Case: Lopez v. Allstate Fire & Cas. Ins. Co., 2015 U.S. Dist. LEXIS 144823 (S.D. Fla. Oct. 26, 2015)
Background:
The plaintiffs brought this third-party auto insurance bad faith action against Defendant Allstate Fire and Casualty Insurance Company (“Allstate”) for its allegedly unreasonable failure to settle claims made against Allstate’s insured, Michelle Soto, resulting in an excess judgment against Ms. Soto.
On September 6, 2011, Ms. Soto lost control of her vehicle and crashed into a bus stop bench where Giraldo Lopez and his wife, Magaly Nunez Delgado were waiting. Ms. Soto’s vehicle hit Giraldo Lopez, killing him at the scene. Mrs. Nunez Delgado witnessed the accident from only a few feet away. Ms. Soto reported the accident to Allstate on September 7, 2011. As of that afternoon, Allstate had concluded that Ms. Soto was liable for the accident and that the value of the liability claim for the fatality of Mr. Lopez likely exceeded the $25,000 per person bodily injury liability limits.
On September 8, 2011, Allstate sent a letter to Ms. Soto in reference to the accident. It stated, “The bodily injury liability limits section of your policy…provides coverage up to $25,000 per person and $50,000 per accident. The value of the bodily injury claim(s) of Giraldo Lopez appears to exceed the limits under your policy.” It further stated that “the damages appear to exceed your policy limits and you face personal exposure for liability for any damages above your insurance protection,” and that, “A jury could determine that you are liable for all or a part of medical bills and funeral costs to date, certain damages to the Estate of the decedent and any pain and suffering or lost support for qualified survivors.” Finally, the letter read, “We will make every effort to settle this case within your insurance network coverage in exchange for a full and final release of all claims. However, if the case cannot be resolved within your policy limits, you may consider contribution of your own funds to resolve the matter and avoid an excess judgment.” The letter made no specific mention of personal injury protection (“PIP”) benefits available under the Policy.
Insurance Expert Witness:
Mr. Dinsmore, an insurance expert witness, has worked in the insurance industry in various capacities for over 24 years and has 16 years of insurance litigation experience. He had worked as a field claims representative, claims specialist, special disaster supervisor, agent, independent adjuster, and general adjuster for insurance companies such as State Farm Group, Prudential of America Group, The Lumbermens Mutual Insurance Co., and United Services Automobile Association. Mr. Dinsmore then obtained a law degree before spending the next 15 years doing consulting work for insurance companies.
Mr. Dinsmore opined as to whether Defendant met industry standards in its claims handling; as to the type of policy at issue; and as to whether Allstate’s insurance adjusters and claims managers met their duties to investigate, evaluate, communicate, and settle within policy limits when doing so is possible and is in their insured’s interest. Mr. Dinsmore specifically opined that Allstate should have tendered the full policy limits — both the bodily injury limits and the PIP limits — in order to protect its insured from an excess judgment.
Daubert Challenge:
Defendant sought to preclude Mr. Dinsmore from testifying specifically regarding Plaintiffs’ claims for PIP benefits and Allstate’s handling of those claims. Defendant argued that Mr. Dinsmore was not qualified to testify competently regarding Allstate’s handling of Plaintiffs’ PIP claims; that Mr. Dinsmore’s opinions regarding Allstate’s handling of Plaintiffs’ PIP claims were unreliable; and that Mr. Disnmore’s testimony regarding Allstate’s handling of Plaintiff’s PIP claims would not assist the trier of fact.
Allstate argued that Mr. Disnmore should not be permitted to opine on Allstate’s handling of Plaintiffs’ PIP claims because, while he is experienced in the insurance claims handling industry generally, he has limited experience handling Florida PIP claims specifically and is not knowledgeable regarding the applicable standards for handling Florida PIP claims.
Allstate argued that Mr. Dinsmore’s opinions regarding Allstate’s handling of PIP claims in this case are unreliable because Mr. Dinsmore lacked experience and knowledge regarding PIP claims in Florida, and because Mr. Dinsmore failed to consider components of Florida’s PIP statute. More specifically, Allstate argued that Mr. Dinsmore’s “testimony infers that PIP claims are governed by the same standards as bodily injury liability claims.”
Finally, Allstate argued that Mr. Dinsmore’s opinions regarding personal injury protection would not assist the jury because Ms. Nunez-Delgado’s claim for PIP benefits was a first-party claim against Allstate pursuant to the insurance policy, whereas the instant case is for common law bad faith against Allstate arising out of Allstate’s handling of the bodily injury liability claims against Allstate’s insured, Ms. Soto. In other words, Allstate argued that its “handling of the PIP claims has no bearing on the handling of the bodily injury liability claims and, therefore, is not part of the totality of the circumstances” the jury will consider in determining whether Allstate acted in bad faith.
Conclusion:
The Court granted Defendant’s motion in part, and denied it in part. The Court believed that the insurance expert witness’s opinions were admissible, except to the extent that he opined on the applicable law in this case, or his perceptions about empathy, zealousness, passion, emotion, antagonism, vexatiousness, and familiarity of the parties and their actions.
The Court first noted that a witness may be qualified as an expert by scientific training, education, or experience in a pertinent field or occupation. United States v. Frazier, 387 F.3d 1244, 1261 (11th Cir. 2004). In the Court’s eyes, Mr. Dinsmore was qualified to provide expert opinions on insurance industry standards and practices by his more than 40 years of professional experience within the insurance industry. Mr. Dinsmore had been employed as an insurance adjustor, agent, supervisor and consultant for numerous nationally prominent insurance companies. He had handled claims arising from all types of insurance policies, including bodily injury claims arising under automobile policies and catastrophic claims. Mr. Dinsmore also handled PIP claims in Florida, though only on severe claims, and on a limited basis (less than 100). At various times, Mr. Dinsmore had been licensed as an insurance adjustor in five states, including Florida, and has held numerous licenses for the State of Florida (General Lines, All-Lines, and Insurance Agent). Mr. Dinsmore held an Associate in Claims (“AIC”) designation from the Insurance Institute of America (“IIA”) as well as designations as a Casualty Claims Law Associate (“CCLA”) and Property Claim Law Associate (“PCLA”). Mr. Dinsmore, a licensed lawyer, had also taught courses in insurance and bad faith, and had published articles in these areas. The Court found this experience to be more than adequate to qualify Mr. Dinsmore as an expert in insurance industry claims handling standards.
Defendant nevertheless argued that Mr. Dinsmore’s experience in handling PIP claims specifically is insufficient to qualify him to opine on Allstate’s handling of Plaintiffs’ PIP claims in this case. The Court disagreed. Mr. Dinsmore’s opinion was that Allstate should have, under the circumstances presented, included the available PIP benefits in its settlement offers so as to protect its insured from an excess judgment. Mr. Dinsmore did not opine on whether Plaintiffs complied with all the requirements under Florida PIP law for obtaining PIP benefits. In other words, Mr. Dinsmore’s expert opinion is that Allstate should have handled Plaintiffs’ claims as a global settlement opportunity, rather than treat the bodily injury claim in a manner entirely divorced from the PIP claims, under the circumstances of which Allstate was aware. The Court found that Mr. Dinsmore’s experience with adjusting severe claims involving PIP benefits was adequate to admit his expert opinions, and that the defendant could address any deficiencies it perceived in Mr. Dinsmore’s experience through cross-examination and the presentation of contrary evidence.
As to the reliability of his methods – Mr. Dinsmore was not opining on whether Plaintiffs or Defendant complied with Florida PIP statutes, but rather, on whether, under the circumstances known or capable of being known, Allstate met its duty of good faith to its insured when it treated Plaintiffs’ demand for the full $65,000 available policy limits as two separate claims for bodily injury limits and PIP limits, and required Plaintiffs to submit certain PIP-related paperwork, rather than considering the opportunity for a global settlement. Mr. Dinsmore’s methodology for opining on this subject matter was sufficiently reliable. He identified industry standards for claims handling based on his extensive experience working within the insurance industry, as detailed above, and based on his review of applicable laws, regulations, publications, and manuals, and applied those standards to the case at bar after reviewing the claims file.
The Court did, however, agree with Defendant that some of Mr. Dinsmore’s proffered opinions were not helpful to the jury because the jury is capable of discerning those facts for themselves. Under Daubert, Expert testimony is admissible only if it concerns matters that are beyond the understanding of the average lay person. Some of the opinions the Court determined to be inadmissible were those Dinsmore made regarding his feelings on how Allstate’s dealings with Ms. Soto were impersonal, as well as the zealousness of the plaintiff’s attorney’s deposition. The Court found that these opinions did not rely on Mr. Dinsmore’s expertise and were among the factual determinations that the jury was capable of making without an expert’s assistance. Moreover, to the extent that Mr. Dinsmore sought to opine on the standard for bad faith in Florida, those opinions were excluded because the Court alone is tasked with instructing the jury as to the applicable law, not a witness.
About the author
Michael Morgenstern
Michael is Senior Vice President of Marketing at The Expert Institute. Michael oversees every aspect of The Expert Institute’s marketing strategy including SEO, PPC, marketing automation, email marketing, content development, analytics, and branding.
