Advanced Social Media Research Tools & Resources

Earlier this week I delivered Episode 56 of my social media research presentation to a major P&C insurer's enterprise risk prevention committee or group.  That was the 56th time I've spoken on the potential value of SM content to insurance and law enforcement industry groups since May of 2010 when the good folks out at the Rocky Mountain IASIU Chapter had me present what I then suspected might be or become a popular topic.  It was and has and continues to be so. 

Much has changed in my presentation over the past three years.  New social networks have emerged and ascended onto the Top 10 list of most popular SN sites, while some of the original Top 10 sites have slipped in the rankings.  And new techniques, tools and resources have appeared to assist SM researchers in their efforts to find, secure, verify and then utilize SM content in responsible business decision making.  For those who have not attended one of my more recent episodes, in no particular order here are some of my favorite newcomers to the SM research party:

TWITTER AGGREGATORS

Twitter has grown in popularity and use since May 2010 and much content that once was deposited onto a Facebook page or wall now gets blasted out into the Internet 140 characters at a time.  Spotting and finding those contrails of relevant SM content have become somewhat easier. 

In the last five or so episodes of my SM research presentation I have told the story of finding and then reporting what likely is an actual case of  a fraudulent insurance claim.  I run a Twitter aggregator called TweetDeck, which enables me to monitor from my desktop and laptop computers my two Twitter accounts, key words, hash tags, and individual Twitter users who may be under investigation.  There are other Twitter aggregators out there, but I prefer TweetDeck. 

In preparing for one of my recent SM research presentations I noticed an interesting tweet in my TweetDeck’s “Insurance Fraud” column, which pulls in any English-language tweet that contains the words insurance fraud.  After a bit of basic SM research, I had what appeared to be an actual outing of someone’s fraudulent auto physical damage claim.  I called and then emailed the tweet links to the local special investigator of the auto insurer identified in one of the tweets, and I understand he confirmed that the insured had made a stolen-recovered-crashed claim when in fact a Twitter account bearing his name and likeness admitted to having crashed his car while drunk.  Getting a twitter account and using an aggregator like TweetDeck can make Twitter research and monitoring easier and more efficient. 

TWITTER CONTENT SEARCHING

Have you ever tried to find someone’s old tweets?  For unprotected Twitter accounts try All MyTweets, which will display up to approximately 3,200 of the account’s most recent tweets on one page.  Unfortunately, Twitter limits the number of tweets Twitter API (Application Programming Interface) services such as All My Tweets can retrieve to 3,200, and I have yet to find a way around that limitation.  Also, if a person has at some point changed their unprotected Twitter account to a protected Twitter account, compilers such as All My Tweets won’t work.  Nonetheless, displaying an unprotected Twitter account’s last 3,200 tweets on one page enables word searching (Ctrl+F or Command+F) on that page for key terms.  Try it.  Tweet Tunnel and Snap Bird do essentially the same thing as All My Tweets, but in bunches rather than all on one page.  They are also limited to approximately 3,200 tweets. 

For word-specific or phrase-specific Twitter searches, try Twitter’s Advanced Search engine.  I use this page frequently for searching tweets to or mentioning certain accounts, especially when the 3,200-tweet limit tweet compilers like All My Tweets prevents me from finding older tweets of an active Twitter account.  I also use the “To these accounts” or “Mentioning these accounts” Advanced Search fields to find tweets to or mentioning persons who have protected Twitter accounts.  Valuable substantive or relational information can sometimes be found from such “to” or “mentioning” tweets. 

LOCATION-BASED TWITTER SEARCHING

Location-enabled tweets can carry data that provide the means of determining where the device that broadcast the tweet was located at the time.   Creepy remains an interesting and useful geolocation data aggregator for Twitter, although it can be buggy at times and works only on PCs. 

There are other methods for conducting location-based Twitter searches.  If you want to find tweets about a particular word or phrase within a particular radius of a particular town or city, enter the desired word in a Twitter search bar followed by “near:[city,state] within:[x]mi”, like this:  arson near:Buffalo,NY within:50mi

If you want to search around an actual address, use GoogleMaps or another mapping site to obtain and copy the X- and Y- geocoordinates ofthe address then use the following search nomenclature: [key word] geocode:[geocoordinates],Xmi” into a Twitter search box, replacing the geocoordinates with the location you want to search and the “X” with the radius of your desired search in miles.  For example, the search term for searching “insurance fraud” within 10 miles of my office would be: "insurancefraud" geocode:42.886496,-78.873358,10mi 

Bing Maps also offers a method of viewing recent tweets at or around a particular location.  Best accessed through IE or Safari (the “explore map apps” menu option does not appear when using Chrome), Bing’s Twitter Maps app, when it works, offers another easy method of viewing recent tweets near a particular location.  Here’s what recent tweets near my office in Buffalo, New York look like.  Be sure to search the address before loading the Twitter Maps app.   

FACEBOOK GRAPH SEARCH

Facebook recently rolled out its Graph Search feature, which is still in beta.  Why should you consider requesting and trying Graph Search Beta?  Because it will significantly enhance your search capabilities within Facebook.  For example, you find an individual’s FB page but it is friends-only protected and your company does not allow pretexting.  Dead end?  Maybe not.  With Graph Search (which FB just earlier this week enabled on my FB account after I applied several weeks ago) you would be able to search for photos of the person appearing on other persons’ FB pages.  What once required a time-consuming manual search through an individual’s friends’ pages and photo albums can now be done in a single search using FB’s Graph Search toolbar.  I can’t think of a single reason why any investigator who does SM research would NOT want to sign up for FB’s Graphic Search. 

REVERSE IMAGE SEARCHING

Approximately a year ago I began incorporating reverse image searching into all of my SM research projects.  Google offers an excellent reverse image search engine that can locate additional SN and web sites on which an individual’s image appears.  Once you have the URL of an online image or have downloaded an image onto your computer, use Google Images search engine to find that image elsewhere on the Internet.

Another reverse image search engine I use is Tin Eye.  Works pretty much the same way as Google Images’ reverse image search engine, but Tin Eye found only two matches for this image of me whereas Google Images found five matches. 

* * * * *

If anyone who reads this post has any other advanced SM research tools or resources they would like to share, please do so in the comments to this post.  Updated and tweaked versions of both my basic and advanced SM research presentations are available now and either are or can be coming to your area soon.  If you would like either or both presentations for your organization or company, contact me here.  

Emergency Adoption of the Twelfth Amendment to New York Insurance Regulation 64

This afternoon New York Governor Andrew Cuomo announced four new measures or actions being taken in New York purportedly to expedite and in response to Sandy-related insurance claims:

1. today's issuance by the New York Department of Financial Services of an emergency amendment to New York Insurance Regulation 64 (11 NYCRR Part 216) reducing from 15 business days to 6 business days the time for insurers "to commence" an investigation of certain types of claims "occurring from October 26, 2012 through November 15, 2012" in the 10 designated counties (Bronx, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk or Westchester) and, if they wish their investigation to include an inspection of the damaged or destroyed property, to conduct that inspection within that 6-day period; 
2. the inclusion within that emergency regulation of a provision allowing claimants to commence certain repairs immediately and before the insurer has had an opportunity to inspect the damaged property "[w]here necessary to protect health or safety" and provided the claimant submits proof of loss documentation; 
3. the issuance of Executive Order Number 82 temporarily suspending from today and until further notice the requirements of New York Insurance Law § 2108 so that the DFS may more easily issue temporary public adjuster licenses that authorize such temporary licensees to adjust property/casualty insurance claims in the counties of Bronx, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk and Westchester that are commenced during the period this executive order remains in effect; and 
4. the launching of an "online report card system concerning insurance companies who are operating in the areas that were affected by Hurricane Sandy."

  You can watch the Governor's press conference, including the Q&A at its end, here:


New York property insurers should take note of the following:

Twelfth Amendment to New York Insurance Regulation 64 (11 NYCRR Part 216)

Amendment of Existing Subsection 216.5(a)

Notwithstanding what the Governor's and DFS's press releases say or imply, there never was and still is no actual requirement in Regulation 64 that a New York property insurer inspect a claimed loss.  Until today section 216.5(a) only required insurers subject to that section to "establish procedures to commence an investigation of any claim filed by a claimant, or by a claimant’s authorized representative, within 15 business days of receipt of notice of claim."  That subdivision was amended ever so slightly by renumbering it as 216.5(a)(1) -- to allow for the addition of subsection (a)(2) -- and by deleting the words "establish procedures to" and changing ""receipt of" to "receiving".  The amended subsection, which is applicable to ALL insurers that are subject to section 216.5, now begins by providing that such an insurer

shall commence an investigation of any claim filed by a claimant, or by a claimant’s authorized representative, within 15 business days of receiving notice of claim.

Of course, the regulation nowhere defines what suffices to "commence" an investigation of a filed claim.  Presumably that is something more than merely acknowledging a claim, however, inasmuch as section 216.4(a) already requires insurers within 15 business days to acknowledge in writing their receipt of all claim notifications.

Addition of New Subsection 216.5(a)(2)

The bulk of today's emergency regulation is its new paragraph (2) of section 216.5(a).  Here's the language of that new paragraph, which took effect today:

(2)(i) Notwithstanding paragraph one of this subdivision, for claims that would otherwise be subject to the provisions of paragraph one the provisions of this paragraph shall instead apply, with respect to any claim occurring from October 26, 2012 through November 15, 2012 in the counties of Bronx, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk or Westchester, including their adjacent waters, with respect to

(a) loss of or damage to real property;
(b) loss of or damage to personal property; or
(c) other liabilities for loss of, damage to, or injury to persons or property.

(ii) Every insurer shall commence an investigation of any claim filed by a claimant, or by a claimant’s authorized representative, within six business days of receiving notice of claim, provided, however, that if a claimant, or the claimant’s authorized representative, filed a claim
between October 26, 2012 and November 29, 2012, then the insurer shall commence an investigation of the claim within six business days after November 29, 2012 or 15 business days of receiving notice of claim, whichever is sooner. If the insurer wishes its investigation to include an inspection of the damaged or destroyed property, the inspection, whether performed by the insurer, an independent adjuster, or other representative of the insurer, must occur within the time frames specified in this paragraph.

(iii) An insurer shall furnish to every claimant, or claimant's authorized representative, a notification of all items, statements and forms, if any, that the insurer reasonably believes will be required of the claimant, within six business days of receiving notice of the claim.

(iv) A claim filed with an agent of an insurer shall be deemed to have been filed with the insurer unless, consistent with law or contract, the agent notifies the person filing the claim that the agent is not authorized to receive notices of claim.

(v) Where necessary to protect health or safety, a claimant may commence immediate repairs to heating systems, hot water systems, and necessary electrical connections, as well as exterior windows, exterior doors, and, for minor permanent repairs, exterior walls, in order to enable property to retain heat, and any policy requirement that the policyholder exhibit the remains of the property may be satisfied by the policyholder submitting proof of loss documentation of the damaged or destroyed property, including photographs or video recordings; material samples, if applicable; and inventories, as well as receipts for any repairs to or replacement of property. This subparagraph does not apply to claims under flood policies issued under the national flood insurance program.

Insurers subject to section 216.5(a)(2) should take note of the following:

Temporal Limitation of 216.5(a)(2) -- 216.5(a)(2)(i)

This new subdivision expressly only applies to "any claim occurring from October 26, 2012 through November 15, 2012".  Now, I'm not sure when a claim "occurs" and whether this new subsection should have read "any loss occurring", but this new subsection does seems to be temporally limited to claims "occurring from October 26, 2012 through November 15, 2012".  If someone could explain why November 15th was selected as the end date, I would be appreciative.  That's a period of 20 calendar days.

Territorial Limitation of 216.5(a)(2) -- 216.5(a)(2)(i)

This new subdivision applies only to claims "occurring" in the counties of Bronx, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk or Westchester, and their adjacent waters.  Once again, I presume the Department meant loss rather than claim when speaking of something "occurring".  I don't know what it means for a claim to "occur" in the Bronx, or Staten Island, or Long Island.  Claims stems from losses and are asserted, filed, or made; they don't really occur, do they?  Nevertheless, whatever is meant by "occurring", it must have taken place in one of these 10 counties or their adjacent waters for this new paragraph and its new requirements to apply. 

Type Limitation of 216.5(a)(2) -- 216.5(a)(2)(i)

This new subdivision only applies to three types of claims or losses:

1.  loss of or damage to real property; 
2. loss of or damage to personal property; or
3. other liabilities for loss of, damage to, or injury to persons or property.

I know what Types 1 and 2 are and think Type 3s are 3rd-party BI and PD liability losses and resulting claims.  Right?  

Contrary to what may become or already is a widespread belief, however, no part of this emergency regulation is limited to Sandy-related claims.  As long as a claim "occurs" within the designated period and within one of the designated counties and is of one of the above three types, the new requirements ostensibly apply.

Reduction of Time to "Commence" Investigation to Six (6) Business Days -- 216.5(a)(2)(ii)

For claims to which new subsection 216.5(a)(2) applies (see above), the insurer's time to "commence" its investigation of such claims is now either

six (6) business days after today, November 29, 2012 -or-

15 business days of receiving notice of the claim

 whichever is sooner.  During Governor Cuomo's press conference, Superintendent Lawsky explained that if a claim was already filed with the insurer, the insurer would have the lesser of either the balance of the previous 15-day period or 6 days from today to commence its investigation and, if desired, to inspect the loss.  I'm interpreting and adding the latter part; both Governor Cuomo and Superintendent Lawsky made it sound like this new emergency regulation would impose an obligatory inspection requirement on all applicable insurers for all applicable claims, but it doesn't read that way.  Notice that the second sentence of 216.5(a)(2)(ii) reads:

If the insurer wishes its investigation to include an inspection of the damaged or destroyed property, the inspection, whether performed by the insurer, an independent adjuster, or other representative of the insurer, must occur within the time frames specified in this paragraph.

The inspection is not a "shall"; it's an "if".  And only if it's desired on qualifying claims must it then be conducted "within the time frames specified in this paragraph" which presumably (hedge here) is the sooner of either six business days from today or 15 business days from when the insurer received notice of the claim.  

Reduction of Time to to Six (6) Business Days to Furnish to Claimants Stuff that Will Be Required of Them -- 216.5(a)(2)(iii)

This seems relatively straightforward.  For qualifying claims, insurers shall furnish to every claimant, or claimant's authorized representative, a notification of all items, statements and forms, if any, that the insurer reasonably believes will be required of the claimant, within six (6) business days of receiving notice of the claim.

Claims Filed with the Insurer's Agent -- 216.5(a)(2)(iv)

Also pretty straightforward.  Unless a producing agent notifies the the person filing the claim that the agent is not authorized to receive notices of claim, claims filed with an agent of a qualifying insurer will be deemed to have been filed with the insurer.

Immediate Repairs Provision -- 216.5(a)(2)(v)

Notwithstanding the new provisions of 216.5(a)(2)(ii), claimants of qualifying claims (see above) may commence certain immediate repairs "[w]here necessary to protect health or safety".   Immediate repairs may be made to

heating systems, hot water systems, and necessary electrical connections -and-

exterior windows, exterior doors, and, for minor permanent repairs, exterior walls, in order to enable property to retain heat[.]

This subdivision further provides that any policy requirement that the policyholder exhibit the damaged property "may be satisfied by the policyholder submitting proof of loss documentation of the damaged or destroyed property, including photographs or video recordings; material samples, if applicable; and inventories, as well as receipts for any repairs to or replacement of property."

Public Adjuster-repped Claims

Our governor today announced the temporary suspension of certain licensing requirements of Insurance Law § 2108 so that more public adjusters could be temporarily licensed to help New York insureds with their property claims, but did anyone at the DFS consider that section 216.2(d) of Regulation 64 already provides, and continues to provide, since it was left unamended and unaffected by this emergency regulation, that

... subdivision (a) of section 216.5 of this Part shall not be applicable to policies of insurance where the claimant is represented by a public adjuster or a person acting in the capacity of a public adjuster pursuant to the provisions of article 21 of the Insurance Law[?]

So what become of the new requirements of subparagraph (2) of 216.5(a) in PA-repped qualifying claims?  Certainly an argument could be made they don't apply. 

Executive Order Number 82

Which brings us to Executive Order Number 82, which you can read in its entirety for yourself if you care to.  My read of this executive order is that it merely permits or creates the category of a temporary public adjuster who, upon issuance of such a license, will be authorized only "to adjust property/casualty insurance claims in the counties of Bronx, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk and Westchester that are commenced during the period for which this Executive Order is effective[.]"

Once again, I'm not sure what is meant by "claims ... that are commenced" within this executive order's period, but presumably it means claims filed on and after today and for as long as this executive order, which itself has a "until further notice" expiration date, remains in effect. 

Under this executive order, the requirements to obtain such a temporary PA license are:

1. completion of an application on a form prescribed by the Superintendent of Financial Services;
2. signing of such application form by a public adjuster who is licensed in this State pursuant to Section 2108 of the Insurance Law, whose license is in good standing, and who will be responsible for both the supervising of the temporary licensee either in an employer/employee relationship or other arrangement whereby the licensed public adjuster has control over the temporary licensee and the satisfactory completion of all adjustment undertaken by the temporary licensee;
3. the temporary licensee has not had an insurance license revoked, suspended or otherwise terminated for cause in any state in the United States in the last ten years;
4. the temporary licensee has not been charged with, been convicted of, or pleaded guilty to or nolo contendere with respect to a crime or misdemeanor in any state in the United States in the last ten years; 
5. the temporary licensee has not been found liable for misrepresentation, fraud, or unethical conduct in any state in the United States in the last ten years; and 
6. the temporary licensee is presently licensed in another state as a public or independent adjuster to adjust property/casualty insurance claims; or has 5 years prior experience within the last ten years as a public or independent adjuster adjusting property/casualty insurance claims in the United States; or has been licensed as a public or independent adjuster in New York State within the last 5 years.

Online Insurer Report Cards

For the stated purpose of "hold[ing] insurance companies accountable to consumers and allow[ing] New Yorkers to see the performance of their insurance company compared to other companies", today the DFS published online "report cards" of certain, but certainly not all, auto and property insurers that "are operating in the areas that were affected by Hurricane Sandy."  (Wait, I thought it wasn't a hurricane, Governor Cuomo and Superintendent Lawsky?) 

Those lucky 24 insurers or insurer groups are:  

• Adirondack Insurance Exchange
• Allstate Insurance Group
• Amtrust Financial Service Group
• Assurant Insurance Group
• Andover Group
• Arch Insurance Group
• Berkshire Hathaway (GEICO)
• Central Services Grp
  (aka New York Central Mutual)
• Chartis/AIG
• Chubb & Son Inc
• FM Global Group
• Hartford Fire & Casualty Group
• Liberty Mutual Group
• Metropolitan Group
• Narragansett Bay Insurance Company
• Nationwide Group
• NY Property Insurance Underwriting Association
• QBE Ins Grp Ltd
• State Farm IL
• Travelers Group
• Tower Group
• USAA Group
• Utica National Insurance Group
• Zurich Insurance Group

 In his press conference this afternoon, Governor Cuomo spoke (at 2:00 of the video, to be exact) of the "many, many complaints" insureds have made about their insurers following the ravaging Hurricane Super Storm Really Big Storm Sandy.  Yes, Governor, I suppose 742 complaints could be called "many".  But that number is the total of all complaints of the 329,156 claims reported on those report cards as of November 27, 2012, or less than ¼ of 1% of all claims filed.  99.78% is a pretty good grade on any report card in any school or industry, I would say.  And the number of complaints that were warranted must be less than that.  Which is why, I suppose, New Yorkers needed this emergency regulation and additional executive order right now, right?

Somewhere, some law professor who teaches administrative law must be salivating over what Governor Cuomo and Superintendent Lawsky have gifted him or her for syllabus material for an upcoming semester.  Moratoriums, executive orders, and emergency regulations, oh my. 

Law and sausage. 

Episode 42 -- Social Media Research in Claims Investigations Training

This is for those of you who have asked me when you might be able to attend a "full" version of my social media research training presentation.  I'll be delivering a 145-minute version of that interactive presentation on this coming Thursday, October 25, 2012 at the Albany Claims Association's 29th Annual Education Day in Latham, New York.

This will be Episode 42 in my now long-running series of social media research presentations.  Even if you have seen one of the prior episodes, you may want to attend this one.  There have been a number of important case decisions and other developments in this area that we will be discussing. Here's the seminar's agenda: 

The seminar's cost is a modest $35 per person, which includes lunch.  The stated registration deadline is this coming Monday, August 22, 2012, so click HERE to register and submit right away.  I can't imagine they would turn away walk-ins, however, in the event you are not able to register by Monday the 22nd. 

No Fishing Allowed -- Fourth Department Reverses Order Granting Discovery of Plaintiff's Facebook, MySpace and Other Internet Postings

PERSONAL INJURY – DISCOVERY – SOCIAL MEDIA CONTENT
Kregg v. Maldonado
(4th Dept., decided 9/28/2012)

Christopher Williams was injured in a motor vehicle accident while driving a motorcycle manufactured and distributed by Suzuki Motor Corporation of Japan and American Suzuki Motor Corporation.  Charlotte Gregg, Williams' guardian, sued the owner and operator of the car involved in that accident and the Suzuki defendants.  After initial disclosure exchanges, the Suzuki defendants learned that family members of Williams had established Facebook and MySpace accounts for him and had made Internet postings on his behalf in connection with those accounts. The Suzuki defendants served additional discovery demands on the plaintiff, requesting the "entire contents" of those and any other social media accounts maintained by or on behalf of Williams.  When plaintiff refused to provide those materials, the Suzuki defendants moved to compel such disclosure.   Plaintiff opposed that motion on the grounds of relevance and burden, contending that the demand for disclosure was a "fishing expedition." Supreme Court agreed with the Suzuki defendants that they were entitled to such disclosure.

In REVERSING Supreme Court's order compelling the disclosure, the Appellate Division, Fourth Department, held:

Although CPLR 3101 (a) provides for "full disclosure of all matter material and necessary in the prosecution or defense of an action," it is well settled that a party need not respond to discovery demands that are overbroad (see Optic Plus Enters., Ltd. v Bausch & Lomb Inc., 35 AD3d 1263, 1263). Where discovery demands are overbroad, " the appropriate remedy is to vacate the entire demand rather than to prune it' " (Board of Mgrs. of the Park Regent Condominium v Park Regent Assoc., 78 AD3d 752, 753). In McCann v Harleysville Ins. Co. of N.Y. (78 AD3d 1524, 1525), we addressed a similar discovery demand and concluded that the request for access to social media sites was made without "a factual predicate with respect to the relevancy of the evidence" (see Crazytown Furniture v Brooklyn Union Gas Co., 150 AD2d 420, 421). Here, as in McMann, there is no contention that the information in the social media accounts contradicts plaintiff's claims for the diminution of the injured party's enjoyment of life (cf. Romano v Steelcase, Inc., 30 Misc 3d 426, 427). As in McCann, the proper means by which to obtain disclosure of any relevant information contained in the social media accounts is a narrowly-tailored discovery request seeking only that social-media-based information that relates to the claimed injuries arising from the accident. Thus, we deny that part of the Suzuki defendants' motion to compel the disclosure of the entire contents of the injured party's social media accounts, without prejudice to the service of a more narrowly-tailored disclosure request.

The 10-Year Life Cycle of a New York Consequential Damages Claim

COMMERCIAL PROPERTY – CONSEQUENTIAL DAMAGES
Stern v. Charter Oak Fire Ins. Co.
(4th Dept., decided 9/28/2012)

Who out there other than I remembers this case and the position it forever occupies in the evolutionary chain of the recoverability of consequential damages against property insurers in New York State?  Those who do might understand then why I am blogging about a one-line decision.  

Vivian Stern made a claim to The Charter Oak Fire Insurance Company (Travelers) for losses stemming from an armed robbery that occurred at her jewelry store on or before December 28, 2001.  For reasons not apparent in the 13 (!) reported decisions of the Fourth Department in this case (most regarding motion practice), a dispute arose between the parties and Stern sued Charter Oak in 2002 for both contractual damages and consequential damages, including future lost profits and future sale value of the business.

In September 2005, Charter Oak moved to dismiss the complaint's consequential damages claim arguing, among other things, that coverage for such damages was negated by the policy's consequential loss exclusion.  Onondaga County Supreme Court (Deborah H. Karalunas, J.) granted that motion and plaintiff appealed.

In a decision issued March 16, 2007, the Appellate Division Fourth Department, unanimously affirmed Supreme Court's order dismissing the consequential damages claim, holding:

Supreme Court properly granted Charter Oak's motion to dismiss plaintiff's claim for consequential damages, including future lost profits after December 28, 2001 and future sale value of the business. The court also properly granted Charter Oak's motion to preclude plaintiff's expert from testifying with regard to that claim and denied plaintiff's cross motion seeking partial summary judgment determining that the expert's testimony was admissible at trial. The insurance policy expressly excludes coverage for the consequential damages claimed by plaintiff (see Bi-Economy Mkt., Inc. v Harleysville Ins. Co. of N.Y., 37 AD3d 1184 [2007]; J.R. Adirondack Enters. v Hartford Cas. Ins. Co., 292 AD2d 771, 772 [2002]; Crawford Furniture Mfg. Corp. v Pennsylvania Lumbermens Mut. Ins. Co., 244 AD2d 881 [1997]).

In that decision, keen-eyed property coverage professionals will notice the Fourth Department's citation to its decision of one month earlier in Bi-Economy Market, Inc. v. Harleysville Ins. Co. of N.Y.,which decision those same professionals will also recall the New York Court of Appeals reversed in the watershed decision on the recoverability of consequential damages against New York property insurers in February 2008.

So what's a robbed jewelry store owner to do under those circumstances?  Make a motion to renew the motion that resulting in the adverse order based on a change in the law, of course.  Unfortunately, plaintiff made such a motion to the Appellate Division, which in July 2008 denied her motion and referred her back to Supreme Court with the instruction that "[i]f [she was] is aggrieved by an order of Supreme Court, plaintiff's remedy is an appeal to this Court from that order."

The order to which the Appellate Division was referring was one apparently granted by Supreme Court Justice Karalunas on May 5, 2008, which had denied plaintiff's Bi-Economy-based motion to renew her opposition to Charter Oak's original motion to dismiss plaintiff's consequential damages claim based on the doctrine of "law of the case", which essentially is a "because I already said no" legal doctrine that courts sometimes apply when litigants want a do-over.

So plaintiff appealed that order back to the Appellate Division, Fourth Department, and in February 2009 that court, in light of the intervening opinion of the Court of Appeals in Bi-Economy, modified the order appealed from to grant plaintiff's motion to renew her opposition to Charter Oak's original motion and then, on such renewal, denied Charter Oak's motion to dismiss and reinstated the plaintiff's consequential damages claim:

Following our decision in the prior appeal, the Court of Appeals reversed the order in Bi-Economy Mkt., Inc., concluding under circumstances similar to those present in this case that a contractual exclusion for consequential losses in the insurance policy issued to the plaintiff business did not bar its claim for consequential damages caused by the defendant insurer's alleged breach of the terms of the policy (Bi-Economy Mkt., Inc. v Harleysville Ins. Co. of N.Y., 10 NY3d 187, 194-196 [2008]; see Panasia Estates, Inc. v Hudson Ins. Co., 10 NY3d 200, 203 [2008]).

While the instant action remained pending, plaintiff moved, inter alia, for leave to renew her opposition to Charter Oak's motion to dismiss her claim for consequential damages, based upon the decisions of the Court of Appeals in Bi-Economy Mkt., Inc. and Panasia Estates, Inc.  Supreme Court erred in denying that part of plaintiff's motion for leave to renew with respect to consequential damages based upon the doctrine of law of the case and instead should have granted leave to renew and, upon renewal, denied Charter Oak's motion.  "[A] court of original jurisdiction may entertain a motion to renew or [to] vacate a prior order or judgment even after an appellate court has rendered a decision on that order or judgment" (Tishman Constr. Corp. of N.Y. v City of New York, 280 AD2d 374, 377 [2001]). Furthermore, we conclude that, because "the analysis employed by this [C]ourt in the prior appeal no longer reflects the current state of the law, the doctrine of law of the case should not be invoked to preclude reconsideration of" Charter Oak's motion to dismiss plaintiff's claim for compensatory damages (Szajna v Rand, 131 AD2d 840, 840 [1987]; see Foley v Roche, 86 AD2d 887 [1982], lv denied 56 NY2d 507 [1982]). We therefore modify the order accordingly.

Rearmed with her complaint's consequential damages claims, plaintiff went back to Supreme Court where in late 2009 or early 2010 the parties moved and cross-moved for summary judgment.  As best as can be discerned from the limited information available on eCourts, those motions resulted in a November 18, 2010 order denying plaintiff's subsequent motion to correct the motion record and holding that: (1) Charter Oak had breached the insurance policy; (2) that the plaintiff's alleged business failure (aka consequential damages) was not proximately caused by that breach; and (3) that plaintiff was entitled to money damages of $7,887.19, plus interest.  That's right -- $7,900.  The printing costs already expended in the two previous trips to the Fourth Department had to cost more than the award amount.

Apparently having never heard of throwing good money after bad, or perhaps having unlimited resources to file and respond to six (!) more appellate motions prior to perfecting an appeal (five for filing extensions and one pro hac vice admission of new appellate counsel for Charter Oak), coupled with the fact that a relative of some kind assumed lead counsel responsibilities for her, plaintiff appealed Supreme Court's order denying her consequential damages and awarding her only $7,887.19 in contractual damages, plus interest.

Which brings the story of Stern v. Charter Oak to present.  In a "for reasons stated in the decision at Supreme Court" one-sentence memorandum decision issued on September 28, 2012, the Fourth Department unanimously affirmed Justice Karalunas' nth order, effectively concluding the case.  Except, of course, for perhaps another motion to renew and a motion for leave to appeal to the Court of Appeals.  Set your Google Scholar alert.

Although Adjustment of Claim is Not Required for Public Adjuster to Collect Its Fee, Whether Public Adjuster Performed "Valuable Services" Presents a Question of Fact

PROPERTY – PUBLIC ADJUSTER COMPENSATION – "VALUABLE SERVICES"
Public Adjustment Bureau, Inc. v. Greater New York Mut. Ins. Co.
(1st Dept., decided 9/25/2012)

Under New York regulatory law (11 NYCRR Part 25, a/k/a Insurance Regulation 10), licensed public adjusters in New York may charge a fee of no more than 12½ % of the recovery for the loss adjusted by such adjusters.  11 NYCRR § 25.7, entitled "Maximum compensation", provides:

No public adjuster shall charge any insured a fee in excess of 12.5 percent of the recovery for services rendered by the adjuster.

Section 25.10, entitled "Right to compensation", further states:

(a) The public adjuster shall not be entitled to any compensation for any services performed pursuant to a compensation agreement prior to its cancellation in accordance with section 25.8 of this Part.

(b) If a public adjuster performs no valuable services, and another public adjuster, insurance broker (in accordance with section 2101[g][2] of the Insurance Law) or attorney subsequently successfully adjusts such loss, then the first public adjuster shall not be entitled to any compensation whatsoever.

(c) Where more than one public adjuster performs valuable services for an insured, and there has not been a valid cancellation of the compensation agreement in accordance with section 25.9 of this Part, the insured shall not be obligated to pay an amount for all of such services in excess of the maximum compensation amount set by section 25.7 of this Part.

Property insurers are obligated to pay public adjusters their fee only if, at the time of the claim's settlement, the  the insured requests that the public adjuster be paid.  Section 25.12, entitled "Payment of losses", provides:

When a claim is settled where the insured is represented by a public adjuster, upon the request of the insured, the insurer's check may be made payable to both the public adjuster and the insured or to the public adjuster named as a payee, but not in excess of the amount of the public adjuster's fee, as indicated in the written compensation agreement signed by the insured and filed with the insurer. The balance of the proceeds shall be made payable to the insured or loss payee, or both, whichever is appropriate.

It occasionally happens that insureds do not want to pay their public adjusters either at all or what their public adjuster's compensation agreement specifies as the adjuster's fee.  In this case, plaintiff entered into a compensation agreement with Seward Park Housing Corporation in which the parties agreed:

TO THE INTERESTED INSURANCE COMPANIES:
We retain Public Adjustment Bureau, Inc. to perform valuable services, to include preparation and submission of claim detail and to advise and assist in the adjustment of claim detail and to advise and assist in the adjustment of the loss by collapse of January 15, 1999, at [the premises in question.] We agree to pay and hereby assign and request payment of expenses, disbursements and seven percent of the amount of loss and salvage be distributed to Public Adjustment Bureau, Inc. when adjusted or otherwise recovered, regardless to whom the loss is payable[.]

The claim was not adjusted; following extensive litigation, which included at least one trial and an appeal, Seward Park settled with Greater New York. Seward Park then disputed its obligation to pay the plaintiff, its public adjuster.  Public Adjustment Bureau (PAB) sued both its client, Seward Park, and the insurer, Greater New York Mutual Insurance Company.  Seward Park moved and PAB cross-moved for summary judgment.  Supreme Court granted Seward Park's motion, dismissing the complaint, and PAB appealed.

In MODIFYING the Supreme Court's order to deny both motions for summary judgment, the First Department, Appellate Division, held:

We reject Seward Park's argument that plaintiff is not due any fee under the contract because it neither adjusted the claim nor provided "valuable services" that resulted in the adjustment of the claim (see 11 NYCRR 25.10). In light of the "otherwise recovered" language in the retainer agreement, we find that adjustment of the claim is not a condition precedent to plaintiff's recovery of a fee (see GS Adj. Co., Inc. v Roth & Roth, L.L.P., 85 AD3d 467 [1st Dept 2011]; see also Goldstein Affiliates v Affiliated FM Ins. Co., 178 AD2d 301 [1st Dept 1991]). However, the record presents an issue of fact whether plaintiff performed valuable services.  

In New York State, public adjusters may be compensated only if they have a written and signed compensation agreement with the insured that "consist[s] of substantively the same information and statements contained in Form 1 in section 25.13(a) of [Part 25]."  11 NYCRR § 25.6(a).  The "otherwise recovered" language found in PAB's compensation agreement with Seward Park is contained in the prescribed public adjustment compensation agreement found at section 25.13 of Part 25 (Regulation 10).  In pertinent part, that form provides that the insured

hereby retains (name of adjuster) to act or aid in the preparation, presentation, adjustment and negotiation of or effecting the settlement of the claim for the loss or damage by (nature of loss) sustained at (loss location) on ________, [20] ________, and agrees to pay the adjuster for such services a fee of ________ percent of the amount of the loss including salvage when adjusted or otherwise recovered from the insurance companies.

Notably, the "valuable services" language that PAB incorporated into its compensation agreement is not required by or found in the prescribed compensation agreement of Regulation 10 and presumably derived  instead from section 25.10(b).  Had PAB not pledged in its compensation agreement to provide "valuable services" -- the delivery of which the First Department has now held presents a question of fact -- the question of whether a New York licensed public adjuster provides any "valuable services" would not be relevant to the public adjuster's compensation unless "another public adjuster, insurance broker ... or attorney subsequently successfully adjusts such loss[.]"  11 NYCRR § 25.10(b).

Second Department Holds that SUM Limit Is To Be Reduced by Recovery from All Tortfeasors

UNDERINSURED MOTORISTS COVERAGE – OFFSET – NON-DUPLICATION PROVISION 
Weiss v. Tri-State Consumer Ins. Co.
(2nd Dept., decided 9/26/2012)

$250,000 per person/$500,000 per accident SUM limits.
Two deaths in insured vehicle.
Drunk driver and two Dram Shop defendants.
Drunk driver's auto insurer pays $100,000 limit to settle.
Dram Shop defendants and their insurers pay $255,000 to settle.
Total settlement of wrongful death action = $355,000.

Question:  What's the recoverable SUM coverage limit?
Answer:  $145,000.

Plaintiffs successfully argued to Supreme Court that the recoverable SUM limit was $400,000 because only the $100,000 settlement amount from the drunk driver's motor vehicle liability insurer was to be deducted from the $500,000 per accident SUM limit.   In REVERSING the Supreme Court's denial of summary judgment to defendant Tri-State, the Second Department reasoned:

The subject policy contained the standard SUM endorsement prescribed by the Superintendent of Insurance in Regulation No. 35-D (11 NYCRR 60-2.3[c], [f]). Two conditions in the endorsement are directly at issue in this appeal. Condition 6 provides:

6. Maximum SUM Payments. Regardless of the number of insureds, our maximum payment under this SUM endorsement shall be the difference between:

a) The SUM limits; and

b) The motor vehicle bodily injury liability insurance or bond payments received by the insured or the insured's legal representative, from or on behalf of all persons that may be legally liable for the bodily injury sustained by the insured.

The SUM limit shown on the Declarations for "Each Person" is the amount of coverage for all damages due to bodily injury to one person. The SUM limit shown under "Each Accident" is, subject to the limit for each person, the total amount of coverage for all damages due to bodily injury to two or more persons in the same accident.

Condition 11 provides:

11. Non-Duplication. This SUM coverage shall not duplicate any of the following:

(a) Benefits payable under workers' compensation or other similar laws; 

(b) Non-occupational disability benefits under article nine of the Workers' Compensation Law or other similar law;

(c) Any amounts recovered or recoverable pursuant to article fifty-one of the New York Insurance Law or any similar motor vehicle insurance payable without regard to fault;

(d) Any valid or collectible motor vehicle medical payments insurance; or

(e) Any amounts recovered as bodily injury damages from sources other than motor vehicle bodily injury liability insurance policies or bonds.

SUM coverage in New York is a converse application of the golden rule; its purpose is "to provide the insured with the same level of protection he or she would provide to others were the insured a tortfeasor in a bodily injury accident" (Matter of Prudential Prop. & Cas. Co. v Szeli, 83 NY2d 681, 687; see Matter of Allstate Ins. Co. v Rivera, 12 NY3d 602, 608; Raffellini v State Farm Mut. Auto. Ins. Co., 9 NY3d 196, 204; see generally Norman H. Dachs and Jonathan A. Dachs, SUM Insurance Dilemma Hits the Mainstream, NYLJ, Sept. 19, 2012 at 3, col 1). With this limited purpose, SUM coverage does not function as a stand-alone policy to fully compensate the insureds for their injuries (cf. Bauter v Hanover Ins. Co., 247 NJ Super 94, 96-97, 588 A2d 870, 872, cert denied 126 NJ 335, 598 A2d 893). The conditions quoted above make this clear, as do other conditions not directly at issue in this case.

Here, the maximum SUM coverage of the subject policy was $500,000 per accident. The amount payable under that coverage was reduced, under Conditions 6(a) and 6(b), by the $100,000 paid by McGibbon's insurer, inasmuch as that amount constituted a "motor vehicle bodily injury liability insurance . . . payment[ ]" that the plaintiffs received (11 NYCRR 60-2.3 [f]). Further, the Dram Shop claims were settled for a total of $255,000. The Dram Shop recovery constitutes, under Condition 11(e), an amount "recovered as bodily injury damages from sources other than motor vehicle bodily injury liability insurance policies or bonds." Condition 11 does not allow duplicate recovery of such damages. Consequently, under the terms of the SUM endorsement, the plaintiffs' receipt of the Dram Shop recovery reduces, by that same $255,000, the amount payable under the SUM endorsement. The plaintiffs are not penalized by this reduction, since they received the maximum amount for which they are covered under the SUM endorsement: $100,000 from McGibbon's policy, $255,000 from or on behalf of the Dram Shop defendants, and $145,000 from Tri-State.

Notice of Consolidated Proposed Consensus Rulemaking to Correct Out-of-Date Hyperlinks and References as a Result of the Consolidation of the New York State Insurance and Banking Departments Into a New Department of Financial Services

How could I have missed it with a title so clear and succinct?

Since October 3rd of last year, when the New York State Banking and Insurance Departments consolidated into a single Department of Financial Services, I've been waiting for the DFS to announce the corrected verbiage for the "Should you wish to take this up with..." consumer advisory paragraph required by Regulation 64.  You know, the one that instructs insureds and claimants how to skew your company's consumer complaint ratio.  I blogged about that paragraph -- and in what letters it belongs and doesn't belong -- more than four years and four months ago.  If you work in claims for a personal property or auto insurer that does business in New York and don't recall reading that post, you should do so now by clicking here.

Well on July 18, 2012, the DFS proposed a consolidated consensus rulemaking that, among other things, replaces the old and outdated New York State Insurance Department references and hyperlink in the advisory paragraph with new and up-to-date references to the DFS.  The new advisory paragraph will thus read:

Should you wish to take this matter up with the New York State Department of Financial Services, you may file with the Department either on its website at http://www.dfs.ny.gov/consumer/fileacomplaint.htm or you may write to or visit the Consumer Assistance Unit, Financial Frauds and Consumer Protection Division, New York State Department of Financial Services, at: 25 Beaver Street, New York, NY 10004; One Commerce Plaza, Albany, NY 12257; 163B Mineola Boulevard, Mineola, NY 11501; or Walter J. Mahoney Office Building, 65 Court Street, Buffalo, NY 14202.

Although the 45-day public comment period for this new language expired on September 1, 2012, we still wait for our newly activated ChangeDetection.com subscription (see the immediately preceding post) to register the listing of the Twelfth Amendment to 11 NYCRR 216 (a/k/a Regulation 64) among the Department's final adoptions. 

I understand that some New York insurers, perhaps recognizing that this is a consensus rulemaking that is not expected to garner any objections, have already changed their letters and forms to comport with the new language, even though the proposed amendment technically has not yet taken effect.  This new paragraph becoming the required one is not an if, but a when.

Little known factoid:  the consumer advisory paragraph is also found on Page 2 of the prescribed NF-10 Denial of Claim Form for New York no-fault claims.  Once this consolidated rule goes into effect, including its Fourth Amendment to 11 NYCRR 65-3 (a/k/a Regulation 68-C), New York no-fault insurers will need to begin using the revised or "new" NYS Form NF-10.

More Sausage, the New York Register, and Regulation 68-E

For those of you who like to watch, I bring you some more information regarding how administrative law is made in New York State.

In New York, administrative agencies that wish to promulgate new rules and regulations do so on either in an emergency basis without public review and comment, or a regular basis with an opportunity for public review and comment.  The New York State Administrative Procedure Act or "SAPA" governs how proposed rules and regulations of administrative agencies in New York become law.

The maternity ward, if you will, of administrative rules and regulations in New York is the New York Register, where preemie and full-term newborn rules and regulations are displayed for adoring parents and relatives.  And, much like real world maternity wards, one needs to visit the New York Register regularly to see the newborns.

Take, for example, the rules and regulations promulgated by the combined agency formerly known as the New York State Insurance Department -- the New York Department of Financial Services.  Since the beginning of this year, it has proposed seven insurance regulation changes on a regular basis by publishing them in the New York Register.  A Notice of Proposed Rule Making that accompanies the proposed rule or regulation will indicate, among other things, whether a public hearing is to be scheduled and how long the public comment period is to last from the proposed rule or regulation's publication in the New York Register.  Similarly, since the beginning of this year it has also published seven insurance regulation changes adopted and promulgated on an emergency basis, including the adoption of Regulation 68-E, entitled "Unauthorized Providers of Health Services", which took effect on the date it was filed with the New York Secretary of State, which the DFS's website lists as August 31, 2012.

When a proposed rule or regulation is promulgated on an emergency basis there will be an accompanying Statement of Reasons for Emergency Measure filed with the New York Secretary of State and published in the New York Register.  In Regulation 68-E's case, the accompanying Statement of Reasons for Emergency Measure dated August 31, 2012 reads:

This regulation concerns the de-authorization of certain providers of health services.  Insurance Law § 5109(a) requires the Superintendent, in consultation with the Commissioner of Health and the Commissioner of Education, to promulgate standards and procedures for investigating and suspending or removing the authorization for providers of health services to demand or request payment for health services under Article 51 of the Insurance Law upon findings of certain unlawful conduct reached after investigation, notice, and a hearing pursuant to Insurance Law § 5109.

For years, certain owners and operators of professional service corporations and other types of corporations have abused the no-fault insurance system. These persons are involved in activities that include intentionally staging accidents and billing no-fault insurers for health services that were unnecessary or never in fact rendered. Indeed, recent federal indictments have demonstrated that organized crime has infiltrated and permeated the no-fault provider network.  Such wide-scale criminal activity is estimated to have defrauded insurers of at least hundreds of millions of dollars, if not more. Insurers ultimately pass on these costs to New York consumers in the form of higher automobile premiums, and schemes such as the fraudulent staging of auto accidents endangers the innocent public. Furthermore, it places in peril the quality of care received by innocent auto accident victims and the public’s health, safety, and welfare.

It is of the utmost importance that the Superintendent, Commissioner of Health, and Commissioner of Education be able, as soon as possible, to prohibit health service providers who engage in such activities from demanding or requesting payment from no-fault insurers.

For the reasons stated above, emergency action is necessary for the public health, public safety, and general welfare.

So how does a New York insurance professional keep up on the new rules and regulations of the New York Department of Financial Services?  Several ways.  First, you can set up and use a webpage monitoring service to watch for changes to the DFS's proposed, emergency, and final insurance regulations pages.  I use the free service offered by ChangeDetection.com.  Or, if you prefer, you can navigate to the New York Register's webpage by clicking the image below and click the "Subscribe" button, which will create an email to listserver@ny.gov to subscribe to dos.dl.listserv.DAR.ERegister, after which you can then scan and read the weekly New York Register's weekly publications.

Or you can subscribe to this blog by using the widget on the right side of this page, and I'll do my best to let you know when fresh New York insurance-flavored sausage is made.