Vexatious Victory Over Lloyd’s of London in Property Damage Claim

Missouri law tries to protect people with insurance claims in R.S.Mo. § 375.420: if a Court finds that the insurer
refused to pay a loss “without reasonable cause or excuse,” it may award “interest [and] twenty percent of the first
fifteen hundred dollars of the loss, and ten percent of the amount of the loss in excess of fifteen hundred dollars
and a reasonable attorney’s fee,” in addition to the amount of the loss.  This applies to all insurance but
automobile. That the insurance company pays, paid or eventually pays all or part of the amount owed under the policy
does not eliminate a claim under § 375.420.  Dhyne v. State Farm Casualty Co., 188 S.W.3d 454 (Mo.banc
2006).

The Court agreed that Lloyd’s underpaid $25,533.31 and imposed penalties and interest under the vexatious refusal
statute against Lloyd’s for a total of $51,489.11. Lloyd’s must also pay attorneys’ fees and daily interest until
the judgment is satisfied. With our attorney’s fees, we anticipate the judgement to be around $80,000.  It is hard
to confront and fight big multinational insurance companies like Lloyd’s, but West End Diving did so and succeeded
with Gary’s help. Insurance companies too often drag their feet and slowly pay claims hoping the insured will give
up and take less. Unfortunately, this improper tactic often works.

Lloyd’s totally ignored their own appraisal process:  “A provision in an insurance policy for the amount of the loss
to be ascertained by appraisers in case of disagreement between the parties is binding and enforceable.”
Hawkinson Tread Tire Service v. Indiana Lumberman’s Mut. Ins. Co., 245 S.W.2d 24 (Mo. Banc 1951). When the
appraisal resulted in a higher figure, Ms. Renteria paid the original lower estimate submitted (two years late).
Lloyd’s refused to pay the agreed-upon binding appraisal award and forced litigation. Their heavy handed and unfair
conduct is exactly why we have the vexatious refusal statute and regulations governing claims adjustment.

Renteria and Lloyd’s also argued their March 2013 payment completely resolved the claim.  At common law, an “accord
and satisfaction” is a contract for the settlement of a disputed claim for an amount less than that claimed. But no
accord and satisfaction occurred here because neither the March 2013 check nor any accompanying or prior
correspondence indicated the check was being tendered in full satisfaction of the claim. It didn’t say anything like
that.  And, at Gary’s instruction, West End Diving sent three letters to Renteria saying this was only a partial
payment – let us know if you disagree and we will not cash the check.  In sum – you can’t trick someone into accord
and satisfaction like Renteria and Lloyd’s tried to do.