Insurance Coverage Disputes

The insured found us through this web site. He operated a northern Ohio chinchilla farm, and hundreds of his animals had died when the power went out to one of the buildings where the chinchillas were housed, causing the animals to suffocate from lack of ventilation. He had called in the claim to his insurer and it had only taken them two days to deny the claim because there was ostensibly no proof the power interruption was caused by a mechanical malfunction — the only arguable covered cause of loss. Rutter & Russin hired an electrician and an engineer, who pinpointed the cause of loss as a defective wire, which caused a motor to short out — a mechanical malfunction. The insurer finally accepted this conclusion, but then argued that the policy limited coverage for farm animals to $5,000. Once again, Rutter & Russin proved them wrong, and the insurer ended up paying its $100,000 policy limits.

The story was splashed across the front page of the local paper — an employee of a nursing home had confessed to sexually abusing several elderly and incapacitated patients. The relatives of the abused patients were understandably upset, and sued the nursing home, which turned to its insurance carrier for protection. The insurance company, however, also filed suit against the nursing home, asserting that its policies did not cover sexual abuse. Not knowing where to turn, the owner of the nursing home came to us. Rutter & Russin challenged the insurance company's coverage position, eventually resulting in a settlement that resolved all claims against the nursing home.

A Fortune 500 company needed coverage help when its medical excess insurer refused to reimburse it for over $500,000 in medical bills resulting from the hospital stays of two badly injured employees. Rutter & Russin filed suit in federal court, and, following several lengthy depositions of the involved parties, convinced the insurance company to honor the vast majority of the claim.

An employee of a bank erroneously authorized the deposit of millions of dollars worth of checks into an unauthorized account. It was forced to reimburse its customer for the loss, and then turned to its fidelity insurer for reimbursement. When the carrier refused, cited certain technical defenses, Rutter & Russin filed suit and forced a settlement favorable to the bank.

A hotel in Tennessee suffered a major fire. The hotel owner did not have a fire sprinkler system, and never had. However, the policy required, as a condition of coverage, that the insured "maintain" a sprinkler system. Consequently, the insurer refused to pay the claim until Rutter & Russin became involved. We resolved this case for full value by convincing the insurance company that, as a matter of policy interpretation, the insured could not "maintain" what it did not have.