Category Archives: Miscellaneous

‘Tis the season to be politicking

In perusing this article and this article in the Insurance Journal I was struck by the differences between the everyday understanding of an insurance contract and the understanding I have been gaining through working with them in the legal system. Senator Richard Blumenthal of Connecticut, who to his credit wants to save money for his constituents, has in my opinion put State Farm and other insurance companies into a really unfortunate position. The article says:

Blumenthal said State Farm is the largest insurer not to waive the deductible and continues to apply the charge to claims it received because the storm was downgraded less than 24 hours before causing damage in Connecticut.

“I understand that the insurance policies State Farm wrote for Connecticut residents permit the company to charge a full hurricane deductible, as Irene was downgraded to tropical storm status before the 24 hours that your policies require,” Blumenthal said in his letter to State Farm CEO.

“However, I urge you to reconsider this narrow interpretation of your policy documents. The total amount that State Farm would have to waive in deductibles would be negligible, and would represent a significant benefit to your policyholders.”

 

 

 

 

 

 

Reading his comments, I am not sure the senator does in fact understand the insurance policy, or policies in general. Insurance policies do not "permit companies to charge . . . ." They either cover some loss/damage/injury, or they do not — an outcome that is not based on the company’s "permission." In fact, the insurance company that would decide to apply only certain provisions of their policy would be acting incorrectly. The company must strictly follow their contract that was entered into in good faith. The "narrow interpretation" Blumenthal is criticizing is merely proper application of the policy. Says who? Well, says the courts.

Because of his challenges, insurance companies that don’t capitulate are faced with bad publicity by the public who, understandably, are not aware of the applicable legal background. Because the insurance company IS aware of the legal implications of their choices, and because they are aware of other dangers (some of which are noted by the comments to the articles) that could come about if they begin picking and choosing when to apply policy language, they have no choice but to turn the other cheek.  

 

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A quick missing link

In searching for a topic that could wake me up and get my brain flowing this Monday morning I got a bit sidetracked looking at this article on Above the Law. (As a side note, if you never surf that site, Above the Law is always good for some laughs . . . and some tears).

Anyway, looking at the claims of Thomas Jefferson somehow lead to an actual insurance topic. Sallie Mae is now entering the world of tuition insurance. Tuition insurance provides coverage for students’ tuition when they are forced to leave school mid-term for a physical or mental illness. Here is NY Times coverage on the plan. This article sparked some interesting comments, which you can read here due to the plan’s differing payouts for physical/mental health claims (100% payout for physical, 75% for mental health). 

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Made for TV

In April, when I first saw an article about Worker’s Comp, a TV show pilot following the inner-workings of an insurance company, I couldn’t believe there was enough humor to base an entire comedy series on the topic. Today, I stand corrected. After seeing this blog post on InsuranceQuotes, and being incredibly amused by the thought of someone coughing their way to $1 million, I did a little digging. Turns out people have attempted some crazy (read hilarious) things to try to squeeze some money out of their insurance carriers. For instance, Fox Business reported on a person attempting to put a mouse in their soup (but forgetting that there would be no soup in the poor critter’s lungs or alternatively, that they needed to cook the mouse in soup), and a man who attempted to collect on his home and car insurance after throwing flaming cooking pans into his car and on his couch. Then there is this article,  from InsureMe, which, believe it or not, reports on a man who successfully claimed against a homeowner’s insurance policy for undue mental anguish after breaking into the home, locking himself in the garage, and having to live off of dog food and soda until the homeowner returned.

While there seems to be plenty of humor for a television show, there is also an important message in these articles. The insurance company will investigate claims, they have the resources to give mouse autopsies, and insurance fraud is not a smart get rich quick scheme.

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The Missing Links

The Cutting Edge: Whoever said insurance coverage wasn’t on the cutting edge of civil rights (if anyone has ever actually said that . . . or thought about it even) hasn’t been keeping up with Lambda Legal or its most recent lawsuit. The lawsuit, filed on Tuesday, claims that the state of Oregon violated anti-discrimination laws by denying insurance coverage for a hysterectomy to a transgender man clerking for the Oregon Court of Appeals.

Homes, automobiles, and commercial property, OH MY!: Worse than the damage to Auntie Em and Uncle Henry’s house in the Wizard of Oz: insurance companies have already paid over $4.2 million in coverage for the damage caused by the Memorial Day windstorm (that did include tornadoes) in Fargo, North Dakota and the total could rise to $5.8 million.

David adds: There are also big flooding problems in Minot, N.D. The Souris River is going nuts. Lots of the town has been evacuated, including my niece, her husband and their kids, and they are living out on our family farm two hours away. "Souris" is French for mouse, the river originates in Canada, comes down to Minot and loops back up. I don’t like to brag, but Minot is where I went to undergrad, at the prestigious Minot State College — it had a great English department and was an awesome party school (I co-majored in English and Advance Party Studies). When I  was a kid there was a big flood and they called it "The Mouse That Roared," but as I recall I don’t think it was anything like the size of this.  

Insurance, bringing politicians together: One thing that always annoys me during election season is that with both parties so busy pointing out their differences, we miss the chance for politicians to come together. Well, the NY Times has solved this problem (really, solving a problem this big is as simple as publishing an article in the Times) by pointing out 4, count ’em, 4 insurance issues that Republicans and Democrats could possibly, if they try really, really hard agree on.  

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Hit and Run Links

Hey, at least it’s an Ethos: This story reminded me of the classic comedy The Big Lebowski, where Walter Sobchak contrasts nihilism with Naziism: "I mean, say what you want about the tenets of National Socialism, Dude, at least it’s an ethos."  An "insurance" company called Ethos, according to the story, apparently sold dirt cheap auto insurance policies with just one significant  drawback: the policies were bogus. The whole thing was fake, and the people who bought the policies were completely uninsured — which is what they call "self-insurance." Makes me wonder if among the scammers was a Big Lebowski fan and there was some irony in the name Ethos — "say what you want about a company that defrauds you, at least fraud is an ethos."    

Vancouver hockey riot: does insurance cover damage from looting and rioting? The Vancouver riot, like many of these things, was carried out by "anarchists." Walter Sobchak would have no respect for these people, they are just barely above nihilists as far as having an ethos. As Little Bill Daggett said in The Unforgiven, they don’t have any character, not even bad character. Plus, their anarchism is fake anarchism. As has been pointed out by others, if there was an actual state of anarchy, so-called anarchists who wear masks, mob up and destroy property would be machine-gunned or sold into slavery by the private security firms that would rule the streets.   

More on Vancouver hockey riot: anarchist looters to be sued. They would be getting off easy. Being sued is still better than being machine-gunned or sold into slavery during a state of actual anarchy, which is what the anarchists want.

Montana — home births rise, covered by insurance.  This story says they have both insurance and a midwife. I was born at home in North Dakota, delivered by my father (my mother also played a large role), no doctor, no midwife, no insurance. So was one of my sisters. People are so extravagant these days. Midwives and insurance are for wimps.  

 

 

 

 

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Dumbing down analysis with dictionaries

Generally in insurance analysis when I see a court resort to a dictionary definition to interpret a word or phrase in a policy I figure what’s going to follow will be a fairly facile, superficial explanation. Usually that’s the way it works out. 

The New York Times explores what it says is an increasing reliance on dictionary definitions in U.S. Supreme Court opinions. In May alone, justices cited dictionary definitions eight times, and not always for big words.

All of this is, lexicographers say, sort of strange.

“I think that it’s probably wrong, in almost all situations, to use a dictionary in the courtroom,” said Jesse Sheidlower, the editor-at-large of the Oxford English Dictionary. “Dictionary definitions are written with a lot of things in mind, but rigorously circumscribing the exact meanings and connotations of terms is not usually one of them.”

I can’t speak much to opinions of the U.S. Supreme Court, because I seldom read them, but I read a lot of insurance coverage cases from state appellate courts, federal district courts and federal appeals courts, and I agree with the gist of the Times story.

One issue with using a dictionary definition is which dictionary do you use? There are scores and scores of dictionaries, and the variance among them is sufficient to allow a judge to cherry pick a definition that proves a pre-conceived point. 

In addition, the use of dictionaries tends to support an extra-textual method of analysis that renders a much more limited and less insightful analysis. I’m not saying this is done out of bad motives. I’m simply saying it’s non-textual and not the  best method of analysis. 

Words and phrases in a policy should not be viewed in isolation, outside the context of surrounding terms of the policy, and of the policy as a whole. I strongly advocate analyzing policy language by analyzing the entire context of the policy and attempting to discern what underwriting concern or principle of insurance is being addressed. Also, analyzing sentence structure, punctuation and syntax is much more helpful at discerning meaning, or finding ambiguity, than turning to a dictionary. In reality, although some courts purport to cling to notions that insurance terms are supposed to be understood in the common, everyday usage of the word in the absence of a specific definition within the policy, I think this is unrealistic. Most of the time, words, phrases and clauses in insurance policies have at least some degree of specialized meaning, because the concepts they deal with are specialized, and because the words are usually selected in response to previous judicial opinions. 

I would make one final point: extra-textualism, or non-textualism as it also could be called, is heavily reliant on the deductive method of reasoning, which is inferior to the inductive method in insurance coverage analysis. Deductive logic is prone to misuse because it relies on an initial set of premises that are subject to the bias of the person who creates the premises, and is therefore rigid, and you are less likely to catch your own mistakes or recognize your own folly.

UPDATE: Forgot the link to the NYT, fixed it.

 

          

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Give the ABA a pat on the back

It was a rude awakening when I graduated law school and was faced with the realization that schools were able to beat the system and were not being totally honest when they report extremely high percentages of students with jobs after graduation. I remember hearing that Michigan students were well over 90% successful at finding a job before or soon after graduation. From what I could see in my own class, that wasn’t the whole truth. The school started "employing" students to work for  few months at the clinics or at nearby firms who needed a temporary employee. I guess these jobs were at least better than being a nanny (not that I don’t love kids, but that’s not why I got a legal degree) or a chauffeur.

BUT! Don’t you fret, the ABA is (hopefully) coming to the rescue:

"The ABA will require schools to report the percentage of graduates who are employed and the types of jobs they have taken in much greater detail than they do at present. They must report whether graduates are in jobs that require a law degree; whether they are unemployed; whether their employment status is unknown; and whether they are in jobs funded by the law school or university. Critics have complained that some law schools give their graduates temporary academic jobs so they will count among the employed for purposes of U.S. News & World Report’s rankings."

Read the rest of this article here.

While it is nice that this will help future students have a more realistic view of their schools, I think the more important result from the ABA changes will be schools working harder to find real employment for their students. I feel fairly safe in saying students utilize these reports in deciding what law school to attend. Now, the schools will have to work harder and smarter to continue to draw top students into their ranks.

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Blogging, branding and the free-gap

Seth Godin has some insights on game theory, the marketplace of ideas and the demand for free. 

"Radio thirty years ago was simple: everyone hears it for free and a few buy it.

For a time, one could use free to promote an idea and have leverage to turn that attention into paid sales of a similar item (either because free went away or because the similar item offered convenience or souvenir value).

I think that might be changing. As the free-only cohort grows, people start to feel foolish when they pay for something when the free substitute is easily available and perhaps more convenient.

Think about that–buying things now makes some people feel foolish. Few felt foolish buying a Creedence album in the 1970s. They felt good about it, not stupid."

Can’t disagree with anything he says in his post. Especially since this gives me an excuse to give  an obligatory Creedence link as well as a link to the same song in The Big Lebowski, one of the 10 greatest movie comedies of all time. The Dude was, without doubt, one of the laziest men in Los Angeles County, which placed him high in the running for laziest worldwide. 

Godin gives the example of what all this means in the context of, say, Lady Gaga: the music is basically given away, but the concerts cost money.  Lawyer blogging is somewhat similar in theory, and somewhat different. Unlike Lady Gaga, whose product is mainly the same songs she performs in concert, lawyers are selling legal advice, but they don’t actually give away much of it on the internet.  Law is a knowledge-based business: even if you give away a free analysis of what some case means or what some development signifies, you are not really giving away your songs. The application of the knowledge is so fact-intensive and so variable under new circumstances that you are really not giving away all that much, truth be told, that you could put a price on in the first place. 

Instead, lawyer blogging is less about transfers of information from paid to free than it is about branding. I know, a lot of lawyers are completely uncomfortable with talk of branding, selling, marketing, and so forth — bring up the subject and they react like you just set a basket of snakes on the desk in front of them. I  myself see nothing wrong with the concept of selling, because I don’t have a concept of lawyerism as a mystical calling. It’s a hard job in a highly regulated field with a lot of responsibility, but still a commercial endeavor, and all in all, one I’d rather do than what I did in my younger years: hauling hay bales, driving tractors and cleaning cow manure out of barns with a pitchfork. As the economist John Kenneth Galbraith said, if you’ve ever worked on a farm, nothing else ever seems like work. Selling legal services is as much a part of being a lawyer as writing briefs and arguing to judges.  

The concept of branding is increasingly important to legal work these days, and this is something that has to be thought through, because the days of low hanging fuit in the legal business are done.  Blogging or some other promotional activity is an integral part of branding, because increasingly, as is clear from the Godin post, if you aren’t giving some information away it will be assumed you don’t have anything anyone wants, either for free or to pay for. You have to be part of the mix, a player. How you differentiate yourself,  and if you can, is something you have to give thought to. The first step is to ask yourself what you have to sell that someone would want. It’s a hard question, and uncomfortable for many. If the answer is you don’t have anything, you have to get something. You can’t sell something if you don’t have anything to sell that someone would buy. Asking yourself this question is pretty uncomfortable, because the answer may involve making changes, perhaps some big ones.    

I formed many of my ideas about legal marketing from Joe Gerber of Cozen O’Connor. When I read this speech he gave about the subject, it was a thunderbolt, a Road to Damascus moment, one of the most amazingly true things I’ve ever read.  Joe is one of my heroes, a guy with ideas as well as a guy who does stuff, he’s the Legal Ayatollah of Rock’n’Rolla. Over the years I have re-read this speech at least two dozen times and handed it out to lots and lots of people. Not sure how many have read it, but I’ve handed it out.     

I think I’ll conclude by noting something else Godin said in his post:

"Does the game theory of the market make it likely that those in search of discovery will accelerate the use of free to get attention? Of course."

This point is something to ponder. The implication of it for lawyers, as I’ve said, is that people have to know who you are and that you are selling something. But Joe Gerber says, "don’t just do it." If you’re going to do it, don’t do it because someone is telling you to or just to go through the motions, do it with passion and creativity and because you believe in what you are selling. For Joe, any and all marketing is good marketing — if it works. If it works, it can be quantified on the bottom line. If it can’t be measured on the bottom line, it’s not marketing. It might be something else, such as a social activity you enjoy, or perhaps just a complete waste of time that you are deluding yourself with to try to look like you are doing something, but it isn’t marketing.        

    

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The Missing Links

Will he write boxer briefs? Following the example of Bruno Campos (see page 11) and others who left the spotlight to attend law school, Juan Diaz, former unified lightweight titlist, is starting at the University of Massachusetts Dartmouth Law School. 

More on boxers. Well, Sen. Boxer, and to be honest, the story isn’t really about her. But, it made for a good segue. I remember starting law school and being told that the legal world would beg to employ us when we were ready to enter the job market.  Turns out, not so true. That being said, it will be interesting to see if the ABA meeting on June 11 brings about changes that will "improve the independent oversight, accuracy, credibility, and transparency of the data law schools have to make available to the public."

Higher education bubble: Are students finally figuring it out? University of Kansas Law School reported a 23 percent drop in applications and quoted a nationwide drop of 12-13 percent. Looks like students are getting smarter – but what about KU? Why are they spending money on recruiting instead of putting their money where it is needed…helping graduates find jobs!  

And an insurance note for new grads. YOU DO NEED RENTERS INSURANCE!

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As promised

David mentioned in his post on May 19, 2011 that he is going to have some help blogging and that he’s going to be broadening the format of the blog somewhat beyond insurance analysis including a de-Scruggsification of the blog. I’m Elissa Meyrowitz Boyd, a newly minted lawyer and a December graduate of the University of Michigan Law School. I can tell you that David’s first statement was true, I will be helping to keep you fully blogged; however, I cannot guarantee a de-Scruggsification of the blog….I haven’t known David to give up on anything yet. I will be blogging about being a recent law school graduate, the challenges of being a new lawyer and other topics that I think may be of interest. Please be patient with me as I learn, or at least don’t laugh at me too hard (unless I’m trying to be funny and then it’s OK).  My bio is here, where you can read my fancy new blog title.

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