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David Smith specializes in insurance coverage law, focusing on insurance claim preparation and presentation.   Mr. Smith also works on the negotiation of insurance claims and disputes on behalf of policyholders. Additionally, Mr. Smith works with the firm's insurance coverage attorneys in the areas of insurance industry policy drafting history, industry interpretation, and coverage intent. He also specializes in the identification and analysis of client's insurance policies that may provide coverage for a loss. This includes insurance archaeology - the piecing together of secondary evidence of lost policies to reconstruct historical records of clients' insurance programs.

Self-driving cars are coming.  In fact, Tesla Model S owners woke up on the morning of October 15, 2015 to discover that a software download to the cars has made them capable of steering and changing lanes at high speed, slowing and stopping, and self-parking, in “Autopilot” mode.  The future is now, and self-driving cars bring with them a host of unanswered questions relating to safety, liability, and the insurance for protecting against liability.

Over the next few months we’re going to produce a series of articles looking at issues affecting insurance raised by autonomous vehicles, and how those issues may develop and change as the degree of autonomy – and the number and types of autonomous vehicles on the roads – grows.  For many years the insurance industry has been a prime mover in the field of vehicle safety.  One of the main concepts behind the drive to develop autonomous vehicles is to reduce crashes, particularly ones that result in serious injury.  95% of fatalities from car crashes result from human error.  How will the insurance industry keep up, and how will it adapt to the changing scenarios?

Continue Reading Autonomous Vehicles – Where in the (Insurance) World Will They Go?

Last weekend’s Napa earthquake served as a wake-up call for everyone living and working in the Greater Bay Area. As with all natural disasters, after the immediate clean-up is over the analysis will begin as to how to make buildings safer and how to prevent and minimize injuries and damage.

But if you have a business that was affected by the earthquake, now is the time to be looking at your insurance policies, even while you are still sweeping up the debris and are wondering what the extent of the damage is.

If you have earthquake coverage, your insurance company can be an important resource. Insurers have experience handling disasters of all types. They have a large pool of consultants and experts who can help minimize the effect of the earthquake on your business – by providing resources to help with clean-up, estimating the extent of the damage, finding contractors quickly, and generally helping you through the crisis period.

However, insurance companies don’t know your business or your premises nearly as well as you do. Insurance adjusters – particularly in times of disasters when they are flooded with claims – will sometimes try to impose “cookie-cutter” solutions on unique situations. This could be especially true in the Wine Country, given the unique nature of the items damaged, such as historic buildings or high-quality wine. An area such as Napa, replete with wineries and specialty boutiques, restaurants and businesses, is ripe for coverage disputes over the value of damaged property, even after the scope of the damage has been agreed.

Continue Reading The Napa Earthquake – The Time To Think About Insurance Coverage Is Now

I recently came upon an interesting case from the United States Court of Appeals for the First Circuit that examined the complex and confusing Commercial General Liability (CGL) “business risk” exclusions. Oxford Aviation, Inc. et al. v. Global Aerospace, Inc., 680 F.3d 85 (1st Cir. 2012) These exclusions were written to restrict coverage for claims relating to the repair or replacement of the insured’s faulty work or products, or defects in the insured’s work or products. They are frequently misread or misunderstood, particularly by claims adjusters who tend to see them as absolute bars to coverage for claims involving any damage to an insured’s work.

An aircraft owner (Airlarr) sued an aircraft repairer, Oxford Aviation, Inc., alleging negligent and faulty performance. Airlarr claimed that Oxford’s work on one of its planes left it with uncomfortable seats, leaking fuel injectors and a cracked turbocharger and a window that cracked when the plane was being flown back to Airlarr’s base from Oxford’s premises.

Oxford’s insurer, Global Aerospace, denied Oxford’s claim for a defense to the lawsuit based on the business risks exclusions. Oxford sued Global Aerospace for declaratory relief. Both parties filed for summary judgment on the duty to defend issue. The trial court granted Global Aerospace’s motion, holding that the claims fell within the exclusions. Oxford appealed.

Continue Reading The CGL “Business Risk” Exclusions

Despite the financial and economic turmoil of the last several years – both nationally and globally – the insurance market has remained remarkably stable.  There have been surprisingly few insurance company failures, and premiums have remained at worst flat, and in most cases have seen year on year decreases.

As explained in a prior article I wrote, the soft market was largely the result of long term excess capacity in the market place – meaning insurers had to compete hard against each other to get clients’ business.  Another factor was the reinsurance market – the mechanism by which insurance companies insure the risks they take on and spread risk to a much wider pool.  For a number of years reinsurers have enjoyed relatively easy years, and have seen relatively few major catastrophic losses.

Continue Reading A Look at Pricing Trends in the Insurance and Reinsurance Industries

The tragic events in Japan serve as a reminder of how fragile our lives and societies are.  Businesses too can be fragile, and can be easily disrupted by events completely outside of our control.  That’s one of the rationales behind commercial insurance.

A little over a year ago, I wrote about the complexities and challenges of both purchasing, and making a claim on, business interruption insurance. (Business Interruption Coverage – 2/18/10)  Because many US companies will be either directly or indirectly affected by the devastation in Japan, this is a good time to revisit that topic. Continue Reading Japan’s Tragedy A Reminder To Review Your Business Interruption Coverage

The world is still in a state of financial flux.  Yet during a period in which a couple of well known insurers (Kemper; Atlantic Mutual) finally hit insolvency and the biggest name of all, AIG, had to be bailed out by the US Government, the insurance market is in some ways actually surprisingly stable.
Not that the carriers necessarily like it – despite the general financial turmoil, the insurance soft market is continuing, and some industry insiders wonder whether it’s here to stay.  Even conservative predictions think that the soft market will continue for two to three more years.

Worldwide interest rates are still at all-time lows, and the financial markets need to invest in something with a good rate of return.  For some time the large financial markets have seen the insurance industry as a safe bet with stable profits.  So they are pumping money into insurance companies and as a result the insurance industry’s policyholder surplus is at a record high.

Policyholder surplus is one of the measures of an insurer’s financial health, and one of the benchmarks that control the insurance market.  Put (very) simply, regulations control the ratio between an insurer’s assets and the total value of insurance it is allowed to write.  When an insurer has a large surplus, it can write more insurance.  When the entire industry has a large surplus, supply outweighs demand, and a soft market develops.

This has also been fueled by the downturn in the business climate.  There are fewer insureds being courted by an increased number of carriers needing to write more insurance.  Because supply is high and demand is low, premiums get cheaper.  In previous soft markets, this condition has self regulated over time – lower premiums lead to smaller profits, investment income slows down, capacity is reduced, and premiums rise.  And so the cycle reverses.  However, policyholder surplus has now been rising steadily since the early 1990s and shows no sign of stopping.  That means that the market is staying soft, probably for a long time to come.  You should note that of course an individual insured’s claims history and each sector’s overall claims experience will still affect premiums to a degree.

A recent report from the Council of Insurance Agents & Brokers notes that renewal premium rates declined on average 5.2% in the third quarter of the year, compared with a 6.2% decline in the second quarter.  The decline in renewal premium rates has hovered around the 5% marks since the middle of 2009.

Helping sustain the soft market is that this year has seen a lower than average number of US weather related catastrophes – traditionally an area of significant losses.  There is now so much surplus that some reinsurers think it will take a big bang event (a $50 billion or greater loss) to reverse the soft market.  Reinsurance rates are expected to continue to drift downward unless (or until) that big bang event occurs. 

The winners of this scenario are the insureds, especially those with good risk management programs and good claims records.  Generally speaking, premiums are so low that they are probably cannot go down much more – some sectors are at extreme lows.  But insureds still have a very strong bargaining position for other benefits – claims handling agreements; additional coverages; risk management partnerships, etc.  Carriers need to find a way to differentiate their product from that of the competition and so they are willing to compete on terms and conditions, as well as price.  It’s definitely a buyer’s market, and so insureds can pick and choose who they want as their insurance and risk management partners.

But a word of warning for insureds:  this glut of surplus itself carries risk.  Enabled by large amounts of surplus and trying to make profits despite lower premium and fewer accounts written, some carriers are retaining more of the risks they underwrite instead of laying it off to reinsurance.  A significant loss could wipe out such a carrier.  So choose your insurer carefully, and don’t be afraid to do some research on a prospective insurer’s financial health, marketing and underwriting philosophies, etc.

And of course, there are exceptions to every rule.  In particular, not all is well with Worker’s Compensation insurance in California.  In part because of the weak job market, some workers are staying on compensation benefits longer.  This is because there are fewer opportunities for injured workers to move to less demanding jobs.  With unemployment high and fewer jobs in the state, the carriers are taking in less premium money.  Medical costs continue their inexorable upwards march, and as a result Workers Compensation rates are starting to rise once again.

Check that policy (and endorsement) wording carefully

Pennsylvania General Insurance Co. v. American Safety Indemnity Co., 185 Cal. App. 4th 1515 (2010)

In 1995, the California Supreme Court held in Montrose Chemical Corp. v. Admiral Ins. Co., 10 Cal. 4th 645 (1995) *(“Montrose II”) that in cases of continuing damage, all liability policies from the time the damage started occurring until the time that the insured’s liability for that damage was determined were potentially implicated.  From a defense perspective, that meant that all liability policies from the time the damage potentially started to occur had to defend the insured, since the duty to defend is broader than the duty to indemnify, and a policy must defend if there is any possibility that the claim is covered, even if it is subsequently shown not to be.

The insurance industry had fought hard against the concept of the “continuous trigger” of coverage, and although Montrose II was a pollution clean-up case, insurers recognized that construction defect cases would also be impacted by the Court’s holding on continuous damage.  For example, insurers wanted to restrict a case of defective window flashing or a leaky roof to just one occurrence, and policies issued subsequent to the defective work, or at most subsequent to the first leak, should not be triggered.  Insureds, on the other hand, wanted to benefit from the availability of its subsequent policies’ limits.

The insurance industry quickly launched what became known as “Montrose endorsements.”  These endorsements attempted to limit insurers’ liability to those policies in force at the time any continuing damage first started to occur or was discovered.  Other insurers incorporated such concepts into the insuring clause itself.  However, while generally speaking most endorsements are drafted by an insurance rating organization (the biggest being ISO), many insurers wrote their own Montrose endorsements or modified insuring clause provisions.  The effect of this was that there was no standard language used, and one carrier’s endorsement could have different wording to that used by other carriers. 

In Pennsylvania General Insurance Co. v. American Safety Indemnity Co., 185 Cal. App. 4th 1515 (2010), American Safety argued that its version of the Montrose endorsement had two triggers—a causal event or “occurrence” trigger and a “property damage” trigger, both of which needed to occur within the policy period.  The effect of this could be devastating for a contractor – if all his policies had this wording and if the damage didn’t occur until after the end of the policy period, he would have no coverage at all since the defective workmanship and the damage would occur in separate policy periods.

Recognizing that California courts had generally interpreted the trigger to be based on the timing of property damage rather than the timing of the insured’s conduct, the Court held that the American Safety wording did not clearly and unambiguously depart from this rule.  The Court, while recognizing American Safety’s intention to circumvent the continuous trigger of coverage rule laid down in Montrose II, ruled that the language and clause construction in its endorsement was defective.  American Safety’s endorsement purported to limit when covered property happened, but did so in the same paragraph of the endorsement that changed the definition of “occurrence.”  The end result was ambiguous.  American Safety at 1526-27.

The court noted that, while the first sentence of the modified “occurrence” definition did not specifically incorporate the word “property damage,” the second stated that property damage starting prior to the policy period would not be deemed to occur during the policy period.  This implied that as in CGL policies generally, it was the property damage, not the causal act, which must first occur during the policy period.  Id. at 1527.

The court also noted that the title of the endorsement at issue was “Pre-Existing Injury or Damage Exclusion,” not “Pre-existing Causal Conduct Exclusion.”  The use of such terminology undercut the insurer’s claim that the endorsement was directed at the timing of the insured’s conduct as well as the timing of the damage.

American Safety did not succeed in its effort to impose two separate triggers.  However, this case should sound warning bells for all insureds who face continuing injury type exposures (not just contractors).  Had American Safety succeeded in its quest to require both causal act and first damage (and thus, all damage) to occur in the same policy period, the insured would have been left with massive coverage gaps.  Given the non-standard nature of these endorsements, other carriers may not be guilty of the same sloppy drafting employed by American Safety.  Insureds with these types of exposure should check their policies – old, current, and new – for the wording of the insuring clause itself and any Montrose endorsements.  As shown by the Pennsylvania General case, the devil of the insuring clause and endorsement can be in the details, and analysis by a coverage expert may find ways around what may look to be an onerous policy requirement or exclusion.  Additionally, help from a risk management consultant or insurance counsel at the time of negotiating for the policy can be useful in ensuring that appropriate coverage is obtained.

The recent earthquake in Eureka, California (as well as the devastating events in Haiti), reminded me of the financial challenges and complexities faced by businesses large and small following a catastrophe.  While the Eureka situation is in no way comparable to the devastation in Haiti, businesses there will be facing challenges and potentially lengthy shut-downs.  One tool for dealing with the financial loss of such an involuntary shutdown is business interruption insurance.  However, that comes with its own set of challenges.

Insureds face difficulties determining limits for both earthquake insurance and business interruption insurance.  Generally speaking, limits for both should be based around Probable Maximum Loss (PML) calculations instead of Maximum Possible Loss (or Maximum Foreseeable Loss).  This is different to the normal valuation techniques for property insurance.  A good broker is worth his or her weight in gold for this.

Additionally, it is important that you buy the right property coverages.  Business interruption coverage is only triggered if there is a covered property loss.  If you don’t have earthquake coverage, you won’t have business interruption coverage if your business is closed because of earthquake damage.  Business interruption coverage is not available as a “stand alone” coverage, only as part of one of the business property policies that are offered.

A good broker, who fully understands the complexities of business interruption insurance, is essential when purchasing the coverage.  Make sure your broker does.  If you’re unlucky enough to need to make a claim, it’s even more essential to get expert help.

It’s important to remember that business interruption insurance covers financial loss.  That leaves you, the insured, to prove how much loss you suffered.  Insureds and insurers frequently have disputes about the value of buildings and machines and all sorts of other physical property.  However, trying to calculate the amount of money your business would have earned had the loss not occurred is open to much more disagreement, and is clearly an arena ripe for conflict.  On top of that, many losses involve the loss of the very financial records the insured needs to prove the claim.  This is just another reason that a well thought-out risk management program, including offsite duplication of financial records, should be in place.

Business interruption losses spawn more disputes (though not so many lawsuits) than most other coverages, simply because it is so hard to prove the value of the loss.  Insurers vigorously challenge insureds’ estimates of what profits would have been earned.  Add outside distractions such as recession or disasters, and disputes are bound to ensue.  (For example, an insured who owned a hotel in New Orleans that was badly damaged by hurricane Katrina was told that because there was no tourism in the area following the disaster that he would not have had any business anyway, and therefore he had suffered no business interruption loss.)

For these reasons, any insured suffering a business interruption loss should, very early on in the process, hire both insurance coverage counsel and accountants who specialize in business interruption losses.  Counsel can stay hidden in the background to start with (so as to not appear over aggressive or defensive), but you can be absolutely sure that the insurer will hire its own accountants who specialize in minimizing covered business interruption losses.  If the insured doesn’t have his or her own accountants and advisors, there is the risk (some would say certainty) that the carrier will run financial rings around him.  Carriers deal with these issues every day, whereas the insured hopes he or she never has to.  Therefore it’s important to get these consultants in quickly, so that they’re not battling from behind when they do get involved.

It is completely understandable that insureds facing potentially catastrophic loss would be reluctant to spend money on lawyers and accountants at that time.  However, it is completely false economy not to do so.

Construction defect coverage litigation has been declining over the years.  The building booms of the late 80s and 90s resulted in a boom of construction defect litigation too.  Coinciding nicely with the introduction of the 1986 ISO form policy with new wording, insurers found themselves paying for a lot of defective construction claims.  Since then, coverage for construction has gotten harder to get, and a lot narrower.  Insurers tightened down by introducing new – and more restrictive – versions of additional insured endorsements, by adding very restrictive versions of “Montrose” endorsements, and by ultimately by refusing to sell insurance to many contractors.

This decline in construction defect coverage litigation is probably due to both the end of the building boom, and also the fact that many of the issues have now been litigated all the way up to the top courts.  Therefore many of the once disputed issues are decided:  the scope of completed operations coverage; the meaning of “your work;” the alienated premises exclusions, and so on.  But it was somewhat surprising (to me at least) that some carriers are now disputing the meaning of “that particular part,” as that phrase is used in exclusions J(5) and J(6) of the current ISO CGL policy.  And interestingly, there are relatively few published court opinions across the nation that have interpreted these exclusions.
These exclusions are generally thought of as the “faulty workmanship” or “business risk exclusions,” and in the current version of the standard ISO CLG policy read:

Property damage to:

J(5)  That particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the “property damage” arises out of those operations;

J(6)  That particular part of any property that must be restored, repaired or replaced because “your work” was incorrectly performed on it.

The term “your work” is defined to include work or operations performed by you or on your behalf (thus, work done by subcontractors “becomes” the work of the general contractor) for the purposes of these exclusions.

The intention of these exclusions is to exclude coverage for defective work because of the moral hazard of doing so (coverage would encourage sloppy workmanship because the carriers would have to pay to put it right).  However, because these exclusions are restricted to the damage to “that particular part” of the property that needs correction because of the defective work, they do not apply to consequential damage to other parts of the same project which are not defective.

Text books published by the American Institute for Chartered Property Casualty Underwriters (the very books that CPCU’s1  all over the country learn from) make this abundantly clear.  In its discussion of exclusion J(5), one text notes:

The reference to “that particular part” is important.  No coverage applies to “that particular part” of real property damaged while work is being performed on it.  But, by inference, coverage does apply for damage to any other part of the property besides “that particular part,” as long as it is not otherwise excluded.”

Malecki, Horn, Wiening & Flitner, Commercial General Liability Insurance Vol. 1 (Third Edition, AICPCU 1995 ) at 95 (emphasis is original).  The text goes on to give an example of a contractor erecting a steel frame building, and by accident a beam falls from the hoisting crane, damaging other parts of the framework that had already been constructed.  The text instructs that the contractor’s CGL policy “would cover the damage to the property damaged by the beam that fell.  The property damaged by the beam was not ‘that particular part’ of real property being worked on at the time of the accident.”  Id.

A recent Texas case highlights the basic misunderstandings that the carriers are making with respect to these exclusions.  In Mid-Continent Casualty Co. v. JHP Development, Inc., 557 F.3d 207 (2009), a contractor (JHP) partially built a condominium project, finishing the foundations, walls, roofs, windows and doors.  The contract called for work to stop at that point, and only be finished as the individual condos were sold by the developer.  Still to be done was painting, flooring, plumbing and electrical fixtures, and activation of the HVAC system.  However, several months later, water intrusion problems became apparent, causing damage to interior drywall, stud framing, electrical wiring and wood flooring.  JHP’s insurer, Mid-Continent, denied the claim.

In the subsequent declaratory relief action and the appeal that followed, Mid-Continent argued (among other things) that exclusions J(5) and (6) applied.  The appellate court held that J(5) was inapplicable as it only applies to ongoing operations, and because all work had stopped at the project for a prolonged period of time, no operations were ongoing.  557 F.3d at 211-12.

The court also held that the “that particular part” language of exclusion J(6) meant that it too did not apply to the claim.  The court explained that “the plain meaning of the exclusion . . . is that property damage only to parts of the property that were themselves the subjects of the defective work is excluded.”  Id. at 214-15.  The court also noted that if insurers had wanted to exclude all damage to a project caused by any defective work in that project, they could easily have written the words to do so.

Distinguishing other cases interpreting exclusions “that bear some resemblance to exclusion J(6)” as a bar to coverage, the JHP court noted that in those cases the exclusionary language was different.  The court also criticized a decision by the South Carolina Supreme Court which had barred recovery for a similar claim because it said the CGL policy was not designed to insure business risks.  Citing the Texas Supreme Court, the JHP court noted that “‘such preconceived notion[s] . . . must yield to the policy’s actual language,’ and that ‘coverage for business risks depends, as it always has, on the policy’s language . . .’”  Id. at 216-17 (citation omitted).

Given the CPCU texts’ clarity, the thoughtful and intelligent analysis by some courts, and the clear view of such insurance coverage experts as IRMI (the International Risk Management Institute)2, that these exclusions do not bar coverage for non-defective work that is damaged because of defective work, it is surprising that some carriers are continuing to argue to the contrary.

1 The CPCU designation is the insurance industry’s highest accreditation – the equivalent of the CPA designation in the accounting world.

2 See, e.g., Wielinski, Insurance for Defective Construction (Second Edition, IRMI 2005) at 183, and 191-93; Wielinski and Gibson, Broad Form Property Damage Coverage (Third Edition, IRMI 1992) at 69.

A lawsuit is filed, the defendant gives notice to the insurers, and in the meantime engages counsel to start the defense.  Several rounds of coverage opinion letters go back and forth, and finally – the insurer accepts the defense of the lawsuit (usually subject to a reservation of rights).  Meanwhile, defense counsel has been doing his or her job.  So surely, now all is well.  Defense bills incurred before the insurer agreed to defend are submitted for reimbursement. 

But then the insurer’s “litigation guidelines” arrive – explaining just how much of the insured’s defense the carrier will NOT pay for.  These guidelines often include completely unrealistic restrictions on the way the defense must be conducted.  Frequently, the guidelines exclude reimbursement for (and thus can be looked at as an insurer-imposed bar) such things as discussions between members of the defense team working on the case; emails between the defense team; leaving or listening to voicemails; and the attendance of more than one attorney at hearings or meetings, without regard for the requirement of attorneys with specialist knowledge.  Additionally, litigation guidelines regularly impose arbitrary restrictions on legal research; and arbitrary time limits on drafting of pleadings, no matter how complex.  And often, insurers impose these guidelines retroactively – back to the beginning of the case and long before they sent them to either the insured or to defense counsel.

These guidelines are a constant source of tension between independent defense counsel and insurer, and a potential financial drain for the insured – already hit by the reality that insurers pay absolute rock bottom hourly rates for defense counsel, no matter how complex the case and no matter what the wording of Civil Code Section 2860.

So what are the insured’s rights with regard to these onerous and often completely unrealistic “litigation guidelines”?  First, it’s worth remembering that the Litigation Guidelines do not form any part of the policies, and the policies make no reference to them.  As such, they are not part of any contract, and – at least in theory – are not binding on the insured.
It’s also worth arguing that the defense invoices submitted for reimbursement reflect the considered judgment of experienced defense counsel, acting in the client’s best interest and in a manner consistent with ethical obligations.  Insurers cannot supplant defense counsel’s judgment with its own, and California courts have questioned the propriety of litigation guidelines:

Under no circumstances can such guidelines be permitted to impede the attorney’s own professional judgment about how best to competently represent the insureds.  If the attorney’s representation is to be limited in any way that unreasonably interferes with the defense, it is the insured, not the insurer, who should make that decision.

Dynamic Concepts, Inc. v. Truck Ins. Exch., 61 Cal. App. 4th 999, 1009 n.9 (1998) (emphasis in original); see also In the Matter of the Rules of Prof. Conduct and Insurer Imposed Billing Rules and Procedures, 2 P.3d 806, 334-36 (Mont. 2000) (concluding that a litigation guideline which requires defense counsel to obtain insurer approval before making strategic decisions “fundamentally interferes with defense counsels’ exercise of their independent judgment.”)

Additionally, Rule 1-600(A) of the California Rules of Professional Conduct prohibits attorneys from participating in non-governmental activities or programs “furnishing, recommending or paying for legal services, which allows any third person or organization to interfere with the member’s independence of professional judgment, or with the client-lawyer relationship.”  Notes to the Rule clarify that the rule is “not intended to override any contractual agreement or relationship between insurers and insureds regarding the provision of legal services.”  Since an insurer’s Litigation Guidelines never formed part of any contract the insured, implementation of those guidelines, to the extent they interfere with defense counsel’s professional judgment or interfere with the client-lawyer relationship, is barred by Rule 1-600(A).

And clearly, imposing the sort of restriction listed earlier interferes with the defense of the case.  Insurers, though, strongly defend the guidelines, arguing that they simply seek to impose “reasonableness” on defense counsel.  This ignores the fact that defense counsel has an ethical obligation to be reasonable in any event.  And usually, it is the guidelines that are unreasonable.

As with most disputes, the best answer lies in clear lines of communication.  This includes setting up a direct line of contact with the person who actually audits the bills is essential – as he or she is the person wielding the red pen, and who probably has no other knowledge of the case other than what’s written on the bills. 

Also helpful is an understanding that in the real world, the insured will most probably not get full reimbursement.  The goal becomes to find the cost effective balance – getting the biggest amount of reimbursement possible with the least amount of time spent arguing about it – time that is itself not reimbursable.