Insurance Expert’s Testimony on Overhead and Profit Calculations Admitted
Posted on November 11, 2025 by Expert Witness Profiler
Plaintiff Nirangtar LLC (d/b/a Red Roof Inn Cave City) (“Red Roof”) alleged that a storm caused damage to its property. At the time of the loss, Red Roof had an insurance policy with Defendant Navigators Specialty Insurance Company (“Navigators”). Because Navigators has not paid Red Roof for its claimed losses, Red Roof filed suit in Barren Circuit Court (Kentucky), which Navigators removed to Federal Court.
Red Roof has recently disclosed expert witnesses, including Deanna Ramsey (“Ramsey”) and Dennis James Kurttila (“Kurttila”). Ramsey, a certified public accountant, was disclosed to express opinions regarding Red Roof’s lost revenue; Navigators contended that Red Roof provided her with the necessary information, then she “simply multiplied (the number of rooms) times (the number of nights they were allegedly unavailable) times (the average rental rate).” Kurttila, a public insurance adjuster, was offered to provide his cost estimate for Red Roof’s repairs and losses resulting from the storm.
Navigators filed motions to exclude the testimony of these two experts.
Insurance Expert Witness
Dennis James Kurttila has been in the construction and general contracting business since 1996. He has gained substantial work experience since 2007 in the claims industry and submitting/ parent damage claims. He is licensed as a Public Insurance Adjuster in the following states: Kentucky, Tennessee, Indiana and Mississippi.
Accounting Expert Witness
Deanna Ramsey, CPA, is a certified public accountant. She has a master’s in accounting. She has prepared individual and business tax returns involving several issues related to trusts, estates, adoptions, independent contractors, education trusts, farming (business and sale), and other variations of business issues.
Discussion by the Court
Red Roof did not object to the exclusion of Ramsey’s testimony. Certainly, a jury would be capable of performing simple multiplication without the aid of an expert, so that motion was granted. Red Roof did, however, contest the exclusion of Kurttila’s testimony. Navigators argued that Kurttila’s testimony should be excluded because it is unreliable and unhelpful, but did not question Kurttila’s qualifications.
A. Reliability
Navigators argued that Kurttila’s proffered testimony is unreliable. Navigators asserted that Kurttila is biased and contested the reliability of his methods and the factual basis of Kurttila’s report.
1. Bias
It is not uncommon for employees of parties—and sometimes the parties themselves—to testify as experts. Thus, though Kurttila may have just “switched hats” from public adjuster to expert witness, that is not sufficient reason to exclude his testimony.
2. Methods
a. Overhead and Profit
Navigators asserted that Kurttila’s testimony relating to his overhead and profit (“O&P”) calculations was unreliable because Kurttila did not know whether Red Roof had retained a contractor nor whether Red Roof could be paid for O&P under Kentucky law. He did testify that, in his opinion, Red Roof should be paid for O&P, that this is standard practice in the insurance business, that this is the case in Tennessee, and two Kentucky hotels damaged in the same storm received settlements that included O&P. Thus, Kurttila had a reasonable basis in his knowledge and experience to include O&P in his estimate.
b. Professional Standards
Navigators noted that Kurttila was unable to articulate the professional standards he used in preparing the estimate.
Red Roof did not contradict this assertion. Though unable to name any specific professional standards, Kurttila testified that he used his “years of contracting and public accounting and working with Xactimate” to come to his conclusions.
Courts have held that Xactimate, a program used by insurance companies and public adjusters to develop estimates, is a reliable method for creating estimates.
However, Kurttila’s inability to name any “professional standards” used does not make his estimate unreliable per se—Red Roof has demonstrated that Kurttila’s estimate has a basis in his knowledge of and experience with these sorts of estimates.
c. Date
Navigators highlighted the fact that Kurttila did not know why he used the month reflected in the estimate.
The Court was convinced that Kurttila’s use of November of 2023 in his estimate did not make his testimony so unreliable that it should be excluded.
November 2023 is after the storm loss occurred, and, on a practical note, the use of November 2023 rather than October 2024 is likely favorable for Navigators, as Kurttila believes prices would have only increased, resulting in a higher estimate.
3. Factual Basis
Navigators argued that Kurttila’s testimony should be excluded because he relied on questionable facts and figures provided by Red Roof. In many cases, Kurttila did not know how Red Roof acquired or calculated that underlying data. Additionally, Navigators avers that the claimed damages exceed the scope of Red Roof’s causation expert’s testimony.
However, Kurttila has remedied some of the inaccuracies. Even where Kurtilla’s estimate may be inaccurate, however, it was based on information supplied to him by Red Roof or from his own observation. Kurttila may rely on Red Roof’s data in his estimate without independently verifying it, under the assumption that it was caused by the storm. Navigators may challenge that data and any assumptions at trial; any weakness in the factual support for Kurttila’s estimate goes to weight, not admissibility.
B. Helpfulness
Navigators argued that Kurttila only performed multiplication and addition to construct his estimate. However, Kurtilla did more than just “basic math.” He generated estimates for several line items using Xactimate, relying on his own professional experience and, in one case, own measurements.
Held
The Court granted the Navigators’ motion to exclude the testimony of Deanna Ramsey but denied the Navigators’ motion to exclude the testimony of Dennis Kurttila.
Key Takeaway:
Some courts have held that, because jurors can perform basic math, expert testimony that can be reduced to a simple calculation violates the principle that an expert’s testimony must involve “specialized knowledge” that “will help the trier of fact to understand the evidence or to determine a fact in issue” and is therefore inadmissible. However, courts “have also treated public claims adjusters and their use of Xactimate as within the realm of expert testimony.” Thus, Kurtilla’s preferred testimony will not be excluded on the basis that it is unhelpful.
Case Details:
| Case Caption: | Nirangtar LLC V. Navigators Specialty Insurance Company |
| Docket Number: | 1:23cv184 |
| Court Name: | United States District Court, Kentucky Western |
| Order Date: | November 10, 2025 |
