Insurance company thought it was ‘untouchable.’ It wasn’t
Tuesday, November 10, 2009
Yanting Zhang sued her insurance company, California Capital Insurance, after the company balked at reimbursing her for a fire at her place of business.
Zhang enumerated numerous incidents of misconduct by California Capital, including failing to authorize payment and mishandling her claim.
Most importantly, Zhang alleged that California Capital committed unfair, deceptive, and misleading advertising when the company promised its clients that “it will timely pay proper coverage in the event the insured party suffers a covered loss.”
California Capital claimed that Zhang did not have a right to bring the claim for unfair and deceptive advertising because the insurance code does not permit an individual to bring a claim against the insurer.
Superior Court Judge Joseph R. Brisco of San Bernardino County agreed, dismissing the claim as not allowed under California law.
In a unanimous decision authored by Justice Betty A. Richli, the appellate court overturned the lower court ruling, and held that although the Unfair Insurance Act may not allow an individual to bring a claim against an insurer, a separate law, the California Unfair Competition Law, does permit an individual to bring a claim for unfair, deceptive, fraudulent advertising.
The court stated that the insurer is not “untouchable” when it comes to allegations of unfair business practices. Zhang v. California Capital Insurance Co. 4th Dist. Div. 2 (E047207)