Insurance Transparency Project

Fellow Insureds, policyholders and other uncovered perils (honk):

People often ask me, ‘Say, Dean, why do you spend so much time on the sexy, sensational aspects of insurance , like claims-handling and crop insurance — but ignore the really hot-buttom issues, the tabloid stuff, like insurance accounting and taxation? Isn’t that irresponsible?”

I tell them, `Patience, Notes! Nation(TM).  All will be revealed.”

Today, though, we’re talking about Katrina-related lawsuits, as reported by my favorite Southern Mississippi paper. A couple things about counting insurance plaintiffs: It’s really hard.  Policyholder suits are generally filed under state law in individual state courthouses and even then are generally not categorized by court officials as “insurance cases,” but rather filed under broader categories, such as “breach of contract” or something else. So no one really knows (except insurers) how often an insurer is sued by its chiseling, gold-digging, suit-happy policyholders, oops, I mean, its customers.

Katrina, however, offers something of an opportunity. So big it was, Grasshopper, that some court officials, for administrative purposes, are keeping track. Also, for legal reasons I’ll spare you, nearly ALL the Mississippi Katrina cases are filed in the federal court in Pascagoula (love writing word.)

But even now, we don’t know how many individual plaintiffs there are.  A single suit, for instance, can, and does, contain hundreds of plaintiffs.  Richard Scruggs, famed tort king, tells me he has nearly 3,000 individual plaintiffs himself.  And, as commonsense tells us, only an (unknown) fraction of unhappy insureds (or unhappy anyone) will sue. And of course each case must be heard individually, according to a recent ruling by the lead judge in the cases, L.T. Senter.

So, even with two visiting judges brought in to help out, at 290 cases a year (see the story), the last of these cases should (conservatively speaking) be headed for trial in 2011, more likely closer to 2014. Oy.

But that’s ok, most of these retired factor workers and customer-service representatives down here are loaded, believe me. Insurers are no match for them.

Coming soon: insurer litigation tactics.

In an effort to widen the circle, I’m going to invite The World’s Hardest Working Economist, The Oklahoma Kid, The Washington Duomos and gulp, funders.

Private note to Foxy Oregonian: Stop reading this far down. I’m not going to mention you!

http://www.insurancejournal.com/news/national/2006/10/20/73450.htm