 The Investigative File: Insurance
Company
by Guy E. Burnette, Jr., Esquire
The investigative file for an insurance company handling an arson case should
be complete by the time the matter is set for trial. The file should be
thoroughly reviewed and organized in preparation for testimony at trial.
When the insurance adjuster or SIU representative in charge of the claim
compiles the records which will be part of the investigative file used at
trial, the following folders are likely to appear in the file.
Contents
Policy - A certified copy of the policy and declarations page
will be needed in every trial. In order to prove the contractual defenses,
the contract will need to be received into evidence. The policy should be
pre-marked with an exhibit label for that purpose.
Application - The original policy application will be admitted in
evidence at many civil arson trials. If it is not signed by the insured/applicant,
it may need to be authenticated at trial through the testimony of the agent.
See How to Analyze Insurance
Documents in a Fire Investigation: The Homeowner Application for information
on how to use application information in the investigation.
Agency Records - Most of the records from the producing agency file need
to be collected for possible use at trial. Any telephone messages, correspondence
or other records of communications with the insured should be included.
An inspection report or photographs taken when the policy was issued will
be important evidence. Payment records and cancellation/non-renewal notices
may be included in the agency file.
Underwriting Records - While this may contain many of the same items found
in the Agency Records file, there will be other important records from the
Underwriting file. Information about any other claims filed by the insured
may be found in the Underwriting file. It should contain rating information
about the size, style, age and construction of the building or residence.
Endorsements changing coverage type or amount should be made a part of this
folder in the file. See The Underwriting File for more information on what is contained in Underwriting
Records.
Inspection / Loss Control
Reports - These are reports usually taken
from the Underwriting file which contain detailed inspections and evaluations
of the insured location from a Loss Control/Safety standpoint. The reports
may include photographs and diagrams of the premises, noting any safety
or fire hazards which were found. The photographs can provide important
information about the location of items inside the building and may reveal
when things have been moved or taken out of the building before the fire.
Premium Payment Records - These records are important evidence in cases where financial
motive is an issue. They may show chronic delinquent payments prior to the
time of the fire as a pattern of financial problems. They may show a policy
which was suddenly paid-off shortly before the loss or a scheduled premium
payment around the time of the fire which was actually made ahead of time
when all of the others were always late.
Cancellation / Non-Renewal
Notices - This information will also come
from the Underwriting file and will show any cancellation or non-renewal
notices to the insured indicating that coverage was going to be terminated.
That may shorten the policy term shown on the declarations page and may
have significance relative to the date of the fire.
Loss Notice - This document shows the first report of the fire to
the insurance company and is usually sent in by the agent, after being notified
by the insured. It can contain important information about when and how
the insured learned of the fire. The time when the loss was first reported
to the insurance company may take on significance relative to the other
activities of the insured on that day. It may contain information from the
insured which contradicts his later testimony in a recorded statement or
Examination Under Oath. See How
to Analyze Insurance Documents in a Fire Investigation: Loss Notice
for information on how to use loss notice information in the investigation.
Proof of Loss - This is a key document in the case and will be pre-marked
as an exhibit to be introduced at trial. The folder should contain the original
Proof of Loss signed by the insured. See How to Analyze Insurance Documents in a Fire Investigation:
Proof of Loss for information on how to use proof of loss information
in the investigation.
Building Estimates - This folder should contain the estimates of structural
damages prepared for the company and for the insured. This may include preliminary
estimates by the adjuster, as well as a detailed contractor's estimate prepared
by a licensed builder.
Contents Inventory - The original inventory forms submitted by the insured
detailing the personal property claim will always be admitted as evidence.
Where there has been fraud by the insured in the presentation of the claim,
this will be a prime exhibit.
Contents Worksheets - These papers analyzing the insured's contents inventory
on the claim will be useful in establishing the actual damages to the property,
as well as identifying any fraud in the claim on the type and value of items.
Contents Records and Receipts - The original records and receipts submitted by the insured
should be included in this folder, together with any receipts and records
obtained from the stores or suppliers where the items were allegedly sold.
If the records show fraud in the claim, they will be used as trial exhibits
to prove the fraud.
Contents Photos and Diagrams - Any photos of the contents taken before or after the
fire should be in this folder. Also, any diagrams showing the location of
the items at the time of the fire made by the insured or any diagrams by
the investigator after the fire should be part of the investigative file.
Where items were not found after the fire or where items were shown to be
of a different type or value than the insured claimed, this will be important
evidence in the case.
Deed
- A copy of the deed from the courthouse showing the ownership of the property
is sometimes needed at trial. Where there were prior transactions involving
the property relevant to the case, those records should be included as well.
Purchase Contract - The Purchase Contract when the insured acquired the
property may be relevant to the case. It may be important to show the value
of the property, as well as its condition and any equipment, fixtures and
personal property included in the sale of the property.
Appraisals - There may be various appraisals of the insured property.
There is usually an appraisal in conjunction with the purchase of the property,
especially where there has been mortgage financing. Subsequent appraisals
in anticipation of later selling the property may show any changes in the
value and condition of the property. Sometimes an appraisal is conducted
after the loss to show the estimated value at the time of the fire and the
value of the remaining land.
Property Tax Assessment - The Property Tax Assessment is usually not a reliable
indicator of market value, but may be useful in the context of other records.
It may also show the insured's valuation of the property where a tax assessment
has been challenged as being too high.
Property Tax Payments - The payment records for property taxes are often used
as evidence to show financial problems. When the property taxes have not
been paid, it is an indicator of significant financial problems in most
cases.
Other Mortgages / Loans - If there is a second mortgage on the property or some
other form of secured loan, the records should be in this folder. They may
relate to the financial condition of the insured in showing increasing debt
during the time preceding the fire.
Other Mortgages / Loans Payment
Records - These records may provide important
information about the amount of the insured's other obligations and the
pattern of payment for those obligations. They may prove the existence of
mortgages or loans which were undisclosed by the insured in the claim investigation.
Liens / Filings - The records of any liens or other filings against the
property will likely be used as evidence at trial. Tax liens for unpaid
tax assessments and judgment liens are a significant indicator of financial
problems. Certified copies of the liens should be obtained from the Clerk
of Courts or Registrar of Records.
Origin and Cause Report - Although the Origin and Cause Report will not be offered
in evidence as a trial exhibit in most cases, it is necessary to have it
in the investigative file taken to court. Unless the adjuster or SIU representative
directly participated in the fire scene investigation, it may not be directly
used. However, it may become an issue during cross-examination when the
objectivity of the investigation is being challenged or the underlying arson
defense is questioned. It may be used to illustrate testimony about the
location of items at the fire scene, particularly items on the claim which
are being challenged. As an integral part of the case it should be there
in the investigative file.
Lab Report - Just as the Origin and Cause Report may become an issue
during trial testimony, the lab report should be in the investigative file.
Certainly, the results of the analysis and the analytical methods can only
be challenged when cross-examining the chemist or laboratory analyst. However,
as an important part of the proof of the incendiary origin of the fire,
it should always be contained in the investigative file.
Miscellaneous Expert Reports - When additional experts have been involved in the case,
such as metallurgists, fire protection engineers, electrical engineers or
other such experts, their reports should be in the investigative file. There
should be a separate file folder for each expert report. While it is not
expected the adjuster or SIU representative will be questioned about the
methods and findings of the experts, it may become an issue in cross-examination
about the overall case.
Fire Department Reports - The Fire Department Reports, including the "run
report" or fire response report, should always be in the investigative
file. While the reports and information cannot be used by the adjuster or
SIU representative to establish the facts and findings in those reports,
the information may be needed to respond to questions about the reasons
for the denial of the claim and the information on which the case has been
built.
Police Reports - The police reports should be in the investigative file
in every case. The information from those reports cannot be directly testified
to by the adjuster or SIU representative, but may have relevance to other
factors in the case about which the witness may testify.
Fire Marshal Reports - The report on the investigation of the fire by the public
agency investigator (Fire Marshal, Fire Inspector or Fire Investigator)
should be in the investigative file even though the adjuster or SIU representative
may not directly testify about the information and findings in those reports.
When challenging the basis for the denial of the claim, the reports may
be referenced to point out any discrepancies or conflicts between those
reports and the report of the expert retained by the insurance company.
Immunity Act Letters - A separate folder should be created for the Arson Immunity
Reporting Act letters documenting the information provided to the designated
law enforcement agency under the applicable statute. This may be an issue
in cross-examination if it is suggested there was an improper relationship
between the insurance company and the public agency authorities.
Fire Scene Photographs - The fire scene photographs which will be used to establish
the origin and cause of the fire should be enlarged for display to the jury.
A separate set of the photographs, properly marked and labeled, should be
in the investigative file. Any photographs which may not have been enlarged
should be in the file in case there is an issue about something at the fire
scene which is not shown in the enlarged photographs. Photographs taken
by the adjuster or SIU representative should be in the file, as well. Important
photographs taken by the adjuster or SUI representative will be enlarged
for display to the jury. Photographs taken by the insured, fire department,
fire investigator, neighbors or any other source should be in the file,
as well.
Fire Scene Video - If the fire scene was filmed on videotape, during the
fire or during the investigation, it will be used as evidence at trial.
The original tape should be in the investigative file, pre-marked and labeled
as a trial exhibit. If only excerpts from the video will be shown to the
jury, an edited copy should be in the file along with the original tape.
Fire Scene Diagrams - All of the fire scene diagrams should be in the investigative
file. This includes diagrams prepared by the fire investigators, the insured
or any other person in the case. Most of these diagrams will be enlarged
for use as demonstrative evidence at trial. The original diagrams need to
be in the investigative file to verify the accuracy of the enlarged copies
and to be admitted as evidence, since most courts require reduced copies
of demonstrative evidence to facilitate storage in the event of an appeal.
Building Plans / Blueprints - The building plans or blueprints should be in the investigative
file for potential use as trial exhibits. If enlarged copies have been made
for use as demonstrative evidence, the originals will need to be maintained
to verify the authenticity of the enlargements and to admit in evidence
in place of the enlarged copies used for demonstrative evidence.
Utilities Records - The various utilities records (electric, sewer, gas,
water, etc.) often will be used as evidence at trial. All such records should
be pre-marked and labeled as trial exhibits to be offered during the testimony
of the appropriate witness. They must be properly authenticated.
Telephone Records - The telephone records may be evidence in the case and
should be in the investigative file. If they are going to be offered into
evidence, they will need to be pre-marked and labeled as trial exhibits.
They must be properly authenticated.
Delivery/Newspaper/Mail Records - Delivery records for the residence or the business,
including newspaper and mail delivery records, may be significant evidence
in the case to prove the occupancy of the premises or the identity of the
occupants. These records will likely be used as evidence in the case. They
need to be properly authenticated, then pre-marked and labeled as trial
exhibits.
Timeline/Flow Charts - A timeline showing the chronology of events in the case
is an excellent example of demonstrative evidence. Similarly, a flow chart
or link analysis of the witnesses and evidence can provide a visual depiction
of the case. Most of the time these will be enlarged for dramatic effect
at trial. A copy should be kept in the investigative file for reference
during testimony and/or admission in evidence in place of the larger exhibits.
Bank Records - In an arson-for-profit case, the bank records will almost
certainly be used as trial exhibits. They should be organized in the proper
chronological order, pre-marked and labeled as trial exhibits. A marked
copy should be kept in the investigative file for reference during testimony
to highlight the significant entries in the records.
Creditor Records - Creditor records will likely be used as trial exhibits
and should be properly organized in the investigative file. They should
be pre-marked and labeled as trial exhibits. Marked copies should be in
the investigative file to refer to when discussing the significant entries
in the records.
Business Books - The business books should be in the investigative file
and prepared for admission in evidence. They should be organized in the
proper order, pre-marked and labeled as trial exhibits.
Income Tax Returns - The income tax returns of the individual and/or business
will almost certainly be evidence at trial. They should be properly organized
and authenticated if the originals are not in the file. They should be pre-marked
and labeled as trial exhibits.
Miscellaneous Tax Returns - Other types of tax returns, such as sales tax, payroll
tax, intangible tax and the like should be in the investigative file and
ready to be offered as evidence. If the originals are not available, properly
authenticated copies should be in the investigative file. They should be
pre-marked and labeled as trial exhibits.
Financial Statements /
Balance Sheets - Financial statements and
balance sheets relating to the individual and/or business should be in the
investigative file. They will likely be offered in evidence and should be
prepared accordingly. If original documents are not available, the copies
should be authenticated to ensure their admissibility at trial. They should
be pre-marked and labeled as trial exhibits.
Financial Analysis - Where a forensic accountant or other financial expert
has been retained in the case, a copy of the report should be in the investigative
file. The original may be offered in evidence through the testimony of the
accountant or financial expert. However, a copy should be in the investigative
file and ready for reference by the adjuster or SIU representative when
testifying about the basis of the denial and the evidence of financial motive.
Witness Statements - The transcribed or written statements of all witnesses
in the case should be in the investigative file. A separate copy will be
in the witness folder of each witness for use by the attorney when calling
those witnesses to testify. The adjuster or SIU representative may need
to refer to the facts on which the denial was based and some of those facts
may come from the witness statements. The copies in the investigative file
should be highlighted for ready reference during testimony or cross-examination.
Witness Tapes - A copy of the tape of any recorded statement of a witness
should be in the investigative file. Where the statement was taped by the
adjuster or SIU representative, there may be a question about the accuracy
of the statement or the method of interrogation. The tape may be needed
to respond to those issues. The original tape should be in the witness folder
of each witness for use by the attorney when calling the witness to testify.
Witness Summaries - A summary of the statement of each witness should be
in the investigative file with the significant portions highlighted. While
the adjuster or SIU representative generally cannot testify to the statement
of another witness, an issue may arise during cross-examination about the
information developed in the investigation and the factual basis of the
decision to deny the claim.
Insured Statements - Any written or transcribed recorded statements of the
insured should be in the investigative file. Unlike the statements of other
witnesses, the adjuster or SIU representative may be allowed to testify
about the statements of the insured which are considered an exception to
the general rule about hearsay. Particularly where the information in the
statements will be used to establish the misrepresentation/fraud defense,
they need to be available for the adjuster or SIU representative during
testimony at trial. A highlighted copy should be in the investigative file
for easy reference to the important parts of the statements.
Tapes of Insured Statements - The original tapes of any recorded statements of the
insured should be in the investigative file. They will likely be used as
evidence of the misrepresentations or fraudulent statements of the insured.
They should be pre-marked and labeled as trial exhibits in preparation for
their admission at trial. Not surprisingly, the insured will often deny
having made the statement when the case comes to trial and the tape can
prove otherwise.
Insured Statement Summaries - Any statements of the insureds taken in the case should
be summarized and put in the investigative file. This allows the adjuster
or SIU representative to easily find any significant portions of the statements
which may become an issue at trial.
Examination Under
Oath Transcript - The transcript of the
Examination Under Oath should be copied and put in the investigative file.
The original will be pre-marked and labeled as a trial exhibit in the witness
file of the insured used by the attorney. It may be necessary to refer to
the transcript in testifying about a statement of the insured, particularly
a misrepresentation or false statement.
Examination Under Oath
Summary - A summary of the transcript of
the Examination Under Oath should be in the investigative file with the
key portions highlighted. This allows for easy reference at trial when testifying
about the statement of the insured during the Examination Under Oath or
when cross-examined about the Examination Under Oath.
Examination Under Oath
Exhibits - The original exhibits from the
Examination Under Oath will be in the witness file of the insured for use
by the attorney. Copies should be in the investigative file for reference
during testimony about the records produced or diagrams drawn by the insured.
Miscellaneous Files - The list above is by no means complete and every case
will have items unique to the case which need to be contained in the investigative
file. If it is appropriate to the particular case, it should be in the investigative
file.
 Reprinted with permission from the author.
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