Merged Let's Talk about Insurance Fraud!

JonnyFive said:
If that was insurance fraud, it was the single stupidest insurance fraud in the history of ever.
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I loved that line so I stole it for my sig (I get a sig now, woowoo!). "History of ever" made me laugh out loud.
 
TriangleMan said:
This may help, but it's not a word-by-word content of the policies: http://www.nysd.uscourts.gov/rulings/03cv0332_opinion_060806.pdf
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Thanks, that's very helpful.

It looks like the big issue was whether or not the main policy would cover defense costs. Sounds like it was an umbrella general liability policy, and as they didn't contest the claims (only the number of occurrences), I would assume that there was no rider excluding coverage for terrorist acts.

The excess coverage layers are typical of such a large risk. It looks like they had at least 17 different carriers providing the total coverage on the property. Then again, in CT world they are all the same carrier.


Minadin said:
I loved that line so I stole it for my sig (I get a sig now, woowoo!). "History of ever" made me laugh out loud.
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Thanks, I'm honored.
 
Given that these are some of the same people who are claiming they stole $1 trillion in gold from the WTC, the Illuminati made billions shorting stock, the dollar is going to soon be replaced by the "Amero", and Leo Wanta is the trustee for a $70 trillion fund, I don't place much faith in their finance knowledge.
 
Wot, no CTs?

*nothing but the drip, drip, drip of drool upon soiled keyboard*
 
TriangleMan said:
For big property insurance the policies almost always state the maximum amount payable rather than 'replacement value' or other ambigous terms. The major court case with one group of reinsurers was that the policy stated something like $3.5b per occurence, and the argument was whether two planes hitting two towers was one occurence ($3.5b payout) or two ($7b payout). Courts ruled that due to the wording of the contract it was a $3.5b payout.
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The Silverstein WTC insurance policies and claims were very complicated, involving about 23 insurance companies and many policies. Some of the wording in those policies had not even been finalized at the time of the attacks, which made the court decisions more difficult. The courts decided that some of the insurance clauses DID allow for a double payout under the circumstances. Therefore, although Silverstein's insured amount was about $3.5 billion, he was finally awarded about 4.6 billion.

The $861 million claim on building 7, which was owned, not leased, by Silverstein properties, was promptly paid by Industrial Risk Insurers. What? Hadn't they heard that Silverstein ordered the building to be blown up? Barton Keyes would have sniffed that out in a second!
 
Good stuff, Jonny! I did a post a number of months back on the "two occurences" bit that a lot of the Deniers find so baffling. I can't locate it right now but I thought I'd throw the points into this thread.

Commercial property owners have a strong incentive to keep their insurance coverage as low as possible, since any money saved flows directly to the bottom line, and in fact usually commercial property coverage is mandated by the lender and not by the property owner. The Lender typically wants their loan amount in coverage, but they will often let borrowers insure for less than that based on aspects of the property. For example, on garden apartment loans, it is not uncommon for a lender to allow the borrower to purchase insurance that covers (effectively) just one building per occurence, on the rationale that only one building is likely to burn down in a fire. Of course they will look hard at other factors--how far apart the buildings are, whether they have clay tile or cedar shake roofs, etc. Note however, that this does cover the lender in the event of two separate fires in two separate buildings on the same day because those are different occurences. Hence Silverstein's claim that the terrorist attacks constituted two separate occurences is not as far-fetched as it sounds. Of course, he was hosed by the language in one of the binders for insurance coverage (IIRC called the Wilprop policy) which specified a maximum payout.

This is of course, a layman's version and a lender's version; the actual issues involved in the WTC coverage were quite a bit more complex.

ETA: My 911th post! It must be part of the conspiracy!
 
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Gravy said:
The $861 million claim on building 7, which was owned, not leased, by Silverstein properties, was promptly paid by Industrial Risk Insurers. What? Hadn't they heard that Silverstein ordered the building to be blown up? Barton Keyes would have sniffed that out in a second!
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Oh but Gravy -

Lookit how they connect up to Nwoo Woorld Oorder:

Industrial
Risk
Insurers

Illuminati
Rothschilds
Freemasons

Okay, 2 out of 3, but STILL...
 
Gravy said:
The Silverstein WTC insurance policies and claims were very complicated, involving about 23 insurance companies and many policies. Some of the wording in those policies had not even been finalized at the time of the attacks, which made the court decisions more difficult. The courts decided that some of the insurance clauses DID allow for a double payout under the circumstances. Therefore, although Silverstein's insured amount was about $3.5 billion, he was finally awarded about 4.6 billion.

The $861 million claim on building 7, which was owned, not leased, by Silverstein properties, was promptly paid by Industrial Risk Insurers. What? Hadn't they heard that Silverstein ordered the building to be blown up? Barton Keyes would have sniffed that out in a second!
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Yes, that's all correct, Gravy. As set out here:

http://www.internationalskeptics.com/forums/showpost.php?p=1983689&postcount=8

The $3.5 billion coverage was for all four of the buildings under the July 2001 lease (buildings 1, 2, 4 and 5).

The coverage was procured through 23-24 insurance companies.

Two companies - ACE Bermuda and XL Insurance, Ltd. - settled in Feb. 2002, paying a total of $365 million ($298 million by ACE and $67 by XL)

Three companies - Hartford, Royal Indemnity, and St. Paul Fire - brought motions for summary judgment seeking a declaration that they were subject to the "WilProp" language (which would mean that the terrorist attacks were one occurrence and not two) rather than the Travelers language. They were successful and the decision was upheld on appeal by the Circuit Court in September 2003. These three were subject, therefore, to a maximum liability of $112 million.

The remaining insurers were split into two groups for jury trials on the question of whether they were subject to the "one occurrence" or "two occurrence" language.

The first trial resulted in a verdict that 10 of those insurers whose liability totalled $1.9 billion, were subject to the WilProp language and thus their total liability was limited to $1.9 billion (three of the 13 insurers in this group were found to be liable to the "two occurrence" language so were added to the second trial group).

The second trial resulted in a verdict that the remaining insurers were indeed subject to the double occurrence language, so their $1.1 billion in coverage resulted in these insurers being liable for a maximum of $2.2 billion

Total potential payout, therefore, is capped at $4,577,000,000 for buildings 1, 2, 4, and 5.

See also here:

http://www.internationalskeptics.com/forums/showpost.php?p=1985777&postcount=13


First jury trial
Verdict April 29, 2004 (no decision re Swiss Reinsurance)
http://www.law.com/jsp/article.jsp?id=1082923373947
http://www.realestatejournal.com/reg...-starkman.html

Swiss Re verdict May 3, 2004:
http://quote.bloomberg.com/apps/news...c&refer=europe

Second jury trial – December 6, 2004 - these insurers subject to double payment re 2 occurrences
http://insuranceletter.com/archives/...sg00007.html#1

In October, TriangleMan posted a link showing the results of Silverstein's appeal of the SwissRe verdict here:

http://www.internationalskeptics.com/forums/showpost.php?p=2015836&postcount=14

(Silverstein lost on appeal, thus the total potential payout remains as set out above at $4.577 billion.)

EDIT TO ADD: that does not mean that he has actually been paid the total as yet. He has not been. The parties are currently going through a process to assess his actual losses, as he cannot, of course, collect more than his actual losses. (In this case, however, I am certain that he will ultimately collect the total as it is next to inconceivable that his damages on buildings 1, 2, 4 and 5 could be less than his maximum payout)
 
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Anybody have any idea on the duration of the loss of rents coverage? I can't imagine it going for five years out. I remember that once it became obvious to the insurance companies that Silverstein was going to claim two occurences, the insurerers held out on paying the rent loss policy, because they knew they'd just be funding his lawsuit.
 
Brainster said:
Anybody have any idea on the duration of the loss of rents coverage? I can't imagine it going for five years out. I remember that once it became obvious to the insurance companies that Silverstein was going to claim two occurences, the insurerers held out on paying the rent loss policy, because they knew they'd just be funding his lawsuit.
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I don't recall anything specific about business interruption insurance (which would typically include loss of rent) on the WTC buildings, and I don't recall anything specific about them having such coverage, but it would make sense. The length of business interruption coverage would depend upon the specific language in the policies. Given that nobody would have predicted or anticipated the total collapse of the buildings, though, I would doubt that a prescribed period would be more than a year or two at most, subject to contingencies such as debris removal, access being denied due to safety issues or civil authorities, etc. (And I vaguely recall some issue about a prescribed time period in some of the policies relating to the WTC buildings but, again, I don't recall the details). However, if the language was such that it includes business interruption losses until the premises can be repaired or replaced, for instance, who knows how long it could go on? Obviously, the policyholder and the insurer will have differing views on this.

Another research project, it seems, for someone willing and able to take it on.

JonnyFive? This seems to be up your alley. What do you say? :)


(As an aside, there were probably thousands of business interruption claims by tenants in all of the WTC buildings as well - surely billions of dollars involved there, as well, for the tenants. When all is said and done, the WTC terrorist attacks probably rank among the top 10 incidents of all time for impact upon the insurance industry - and probably the largest insured loss of all time - but insurance professionals can correct me on this, of course, if I'm wrong.)
 
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Brainster said:
Anybody have any idea on the duration of the loss of rents coverage? I can't imagine it going for five years out. I remember that once it became obvious to the insurance companies that Silverstein was going to claim two occurences, the insurerers held out on paying the rent loss policy, because they knew they'd just be funding his lawsuit.
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Sorry for the slight derail. Yesterday I saw an item on CNN International about the first beams being placed for the Freedom Tower. The new WTC7 is still about half empty. I wonder who'll Siverstein get to occupy the Freedom Tower. I can't imagine him ever getting full rent.
 
LashL said:
I don't recall anything specific about business interruption insurance (which would typically include loss of rent) on the WTC buildings, and I don't recall anything specific about them having such coverage, but it would make sense.
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Good to see that you joined the thread LashL, you have a better knack for digging up the specifics than I do.

I agree on the Business Interruption (BI) insurance, given the shutdown of the buildings after the 1993 attacks most if not all of the tenants, as well as Silverstein, should have purchased BI cover after that. I don't know much about BI and the limits to the time of interruption but JonnyFive is an underwriter, maybe he has some idea?
 
Some reasons why it could be insurance fraud.

Once the 9-11 event happened all insurance companies changed rules slightly.
Example in my business as a private contractor requiring liability insurance suddenly all types of claims were now considered acts of terrorism from the destruction of my equipment and damage to property to being beaten upon the job of which there is a good chance being a cleaning contract in a casino hotel.

Also It is widely understood that the Trade center was in a highly unstable condition and that it was to be emptied of tenants and demolision begun by 2007. This could not be achieved by implosion but had to be done manually brick by brick.
The cost fo the scaffolding alone was apparently going to cost more to erect than the building was worth.
As a small business owner these changes has all but destryed any claims I may have but I still hae to pay the premiums.

cheers.
 
Wizentub said:
Also It is widely understood that the Trade center was in a highly unstable condition and that it was to be emptied of tenants and demolision begun by 2007. This could not be achieved by implosion but had to be done manually brick by brick.
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Yes, and I hear they had to say "clunkety clunk" every time they removed a brick. Fortunately, this did not take them long.
 
Wizentub said:
Once the 9-11 event happened all insurance companies changed rules slightly.
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First, welcome, Wizentub.

Second, your post appears to be nonsensical on its face, with perhaps the exception of the first sentence - but even that sentence lacks any specificity, so you'll have to elaborate on that one as well.

Third, in this forum, if you are going to make such claims, you're going to have to bring some evidence to support your assertions.

Example in my business as a private contractor requiring liability insurance suddenly all types of claims were now considered acts of terrorism from the destruction of my equipment and damage to property to being beaten upon the job of which there is a good chance being a cleaning contract in a casino hotel.
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Please provide evidence that "all types of claims were now considered acts of terrorism". I find this assertion preposterous.

Also It is widely understood that the Trade center was in a highly unstable condition and that it was to be emptied of tenants and demolision begun by 2007. This could not be achieved by implosion but had to be done manually brick by brick.
The cost fo the scaffolding alone was apparently going to cost more to erect than the building was worth.
As a small business owner these changes has all but destryed any claims I may have but I still hae to pay the premiums.
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I find these assertions equally preposterous.

Frankly, I find all of the assertions you've made in your post outlandish and extraordinary.

And, as I'm sure you know, extraordinary claims require extraordinary proof. Please get started.
 
TriangleMan said:
I don't know much about BI and the limits to the time of interruption but JonnyFive is an underwriter, maybe he has some idea?
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Yes, that's what I was thinking too, that JonnyFive might have some very good insight on the topic given his underwriting experience. It will be excellent to have his input, perspective, and knowledge to add to the great resources here.
 
Hi Wizentub!

Hi!

(Your post was a joke, wasn't it?)
 
Wizentub said:
Also It is widely understood that the Trade center was in a highly unstable condition and that it was to be emptied of tenants and demolision begun by 2007. This could not be achieved by implosion but had to be done manually brick by brick.
The cost fo the scaffolding alone was apparently going to cost more to erect than the building was worth.
As a small business owner these changes has all but destryed any claims I may have but I still hae to pay the premiums.

cheers.
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Definately satire...and did make I laugh ('specially to 110 storey scaffold :D)
 
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