Cigar Fires, Love Damages, Cat Surcharge, Pump Plan and More

The following were submitted by Insurance Journal readers:

Where There’s Smoke

A North Carolina lawyer who purchased a box of rare and expensive cigars and smoked them all won a claim against his insurer because he had insured the cigars against, among other things, fire. He said the cigars were lost “in a series of small fires.”

The judge agreed with the insurance company that the claim was frivolous. However, the judge found that the policy warranted that the cigars were insurable. The insurer also guaranteed that it would insure the cigars against fire, without defining an unacceptable fire. Thus, the insurer paid $15,000 for his loss of the cigars.

After the plaintiff cashed the check, the insurance company had him arrested on 24 counts of arson. — Ede Edang

Love and Stupidity

Two insureds were having a drunken fight, a common occurrence. The woman locked her husband out of the house. He broke down the door. They were wrestling on the floor when the neighbors and cops broke it up. A few days later, when the insureds loved each other again, they called to see if the door damage would be covered under their homeowners’ policy. The agent’s reply: “Stupidity was not a covered peril.” — Submitted to IJ’s Facebook page.

Cat Surcharge

A client called very upset. He was being charged extra on his condo owners policy for having a cat but his cat had passed away. I was scratching my head trying to figure out what he was talking about. “Do you mean the CAT surcharge?” I asked. He said yes. I then explained what the Florida Catastrophe Fund surcharge was for. — Beth Sanders

Umbrella

A new prospect was discussing policy options with his agent. The agent asked if the prospect had homeowners’ insurance, auto insurance, flood and umbrella coverage. The prospect said: “What good would an umbrella be in a flood?” — Jean O’Neil

Pay at the Pump Insurance Makes a Comeback

The Administration boldly announced that the days of uninsured drivers are numbered and high gasoline prices are at an end. An executive order, to be effective Jan. 1, 2013, resurrects and puts into effect the “Pay at the Pump” insurance plan.

This plan was originally designed to eliminate all uninsured drivers by adding a small liability insurance premium for each gallon of gas a private citizen or business purchases. The order effectively places the regulation of gasoline prices under state control via the McCarren Ferguson act. All gasoline price increases will be reviewed by the respective State Commerce or Insurance Departments where the fuel is actually sold. Gasoline increases will be subject to public hearings and actuarial review with final rate determination tempered by the consideration of the social welfare of the citizenry. All states have suspended their “deemer” clauses on rate increases during this transition period. Many departments are already requesting cat models showing the effects of end of the world rumors that have constantly plagued the price consumers pay for gasoline.

In a related story, all major oil companies announced they would cease selling gasoline in California, Texas, and Florida in January 2013. Consumers there must obtain non-resident gasoline usage licenses in order to purchase gas in bordering states. — Bob Griffin

Tech Merger

Vertafore and Applied Systems have merged into Vertaplied. “Agents couldn’t tell the difference between us anyway so we decided to become one,” said the firms. They said they will pool their resources to bring better technology to all agents. Later in the day, Vertaplied announced support fees would be raised by a “modest” amount. — R. Keighron

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