Dallas Fort Worth Insurance Lawyer Blog

Business owners in Grand Prairie, Fort Worth, Dallas, Arlington, Cedar Hill, Irving, De Soto, Duncanville, Mesquite, Garland, Carrolton, Farmers Branch, Richardson, and other places in Texas might be interested in the following case if they find themselves in a position where they are buying or selling a business.
The style of the case is, Ford Bacon & Davis, L.L.C. v. Travelers Insurance Co., et al. This case was decided on March 14, 2011, by the United States Court of Appeals for the Fifth Circuit. This is a case where one company purchased the assets of another company.
A 1996 Asset Purchase Agreement (the agreement) was between Ford, Bacon & Davis, L.L.C. (FBD LLC) and Ford, Bacon & Davis, Inc. (FBC Inc.) The agreement explicity excluded coverage relevant to this lawsuit, which is "asbestos related lawsuits."
None the less, FBD LLC argued that Travelers had a duty to defend against the asbestos litigation.
The agreement at issue spelled out certain assets that were being purchased. It also spelled out certain assets that were not being purchased, including "all policies of insurance relating to the business or assets or any rights thereunder," except for certain rights and claims not relevant to this litigation.
The agreement also excluded certain liabilities, including "any liability or obligation, direct or indirect, absolute or contingent, known or unknown, of FBD or any FBD subsidiary ...."
FBD LLC argued that the asbestos litigation transferred by "operation of law" regardless of what the agreement said. This arguement is valid in some states, specifically California and Washington. One of the legal "rules" here is the product-line successor liability rule.
This court got into a discussion and explanation why it did not and would not follow California and Washington law. In doing so they cited the Texas Business Organizations Code, which provides that "a person acquiring property described by this section may not be held responsible or liable for a liability or obligation of the transferring domestic entity that is not expressly assumed by the person." This is found in Section 10.254.
The court then stated, "Therefore, because Texas, unlike California and Washington, does not follow the product-line successor liability rule, the Northern Insurance rule has no application here. Where, as here, the entity purchasing assets has expressly not assumed liability for the assets it purchased, such liability will not extend under "operation of Texas law." Therefore, Travelers does not have a duty to defend FBD LLC, as FBD LLC is admittedly not an insured under Travelers's policies with FBD Inc. and the policies do not extend to FBD LLC by operation of law.
In conclusion the court ruled, "FBD LLC's purchase of assets explicitly excluded both liability for the assets relevant to this case and the insurance policies that covered those assets. Because Texas law does not permit liability to extend by "operation of law" under a product-line successor theory, neither does it permit the insurance coverage of those assets to extend by "operation of law." We therefore affirm the ruling of the district court granting summary judgment to Travelers."
This case is confusing, but it is also important to people who find themselves in the position of buying or selling a business.

Home owners in Grand Prairie, Arlington, Pantego, Fort Worth, Lake Worth, Dallas, Mansfield, De Soto, Duncanville, and other places in Texas would naturally wonder at times about exactly what types of coverages they have on their homeowners policies. Of course the answer is a lawerly "it depends."
One case to look for in guidance for part of the answer is found in the case, Gomez v. Allstate Texas Lloyds Insurance Company. This is a 2007, Fort Worth Court of Appeals case. This is a liability insurance dispute concerning coverage under a homeowner's policy for bodily injury arising out of a "four-wheeler" all terrain vehicle. One of the issues was the trial court's interpretation of the scope of the policy's recreational vehicle exception to the motor vehicle exclusion. Another issue was whether or not Allstate had a duty to defend the lawsuit that had been filed.
The Gomezes sued Jamy and Lara Johnson for injuries alleged to have occurred when Austin Gomez (6 years old) was a guest at the Johnson's home, and Jamy placed Austin on a four-wheeler with no protective gear and allowed him to operate the vehicle. The lawsuit papers allege that Austin lost control and "went over an embankment." The lawsuit alleges several things that the Johnson's did wrong in contributing to the cause of this accident.
The Allstate policy, in the Exclusions section, does not apply to:
"f. bodily injury or property damage arising out of the ownership, maintenance, operation, use, loading or unloading of:
(1) motor or engine propelled vehicles or machines designed for movement on land, ...
However this section does not apply to:
(1) motor vehicles which are not subject to motor vehicle registration and are:
...
(c) designed and used for recreational purposes; and are: ...
(ii) owned by an insured while on the residence premises. ...
(f) used exclusively on the residence premises."
The court discussed insurance policy interpretation rules, which apply the rules of contract construction. In so doing the court stated, "In applying these rules, our primary concern is to ascertain the parties' intent as expressed in the language of the policy. When determining the intent of the parties, we examine only the language of the insurance policy to see what is actually stated. We must consider all of the provisions with reference to the entire policy; no single provision will be controlling. If a policy is so worded that it can be given a definite or certain meaning, then it is unambiguous as a matter of law. A policy is not ambiguous merely because the parties advance conflicting contract interpretations."
Their next statement is important to Insurance Law Attorneys. "Only after we determine that the policy's provision is ambiguous will we construe it liberally in favor of coverage." This means that when a policy can reasonably be read to mean more than one thing the courts will try to find it to read in favor of coverage on a claim.
The "eight corners rule" was also discussed by this court. Under the eight corners or complaint-allegation rule, an insurance company's duty to defend a lawsuit is determined by the third party plaintiff's pleadings, considered in light of the policy provisions, without regard to the truth or falsity of those allegations. The rule takes its name from the fact that only two documents are ordinarily relevant to the determination of the duty to defend: the policy and the pleadings of the third-party claimant.
There were arguements put forth by both parties to the lawsuit which the court looked at closely and discussed the separate sides. The opinion is about ten pages long and is good reading in getting an understanding of how the courts look at these types of cases.
One of the arguements in this case was over where it was that the four-wheeler was located when the alleged accident occurred. Applying the eight corners rule while looking at the pleading on file with the court, this court ruled that it was hard to tell exactly where the accident occurred and thus the insurance company had a duty to at least defend the lawsuit even though it may later be determined that they did not have a duty to pay any resulting judgment from the lawsuit.
At this point the court got into a discussion about the distinction between an insurance company's duty to defend a lawsuit and its duty to indemnify. As the court stated, "The duty to defend and the duty to indemnify are not synonymous. Rather, these duties are separtate and distinct. Unlike the duty to defend, the duty to indemnify is not based on the eight corners of the policy and the underlying petition, but on the actual facts that form the underlying claim. While an insurer's duty to indemnify can be negated for the same reasons an insurer's duty to defend is negated, the duty to indemnify cannot be resolved before the duty to defend."
Probably the bottom line here is that these insurance disputes can be very confusing and this case is an illustration of why an experienced Insurance Law Attorney should be consulted.

If someone in Grand Prairie, Arlington, Fort Worth, Dallas, Mansfield, Duncanville, Cedar Hill, De Soto, Irving, Grapevine, or any other place in Texas gets an insurance claim denied they should not simply give up and go away. That is exactly what the insurance company wants you to do.
Depending on the type of claim that you have the process for what should be done next will vary. One thing that should not vary is the first thing you should do. That is to call an experienced Insurance Law Attorney for a consultation.
The Washington Post ran a positive news article related to this subject on March 16, 2011. The title of the article, which was released by the Associated Press is, "GAO report illustrates success rates for appealing denials of health insurance claims."
The first sentence in the article says, "Don't take no for a final answer when a health insurer rejects a claim and leaves behind an unpaid medical bill." The part that says "Don't take no for a final answer ..." is the part to key into. There are often times many things that can be done to turn that no around. This may be as simple as writing a letter or a phone call in the beginning all the way to a lawsuit and judgment.
The article goes on to tell us that as many as 50 percent of some appeals prompt insurers to reverse their decisions, according to a report from the Government Accountability Office.
One thing for the averge insured to be aware of is that different insurance policies and types of claims require different appeals processes. An attorney comes in handy when knowing what the proper process to follow is in any particular situation. One danger is putting off doing anything. Under some plans, there are time periods within which an appeal must be filed, otherwise there is nothing that can be done. What is tricky about this, is knowing the difference between the insurance plans that say you have to follow a particular process and you actually have to follow that process, and the ones that say you have to follow a particular process and it really does not matter whether you follow that process or not.
Insurers frequently deny claims due to billing errors, missing information or judgments on whether care or service is appropriate. This statement in the article seems to ignore the reality that some insurance companies actually deny claims just because they can. And then they hope the person forgets about, gives up, and goes away.
But as the article states, "These denials can be based on mistakes like an incorrect code on a claim submitted by a doctor's office." There is a not-for-profit organization named, "Patient Advocate Foundation" that helps people appeal claims denials related to health insurance claims.
As the Patient Advocate Foundation says, you've got a lot of people in America who are ultimately paying a bill they don't owe because they don't realize it's an incorrect code.
The GAO studied health insurer rejection rates at the request of Congress, which wanted a better picture of the issue as part of the health care overhaul it passed. The GAO studied data collected from a handful of states and reports done by other agencies. If found that as many as 50 percent of appeals to insurers in Maryland in 2009 led to coverage decision reversals.
In Ohio, 48 percent of appeals to insurance companies led to reversals last year.
The GAO cited a report from America's Health Insurance Plans, which studied 37 state external review programs a few years ago and found that about 40 percent of external appeals led to the reversal of a claim denial.
But here is the catch to these statistics: "These figures do not mean patients have nearly a 50 percent shot at success if they appeal a denial. The statistics are based on cases appealed, and only a small portion of denials are challenged."
As the article points out, "There are many times the claim is denied the first go-round to see if you come back and appeal." A sad way for the insurance companies to do business if you ask this author.
Patient Advocate Foundation, which works in all 50 states, helped more than 17,000 people deal with insurance claims denials last year. A benefit not covered by a health plan is the most frequent reason they see for claim denials.
Coverage parameters can vary widely and they are often determined by the insurance company and the employer that provides group health coverage. For instance, some company plans may not cover Autism treatments or clinical trial enrollments.
Also, it is seen that some insurance companies have tightened restrictions on prescription drug coverage in recent years and added cost control wrinkles like limits on the number of surgeries covered in a year.
This means a breast cancer patient in some cases may have her biopsy and lumpectomy covered but not the reconstructive surgery that follows.
Though this article is dealing with health insurance claims, the reality is that the same techniques and intentions are used in all types of insurance related claims.

Someone in Grand Prairie, Arlington, Mansfield, Hurst, Euless, Bedford, Fort Worth, Dallas, Irving, Mesquite, Garland, Carrolton, Farmers Branch, or anywhere else in Texas may use the term "bad faith" when talking about insurance, but very few people can actually define it. And those who can define it will still have a hard time, in a legal sense, applying that term or definition to a particular fact situation.
The United States District Court, Southern District of Texas, Houston Division, had a case recently dealing, in part, with this issue. The opinion in the case was issued on February 28, 2011, and is styled, C. K. Lee v. Catlin Specialty Insurance Company, Justin Carroll, and Engle Martin & Associates, Inc.
Here are some of the underlying facts:
Lee owns a commercial shopping center. Catlin had issued a policy of insurance on the property which provided coverage of up to $1.7 million for wind-storm damage with a $36,000 deductible. Hurricane Ike then inflicted substantial damage in the area of the property. Lee submitted a loss notice to his agent, Breeden Insurance and Breeden forwarded the loss notice to "AUM", who forwarded it to Catlin. Catlin acknowledged receipt of the claim and assigned it to Engle Martin for adjusting. Engle Martin made attempts to contact Lee but had problems due to Lee being out of the country. A reading of this case shows the extensive efforts made to schedule and conduct inspections on the property. The property was eventually inspected. Engle Martin observed evidence of roof repairs that had apparently been made both before and after Hurricane Ike. Engle Martin also observed debris in various sections of the roof and interior water damage, which led it to conclude that an infrared scan of the roof was necessary to help identify which damages, if any, were attributable to wind and which, if any, were attributable to subpar prior repairs or natural deterioration.
A consultant and engineer were hired to conduct the infrared inspection of the roof. Engle Martin also sent a letter to Lee requesting invoices from the emergency roof repairs that Lee ordered after the hurricane and copies of leases between Lee and the four tenants that occupied the property.
The inspection observed that (1) there was "no wind-related damage" to the roof covering, (2) "the roof membrane was brittle and deteriorated across the entire roof," (3) water infiltration, viewed through infrared photographs, existed in areas of previous repairs and in areas where normal wear and weathering had occurrred, (4) there was "poorly installed roofing material along the parapet wall," and (5) "many areas of gravel ballast were missing prior to Hurricane Ike," confirmed by pre-hurricane aerial photographs. Based on these finding, it was concluded that there was no wind related damage to the roof and no breaches or openings created by wind or wind-borne debris, and that the roof covering had exceeded its life expectancy and was in need of replacement due to normal wear and weathering.
In addition to what is written here, there were many other tests and confirmations of the problems that existed and how these problems came to be other than wind storm damage from Hurricane Ike. The claim was denied by Catlin based on these reports and tests. As a result of the denial, Lee filed a lawsuit based on breach of contract, breach of the duty of good faith and fair dealing, fraud, and violations of the Texas Insurance Code and the Texas Deceptive Trade Practices Act (DTPA).
Catlin eventually filed a "Motion For Partial Summary Judgment" with respect to the bad faith, fraud, and Insurance Code and DTPA claims saying there was no evidence to justify any of these accusations.
The following a words used by the court in deciding this case and they are the same words experienced Insurance Law Attorneys need to be aware of when looking at and evaluating a case:
Under Texas law, there is a duty on the part of the insurer to deal fairly and in good faith with an insured in the processing of claims. To prove that an insurer acted in bad faith in violation of Texas common law, an insured must show that the insurer failed to settle the claim even though it "knew or should have known that it was reasonable clear that the claim was covered." The statutory bad faith standard parallels the common law formulation in Section 541.060(a)(2)(A) providing that an insurer engages in an unfair settlement practice by "failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement of a claim with respect to which the insurer's liability has become reasonably clear."
Evidence that merely shows a bona fide dispute about the insurer's liability on the contract does not rise to the level of bad faith. On the other hand, denying a claim solely in reliance on an expert's report does not shield the insurer from bad faith liability "if there is evidence that the report was not objectively prepared or the insurer's reliance on the report was unreasonable." In determining the reasonableness of an insurer's decision a court reviews the facts that were available to the insurer at the time of denial.
In this case the court found that there was no good reason or evidence that the insurance company acted in bad faith.
The court also said that the evidence developed in the case did not show that Catlin was unreasonable in investigating the claim or in waiting a long period of time before making a determination of what they were going to do with respect to the claim.
On Lee's claim against Catlin for violation of the Prompt Payment of Claims Act, the court let this cause of action go forward against Catlin.
On the DTPA and fraud claims the court did not believe that Lee had provided any reliable evidence that justified these claims to go forward.
This case is really a good case for seeing the factors the courts look at in determing whether the insurance code violations asserted in a lawsuit can go forward.

For someone in Grand Prairie, Arlington, Mansfield, Fort Worth, Dalworthington Gardens, Cedar Hill, Duncanville, De Soto, Crowley, or anywhere else in Texas, the issue of "appraisal clauses" in insurance contracts will occassionally come up. How these clauses in an insurance contract work can be confusing to the normal insured, to experienced Insurance Law Attorneys, insurance adjusters, and the courts.
For the most part, the appraisal clause in an insurance policy comes into play when the insured and the insurance company disagree on the value of a claim. In other words the insurance company agrees they owe money on the claim, but the amount of money they owe may be in dispute. This is common when agreeing to the value of items like, jewelry, antiques, and rare collections. But this dispute can also come up in more common claims such as hail damage claims to roofs.
The Court of Appeals in Beaumont, Texas, issued an opinion on March 10, 2011, that is controversial and is an issue that will play out further in other cases in the future if not in a further appeal in this case. The style of the case is, In Re Southern Insurance Company.
In this case, a homeowner, Michelle Neisen, contends that Southern Insurance Company waived its right under the policy's appraisal clause by denying all liability on Neisen's hurricane damage claim. Per this court, the amount of the loss is at issue in this case, the policy provides for an appraisal process to determine the amount of the disputed loss, and that right has not been waived.
The insurance contract says, if the parties "fail to agree on the actual cash value, amount of loss, or the cost to repair," either party may make a written demand for appraisal. The appraisal clause does not provide for a forfeiture of that right, and the policy states that "no provision of this policy may be waived unless the terms of this policy allow the provision to be waived."
Neisen argues Southern must agree that the loss is covered by the policy before it may "fail to agree" on the amount of the loss. And then says Southern has not agreed that the loss is covered by the policy. The court says that nothing in the plain language of the policy requires Southern to acknowledge liability before it may demand an appraisal.
This appeals court does an analysis of two cases, both Texas Supreme Court cases, one decided in 1888, styled, Scottish Union & National Insurance Company v. Clancy. The other is a 2009, case styled, State Farm Lloyds v. Johnson.
What caused the damages in this case seems to be part of the dispute. Southern contends that the damage to Neisen's home is the result of long term repeated leakage, and Neisen contends the damage was caused by winds during Hurricane Ike.
What the court says in this case is that the appraisal would put a value on the damages sustained and then the parties can litigate whether or not the claim is something that is covered under the policy.
Citing the other case, this court said: "When an indivisible injury to property may have several causes, appraisers can assess the amount of damage and leave causation up to the courts. When divisible losses are involved, appraisers can decide the cost to repair each without deciding who must pay for it. When an insurer denies coverage, appraisers can still set the amount of loss in case the insurer turns out to be wrong. The appraisal clause 'binds the parties to have the extent or amount of the loss determined in a particular way, leaving the question of liability for such loss to be determined, if necessary, by the courts.'"
These cases are often times hard to understand.
What this ruling is trying to say is that the insurance company can still invoke the appraisal clause even though they have denied responsibility for the claim. The purpose of this would be to set a value on the loss. Then if during the litigation process or upon a final determination by a court, it is decided that the insurance company is liable, the value of the loss has already been determined by the appraisal. Of course this does not put an end to other claims and damages that the insured may be eligible for due to wrongs the insurance company may have committed, but it does put a determination on at least one part of the claim.

When someone in Weatherford, Aledo, Hudson Oaks, Peaster, Springtown, Azle, Millsap, Cool, Poolville, Whitt, or out in Mineral Wells, finds themselves in a situation where they have to hire a lawyer and file a lawsuit against an insurance company, they want to win the case. The best chance of doing that is making sure the lawsuit is in a State Court rather than a Federal Court. There are many reasons why a State Court is preferable to Federal Court. All someone really needs to know is that every time an insurance company lawyer can get a case removed from State Court into a Federal Court, they are going to do so. The other thing they need to know is to seek the advice of an experienced Insurance Law Attorney. He will know the best strategies for keeping a case in a State Court.
On January 24, 2011, the United States District Court, Southern District of Texas, Houston Division, issued an opinion in a case where the issue was discussing, in which court the lawsuit should be litigated. The style of the case is, Scott Browning v. Sentinel Insurance Company and Cavalry Construction Co.
Browning had filed the lawsuit in the 11th Judicial District Court of Harris County, Texas, alleging that Calvary, violated provisions of the Texas Insurance Code.
The lawsuit arose in the following way. Sentinel issued an insurance policy to Browning, who is a Texas resident. After his home was damaged during Hurricane Ike, Browning submitted a claim for the property damage. Browning alleges in the lawsuit that Sentinel assigned Calvary to adjust the claim. Legally, Calvary is a Texas resident and Sentinel is not a Texas resident. Uncontroverted evidence submitted establishes that Calvary is not an adjuster and merely provided an estimate for repair work for Browning's home, thus was not a proper party to this insurance dispute.
The issue in these types of cases is called "jurisdictional." In this case, if Calvary is out of the case then the only defendant is Sentinel, who is an out of state defendant and when the only defendant is an out of state defendant and certain other qualifications are met, the defendant can have the case removed to Federal Court.
Here is some of the language the court used in allowing the case to be removed from State Court to Federal Court: Sentinel asserts that Calvary was improperly joined. A non-diverse defendant may be found to be improperly joined if either there is "actual fraud in the plaintiff's pleading of jurisdictional facts" or the removing defendant demonstrates that plaintiff cannot establish a cause of action against the non-diverse defendant. There is no allegation of actual fraud in Browning's pleading of the jurisdictional facts in this case.
The test under the second prong "is whether the defendant has demonstrated that there is no possibility of recovery by the plaintiff against the in-state defendant, which stated differently means that there is no reasonable basis for the district court to predict that the plaintiff might be able to recover against an in-state defendant." The party asserting improper joinder bears a heavy burden of persuation. Any doubt about the propriety of removal must be resolved in favor of remand. If necessary, the district court may "pierce the pleadings" and consider other evidence to determine whether, under controlling state law, the non-removing party has a basis in fact for a valid claim against the non-diverse defendant. This is particularly appropriate where the plaintiff has "misstated or omitted discrete facts" that are relevant to or dispositive of the improper joinder analysis.
The Texas Insurance Code, Section 541.002 prohibits certain practices by persons "engaged in the business of insurance." In this case, the uncontroverted evidence establishes that Calvary is a construction company that was hired by Sentinel to provide an estimate or appraisal of repair costs for the damage to Plaintiff's home. It is well established that Texas law does not recognize a claim under the Texas Insurance Code against independent firms who are hired to provide engineering or similar services to the insurance company. Walker has not cited any exception in which an independent construction firm hired by the insurance company to provide an estimate or appraisal of repair costs is held to be a person engaged in the business of insurance for purposes of the Texas Insurance Code.
The Court then pointed out, in this case, there is no evidence that Calvary participated in any way in the sale or servicing of Browning's insurance policy, made representations to Browning regarding the coverage under the policy, or adjusted the claim. Instead, the uncontested evidence establishes that Calvary provided an estimate. As a result, there is no reasonable basis to predict that Browning could recover against Calvary on his Texas Insurance Code claim.
The Court then ruled: "For the foregoing reasons, the Court concludes that Calvary was improperly joined and its citizenship cannot be considered in determining whether this Court has subject matter jurisdiction based on diversity of citizenship. Because there is complete diversity between Browning and Sentinel, and because the amount in controversy exceeds the jurisdictional amount, the Court has subject matter jurisdiction in this case. It is hereb ordered that Plaintiff's Motion to Remand is Denied."

When someone in Grand Prairie, Arlington, Dallas, Fort Worth, Mansfield, De Soto, Duncanville, Ennis, Weatherford, Aledo, or any other place in Texas, buys life insurance they expect that when they die, the life insurance company will pay the benefits of the policy to their named beneficiary. However that is not always what happens.
The Washington Post published an article on March 5, 2011, titled "Death of a loved one can be beginning of hard fight with life insurer." The article is written by David Evans of Bloomberg News.
The article tells of a lady named Jane Pierce who spent nine years struggling alongside her husband, Todd, as he fought cancer in his sinus cavity. The treatments were working. Then in July 2009, Todd died in a fiery car crash. He was 46. That was the beginning of a whole new battle for Jane, this time with Todd's life insurance company, MetLife.
A state medical examiner and a sheriff concluded that Todd's death was an accident, caused when he lost control of his pickup after passing a car on a two lane road.
Their finding meant Jane was eligible to collect $224,000 on the accidental death insurance policy that Todd had through his employer. MetLife, however, refused to pay. The nations largest life insurer told Pierce on December 8, 2009, that Todd had killed himself. The policy didn't cover suicide.
Pierce was insulted saying "How dare they suggest such a thing." This man who courageously battled cancer for a decade was accused of abandoning his wife and two sons - one a Marine, the other a National Guardsman - and giving up on his fight to live.
She argued with MetLife for months. She gave MetLife the autopsy report, medical records, and a letter from the medical examiner saying the death was an accident. MetLife still said no and in May 2010, she sued them.
In July, a year after Todd's death, MetLife settled and paid Pierce the full $224,000 due on the policy. As part of the agreement, MetLife denied wrongdoings. MetLife did not pay interest or penalties for the year it withheld payments.
Life insurance companies have found myriad ways to delay and deny paying death benefits to families, civil court cases across the United States show. Since 2008, federal judges have concluded that some insurers cheated survivors by twisting facts, fabricating excuses and ignoring autopsy findings to withhold death benefits.
To be fair, life insurers do pay most claims in full - more than 99 percent of the time, according to data from the American Council of Life Insurers, a Washington based trade group. Nobody tracks how often companies delay making payments or how often they use spurious reasons.
As of 2009, the latest year for which figures are available, United States insurers were disputing $1.3 billion in claims. Included in that amount was $396 million in death benefits rejected in 2009. In the same year, insurance companies paid out $59 billion, reports say.
Insurance companies have an obligation to policyholders and shareholders to challenge death claims they consider fradulent. It is their job to protect the insurance pool of reserves to cover benefits by blocking undeserved payouts.
However, that does not give them the right to wrongly deny claims. There is a profound structural conflict of interest. The insurance company benefits if it rejects claims. Insurance companies like to take in premiums, but they do not like to pay out claims.
For this article, MetLife declined to answer questions about any of the cases written on in the article. They also refused to discuss their accicental death policies.
In Texas, life insurance is covered in many areas of the law and statutes. But most of the statutes are found in the Texas Insurance Code Section 801 and 1101. The subsections in these two sections and other sections of the insurance code discuss and spell out the remedies available when an insurance company mistreats an insured or beneficiary.
Of course, whenever there is dispute with a life insurance company, an experienced Insurance Law Attorney should be talked to. That attorney will know the insurance laws and the other areas of law that would be beneficial to helping the insured receive the benefits to which they are entitled

For folks in Grand Prairie, Arlington, Fort Worth, North Richland Hills, Hurst, Euless, Bedford, Keller, Colleyville, Saginaw, Lake Worth, and other places in Texas, interpreting an insurance policy is something that is very hard to do. Even an experienced Insurance Lawyer cannot always assure someone who asks what an outcome may be if there is a dispute.
Based on decisions and opinions issued by courts in Texas, an experienced Insurance Law Attorney can give guidance to probable outcomes of disputes. Here is one of those cases that the attorney would have read and used as a resource.
The case is Colony Insurance Company v. ACREM, INC. d/b/a Stetsons Nightclub, and was decided by the United States District Court for the Southern District of Texas Houston Division. The opinion was issued on February 23, 2011.
This case, a declaratory judgment action, arises out of lawsuit filed in state court wherein the plaintiffs sued Stetsons for an alleged accident that occurred while plaintiffs were patrons of Stetson's on the evening of September 1, 2007. The plaintiffs allege they were leaving the nightclub and while walking through the Stetson's parking lot, they were struck from behind by a vehicle driven by patrons of Stetson's that night. The plaintiffs allege that Stetsons improperly provided alcohol to the patrons when they were obviously intoxicated. Stetsons filed a claim under their policy of insurance with Colony asking Colony to defend the lawsuit and provide indemnity for any resulting judgment against it. Colony denied that it owed Stetsons a duty to defend or indemnify.
Colony filed this lawsuit in Federal Court asking the court to issue an order saying that Colony did not have a duty to defend or indemnify based on policy language in the policy.
Colony relies on the "Absolute Auto, Aircraft and Watercraft Exclusion" (Auto Exclusion), that excludes coverage for any bodily injury arising out of or resulting form the use of an automobile. Stetsons replies on the "Limitation to Coverage to Business Description" (Business Limitation), that limits coverage to bodily injury that is caused by or results from the business described in the policy, specifically as "Bar with Dance Floor."
In discussing this case the court said it was well settled law that, "An insurer owes its insured a duty to defend if a plaintiff's factual allegations potentially support a covered claim. Whether the insurer owes a duty to defend is question of law for the Court to decide. When faced with a coverage dispute, the Court must give effect to the intention of the parties as that intention is expressed in the insurance policy itself."
The focus for the court is on the factual allegations in the underlying complaint, not on the legal theories. The Court is required to "resolve all doubts regarding the duty to defend in favor of the duty" and to "construe the pleading liberally." The law is clear that when a lawsuit potentially includes a covered claim, the insurer must defend the entire lawsuit.
"Where there is no duty to defend, and there are no facts alleged in the underlying lawsuit that could create coverage if proven at trial, the Court may conclude that the insurer had no duty to indemnify for the claims in the underlying lawsuit."
In this case, the court said that the policy includes an Auto Exclusion that excludes coverage for bodily injury arising out of or resulting from the use of any automobile. The plain meaning of the Auto Exclusion is that it excludes coverage for claims that arises out of incidents involving automobiles.
The court did not accept any of the arguements by Stetsons. The court pointed out that the Auto Exclusion precluded coverage whether the automobile was owned and/or operated by the insured or by a third party because the exclusion applied to bodily injury arising out of or resulting from the use of "any" automobile and did not distinguish between "cars owned and operated by the insured and cars owned and operated by patrons."
Stetsons argued that it intended for the Auto Exclusion to exclude coverage only if the automobile involved in the incident was owned or operated by an employee and other agent of Stetsons. This arguement failed because it is unsupported by clearly established Texas law. Under Texas law, the intent of the parties is determined by the unambigouous terms fo the contract itself.
The court ended up ruling that there was no coverage provided by this insurance policy for the claim being made. A reading of this case helps in allowing an understanding of how the courts look at these coveage issue cases.

Business owners in Weatherford, Parker County, Aledo, Azle, Mineral Wells, Millsap, Hudson Oaks, Brock, Springtown, Poolville, Cresson, and other communities through out Texas would naturally wonder about the coverages provided in their commercial insurance policies. Very few people would understand all the language. This lack of understanding extends to insurance agents, insurance companies, and even the courts and experienced Insurance Law Attorneys. The value of attorneys who deal in this area of the law is that they can provide guidance in how the courts would ultimately decide in the cases where there is a dispute.
The Burlington Northern and Santa Fe Railway Company F/K/A The Atchison, Topeka and Santa Fe Railway Company v. National Union Fire Insurance Company of Pittsburg, Pa. The opinion in this case was issued on February 25, 2011.
This is an insurance coverage dispute case. The insurance company took the position that based on policy language and the pleading in the lawsuit in which their insured was sued that they had no duty to defend the lawsuit or pay any damages. This is known as the "eight corners rule", the eight corners being the "four corners" of the insurance contract and the "four corners" of the pleading, or lawsuit papers. In other words, when the two are read together, is there anything in the lawsuit allegations that invoke responsibility by the insurance company in the insurance contract to defend their insured or pay for any damages that may be part of the lawsuit.
National Union filed summary judgement motion with the trial court that was granted. The first level appeals court upheld the trial court decision. The Texas Supreme Court reversed the court of appeals and remanded the case back to the trial level for further determinations.
The lawsuit papers said in part:
The Railroad had a contract with SS Mobility Company to carry out chemical weed control. SS Mobility failed to use reasonable care to carry out its chemical weed control, and because of its improper timing in the application of chemical weed control, there was excessive vegetation at the crossing at the time of the collision, which proximately caused the collision.
Burlington Northern asked National Union to defend them in the lawsuit and National Union denied a defense saying they had no duty based on the eight corners rule. The underlying lawsuit was tried to a jury and Burlington was ordered and did pay the injured claimant. Burlington then filed this suit against National Union.
This Supreme Court stated; "As relevant to our consideration of this matter, National Union's policy coverage contains a "completed operations" exclusion which excludes coverage for "all 'bodily injury' and 'property damage' occurring away from premises [Mobley] owns or rents and arising out of [Mobley's] product or work." "However, the policy also excepts from the completed operations exclusion "work that has not yet been completed or abandoned." The policy provides that Mobley's work would be "deemed completed" at the earliest of the following times:
(1) When all of the work called for in the contract has been completed.
(2) When all of the work to be done at the site has been completed if the contract calls for work at more than one site.
(3) When that part of the work done at a job site had been put to its intended use by any person or organization other than another contractor or sub-contractor working on the same project.
The policy also states:
Work that may need service, maintenance, correction, repair or replacement, but which is otherwise complete, will be treated as completed.
Here the court of appeals had determined that National Union did not have a duty to defend because the language in the plaintiffs' pleadings referenced Mobley's actions as having happened in the past, so the policy's "completed operations" exclusion precluded a duty to defend. But unlike the cases cited by National Union in support of their position, in this case, the pleadings do not show that contractual provisions and other extrinsic evidence cannot possibly bring Mobley's vegetation control operations within coverage of Natinal Union's policy for the 1995 accident because the Mobley contract term was "1994 through 1996".
In this case the court stated, "Assuming, without deciding, that the court of appeals correctly determined that National Union owed no duty to defend, the court nevertheless erred by not considering all the evidence presented by the parties when it determined the question of National Union's duty to indemnify Burlington.
These cases can be very confusing, even to experienced attorneys, but these cases are instructive in helping attorneys understand how the courts look at these issues.

Folks in Weatherford, Parker County, Aledo, Azle, Springtown, Poolville, Whitt, Peaster, Hudson Oaks, Brock, Willow Park, Cool, Millsap, and other places in Texas will at one time or another have a claim against their own insurance company. When making this claim against their own insurance company, otherwise known as a first party claim, and the insurance company does not treat you properly in the handling of the claim it is likely that there have been violations of provisions of the Texas Insurance Code. When this happens it is advisable to seek the assistance of an experienced Insurance Law Attorney. Here is what he should tell you.
1) gather all the documents you have related to the claim, such as the policy itself, letters and e-mails and faxes to and from the insurance company, and any documents verifying the value of the loss such as repair bills or estimates;
2) write out what has happened - this should be your version of the sequence of events with all the relevant information to help the attorney understand the case - the writing should start out: My name is ..., I have a policy of insurance with ..., On such and such date ... happened, I then made a claim to my insurance company for benefits. Then write down a sequencial listing of what happened in the claims process.
With all this information the attorney can then give the required 60 day notice letter to the insurance company detailing what has happened and what it has cost the insured. Then the attorney put can plug in all the legal information that sets forth the duties and responsibilities of the insurance company and based on the information provided by the insured the attorney can put in writing the various provisions in the insurance code that appear to have been violated along with a demand that the situation be remedied within the 60 day period or a lawsuit will be filed.
The United States District Court for the Southern District of Texas, Houston Division recently issued an opnion on a case where the 60 day notice provision of Texas Insurance Code, Section 541.154. The style of the case is, Greater Mount Zion Baptist Church v. Harry Blaker and Union Insurance Co., and the opinion was issued on February 14, 2011.
In the case, Zion Baptist sued the defendants for violations of the insurance code. The defendants caused the case to be removed to Federal Court and filed a verified plea in abatement. The abatement was filed in accordance with the Insurance Code, Section 541.155.
Section 541.154(a) of the Texas Insurance Code states: "A person seeking damages in an acton against another person under this chapter must provide written notice to the other person not later than the 61st day before the date the action is filed." Section (b) says: "The notice must advise the other person of: (1) the specific complaint; and (2) the amount of actual damages and expenses, including attorney's fees reasonably incurrred in asserting the claim against the other person."
There is an exception to giving the notice. That exception is found in subsection (c), which says: "The notice is not required if giving notice is impracticable because the action: (1) must be filed to prevent the statute of limitations from expiring; or (2) is asserted as a counterclaim."
As this court stated, the purpose of the 60-day notice requirement under the Texas Insurance Code is to "discourage litigation and encourage settlements of consumer complaints." This was citing Hines v. Hash, a 1992, Texas Supreme Court case.
The notice requirement is intended to give a defendant insurance company a right and opportunity to make a settlement offer.
Quoting the court, "If a plaintiff fails to comply with the notice requirement, 'abatement of the action for the statutory notice period is more consistent with the purpose of notice than dismissal.'"
The court went on to say that the statutory written notice must advise the other party in reasonable detail of "the specific complaint" and "the amount of actual damages and expenses, including attorney's fees reasonably incurred in asserting the claim against the other person.
In this case, the court found no indication that a statutory notice letter had been filed. Nor did they find either of the two exceptions to the requirement to give the notice. As a result the case was abated until 60 days after the plaintiff provides "written notice to the defendants as required by the Texas Insurance Code ..."

Drivers in Grand Prairie, Weatherford, Arlington, Fort Worth, Dallas, Irving, Duncanville, De Soto, Mansfield, Crowley, Burleson, Benbrook, and other places in Texas may wonder how the liability portion and underinsured portion of their automobile policy work. To begin with, there is not a short simple answer. Each situation has to be looked at and the policy read in conjunction with a particular fact scenario. Certainly one of the first things to do is to get with an experienced Insurance Law Attorney. That attorney would know the questions to ask and what to look at to give reliable guidance.
Here is a case for thought. The case is George Rosales and Ester Rivera v. State Farm Mutual Automobile Insurance Company. This case was decided by the Austin Court of Appeals in 1992.
George Rosales and Ester Rivera sued State Farm Mutual Automobile Insurance to recover underinsured motorist (UIM) benefits under a Texas Standard Liability Policy issued to Sharon Barrett. The trial court concluded that Rosales and Rivera could not obtain liability and UIM benefits under a single insurance policy, and granted summary judgment in favor of State Farm. This appeals court affirmed the trial court ruling.
Here are the facts. On March 3, 1990, Rosales and Rivera were passengers in Barrett's 1987 Ford Tempo when it collided with another vehicle. It was undisputed that Barrett caused the accident, and that Rosales and Rivera were seriously injured. Barrett carried a State Farm automobile-insurance policy that provided liability and uninsured/underinsured motorist (UM/UIM) coverage. State Farm paid Rosales and Rivera $25,000 each, the maximum amount of bodily-injury liability insurance available per person under Barrett's policy. In addition, Rosales and Rivera received UIM benefits from their own insurance policies. Rosales and Rivera also made claims for UIM benefits under the Barrett policy, but State Farm denied those claims.
Rosales and Rivera filed suit against State Farm, seeking recovery of UIM benefits under Barrett's policy, and other claims not relevant here. State Farm moved for summary judgment on the ground that it had no obligation to pay UIM benefits to Rosales and Rivera because Barrett's vehicle was not an underinsured vehicle according to the policy's terms.
The legal discussion was that Rosales and Rivera contended that the trial court incorrectly applied Texas substantive law in rendering judgment in favor of State Farm. They argued that State Farm incorrectly applied an exclusion in Barrett's policy to deny them benefits. State Farm responded that Rosales and Rivera are not entitled to UM/UIM benefits because, by definition, Barrett's vehicle is not an underinsured vehicle.
The appeals court pointed out that Barrett's policy specifies that UM/UIM vehicles do not include vehicles owned by or furnished or available for the regular use of the named insured. Both sides stipulated that Barrett was the named insured on the policy at issue in this cause, and that Rosales and Rivera were riding in a vehicle "owned by or available for the regular use of Sharon Barrett" at the time of the accident. From these stipulated facts, the court concluded that the policy's unambiguous language supports State Farm's coverage position.
Rosales and Rivera made other arguements but were overruled on these other issues also. In closing the court stated, "State Farm argues that Barrett did not purchase UIM coverage for the purpose of increasing her own policy limits or protecting her passengers from her own negligence, but as protection from the negligence of other uninsured and underinsured drivers. State Farm contends that permitting Rosales and Rivera to recover both liability and UIM payments under Barrett's policy would effectively convert UIM coverage into a second layer of liability coverage, a result not contemplated by the parties to the policy and not calculated in the cost of the policy premium. We agree with State Farm and conclude that UIM coverage is not available for damages sustained by a passenger who has already recovered the full amount of liability limits under the same policy."
So, with Rosales and Rivera having recovered the liability limits under Barrett's policy, they were precluded from recovering the remainder of their damages under the UIM provision of that same policy.

Here is good information for someone sued in Grand Prairie, Arlington, Fort Worth, Dallas, Weatherford, Lake Worth, Roanoke, Newark, Saginaw, and all other places in Texas.
What happens when you are sued? Does the insurance company automatically protect you?
Here is a partial answer to the above.
In 2008, the Texas Supreme Court decided a case styled, National Union Fire Insurance Company of Pittsburg, PA v. Beatrice Crocker. This was an insurance coverage case that went to the Texas Supreme Court from the Federal District Court asking guidance from the Texas Supreme Court on how Texas law handled the situation. This is called a certified question.
The principle issue was whether an insurance company has a duty to notify an additional insured of available liability coverage.
Here are some facts of the case:
Beatrice Crocker was a resident of Redwood Springs Nursing Home, which is owned by Emeritus Corporation. She filed suit against Emeritus and Richard Norris, a nursing home employee, seeking compensation for injuries suffered when she was hit by a door swung open by Morris. Crocker's claims against Emeritus were covered by a commercial general liability policy issued by National Union Fire. Because Morris was acting within the course and scope of his employment when the accident occurred, he qualified as an additional insured under the policy. National Union Fire defended Emeritus, the named insured, but did not defend Morris even though the claims against him were covered by the policy and Natinal Union Fire knew he was a named defendant that had been served with legal papers. Morris was not aware of the terms and conditions of the policy and did not realize he was an additional insured under the policy. National Union Fire did not inform Morris he was an insured and did not offer to defend him. Morris did not forward the lawsuit papers to National Union Fire and did not ask them to defend him.
In this case, a judgment against Morris resulted when he did not appear for trial and National Union Fire did not defend him. Crocker then sued National Union Fire asserting she was a third party beneficiary of the policy. National Union Fire is claiming that Morris never triggered the duty to defend because he failed to forward the suit papers or otherwise notify them that he had been sued and he did not ask National Union Fire to provide a defense.
The insurance policy at issue here says:
"Before coverage will apply, you must notify us as soon as possible of an occurrence or offense which may result in a claim or suit against you.
Notice should include:
How, when and where the occurrence or offense took place;
Names and addresses of any witnesses and injured people;
Nature and location of any injury or damage.
Before coverage will apply, you must notify us in writing of any claim or suit against you as soon as possible. You must:
Immediately record the specifics of the claim and the date you received it;
send us copies of all demands, suit papers or other legal documents you receive, as soon as possible."
National Union Fire contended that, because Morris failed to comply with the notice provisions, he did not invoke coverage or the right to a defense under the policy, meaning that Crocker, who now purports to stand in Morris's shoes, cannot collect under the policy either.
The court went on discussing the law and citing other cases for support of their decision in this case.
The ultimate decision by this court was: "Insurers owe no duty to provide an unsought, unrequested, unsolicited defense. ... Accordingly, because insurers need not provide coverage to additional insureds who never seek it, National Union had no duty either to inform Morris of available coverage or to voluntarily undertake a defense for him, and its actual knowledge did not establish lack of prejudice as a matter of law."
An experienced Insurance Law Attorney knows ways to get an insurance company to provide a defense in cases such as the one above. That is a big reason why their advise should be sought early on in any potential claim a person has.

Someone in Weatherford, Aledo, Azle, Brock, Hudson Oaks, Annetta, Mineral Wells, Cool, Millsap, Peaster, Poolville, Whitt, Lipan, and other communities in Texas probably does not know very much about Personal Injury Protection (PIP) on their automobile insurance policy. One of the things they should know is that it is a coverge they have automatically unless they reject it in writing.
The Texas Insurance Code, Section 1952.152(a) says:
An insurer may not deliver or issue for delivery in this state an automobile liability insurance policy, including a policy provided through the Texas Automobile Insurance Plan Association under Chapter 2151, that covers liability arising out of the ownership, maintenance, or use of any motor vehicle unless the insurer provides personal injury protection coverage in the policy or supplemental to the policy.
Subpart (b) of this same section says:
The coverge required by this subchapter does not apply if any insured named in the insurance policy rejects the coverage in writing. Unless the named insured requests in writing the coverage required by this subchapter, the insurer is not required to provide that coverage in or supplemental to a reinstated insurance policy or renewal insurance policy if the named insured rejected the coverage in connection with that insurance policy or an insurance policy previously issued to the insured by the same insurer or by an affiliated insurer.
Reading the above sounds well and good - but what if the insurance policy was purchased over the internet? If it was purchased over the internet, which a lot of policies are, how does the "rejection in writing" work for the PIP?
At a minimum the insurance company needs to show that it is the insured that made the rejection which is usually done by an electronic signature.
The Texas Department of Insurance put out a rather vague bulletin concerning this issue. The bulletin says they are adopting the Uniform Electronic Transaction Act.
The Texas Department of Insurance bulletin says, "Texas UETA creates a statutory structure in Texas that supports the use of electronic signatures and electronic records in everyday public and business undertakings. Texas UETA addresses the effect of electronic transactions as follows:
a. A record or signature may not be denied legal effect or enforceability because it is in electronic form.
b. A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation.
c. If a law requires a record to be in writing, an electronic record satisfies the law.
d. If a law requires a signature, an electronic signature satisfies the law."The UETA is found in the Texas Business & Commerce Code, Chapter 43. "a" through "d" above is found in Section 43.007.
Chapter 43 of the Texas Business & Commerce Code is a good law to know, if for no other reason than to see laws keeping up with technology. As for the PIP rejection issue in this article, the issue that could still be contested is whether or not it was one of the named insured's who completed the electronic rejection.
Chapter 2151 mentioned above deals with the type of insurance that is provided to individuals who have been refused insurance coverge due to their driving history or some related driving issue. Section 2151.102(b) says:
An applicant is not eligible for insurance through the association unless the applicant and the servicing agent certify as part of the application to the association that the applicant has been rejected for insurance by at least two insurers that are authorized to engage in business in this state and that are writing automobile insurance in this state.
As a final point. PIP coverage is required by Texas Insurance Code, Section 1952.153, to be in atleast a minimum amount of $2,500. Some insurance carriers will allow their insured to purchase as much as $100,000 of PIP coverage.

It happens in Grand Prairie, Weatherford, Arlington, Dallas, Fort Worth, Roanoke, Keller, Colleyville, North Richland Hills, Grapevine, and all over the state. Someone has some property damage. They call their insurance company. The insurance company suggests they call XYZ company. The insured calls XYZ company. XYZ company does something wrong in their dealings with the insured. The question becomes: Is the insurance company responsible for any wrong committed by XYZ company?
The most common situations where the above happens is car wrecks. After a car wreck the insurance company often suggests a repair shop to take the car to for repairs. The second most common situation is home repairs. A home owner has hail damage, flood, or fire and the insurance company suggests a company to make the repairs.
The Texas Court of Appeals in Dallas recently had a case that involved a theft. The opinion was issued on February 8, 2011, and the case is styled, J. Howard Jaster, Individually and as Assignee of the Edinberg Trust v. Shelter Mutual Insurance Company. In this case Jaster alleged that Shelter Mutual Insurance Company (Shelter) was an agent of Michael Hanna d/b/a Cornerstone Replacement Services (Cornerstone).
Here is some background. In 2004, Jaster moved from Tennessee to Texas. Shorty after he arrived, the U-Haul truck containing his personal property was stolen. The stolen propery included valuable antique furniture, paintings, and other items of high value. Jaster filed a claim with his insurance company, Shelter. Shelter contacted Cornerstone to do an appraisal and told Jaster that Cornerstone would be contacting him. Because Jaster decided to go with Cornerstone to replace the stolen property, he asked Shelter to pay the settlement funds directly to Cornerstone. A check for $189,875.03 was issued to Jaster with Jasters' name and Cornerstone. Jaster endorsed the check over to Cornerstone.
Soon thereafter, Jaster canceled his order with Cornerstone and requested a refund. Cornerstone issued a refund but the check bounced. Ultimately, Cornerstone returned $140,000, but never repaid the remaining amount. After talking with Shelter for a period of time, Jaster eventually sued Shelter and Cornerstone alleging that Cornerstone was an agent of Shelter.
This case evolves into a case where the issue became an arguement about the questions that were submitted to the jury. In these questions, Jaster was trying to get the jury to answer in such a way as to agree that the evidence established that Cornerstone was an agent of Shelter. The appeal point in this case was whether or not these questions proved the point that Jaster was trying to establish.
The lesson to be taken from this case for insureds who are making an insurance claim where the insurance company refers the insured to other vendors is to be aware how courts look at the facts in these cases. For the insured, the first thing to keep in mind is that they should be working with an experienced Insurance Law Attorney to make sure their rights are protected. Beyond that, is to keep good records of what happens. The insured would want to keep copies of all letters, memos, e-mails, and text messages related to the claim. While the claim is going on, the insured should keep a small notebook or computer message detailing all oral conversations with the adjuster and the vendor. Hopefully the claim goes smooth and the case is resolved and the insured can get on with their life. But, too many times problems arise. When they do, it is often times difficult to go back and try to remember all that was said, when it was said, and the context in which it was said. It is important to keep in mind that this is a business transaction taking place between the insurance company and the insured and in that setting it is important to keep a record of what has transpired in the event there is a conflict at some point.
Whether or not there is an agency relationship between the insurance company and the vendor is not always clear. Where it is not clear, then the evidence of what happened including all the communications mentioned above become relevant in determining whether or not the agency relationship is able to be established. It is often times important to prove this relationship because many times the vendor is insolvent or not insured or does not have sufficient monies to pay for the wrongs they may commit thus being able to look back at the insurance company for compensation becomes vital.

Claimants in Grand Prairie, Weatherford, Arlington, Fort Worth, Dallas, Mansfield, Irving, Hurst, Euless, Bedford, Keller, Azle, Aledo, and any other place in Texas would naturally wonder about the value of any claim they may have against an insurance company. Sometimes the valuation is very simple. An example would be where your car is a total loss and it is insured for $10,000 and you and the insurance company agree it is worth $10,000. You look at your policy and determine that you have a $500 deductible and thus you are entitled to a payout of $9,500.
If only they were all so simple.
Here is an actual case example that is less logical. On February 4, 2011, the Court of Appeals for the Seventh District of Texas at Amarillo issued an opinion styled, Progressive County Mutual Insurance Company v. Natividad Delgado.
Here is some background. In December 2007, Delgado filed a negligence action against George Brent Bailey, Jr. Bailey had been towing an auto which became disconnected and struck Delgado's pickup. Delgado also sued Progressive for recovery of underinsured benefits alleging that Bailey was underinsured. Delgado settled with Bailey's insurance company for the policy limits of $25,000. At trial against Progressive, Delgado was awarded $52,968.39 for his medical expenses, $13,258.00 for his past physical pain, $5,000.00 for past physical impairment, and $1,200.00 for past lost earning capacity.
In this case Progressive was entitled to an offset for the $25,000 paid by Bailey's insurance plus an offset of $2,500 already paid by Progressive as part of Delgado's PIP coverage.
Here is where the case gets tricky / confusing:
Delgado had health insurance that had allready paid the medicals. Pursuant to the contract between Delgado, the health insurance, and the medical providers, $4,763.77 had been paid to the medical providers as full and final payment on Delgado's bills with no more money due from Delgado.
At this point a relatively new law that was enacted, Texas Civil Practices & Remedies Code, Section 41.0105, purports to limit Delgado's claim on his medical bills to what was actually "paid," the $4,763.77, rather than the amount "incurred", which was $59,968.39. This is called the "paid" versus "incurred" issue in cases involving medical bills.
So now, instead of a claim for $52,968.39 in medical bills, Delgado was left with a claim for $4,763.77 in medical bills. When this amount is added to the amounts for past physical pain, past physical impairment, and past lost wages, the total is less than the $25,000 already received by Delgado from Bailey's insurance company. Thus, the court said that Delgado did not have an underinsured motorist claim.
The result in this case is being disputed all over the state of Texas. There have been other appeals level courts that have made ruling on this "paid" versus "incurred" issue. This issue arises out of the Section 41.0105 referred to above. Ultimately this issue will be decided by the Texas Supreme Court.
The arguement on this issue can be very confusing when the following is considered.
1) the law in Texas has long been that courts are not suppose to take into evidence any "collateral" sources of payments for medical expenses. This is called the "collateral source rule." This means that a Judge or jury is not to consider whether or not there is other insurance available.
2) many times the money recovered for medical expenses has to be used to pay those bills or if the bills have already been paid, to be used to reimburse whoever has made those payments.
3) why should the person who caused the injury get the benefit of a contract the injured person has with someone else - in this case the injured person's health insurance.
4) this ruling does not take into account the monies that have been spent by the person with insurance to maintain that insurance.
5) this ruling does not take into account the possibility that the person who has the insurance may now get his insurance rates raised or his policy cancelled due to the claim.
These are just five of the many arguements against the fairness of this ruling. There are also many other arguements related to the legislative intent of the law when it was passed and the wording of the statute.
As stated above, this is not the end of this issue. This is a case that will ultimately be decided by the Texas Supreme Court. Also, the Texas Legislature is looking at rewriting this law to make the intent of the law more clear.
There are ways to diminish the harm that results from this law. An experienced Insurance Law Attorney can be useful in navigating this law and optimizing a recovery for his client.

Consumers in Grand Prairie, Arlington, Dallas, Fort Worth, Mansfield, Irving, De Soto, Duncanville, Cedar Hill, Lancaster, Mesquite, and other places in Texas recently got exposed to what can be called a violation of the Texas Deceptive Trade Practices Act. This argueably occurred at the Super Bowl at Cowboys Stadium.
An internet publication called the "Business Wire" ran an article on February 8, 2011. This article is titled, "Class Action Lawsuit Filed by Eagan Avenatti, LLP Against Jerry Jones, the Dallas Cowboys and the NFL over Treatment of Super Bowl Ticker Holders." The lawsuit claims fraud on displaced fans and Cowboys Stadium "Founders."
The article in part, tells us:
-- Eagan Avenatti, LLP, a law firm specializing in consumer rights, filed a class action lawsuit earlier in the day in the United States District Court for the Northern District of Texas, Dallas Division, alleging breach of contract, fraud and deceptive sales practices by Jerry Jones, the National Football League, the Dallas Cowboys Football Club and related defendants in connection with Super Bowl XLV.
The complaint, which seeks compensary damages of over $5 Million, claims that the unlawful acts of Jones, the NFL and the Cowboys resulted in approximately 400 fans who purchased tickets and traveled to the game being denied a seat, despite having spent thousands of dollars in tickets and travel expenses to attend the Super Bowl. The complaint also alleges that Jones and the Cowboys deceived Cowboys season ticket holders known as the "Founders" into paying $1,200 a seat for Super Bowl tickets that turned out to be temporary seats with obstructed views.
The "Founders," who collectively account for over $100 Million in personal seat licenses sold to help fund construction of the stadium, each paid at least $100,000 per seat for their seat license, which the Cowboys and Jones promised would entitle them to the "best sightlines in the stadium" and the right to purchase a ticket to the Super Bowl at face value. Instead, they arrived at the stadium to discover that they had been assigned to sit in obstructed view, temporary metal seats, which had only recently been installed in an effort to meet Jones' goal of breaking NFL Super Bowl attendance records.
"You don't have to own the Cowboys or run the NFL to know that you cannot lawfully treat people like this," stated lead attorney Michael Avenatti. "At an absolute minimum, Jones, the Cowboys and the NFL need to accept full responsibility and reimburse fans one hundred percent for their expenses and damages. Anything short of that is a slap in the face to the fans of the NFL and the Cowboys." --
The law that governs this type of wrong doing is found in part in the Texas Business & Commerce Code, Section 17.46.
Section (a) tells us, "False, misleading, or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful and are subject to action by the consumer protection division under Sections 17.47, 17.58, 17.60, and 17.61 of this code.
Section (b) and it's relevant subparts say:
(b) Except as provided in Subsection (d) of this section, the term "false, misleading, or deceptive acts or practices" includes, but is not limited to, the following acts:
...
(5) representing that goods of services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities which they do not have ...
(7) representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another; ...
(9) advertising goods or services with intent not to sell them as advertised; ...
(12) representing that an agreement confers or involves rights, remedies, or obligations which it does not have or involve, ...
The above would be only a partial list of the legal claims that may be applied to the facts in the lawsuit mentioned above.
Section 17.50(b)(1) tells of the relief that may be available to the claimants above in the event they prevail after going all the way to a trial. It says:
(b) In a suit filed under this section, each consumer who prevails may obtain:
(1) the amount of economic damages found by the trier of fact. If the trier of fact finds that the conduct of the defendant was committed knowingly, the consumer may also recover damages for mental anguish, as found by the trier of fact, and the trier of fact may award not more than three times the amount of economic damages; or if the trier of fact finds the conduct was committed intentionally, the consumer may recover damages for mental anguish, as found by the trier of fact, and the trier of fact may award not more than three times the amount of damages for mental anguish and economic damages.
Violations of the Texas Deceptive Trade Practices Act can be severe. Subsection (d) allows recovery of court costs and attorneys fees.
Any time a consumer believes a business has violated one of the provisions of the Act they should consult with an attorney who handles these types of cases.

There are insurance agents in Grand Prairie, Arlington, Dallas, Fort Worth, Mansfield, Crowley, Everman, Burleson, Benbrook, Lake Worth, and all over Texas. What happens when one of those insurance agent is cheating? The answer would depend on how it is that they are "cheating". Some of their actions are violations of the Texas Insurance Code. Other times their actions are outright fraud or criminal in nature. One thing for certain is that an experienced Insurance Law Attorney needs to be consulted as soon as you think something is wrong.
A February 8, 2011, article illustrates what some agents do. The article was published in the MetroWest Daily News, a Framingham, Massachusetts, newspaper. The article is titled, "Insurance Scam Hits Framingham Towing Company." The article is written by Danielle Ameden, a staff reporter for the newspaper.
The article in part says:
The state is investigating a licensed insurance agent who allegedly fleeced a local towing company into buying a fake insurance policy.
Townando Towing at 93 Beaver St. filed a complaint against Somerville agent James I. Rider last November with the state's Division of Insurance. Rider claimed to have bought the firm a policy for commercial auto liability insurance back in November 2009 through Pilgrim Insurance, according to Townando.
But when Townando called to report two minor accidents last year, the company found out the deal was a fraud, office manager, Simone Barbosa, said.
"The policy number they had belonged to someone else," said the attorney for the towing company.
Rider provided Townando with monthly invoices and collected payments, but kept the money and didn't buy them insurance. "I was shocked to be honest with you," said Barbosa. For the crashes, Townando, owned by Fernando Vieira, ended up having to pay for damage out of pocket.
As investigators work, Townando is seeking a settlement of over $25,000 from Rider for reimbursement, related costs and as payback for lost customers.
Townando is now fully insured through a different company, but his attorney says the damage has been done.
"In a community like Framingham, it's important to keep your reputation if you're a small business," he said. "Nobody's going to want to use a towing company that doesn't have insurance."
Townando counts filing a lawsuit as an option, his attorney says.
Rider has not returned calls.
His invoices list a post office mailbox address in Somerville and an office on Tufts Street.
A Division of Insurance spokesman said Rider's agent license is still active.
Penalties the division commonly hands down as a result of investigations range from a cease and desist order to fines and / or license suspensions or revocations, said Jason Lefferts, spokesman with the state's Office of Consumer Affairs and Business Regulation.
Barbosa filed a copy of her complaint with the Better Business Bureau and the Insurance Fraud Bureau of Massachusetts.
That quasi-private agency only does criminal work, and refers their investigations to district attorneys, the U.S. attorney's office, state attorney general's office and licensing agencies.
Rider never worked directly for Pilgrim Insurance, Pilgrim said in a statement. Instead, his agency was assigned on May 19, 2009, to work with Pilgrim as an involuntary agent by the Commonwealth Automobile Reinsurers. He wrote policies for high-risk drivers.
"Upon becoming aware of his assigned agency's business practices and an ongoing investigation being conducted by the Division of Insurance, we terminated our relationship with James I. Rider Insurance Agency" last month, the statement reads.
Rider provided Townando with the plates and documents, but never any policy paperwork, Barbosa said.
"I would like to find out what's going on," Barbosa said recently at Dawley's office.
While Vieira bought the policy from Rider before Barbosa started working at Townando, she said she dealt with Rider at past jobs for insurance.
If the above had happened in Texas, the first thing someone should do is contact an expereinced Insurance Law Attorney. Then depending on the advice of the attorney, there may be a complaint filed with the Texas Department of Insurance or even a phone call to the local district attorney office. The Texas Insurance Code provides many recourses depending on the exact nature of the wrong committed.

Insured people in Grand Prairie, Weatherford, Arlington, Mansfield, Carrolton, Mesquite, Garland, Fort Worth, Dallas, or anywhere else in the State of Texas would want to know if it is possible to beat an insurance company if you get into a fight with them. The short answer is "heck yeah" you can beat them. Just hire an experienced Insurance Law Attorney.
The Seattle Post-Intelligencer ran an article that published on February 9, 2011, that tells the story of one person beating their insurance company after the insurance company denied their claim for benefits. The article is written by Vanessa Ho and is titled, "Elderly Woman Beats Insurer Over Denied Benefits."
The article in part said:
Four years after an insurance company denied benefits to a woman in a Kirkland nursing home, the state Court of Appeals ruled that the company had erred in denying coverage.
The ruling came after the woman, Evelyn Bushnell, died, and after her son had complained to the company, complained to the state insurance commissioner, filed a lawsuit, and lost.
"We're pleased with the result," said Leroy Bushnell's attorney. "The client is pleased. It restored his faith in the system correcting wrongs."
In 1986, Bushnell bought a nursing-care policy for his mother from the Medico Insurance Company in Nebraska. Bushnell paid the monthly premiums on time for more than 20 years.
In 2007, his mom had a stroke, needed full-time skilled nursing care, and was admitted to the Lake Vue Gardens Convalescent Center in Kirkland. But when Bushnell submitted a claim for benefits, Medico denied coverage.
The company said Evelyn Bushnell had not been in the hospital for at least three days before going to the home - a requirement in Medico's policy. Such a requirement was banned in Washington in 1987, after the Legislature passed the Long-Term Care Insurance Act.
Bushnell argued the law trumped Medico's hospital-stay requirement after he renewed the policy. Medico said the original policy - signed before the law took effect - was valid. The company also said the policy had lapsed, and that Evelyn Bushnell wasn't covered when she went to the nursing home.
In 2009, a King County Superior Court judge dismissed Leroy Bushnell's lawsuit.
On Monday, the Court of Appeals partially reversed that decision, ruling that Medico's hospital-stay requirement was invalid, because a new contract was formed every time Bushnell renewed his premiums. The court also ruled that the Bushnell's policy was in effect and had not lapsed.
Bushnell had also accused Medico of acting in "bad faith" when it denied coverage, which if true, would allow him to collect enhanced damages. The judges remanded that issue to the lower court.
In Texas, had the same thing happened and the court had remanded the case for a determination of whether or not the insurance company had acted in "bad faith," the Texas Insurance Code, Section 541.152, would come into play.
Section 541.152 says:
(a) A plaintiff who prevails in an action under this subchapter may obtain:
(1) the amount of actual damages plus court costs and reasonable and necessary attorneys' fees;
(2) an order enjoining the act or failure to act complained of; or
(3) any other relief the court determines is proper.
(b) On a finding by the trier of fact that the defendant knowingly committed the act complained of, the trier of fact may award an amount not to exceed three times the amount of actual damages.
There are many other sections of the Texas Insurance Code that come into play when an insurance company is dealing with one of its insureds. These various sections are to protect the public against insurance companies who attempt to take advantage of people who in a normal situation simply do not understand their rights when dealing with an insurance company.