Insurance Coverage Blog

Despite the fact that anti-concurrent cause language has been around for quite a few years, if you go looking for the Anti-Concurrent Philosophy Library, you won't find it -- you'd be lucky to find enough to make up a slim book, much less a library or even a shelf in a library.  In other words, as with many insurance coverage issues, there is a great deal of room for scholarly examination.  You might have noticed the same thing I have -- when you research just about any tough question, it's not hard to find stuff that appears to be about the subject, but when you drill down into it, most of what you find is surface area with no core underneath.  The emphasis in the mass of legal literature on discovering what courts do -- the search for rules -- is often a chimera because, and I say this without rancor, courts often don't know why they do what they do.  They have to do something so they do it.

Anti-concurrent cause theory is just one example of how a lack of philosophical inquiry and lack of curiosity as to "why" can harm the debate.  If you recall, during Hurricane Katrina litigation, anti-concurrent cause became politicized in large part because there was a very imperfect understanding of what anti-concurrent language was, what it does or why it exists.  That lack of understanding continues today: witness this editorial from Wednesday's USA Today.  While I generally agree with the main thrust of the editorial -- that proposals to "fix" the National Flood Insurance Program by increasing moral hazard and expanding the size of the program are utter folly -- I'm suspicious of the depth of understanding of the writers based on these sentences about seven-eights of the way through the article:

Backers of the wind-damage proposal do have one thing right.  Private insurers should not be able to lull people into believing they are covered for hurricanes and then try to dump all the claims on the government.  That's what some insurers did in 2005. 

Such bait-and-switch tactics could be handled with smarter regulation. Or, better yet, by the government getting out of the flood insurance business and leaving the issuance of policies to the private sector. 

Huh? Where are these guys getting their information, from the Third Book of Scruggs, Chapter 7, Verse 36?  If you're going to go with the faux populism, at least try to use a line that hasn't been totally discredited.  Bait and switch?  This issue has been tried in court, and found wanting -- the "bait and switch" argument is as mythological as that photo of Sarah Palin with a dead Bigfoot she  shot.  These folks are behind the times -- they probably walk into a drugstore and wonder why there are no bottles of laudanum on the shelf, they're probably sitting around in rocking chairs emitting some Grandpa Simpson-like rant about why the milk wagon is always late, they're probably trying to figure out how to play CD's on their Victrolas.  

Which brings me to the question in the headline on this post.  You may recall some time ago I wrote this post about an anti-concurrent cause case in the Colorado Court of Appeals that had cited my work and theory on anti-concurrent cause -- Colorado Intergovernmental Risk Sharing Agency v. Northfield.  (I see the link to the case has gone bad in the post, here's another better link.) A roof on a building collapsed.  At trial, a jury said the damage was 90 percent attributable to the weight of snow on the roof, and 10 percent to rot caused by humidity from a swimming pool.  Damage caused by snow is a covered cause, rot is uncovered.  Therefore, potentially, this is a classic case for consideration of an anti-concurrent cause clause -- if the two causes resulted in the very same damage and that damage would not have happened but for the combination of the two forces.  Remember, I said potentially.

The Court of Appeals looked at the damage as being one loss, caused by a concurrent of the two forces.  Since one was uncovered, the anti-concurrent cause language made the entire loss uncovered, the court said.  However, the losing party in the appeal, CISRA, filed a petition for rehearing before the full Court of Appeals (a unanimous three-judge panel decided the case earlier).  It's been a number of weeks since the petition, and the court has yet to accept or reject the petition, but the fact that it has not rejected it yet might be a favorable sign for CISRA that the justices are seriously considering taking another look at the case. 

The petition for rehearing, which you can see here, comes up with a good argument -- did the weight of the snow (a covered cause) actually combine with the rot (an uncovered cause) to result in the loss, or were they two separate forces causing separate damage?   This is the very question I asked regarding Katrina damage, and the answer I came up with, which is now pretty well accepted, was that uncovered flood and covered wind had not acted concurrently in Katrina damage and therefore anti-concurrent language was not implicated at all.  This petition for rehearing is pretty shrewd in driving for the same point -- it says that the jury verdict and the evidence at trial were only that two independent causes resulted in different property damage.  I call this shrewd, because if you are going to fight anti-concurrent cause, you don't win by weighing yourself down with bogus arguments about "bait-and-switch" and such amateur theatrics.  That's like going into combat carrying an 80-pound cast iron kettle in your arms instead of a battle-ax.   Taking on anti-concurrent language as ambiguous or the like is, in my view, often not the best course. Instead, working within the framework I have explained is the best way to have a sophisticated, informed debate, and this petition does so.

Essentially, the petition considers the concept of "loss,"  which in the analysis I advocate, is the first step.  If you can find two losses, you can find a way to argue that anti-concurrent cause does not apply.  If you can find only one loss, it's much harder, because then you have to try to peg the covered cause with 100 percent of the loss, and that is a harder row to hoe -- many anti-concurrent cause clauses explicitly say any combination of covered and uncovered causes (theoretically 99 percent versus 1 percent) results in non-coverage.  So again, it's vital to find different losses caused by separate forces acting independently and not concurrently. 

Does this petition for rehearing do a good job of that?  I think yes.  The facts of this case are more involved than I gathered upon just a reading of the Court of Appeals decision.  Whether this will convince the Court of Appeals to rehear the case or not, or to reverse it upon rehearing, I don't know.  It is a very sophisticated argument, though.  One component of the argument, it seems to me, is somewhat different than just looking for two separate causes of loss, it ventures into uncharted territory -- if a covered cause was sufficient in and of itself to cause the damage, can it truly be said the two causes contributed to the loss.  To use an extreme example, does it matter if a garage was weakened by rot if it is blown into toothpicks by a falling meteorite? Could the rot be said to be a concurrent cause of the loss in any meaningful sense?  I think if we ask for a show of hands or commission a Gallup poll, most people will say no.  So my question is this: if the weight of the snow on the roof would have caused its collapse regardless of the presence of rot, is the rot a concurrent cause?  Just asking.  Seems to me if the Court of Appeals takes up that issue, there is some new ground to be broken. 

David, excellent article! It's amazing how this issue has apparently never been properly addressed.

Hi there,

I tried contacting you a while but never received a response, can you please email me so we can discuss my proposal?

Thanks

If the weight of the snow would have caused the roof to collapse irrespective of the rot, then the rot is not a cause of the loss. "Uncovered cause" in that situation becomes something like an oxymoron. The snow is the cause. The rot is a condition of the roof having no relationship to the cause of the collapse. And, that would also help us answer the question posed in your headline: if it's not a cause of the loss, then there's no relevance to asking whether or not there's coverage for it (it would be like saying your roof collapsed because of heavy snow, which is covered, and oh, by the way, your policy doesn't cover mold. So what?) ... So, am I right? If my assessment isn't correct, please tell me why.... This stuff drives me nuts!!

David,

Good points here and 100% correct. The problem HO lawyers have wit concuurent cause is taht it allows insurer to always have a defense even when it is clera that the lose is almost completely caused by covered claim. I have been waiting for act of God concurrent agrument alleging everything is partly act of God...It is good for business though, so tell them thanks for me

"...if a covered cause was sufficient in and of itself to cause the damage, can it truly be said the two causes contributed to the loss."

Seems to me the answer is no. The meteorite scenario works for me. It reminds me of the old pollution exclusion scenario: if a huge oil tank ruptures and a wave of oil comes out and drowns someone, they didn't die because of "bodily injury resulting from the discharge, dispersal, release or escape of pollutants." They would've been killed by *any* liquid. The fact that it was oil is irrelevant. Thus, the PE is inapplicable.

Problem is that most cases are going to be less obvious than that. How do you really know if the rot in the roof contributed in a more conventional "weight of the snow" scenario? Expert opinion, right?

I have fought these battles for 30 years, including as the trial lawyer Garvey v. State Farm. A cause, concurrent or not, has to be at least a substantial factor in creating the loss to count at all. The rot in the meteor example was not a substantial factor-it would be no factor at all. I strongly suspect the rot was a crucial factor in the Colorado case, but I agree that if the excluded peril isn't proximate-however defined by state law-it becomes irrelvant. This is a proof issue, not a policy interpretation issue. I don't think most insurance companies deny claims because an excluded peril exists in the world. The excluded peril must operate in some fashion to actually cause the loss to occur. I have never represented an insurer who would argue that simply because an earthquake occurred on the same day as a windstorm, that a windstorm loss could be excluded because an earthquake coincidentally occurred.

Would this not fall into the same categories as Katrina and how many people that were insured were denied because many times it was determined that flood waters destroyed the house not the hurricane. I agree in this circumstance I think the hurricane coverage should kick in and a claim not be denied because there was flooding.

Bingo! It's a proof issue, not a contractual interpretation issue. Ditto wind vs. water in Mississippi after Katrina, and hence the settlements by all carriers on a case-by-case basis (and their denials of coverage, case-by-case). The average layman could understand this easily were it not for the Scruggs-type press conferences deliberately confusing the coverage issue with the proof issue, for one purpose: money in the pocket of counsel for the plaintiff. And if counsel for the plaintiff loses the first nine, maybe there will be a windfall on the tenth. But who's looking after the first nine policyholders -- the ones who recover nothing? No one. They go home empty handed.

David,

Any comment forth-coming on the Homeland Security report out today that clears insurers of Katrina wrong-doing vis-a-vis misusing NFIP payments to pay for wind damage?

Update on the Federal report re: insurers pushing claims from homeowners to flood policy please?

David,

Any news on what the Grand Jury is doing way down yonder in Mississippi, if anything, regarding Scruggs et al.

The best notion of anti-concurrency is found in the volcanic islands, both US and British Virgin Islands, but many more. On islands such as these, hurricanic activity devolves from the sea and the wind and is thrust simultaneously against rocks upon which houses and building structures exist. There is no surge of water, because islands that are a few miles long and a few miles wide, have almost no tide. The water and wind from hurricanes will always enter the islands of the US and British territories at the instant of where water and wind meet rocky land. The notion that there is a reasonable difference between the impact of wind and that of water upon which an island catches a mix of wind and water is like hyperkinetic energy - the energy of motion. When the hurricane hunters find the eye of a hurricane is it an "anti-concurrent" convolution of cause that the kinetic energy of wind and water circles the eye? I think a rule of causation is like the missing part of a doughnut, the hole, which circles the sugar of reason, and the kinetic energy of wind and water is the energy it possess in the fact of outside motion and inner motionless, but all because of motion. The Antilles islands have nothing but simultaneous wind and water, but the kinetics shows how a failure to communicate the obvious is so obvious. And in the bulls___ of "anti-concurrent" language fails like AIG. Perhaps "anti concurrent death rays" seriously killed AIG.

I don't belive that insruance cover all financial loss. Only a part of the loss could be covered by them. The other part should be suffered by the person who got loss or damage.

Insurance

PEople just always blame everyone and do not think of their responsbility or liability

David:

Are you still in business? I don't see a "closed" sign here, but your lack of posting would seem to indicate that you have closed up shop.

How soon before we get the 404 response?

On a separate issue, the MS DOI published their Conduct Investigation findings. The link below is to a National Underwriter article about it.

http://www.propertyandcasualtyinsurancenews.com/cms/nupc/Breaking+News/2008/10/30-SFMISS-mr

Just thought some might be interested.

David is also on the Advisory Board of the LexisNexis Insurance Law Center and he contributes there as well. Although I don't think I have seen anything recent from him there either...

I hope you are well, and just busy supporting your family/practice.

The suspense is killin' us. What happened?