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In the battle against insurance fraud in Michigan, some companies fight harder than others. One of the toughest fighters is Farm Bureau, which recently won the largest arson/fraud defense case in state history.
The case, involving nearly $10 million, began with a 1989 fire in a fruit-canning factory. It ended in April 1995, with the sentencing of the owner, who was implicated in the arson.
The Buskirk Processing plant, located near Lawrence in Van Buren County, burned on November 25, 1989. When Edward Buskirk submitted a claim for over $4 million to Farm Bureau Mutual Insurance Company of Michigan, the company denied the claim.
“Our investigation into the facts and circumstances of the fire led us to believe that Mr. Buskirk arranged for the intentional destruction of his business,” said Wayne Delo, manager of Farm Bureau’s special investigations unit.
Buskirk sued Farm Bureau Mutual, not only for breach of contract, but also for emotional distress, libel, lost profits and attorney fees.
Before the case went to trial, the court ordered a mediation panel of three attorneys to review the case. The mediators decided in favor of Buskirk and recommended that Farm Bureau Mutual pay him $5.7 million.
“Despite the mediation decision, we felt we had a very strong case and that we could prove insurance fraud to a jury,” Delo said. “Our company policy is to fight claims fraud vigorously wherever we find it.”
When the case went to trial in July 1992, Buskirk’s demand for damages had risen to $9.7 million.
After a month-long trial in Van Buren County Circuit Court, the jury reached a verdict. They determined that Mr. Buskirk had arranged to have his own business set ablaze for the insurance money.
He later admitted his involvement in the fire and, as the result of a plea bargain, was sentenced in April 1995 to 15 months in a federal prison camp.
The sentencing was the culmination of a five-and-a-half-year effort by various law enforcement agencies, the Federal Prosecutor’s office and Farm Bureau Insurance.
Not only was the case a landmark in Michigan, it was also one of the nation’s largest cases of an insurance company successfully defending itself against a fraudulent claim.
“We do all we can to fight arson and insurance fraud in Michigan,” said David Monroe, vice president of Claims and Property Casualty Underwriting for Farm Bureau Insurance. “By fighting fraud, we are holding down costs for our customers. We owe it to our policyholders to pay only legitimate claims.”
Arson in Michigan causes many deaths and injuries each year. In 1994, arson and suspicious fires accounted for 21.6 percent of all fires in Michigan and caused over $92 million in property damage.
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