New York, December 19, 2016 – The New York State Supreme Court in Rockland County has ruled in favor of policyholders in a suit to compel resolution of an insurance claim through appraisal.
On December 2, 2016, Judge Gerald E. Loehr ordered New York Central Mutual Fire Insurance Company to submit to an appraisal on the scope of the loss incurred by policyholders Robert E. Zinn II and Leah D. Farrar.
The New York State Public Adjusters Association (NYPAA) provided legal support to the policyholders in this litigation. NYPAA President Bob D’Amore explains: “In 2014, NY Governor Andrew Cuomo signed into law a revision of the NY State insurance statutes containing an important protection for NY insurance policyholders. This law confirmed that issues such as the proper scope or “extent of loss” are allowable as part of the insurance appraisal process because the courts historically had favored litigation. Now we have case law that recognizes this in support of policyholder rights. The NYPAA supported this litigation because we have seen continued reluctance from insurance carriers to follow the law.”
Wilkofsky Friedman Karel & Cummins, and Jonathan Wilkofsky – who is General Counsel to the NYPAA, represented Zinn and Ferrar before the Court. Zinn and Ferrar’s loss was being guided through the appraisal process by NYPAA member and consultant Paul Bellenchia of Bell Operations Systems, Inc. as the named Appraiser for the Insured.
Appraisal is a clause in most property insurance policies that allows a disputed claim to be settled by a three-person independent panel consisting of two “Appraisers” and an “Umpire.” This process is designed to be a less costly and time-consuming alternative to litigation. Either the policyholder or the carrier has the right to put the claim into appraisal if there is disagreement on the amount of the loss.
Bell Operations Systems is representative of emerging hybrid Appraisal and Consulting / Estimating firms that assist policyholders in sorting out difficult property claims. Bell Operations Systems employs both Public Adjusters and Insurance Brokers in its efforts. “This was an important victory for policyholders as it should serve as notice to carriers that they need to follow the new law. We have seen many cases of carriers continuing to employ tactics designed to delay or circumvent implementations of certain provisions in the policy,” Mr. Bellenchia said.
According to Upheld.org, “a clear and complete scope of loss helps a property owner get a fair, full and prompt insurance claim settlement.” D’Amore noted that “the insurance company did not dispute that the damage was covered, and in fact, paid the policyholder for portions of the damage. Thus, the dispute centered on the scope of the loss and fell within the law, as the court ruling confirmed.”
Mr. Bellenchia concluded: “The NYPAA has played a crucial role in protecting policyholder rights, first by supporting the development of the revised statute, and now by helping to ensure that both the letter and spirit of the law are obeyed.”