Zalma Books

A Resource for the Insurance Professional

 

Books, E-Books, Articles and Blog Available From Barry Zalma

HEADS I WIN, TAILS YOU LOSE

© 2017

Barry Zalma

This E-book started as a collection of columns insurance consultant, expert witness and insurance lawyer Barry Zalma wrote and published in the magazines "Insurance Journal," "Insurance Week," and "The John Cooke Insurance Fraud Report." It now contains 87 fictional stories on how insurance fraud is perpetrated by changing the names and places of the incident to protect the guilty.

Since the last edition I have added more stories that were published in my twice monthly newsletter, Zalma’s Insurance Fraud Letter which is available free to anyone who clicks the link and a brief analysis of the California Special Investigation Unit Regulations. In addition the e-book has been totally rewritten correcting typographical and syntax errors.

The title, "Heads I Win, Tails You Lose" is meant to describe insurance fraud as it works in the United States. Whenever a person succeeds in perpetrating an insurance fraud everyone who buys insurance is the loser. If the fraud succeeds the insurer must charge more premium to cover the expense of defending the fraud and payment of funds to the fraud perpetrator. If the fraud fails the insurer must still charge more premium to cover the expense of defending the fraud.

Everyone, except the lawyers and fraud perpetrators, lose.

It Takes Courage to Fight Insurance Fraud

The legislatures of the various states, the United States Congress, the National Association of Insurance Commissioners, The National Insurance Crime Bureau and insurance industry groups have finally decided that the war against insurance fraud is worth fighting. Until the states, the local police agencies, the district attorneys, the United States Attorneys, and the Attorneys General of the various states join in the battle it will be fought to a stalemate. The insurance industry cannot successfully fight insurance fraud alone.

On the state level the effort has begun. California, and many other states, have forced the insurance industry to pay money into a special fund to create a Fraud Division, California Department of Insurance or Fraud Bureau whose only duty is to investigate and prosecute insurance fraud perpetrators. Proposition 103 and Special Fraud Investigation Unit Regulations forced insurers to pay monies into another fund to pay prosecutors to prosecute the crime of insurance fraud and to create their own special fraud investigation units. Defrauding an insurance company is a felony in most states.

All of these actions suggest that the Legislatures have concluded that insurance fraud is draining away the wealth of their states into the pockets of criminals yet they wish to pass the buck to insurers to do the investigations. California, by statute, state that it is the public policy of the state that insurance fraud must be stopped.

Insurance industry sources estimate insurance fraud from lows of $80,000,000,000 ($80 billion) a year to highs of $200,000,000,000 ($200 billion) a year. Regardless of which, if any, estimate is accurate the amount of money going to insurance criminals is staggering and approaches no less than 3% to 10% of premium collected.

What has been the result of these new statutes? Are insurance criminals going to jail? Have there been scores of arrests? Have the courts been inundated with prosecutions? No. The prosecution of an insurance fraud is as rare as snowfall on the on the Island of Oahu.. It happens, but not in the numbers that the extent of the crime would suggest. Convictions are even more rare. Prosecutors complain that insurance companies do nothing. The statutes compelling insurers to form fraud investigation units usually have no penalties if the insurer fails to establish such a unit [California imposed regulations that imposes a $5,000 fine for failure to establish a Special Investigation Unit or to train its integral anti-fraud personnel and other states are following that lead.]

After you make a payment through PayPal, please wait for the article to upload to your machine.  If you have a problem with the purchase please write to me at zalma@zalma.com.

The Law of Ethical Insurance Claims

Ethics is a process of systematically applying, using, defending and recommending concepts of right and wrong behavior. Ethical behavior is required of both parties to a contract of insurance for the system to work. Ethics is the essence of insurance. The book for the insurance professional who wishes to act ethically. Table of Contents follows:

Table of Contents

 

 

 

 

Glossary

Chapter 1: Ethical Insurance Claims

            Uberrimae Fidei

            What is Insurance?

            Spreading the Risk

            History of Insurance

            Benjamin Franklin and American Insurance

            The Covenant of Good Faith And Fair Dealing

Chapter 2:   Ethical Behavior & Success

            Attempts to Compel Ethical Behavior

            Ethics for Independent Insurance Adjusters

            Public Adjusters Ethics

Chapter 3:   The Unethical Insured

            Criminal Conviction of Unethical Insureds

Chapter 4:    Lawyers and the Adjuster

            The Tort of Bad Faith

Chapter 5:  Ethics

    Kant and the Categorical Imperative

            Hegel and the Ethical Life

            Virtue Ethics

            Metaethics

            The Golden Rule

            Applied Ethics

            Other Concepts of Ethical Behavior

            What Concept of Ethics Best Fits the Insurer?

            Integrity

            Objective

            Professional Competence

            Confidentiality

            Confidences

Chapter 6:  The Ethical Insurance Professional

Chapter 7: Applying Ethics to the Work of the Insurance Professional

Chapter 8:  Sarbanes-Oxley & The Ethical Insurance Professional

            Ethics Mandated by Statute

Chapter 9: What Happens When a Court Creates an Ethical Conflict When None Exists

                        The Creation of a Right to Independent Counsel

                        The Cumis Doctrine

                        Bill Padding by Cumis Counsel Can Be Recovered From Cumis Counsel

Appendix 1: The California Public Adjuster Act

Apppendix 2: The California Fair Claims Settlement Practices Regulations

Appendix 3: The California Insurance Adjuster Act

The Law of Ethical Insurance Claims

Insurance Law Handbook

The earnings of almost every civil lawyer in the United States are funded by the insurance industry. Insurance can best be described as the mother's milk of the legal profession. The civil defense lawyer is paid by an insurer for each hour he or she works. The civil plaintiffs’ lawyer is usually paid by taking a percentage of any judgment entered in favor of the plaintiff, which judgment is usually paid by the defendant's insurer.

In almost every situation in which a civil lawyer practices the funds for that work comes, either directly or indirectly, from insurance. Consequently, lawyers must use their wits and energies to avoid or to pursue litigation to the benefit of the client. Both sides understand that an insurer will eventually pay one or both sides in the dispute. Insurance is important to every civil dispute and even some that fall within the criminal courts.

Every lawyer retained to prosecute or defend a civil suit should begin the representation with a serious effort to find insurance coverage for the benefit of the client or the defendant the client is suing. If no insurance is available it is essential that the plaintiffs’ counsel determine the assets of the defendant(s) to satisfy any judgment. It makes no sense to sue a judgment proof defendant.

A lawyer that does not know the law of insurance will file a suit for actions excluded from every insurance policy the defendant may have. The lawyer who understands insurance will provide a suit whose judgment can be collected or will provide a defense to the client that will pay for the defense of the defendant and, if necessary, satisfy any judgment entered against the insured. Without that knowledge the lawyer without sufficient insurance knowledge will find he or she is in trial litigating with duct tape firmly self-placed across his or her mouth and unable to intelligently evaluate the case.

Insurance Law Handbook

California Insurance Rescission Law Handbook

Rescission is an equitable remedy as ancient as the common law of Britain.

When the United States was conceived in 1776 the founders were concerned with protecting their rights under British common law. They adopted it as the law of the new United States of America modified only by the
limitations placed on the central government by the U.S. Constitution.

The viability and ability to enforce contracts was recognized as essential to commerce. Courts of law were charged with enforcing legitimate contracts. Courts of equity were charged with protecting contracting parties
from mistake, fraud, misrepresentation and concealment since enforcing a contract based on mistake, fraud, misrepresentation or concealment would not be fair.

The common law developed rules that courts could follow to refuse to enforce the terms of a contract that was entered into because of mutual mistake of material fact, a unilateral mistake of material fact, the breach
of warranty (a presumptively material promise to do or not do something), a material concealment, or a material misrepresentation. The remedy – called rescission – created a method to apply fairness to the
insurance contract and allow an insurer to void a contract and allowed courts to refuse to enforce such a contract entered into by misrepresentation or concealment of material facts.

Insurance contracts, unlike common run-of-the-mill commercial contracts, have been considered to be contracts of utmost good faith since, at least, 1766.1 Each party to the contract of insurance is expected to treat
the other fairly in the acquisition and performance of the contract. For example, the prospective insured is required to answer all questions about the risk he, she or it are asking the insurer to take and about the person
the insurer is asked to insure.

Rescission Law Handbook
 

Random Thoughts on Insurance - Vol. IV

Since 2010 I have been writing a blog post at least five days a week. This e-book is a collection of those posts that reveal my interest in insurance case law. Some of the cases reviewed were important. Some were of first impression. Others will be totally unimportant. All were interesting to me and I hope are interesting to the reader. This e-book is more than 1200 pages of my review of interesting cases from 2013 through January 2014.

After you purchase please wait for the e-book to upload from PayPal. If it does not upload please e-mail zalma@zalma.com and I will personally send you a copy of the e-mail in pdf format.

 

Insurance Fraud & Weapons to Defeat Fraud

Insurance fraud continually takes more money each year than it did the last from the insurance buying public. There is no certain number because most attempts at insurance fraud succeed. Estimates of the extent of insurance fraud in the United States range from $87 billion to more than $300 billion every year.

Insurers and government backed pseudo-insurers can only estimate the extent they lose to fraudulent claims. Lack of sufficient investigation and prosecution of insurance criminals is endemic. Most insurance fraud criminals are not detected. Those that are detected do so because they became greedy, sloppy and unprofessional so that the attempted fraud becomes so obvious it cannot be ignored.

No one will ever be able to place an exact number on the amount lost to insurance fraud. Everyone who has looked at the issue knows – whether based on their heart, their gut or empirical fact determined from convictions for the crime of insurance fraud – that the number is enormous.

When insurers and governments put on a serious effort to reduce the amount of insurance fraud the number of claims presented to insurers and the pseudo-government-based or funded insurers drops logarithmically.

The e-book contains the full text of the most important insurance fraud cases in over 2000 pages of material essential to every insurance fraud professional.

 

Getting the Whole Truth

The interview is an essential form of fact gathering for every type of human interaction. Interviews happen everywhere; they are performed by almost everyone. Interviewing is also an art, and the most effective interviews are conducted by those who are knowledgeable and skilled in this art.

The purpose of an interview is to uncover the truth; the method of uncovering the truth is the art of the interview. The standard interview does not have, nor should it be given, the pejorative sense conveyed by the expression “giving someone the third degree.” Interview professionals do not use rubber hoses or hot lights, or subject the interviewee to torture. In their limited arsenal, professionals do not have the power of the state, the reputation of the FBI, the majesty of a court trial, nor the intimidation of a search warrant.

Civil interviewing professionals are, therefore, compelled to get the information they need by intelligence, wit, skill, and experience. They must be masters of the social graces; they must know how to put people at ease. The skill of the professional causes the person being interviewed to actually want to give information to the interviewer. When the interview is successful, the subject becomes a virtual partner with the professional in the effort to uncover the truth, the whole truth, and nothing but the truth.

This ebook will help anyone who needs to obtain information from anyone else gain the information needed whether a business person, reporter, interviewer, investigator or lawyer.

The book will be delivered to you by e-mail shortly after purchase.

Random Thoughts on Insurance - Vol. III

Since 2010 I have been writing a blog post at least five days a week. This e-book is a collection of those posts that reveal my interest in insurance case law. Some of the cases reviewed were important. Some were of first impression. Others will be totally unimportant. All were interesting to me and I hope are interesting to the reader. This e-book is more than 1200 pages of my review of interesting cases from 2013 through January 2014.

After you purchase please wait for the e-book to upload from PayPal. If it does not upload please e-mail zalma@zalma.com and I will personally send you a copy of the e-mail in pdf format.

 

 

MOM & The Taipei Fraud

A short novel dealing with a massive fake burglary of a Beverly Hills, California residence in hopes of garnering enough money to pay off debts and avoid deportation back to the Republic of China on the island of Taiwan.

Follow the investigation of Marion Orpheus Montague (MOM) as he uncovers the fraud and provides defenses needed to save the insurers he represented $7 million.

If it does not upload please e-mail zalma@zalma.com and I will personally send you a copy of the e-mail in pdf format.

 

 

Zalma on California SIU Regulations

Zalma On California SIU Regulations is an e-book designed to assist California insurance claims personnel, claims professionals, independent insurance adjusters, special fraud investigators, private investigators who work for the insurance industry, the management in the industry, the attorneys who serve the industry, and all integral anti-fraud personnel working with California admitted insurers to comply with the requirements of California SIU Claims Regulations.

By statute, the state of California requires all admitted insurers to maintain a Special Investigative Unit (an "SIU") that complies with the requirements set forth in the Special Investigative Unit Regulations (the "SIU Regulations") and that the insurer must train all integral anti-fraud personnel to recognize indicators of insurance fraud. Since almost every employee of an insurer who approaches a claim qualifies as "integral anti-fraud personnel" they must all be trained annually.

It is necessary, therefore, that insurance personnel who are engaged in any way in the presentation, processing, or negotiation of insurance claims in California be familiar with the SIU Regulations imposed by the state on all insurers doing business in the state and be in a position to prove to the California Department of Insurance that the SIU Regulations have been complied with and all integral anti-fraud personnel have been trained.

In addition to explaining the SIU Regulations the appendix contains an outline for the training required. 

Zalma on California Claims Regulations - 2013

The E-book has been updated to include the modifications made to the Regulations to be effective March 30, 2013.

  Zalma on Rescission of Insurance In California - 2013

 Murder and Insurance Fraud Don't Mix - A Novella

 

Murder & Old Lace - A Novella

Arson for Profit - A Novel

Newly revised and rewritten for 2013, a novel, based on reality, about how a thorough investigation by professional claims adjusters, investigators and a claims lawyer defeated an arson-for-profit scheme and kept insurance claims funds from supporting terrorists,

New Zalma Books

New From Barry Zalma

Availability: Ships in 2-3 weeks

Quick Overview

Insurance Law is the most comprehensive, and yet practical, insurance law authority available today. Written by nationally-renowned insurance coverage expert Barry Zalma, an insurance coverage attorney, consultant, expert witness and blogger, Insurance Law introduces the new insurance professional to the fundamental principles of insurance and provides the experienced litigator analyses of today’s leading insurance law decisions nationwide.

Insurance Law is the most comprehensive, and yet practical, insurance law authority available today.

Written by nationally-renowned insurance coverage expert Barry Zalma, an insurance coverage attorney, consultant, expert witness and blogger, Insurance Law introduces the new insurance professional to the fundamental principles of insurance and provides the experienced litigator analyses of today’s leading insurance law decisions nationwide.

This book is ideal for any professional who works in or frequently interacts with the insurance industry. Claims professionals, risk managers, producers, underwriters, attorneys (both plaintiff and defense), business owners, and students will benefit greatly from this all-inclusive reference. It is also the perfect resource for educators and trainers whose role requires an understanding of insurance law.

As you read through these pages, you’ll find comprehensive—yet comprehensible—coverage of key topics, including:
• Construction of Insurance Contracts
• Rules of Contract Interpretation
• Differences between Property and Liability Policies
• The Equitable Remedy of Rescission
• Duties of the Insured and Insurer
• Statutory Bad Faith and Defenses to the Tort of Bad Faith
• Conditions, Warranties, and Exclusions
• The Doctrine of Fortuity
• Coverage Trigger
• Appraisal and Arbitration
• The Right to Independent Counsel
• Fraud and False Swearing
• The Equitable Remedy of Subrogation
• Excess, Escape, Contingent Escape, and Other Insurance Clauses
• Punitive Damages
• Preemption and the Power to Control Insurance

In addition to case law, the author has provided countless citations to relevant statutory, regulatory, and judicial sources which are guaranteed to kickstart your research.


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The Insurance Fraud Deskbook

The Insurance Fraud Deskbook
Author(s):  Barry Zalma
Sponsor(s):  Tort Trial and Insurance Practice Section
Publisher(s):   ABA Book Publishing

ISBN: 978-1-62722-676-9
Product Code: 5190506
2014, 638 pages, 7 x 10

This book is written for individuals who are focused on the effort to reduce expensive and pervasive occurrences of insurance fraud. Lawyers who represent insurers, claims personnel, prosecutors and their investigators can all benefit from this exhaustive resource.

The Insurance Fraud Deskbook is a valuable resource for those who are engaged in the effort to reduce expensive and pervasive occurrences of insurance fraud. It explains the elements of the crime and the tort to claims personnel, and it provides information for lawyers who represent insurers, so they can adequately advise their clients. Prosecutors and their investigators can use this book to determine what is required to prove the crime and win their case.

The full text of decisions from courts of appeal and supreme courts across the country are provided so the reader can understand what happens after the investigation is completed and can apply that information to undertake their own thorough investigations. It allows claims personnel and their lawyers to understand what errors would cause a defeat or a not-guilty verdict.

The effort to reduce insurance fraud requires the assistance of both civil and criminal courts. The Insurance Fraud Deskbook can help the prudent fraud investigator, insurance adjuster, insurance attorney, insurance Special Investigation Unit, and insurance company management to attain the information needed to deal with state investigators and prosecutors.

Available from the American Bar Association at: http://shop.americanbar.org/eBus/Default.aspx?TabID=251&productId=214624; or  orders@americanbar.org, or 800-285-2221.

 

 

ZALMA’S INSURANCE FRAUD LETTER

 

 

The last two digital issues of Zalma’s Insurance Fraud Letter (ZIFL) is available for download.

Subscription and access to ZIFL is free. If you are a subscriber the pdf version of ZIFL the current issue is delivered by attachment to an e-mail. If you are not a subscriber or don’t want the pdf just click the button below and choose to download either the text or Adobe Acrobat .pdf format.  

Sign Up For E-Mail Version of Zalma's Insurance Fraud Letter

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Updated November 22, 2016

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The author and publisher disclaim any liability, loss, or risk incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this blog. The information provided is not a substitute for the advice of a competent insurance, legal, or other professional. The Information provided at this site should not be relied on as legal advice. Legal advice cannot be given without full consideration of all relevant information relating to an individual situation.


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