A Tempe police officer recommended to her parents just after the accident that she hire an attorney. Zilisch asked around at her church and found Gene Gulinson, who helped her secure a $145,000 settlement from the drag-racers' insurance companies. But State Farm balked at paying her own $100,000 policy limits, instead offering her various amounts ranging from nothing to $55,000. (An arbitration panel later valued her claim at nearly $400,000 to compensate Zilisch for her injuries, medical bills, loss of earning capacity and the very real diminishment of her life's potential because of her crippled eye and the death of her fiancé.)
State Farm sent her to what appeared to be a never-ending parade of "new" claims investigators while she continued to see doctors. The fifth physician she visited, a specialist in San Francisco, had examined Zilisch and concluded that, yes, the injury was permanent and that no surgery would help it. But while that doctor had talked with State Farm claims investigators on the telephone, he didn't prepare a full written report on the examination. The Arizona Supreme Court later chastised State Farm for delaying the evaluation and settlement of the claim for 10 months while it insisted on seeing that doctor's written report. The court noted that it had written reports from four other doctors agreeing on the permanency of the injury as well as the verbal agreement from the California doctor.
"State Farm's insistence on seeing a non-existent report was a pretext to drag out the claims process," justices wrote.
During the lengthy negotiations with State Farm, Zilisch says her attorney began to mutter things like "this is typical."
Gulinson says he believed Zilisch's case clearly should have been settled early on for the policy limits. "They were attempting to find excuses not to pay for it," he says.
Zilisch finally realized that there was nothing unusual or complex about her case. She simply was being jacked around so State Farm could save money -- in fact, an insignificant amount for the behemoth company.
"I felt betrayed," she says. "My insurance company is supposed to be there for me. What happens to those 'good neighbors' when you have a fire or you've been in an accident? They beat you up. You feel like you're a victim of your own insurance company."
More than two years after the accident, faced with Zilisch's unrelenting resolve, State Farm finally wrote a check for $100,000. But a higher court later ruled that payment didn't excuse the company's behavior.
Hoping to make State Farm accountable for putting Zilisch through the wringer, Gulinson referred her to Cal Thur, a Scottsdale attorney who has spent much of his career fighting insurance companies. He specializes in "bad faith" cases, litigation which seeks to prove companies have intentionally treated policyholders unfairly, breaching their contractual promise to look after clients.
It was Thur who in 1981 tried the first successful bad-faith case in Arizona in which an insurance company was found to have purposely mistreated its own policyholder. (Before that, Arizona courts didn't recognize that such a thing could occur -- that an insurance company could intentionally abuse its own client.) In nearly 20 years of specializing in nothing but bad-faith insurance cases, Thur has taken 30 cases to trial. Six were against State Farm, more than any other single insurance company. He won five of those.
Thur, who worked for two years as a claims adjuster for Fireman's Fund after moving to Arizona in 1959, has earned a reputation as the go-to guy when other attorneys believe they have taken an insurance dispute as far as they can. And many people -- both consumers and attorneys -- call his office and ask for help with complaints against insurance companies.
"We can't handle all the calls we get," he says.
Taking a bad-faith case to trial involves an incredible amount of preparation. And, Thur says, an attorney can only handle one or two State Farm bad-faith cases at a time because the company's lawyers deliberately tie you up with so much legal paperwork, you can't do much else.
A State Farm lawyer once described this as a "mad dog defense" during a "Trial Preparation Seminar" held at a divisional claims superintendents' conference at the home office. In the 1986 training video, Guy Kornblum, described as the company's "top guy," advised going on the offensive right after being sued.
"And we keep plaintiffs tied up in law and motions for months," he said. "Now it's the old mad dog defense tactic, but it works."