Trial Magazine

To successfully represent clients in any first-party property insurance litigation, you need an intimate understanding of both the technical policy issues and relevant legal principles raised in a given claim. To do so, it’s important to enlist the correct types of expert witnesses.

There is no one-size-fits-all expert witness for first-party property insurance cases. These types of cases implicate a combination of issues, including the cause of the damage, the cost of repairs, and the insured’s duties after the loss. Carefully analyze the policy, the claimed damage, and the insurer’s statements to ensure you retain the most appropriate types of expert witnesses.

Start by developing a comprehensive list of what topics will be relevant to establishing coverage and the amount of damages. Find out what caused the property damage, the type of insuring agreement at issue, and the insurer’s stated reason for its denial or limitation of coverage. Also determine whether the insurer alleges that the insured failed to perform any duties after the loss. And as the litigation progresses, keep an eye out for whether the insurer raises any new coverage defenses. It’s important to actively evaluate these issues throughout litigation so you retain the appropriate experts to counter the insurer’s arguments.

Property Insurance Basics

Before getting into expert selection, you need to understand the basics of first-party property insurance claims. Property insurance is typically sold as either named-peril or all-risk coverage. While the burden of proof applicable to each type of policy seems to follow a similar pattern, there are subtle differences that directly impact the expert witness retention analysis.

Named-peril policies afford coverage for only those perils specifically named in the policy—this varies widely but commonly includes fire, windstorm or hail, smoke, vandalism, sinkhole collapse, and specific types of water damage. Named-peril policyholders will bear the initial burden to demonstrate that the claimed property damage was caused by a peril specifically listed in the insuring agreement during the effective dates of the policy.¹ Then the burden shifts to the insurer, who must demonstrate that the damage was caused by an unnamed peril or that an exclusion or limitation applies to the named peril involved.²

All-risk policies operate on the opposite end of the spectrum, covering all causes of property damage except for those specifically excluded in the policy. All-risk policyholders have a comparatively lighter burden to demonstrate that the insured property sustained physical damage during the policy’s effective dates.³ The burden then shifts to the insurer to demonstrate that the loss falls entirely within a policy exclusion or limitation and can be subject to no other reasonable interpretation.⁴

Causation expert witnesses are especially vital in named-peril policies, as the insured bears the initial burden of demonstrating that the claimed damage was caused by a specifically named peril. For all-risk policies, causation expert witnesses are not necessary to establish that the damage falls within the policy’s insuring clause but may be necessary to rebut an insurer’s argument that a policy exclusion or limitation applies.

Common Disputes

Several types of coverage disputes may give rise to a first-party property insurance lawsuit—from disputes over the specific cause of the damage, to costs, to the insured’s duties after the loss. Be sure to understand the nature of the dispute so you select the appropriate experts.

Cause and cost disputes. Coverage denials often involve the insurer challenging either the cause of the damage or the cost of repairs. If the insurer’s denial asserts that the cause of the damage is not covered by the policy, be prepared to establish that the insurer is either wrong about what caused the damage or what the policy excludes.

Causation disputes require expert testimony to rebut the insurer’s causation theory. Cost disputes often necessitate testimony or a written estimate of repair costs prepared by a general contractor, adjuster, or building consultant. But disputes over policy exclusions require attorneys to formulate technical contract interpretation arguments.

Concurrent cause disputes. When a covered peril and an excluded peril simultaneously contribute to a loss, results vary depending on the policy’s terms and whether the jurisdiction has adopted the concurrent cause doctrine or efficient proximate cause doctrine.

The concurrent cause doctrine provides that coverage may exist when an insured risk constitutes a concurrent cause of the loss even when it is not the prime or efficient cause.⁵ Conversely, the efficient proximate cause doctrine provides that when there is a concurrence of different perils, the efficient cause—the one that set the other in motion—is the cause to which the loss is attributable.⁶

Note that when the concurrent cause doctrine applies, insurers have turned to anti-concurrent cause exclusions designed to exclude coverage when a loss is caused by a combination of covered and excluded perils.⁷ But policies with anti-concurrent cause exclusions often include an ensuing loss exception—this covers losses that occur separate from, but as a result of, an excluded loss.⁸

For instance, many policies exclude damage caused by improper installation of a plumbing fixture but may cover ensuing water damage flowing from that fixture. Depending on the jurisdiction and policy, you may need expert testimony to show whether the improper installation caused the ensuing loss. No matter the standard, however, expert witness testimony is often the deciding factor in establishing that the cause of a concurrent or ensuing loss is covered under the policy.

Duties-after-loss disputes. Property insurance policies typically require the insured to comply with an array of duties after a loss as a prerequisite to obtaining coverage. These duties might include providing prompt notice of the loss, mitigating damages, conducting reasonable repairs, permitting reasonable inspections of property and records, submitting to examinations under oath, and submitting a sworn statement explaining their perspective of the damages.

Jurisdictions vary in how breaches of certain duties are treated. In some jurisdictions, a claim denial based on the insured’s alleged breach of a duty after loss may require a showing that the insurer was prejudiced in some way by the insured’s purported breach.⁹

Duties after loss that are subject to a presumption of prejudice naturally lend themselves to summary judgment motions. Insurers will argue that a duty after loss was breached as a matter of law and that the presumption of prejudice precludes any potential issue of fact.¹⁰ Keep in mind that presumption of prejudice can be attacked by expert or fact witnesses.¹¹

Types of Experts

Once you’ve determined the type of policy, the disputed issues, and the applicable law, you can turn to expert selection. Selecting an expert witness requires pragmatic consideration of the potential value of a claim versus the cost to employ an expert in a given field. The burden of proof applicable to each type of policy will often drive your expert retention analysis.

Causation experts are especially vital in named-peril policies, but they also may be necessary to rebut an insurer’s exclusion or limitation defense in all-risk policies. And you may need a wide range of experts to navigate concurrent cause and duties-after-loss disputes. Here are some useful types of experts to consider.

Perhaps the most common type of expert witness on the issue of causation in first-party property insurance litigation is a civil engineer.

Civil engineers. Perhaps the most common type of expert witness on the issue of causation in first-party property insurance litigation is a civil engineer. Civil engineering is a broad and highly technical field focused on infrastructure design and construction.

Civil engineers specializing in structural, mechanical, and construction areas of study are perhaps the most appropriate experts to explain how damage occurred. Civil engineers specializing in these fields of study are uniquely qualified to apply their physics, mathematics, and design expertise to forensically analyze what exactly caused physical damage to a given property. They can be helpful in providing expert testimony regarding windstorm,¹² fire,¹³ explosion,¹⁴ HVAC,¹⁵ and plumbing¹⁶ losses, just to name a few.

Meteorologists. These experts can help establish weather-related claims or defenses by analyzing meteorological and climatological data.¹⁷ Meteorologists use math and physical science to calculate what pressures and wind speeds were likely sustained at a given location. Their opinions show whether it is possible for the reported damage to have been caused by the reported cause of loss.

Insurers challenge weather-related claims often based in part on a cursory review of online weather data involving wind speeds and precipitation—but that data can be misleading or misinterpreted. Insurance adjusters may then rely on this online data to underpin their opinion regarding the causation of damages. Meteorologists can be vital in providing data analysis and interpreting weather patterns to support the insured’s claim of a covered cause of loss or refute the insurer’s defenses.

Cost-of-repair experts. To establish the cost of repair, parties often turn to adjusters¹⁸ and general contractors.¹⁹ A cost-of-repair expert should have real-world experience evaluating construction projects so that they can provide accurate reports on the cost of materials, labor, and other expenses associated with repairs and testify to the reasonableness of those estimates.

General contractors, for instance, typically know what is a reasonable cost for repairs in a given time frame and location—and they usually have an intimate knowledge of local building codes and the local material and labor markets. This is absolutely crucial in quantifying the amount of damages owed to the insured.

Other experts. Sometimes it helps to bring in other experts and think creatively. For example, in one case an insurer denied a claim involving an unmanned yacht sunk by a hurricane. The insureds prevailed on summary judgment by using an expert boat captain who testified that the presence of a captain and crew, which was required as a condition precedent to coverage, did not increase the unavoidable hazard that caused the loss.²⁰

In another case after an insurer denied a property claim for a livestock death caused in part by a windstorm, the insured retained an expert veterinarian who testified that the livestock would not have died but for the covered windstorm, which was the dominant or proximate cause of the loss.²¹

Successfully representing clients in first-party property insurance litigation starts with developing a comprehensive list of topics relevant to coverage and damages. By carefully analyzing the policy, the claimed damage, and the insurer’s statements and defenses, you can identify and retain appropriate experts.

Derrick Natal is an associate at Ver Ploeg & Marino in Orlando, Fla., and can be reached at dnatal@vpm-legal.com. Michal Meiler is a partner at the firm’s Miami office and can be reached at mmeiler@vpm-legal.com.

Notes

1. See, e.g., Corban v. United Servs. Auto. Ass’n, 20 So. 3d 601, 618–619 (Miss. 2009); Living Word Bible Church, Inc. v. Travelers Indem. Co., 2009 WL 2856127, *2 (E.D. La. Sept. 1, 2009); Royale Green Condo. Ass’n, Inc. v. Aspen Specialty Ins. Co., 2009 WL 799429 (S.D. Fla. Mar. 24, 2009); Miller Marine Servs., Inc. v. Travelers Prop. Cas. Ins. Co., 2005 WL 2334385, at *4 (E.D. N.Y. Sept. 23, 2005), aff’d, 197 Fed. App’x 62 (2d Cir. 2006).
2. Cent. Nat’l Ins. Co. v. Super. Ct., 3 Cal. Rptr. 2d 622, 625 (Cal. Ct. App. 1992); Strubble v. United Servs. Auto. Ass’n, 110 Cal. Rptr. 828, 831–32 (Cal. Ct. App. 1973).
3. 10A Jordan R. Pitt et al., Couch on Insurance §148:52 (3d ed. 2023).
4. C.R. Pittman Const. Co., Inc. v. Nat’l Fire Ins. Co. of Hartford, 453 Fed. App’x 439, 442 (5th Cir. 2011); Transamerica Leasing, Inc. v. Inst. of London Underwriters, 7 F. Supp. 2d 1340, 1347 (S.D. Fla. 1998), rev’d on other grounds,267 F.3d 1303 (11th Cir. 2001); Mejia v. Citizens Prop. Ins. Corp., 161 So. 3d 576, 578 (Fla. Dist. Ct. App. 2014); Hoover v. United Servs. Auto. Ass’n, 125 So. 3d 636, 641 (Miss. 2013).
5. The concurrent cause doctrine provides that coverage may exist where an insured risk constitutes a concurrent cause of the loss even when it is not the prime or efficient cause. See Wallach v. Rosenberg, 527 So. 2d 1386, 1387 (Fla. Dist. Ct. App. 1988); Sebo v. Am. Home Assurance Co., Inc., 208 So. 3d 694, 698–99 (Fla. 2016); State Farm Mut. Auto. Ins. Co. v. Partridge, 514 P.2d 123, 133 (Cal. 1973).
6. See Sabella v. Nat’l Union Fire Ins. Co., 377 P.2d 889, 892 (Cal. 1963); Fire Ass’n of Phila. v. Evansville Brewing Ass’n, 75 So. 196, 198–99 (Fla. 1917).
7. Boazova v. Safety Ins. Co., 968 N.E.2d 385, 394–95 (Mass. 2012).
8. Blaine Const. Corp. v. Ins. Co. of N. Am., 171 F.3d 343, 346 (6th Cir. 1999) (“This policy does not insure loss or damage caused directly or indirectly by any Peril excluded . . . unless loss or damage from an insured Peril ensues and then only for such ensuing loss or damage.”); see also Liberty Mut. Fire Ins. Co. v. Martinez, 157 So. 3d 486, 488 (Fla. Dist. Ct. App. 2015). Some jurisdictions have found that an ensuing loss is one that follows an excluded cause of loss. See Leep v. Trinity Universal Ins. Co., 261 F. Supp. 3d 1071, 1082 (D. Mont. 2017). Other jurisdictions have taken it a step further and held that an ensuing loss is one that not only follows an excluded cause of loss but is also separate and independent from that peril. See Weeks v. Co-operative Ins. Cos., 817 A.2d 292, 296 (N.H. 2003).
9. Compare Pittman v. State Farm Fire & Cas. Co., 868 F. Supp. 2d 1335, 1349–50 (M.D. Ala. 2012), aff’d, 519 Fed. App’x 656 (11th Cir. 2013), with Whistler’s Park, Inc. v. Fla. Ins. Guar. Ass’n, 90 So. 3d 841, 845–46 (Fla. Dist. Ct. App. 2012).
10. Lehrfield v. Liberty Mut. Fire Ins. Co., 396 F. Supp. 3d 1178, 1184 (S.D. Fla. 2019).
11. In the authors’ experience, while expert witnesses can sometimes be used to rebut the presumption of prejudice, fact witnesses are often appropriate.
12. See, e.g., Texas Friends Chabad-Lubavitch, Inc. v. Nova Cas. Co., 539 F. Supp. 3d 669 (S.D. Tex. 2021).
13. See, e.g., Wiles v. N.C. Farm Bureau Mut. Ins. Co., 354 S.E.2d 248 (N.C. Ct. App. 1987).
14. See, e.g., Am. Fam. Mut. Ins. Co. v. Lobrow, 2013 WL 5745378 (Ill. App. Ct. Oct. 21, 2013).
15. See, e.g., MD Retail Corp. v. Guard Ins. Grp., 2017 WL 1164499 (D.N.J. Mar. 28, 2017).
16. See. e.g., State Farm Lloyds v. Hamilton, 265 S.W.3d 725 (Tex. App. 2008).
17. See, e.g., Mesa v. Citizens Prop. Ins. Corp., 358 So. 3d 452 (Fla. Dist. Ct. App. 2023).
18.  See, e.g., Cooley v. State Farm Fire & Cas. Co., 611 F. Supp. 3d 618 (S.D. Miss. 2023).
19. See, e.g., Deputy v. Hartford Ins. Co. of the Midwest, 2020 WL 5807997 (M.D. Fla. June 1, 2020).
20. Travelers Prop. Cas. Co. of Am. v. Ocean Reef Charters LLC, 71 F.4th 894 (11th Cir. 2023).
21. Shinrone, Inc. v. Ins. Co. of N. Am., 570 F.2d 715 (8th Cir. 1978).