It is Fraud to Make the Same Claim Twice
Read the full article at https://www.linkedin.com/pulse/fraud-make-same-claim-twice-barry-zalma-esq-cfe-c4g8c and at https://zalma.com/blog.
Chutzpah: After Being Paid for a New Roof Insured Makes Second Claim For Same Damages
Post number 5347
No One is Entitled to be Paid for the Same Loss Twice
In Mohammed Ali Khalili v. State Farm Lloyds, No. 14-25-00611-CV, Court of Appeals of Texas (April 30, 2026) Khalili maintained a State Farm Lloyds homeowners insurance policy for decades. In 2008 he filed a roof-damage claim; State Farm paid him to replace the entire roof (shingles and gutters). Khalili never replaced the roof and repeated his claim.
BACKGROUND
In 2021 he filed a second roof claim. State Farm’s inspectors found the roof “very old” with extensive non-storm-related damage. The claim was denied because (1) the damage did not exceed the deductible and (2) State Farm had already paid for a full roof replacement.
PROCEDURAL HISTORY
State Farm filed motion for summary...
What Must be Done after Notice of a Claim is Received by the Insurer
Read the full article at https://lnkd.in/gzvvdkMZ and at https://zalma.com/blog.
Below you will read from this post until you reach the the end of this blog post as the free part of an Excellence in Claims Handling post. To read the full article and receive all articles for members of Excellence in Claims Handling you should consider joining as a paid member to get full access to articles for members only, to our news, analysis, insurance coverage, claims, insurance fraud and insurance webinars, by clicking at the subscription link below.
A first party property policy does not insure property: it insures a person, partnership, corporation or other entity against the risk of loss of the property. Before an insured can make a claim for indemnity under a policy of first party property insurance the insured must prove that there was damage to property the risk of loss of which was insured by the policy. The obligation imposed on the insured ...
