Dallas Fort Worth Insurance Lawyer Blog

If you are in Grand Prairie, Arlington, Fort Worth, Roanoke, Keller, Colleyville, Saginaw, or some other place in Tarrant County or Texas and find yourself in some financial trouble, it may be that you find yourself letting your homeowners insurance lapse. If that happens the mortgage lender on your home will buy what is called a force-placed insurance policy and charge you with the premium. There are a bunch of problems when this happens. Two of these problems are real important to you.
First, is that force-placed insurance is very expensive and you are responsible for paying it.
Second, is that a force-place policy covers the mortgage holder not you. In other words, none of your personal property or the contents of the house is covered in the event of a fire loss. Further, if you are sued by someone, the insurance does not cover you. If you get burglarized, you are not covered.
The New York Times published an article on January 21, 2011. The author is Gretchen Morgenson. The title of the article is "Hazard Insurance With Its Own Perils."
Here is some of what the article tell us.
One of the richest and most secretive sources of profit in the mortgage business is coming under scrutiny.
Investigators into this industry are looking into these force-placed insurance policies.
Benjamin Lawsky, the superintendent of the New York State Department of Financial Services, is investigating institutions that underwrite and sell force-placed insurance. Last fall, his office began sending subpoenas to insurance agents and brokers. Requests for information also went out to insurance companies that write such policies.
Recently, new subpoenas went out to loan servicers that imposed force-placed insurance on borrowers, as well as to insurers affiliated with those services.
Subpoena receivers included Morgan Stanley Mortgage Capital Holdings and CitiMortgage. Affiliates that received requests for information include BancOne Insurance and Alpine Indemnity.
Force-placed insurance appears to be the dirty little secret of the mortgage industry. It is a silent killer harming both consumers and investors while enriching the banks and their affiliates.
A spokesman for Citigroup said, "CitiMortgage does not sell homeowner's insurance to consumers. If a homeowner does not provide an insurance policy, CitiMortgage secures a policy to protect the interest of the investor. Whenever the homeowner submits proof they have obtained insurance on their own, the lender placed insurance is cancelled."
Force-placed insurance has exploded during the foreclosure crisis. Whereas it use to generate $1 billion a year, it is now a $6 billion a year business. Much of this growth is on the backs of homeowners.
When homeowners run into financial trouble, they often let their hazard insurance lapse. Because lenders require homeowners to be insured against damage or total loss policies are then forced on the borrowers and added to their monthly mortgage payments.
For those selling force-placed insurance, it is a great game. The policies typically cost at least three times as much as ordinary property insurance. Some borrowers have been charged as much as ten times the prevailing rate.
And as stated in the beginning, force-placed policies do not protect homeowners from loss. Only lenders are covered.
Some borrowers have complained of being forced to buy high-priced insurance even when it is unnecessary. Back in 2007, a borrower with a mortgage serviced by Countrywide Financial described how the lender automatically signed her up for flood insurance even though she had proved that such insurance was unnecessary. Not being able to meet the extra payments, she fell behind on her mortgage. Countrywide then began foreclosure proceedings.
All in all, force-placed insurance represents a major profit center for mortgage servicers and the companies that write the policies. In many cases the mortgage service company and the insurer are affiliated. This sets up the potential for conflicts of interest among mortgage service companies that are suppose to represent investors owning mortgage loans bundled into securities.
A more consumer friendly way to deal with insurance lapses would be for service companies to advance money to the borrower's existing carrier to keep the policy current. Then, the service company could bill the borrower for coverage.
There are other gimmicks and / or games that go on with these force-placed policies. The bottom line is - know that these are not worth while for the borrower.

Residents of Grand Prairie, Fort Worth, Dallas, Arlington, Haltom City, North Richland Hills, and other places in Texas have all become familiar with the use of computers and the purchasing products and services over the internet. A question that often comes up in the context of insurance, particularly Personal Injury Protection (PIP) benefits and Uninsured / Underinsured (UM) benefits is: How is the requirement of a signed rejection of these benefits viewed when the insurance purchase is made over the internet?
Here is some guidance:
The Texas Department of Insurance issued a bulletin that required compliance with the Texas Uniform Electronic Transaction Act. This act is found in the Texas Business & Commerce Code, Chapter 43.
The bulletin says:
COMMISSIONER'S BULLETIN
No. B-0002-02
January 2, 2002
TO: REGULATED PERSONS AND ENTITIES, INCLUDING ALL INSURANCE COMPANIES, CORPORATIONS, EXCHANGES, MUTUALS, RECIPROCALS, ASSOCIATIONS, LLOYD'S, HEALTH MAINTENANCE ORGANIZATIONS, ... AND OTHER ENTITIES REGULATED BY THE TEXAS DEPARTMENT OF INSURANCE AND AUTHORIZED OR ELIGIBLE TO DO BUSINESS IN TEXAS; AND TO THEIR AGENTS AND REPRESENTATIVES AND THE PUBLIC GENERALLY
RE: The use of Electronic Signatures and Records in Connection with Marketing and Selling Insurance and Related Products or Engaging in Other Business Regulated by Texas Department of Insurance.
This Bulletin is intended to provide information to individuals and entities regulated by TDI and too prompt discussions between the regulated community, consumers and TDI about transacting business electronically.
Advances in electronic technology are allowing businesses, including those regulated by TDI, to integrate various elements of electronic commerce into their operations. The Internet and electronic commerce have resulted in increased conveniences and opportunities for consumers and the industry.
Texas UETA
The 77th Texas Legislature passed and Governor Perry signed SB 393 adopting the Uniform Electronic Transactions Act (UETA). UETA became effective January 1, 2002, and is codified in Chapter 43 of the Texas Business & Commerce Code. In accordance with Federal Law, UETA qualifies as a statute that will "modify, limit, or supersede the provisions of section 101" (15 U.S.C. Section 7001) of the Federal Electronic Signatures in Global and National Commerce Act (E-Sign).
The 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 solely 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.
Section 43.007 defines "electronic signature" as "an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record." Therefore, certain insurance transactions may be conducted through electronic means.
This issue of electronic signature comes up in the context of insurance in two areas. One is the requirement under Texas Insurance Code, Section 1952.101, which discusses UM coverage and the other is Section 1952.152, which discusses PIP coverage.
Texas law makes it clear that electronic signatures are good and valid in Texas.

Grand Prairie and Fort Worth holders of a title insurance policy might find this recent case of interest.
The Court of Appeals, Tyler, issued an opinion recently in the case styled, Howard L Straily and Tommie J. Straily v. Lawyers Title Insurance Corporation. Here is some background information:
The Strailys own a home built on a pier and beam foundation. Upon noticing that water had pooled beneath their home and believing the source of the pooling to be a water leak, they hired a plumber to investigate the problem. The plumber pumped water from beneath the home and conducted a visual inspection of the area and discovered an uncapped sewer line that was depositing a large quantity of sewage and water onto the property.
Thereafter, the City of Van was contacted and the problem reported. The City sent workers to the home and determined the sewer line ran directly beneath the house. The City, thereafter, directed that contractors reroute the main sewer line around the home and cap it.
The City never removed the main sewer line from beneath the house. Nor did it claim that it was entitled to keep the line there. Moreover, the City disclaimed any easement or other interest in the Strailys property. A recorded easement was never found.
Because the City's main sewer line was located under their home, the Strailys presented a claim to LTI under a title insurance policy covering the property. Unable to resolve their claim with LTI, this lawsuit was filed against LTI for breach of contract. LTI filed a no evidence motion for summary judgment it which it claimed that the Strailys have (1) no evidence that they had a covered loss under the title policy, (2) no evidence that LTI breached its duties under the title policy, and (3) no evidence that the alleged breach by LTI caused the Strailys damages. In response, the Strailys argued that they demonstrated that LTI failed to detect an easement existing on their property because the City's main sewer line was located under their house. The Strailys further contended that LTI's failure to detect the easement caused their damages. The trial court ruled in favor of LTI.
In upholding the trial court ruling, this appeals court applied the applicable law to the facts presented in the case and said that the Strailys title insurance policy with LTI protects the Strailys if someone else owns either an interest in their property or an easement on their property. Because the flooding on their property caused by the City's main sewer line is a defect in the condition of the property and not necessarily a defect in the title, the Strailys cannot rely solely on the flooding as evidence that LTI breached the contract.
Even thought the City is not claiming any interest in the Strailys property, the Strailys argued that their title was encumbered. The Strailys had not argued that LTI failed to discover an express easement in favor of the City. And there was no evidence of any writing granting the City an easement to any portion of the property.
The Stailys argue that they presented evidence that the City had a prescriptive easement that encumbered their title to the property. The record reflects that the City laid the main sewer line in the 1950s. Accordingly, the main sewer line had been in place much longer that the necessary ten years to establish a prescriptive easement when the Strailys made their claim to LTI. However, the other elements of a prescriptive easement are not all demonstrated by the record, and the absence of any one element is fatal to the claim of a prescriptive easement. Here, by the Strailys own admission, the sewer line was a hidden easement. To be a prescriptive easement, the easement must have been open and notorious. Accordingly, the court concluded that the Strailys failed to present evidence that the City had a prescriptive easement encumbering the Strailys property.
Cases involving title insurance policies are different than other insurance types of cases. In addition to experienced Insurance Law Attorneys, most real estate attorneys can be helpful in resolving title insurance disputes.

Here is an article for people living in Grand Prairie, Fort Worth, Arlington, Hurst, Euless, Bedford, and other places in Tarrant County. It is from the Washington Post Business Page and authored by Noah Buhayar. The article was published on January 11, 2012, and much of it appears below.
Allstate Insurance Company, Travelers Insurance, and State Farm Automobile Insurance Company are among insurance companies raising homeowners' rates after damage from natural disasters defied industry projections.
Allstate, the #2 United States home insurer, boosted prices for its namesake brand of home policies by 5.6 percent in the nine months through September 30, and has said more increases are coming. Travelers is raising rates after re-evaluating United States storm risk. State Farm, the largest U.S. home insurer, has charged homeowners more nationwide for three straight years.
Near record low interest rates cut insurers' investment income, and tornadoes, wildfires and Hurricane Irene increased claims costs in the U.S. last year. The industry averaged annual underwriting losses on homeowners' policies in the decade ended in 2010, according to data compiled by the National Association of Insurance Commissioners.
Homeowners' coverage "has been really underpriced," said Josh Stirling, an analyst at Sanford C. Bernstein & Co., in a phone interview recently. "If you go back 10 years, these businesses were loss leaders." Personal auto coverage has been profitable for insurers during that period, NAIC data show.
Catastrophes worldwide led to a record $105 billion in insured losses last year, according to a report this month from Munich Re, the world's largest reinsurer. About $25 billion of those losses came from U.S. storms, including the tornado that leveled parts of Joplin, Missouri, in May. Irene, the first hurricane to make landfall in the U.S. since 2008, caused $7 billion in insured losses.
Policyholder owned State Farm raised homeowners' rates 3.6 percent last year, Dick Luedke, a spokesman for the Bloomington, Illinois based insurer said in a phone interview. That follows a 7.3 percent increase in 2010 and a 9.7 percent increase in 2009.
Allstate boosted homeowners' rates in 37 states in the first three quarters of 2011, compared with 32 in all of 2010, according to regulatory filings. Chief Executive Officer Thomas Wilson, 54, has said that the company is acting as if increased weather-related losses are part of a permanent shift in climate patterns.
"Rates are not adequate" for homeowners' insurance, he said at an investor conference in New York in December. "They are not adequate for us and the rest of the industry. We are getting little pushback from regulators or customers, for that matter, on raising pricing in the marketplace. So there are more rate increases to come."
Travelers' CEO, Jay Fishman, 59, has also said he is pushing for rate increases after tornadoes last year fueled a second quarter loss and forced the company to assess whether its models understated storm risk.
"We can either make the decision that we're really smart and we've been unlucky, or we can make the decision that something different is happening," he said on an October conference call with analysts to discuss the New York based insurer's quarterly results.
U.S. state regulators approved about 1,500 requests to raise rates for policies that protect homes last year, according to data compiled by Perr & Knight, a Santa Monica, based consulting firm that tracks the records. That adds to more than 3,700 in the prior two years. Companies must seek approval from states to make most changes on policies sold to consumers.
Allstate has also moved to change terms of some policies. They started a program in Oklahoma that limits payouts for customers' with older roofs, Wilson said at an investor conference in December.
Some carriers in Georgia have refused to cover homes with roofs older than 10 years, said Victor Hamby, a partner in Hamby & Aloisio Inc., an independent insurance agency in Atlanta. His clients faced rate increases averaging about 18 percent last year and he expects them to continue rising this year and next. He attributes the increases to underwriters needing to recoup losses and a new state insurance commissioner who has sped up the process for approving rate changes.
"The underwriting standards have really tightened up," he said in a phone interview last week. "It's not like you can jump from one carrier to another and they've got the sale of the day going on down the street."
Insurers are expanding the area they consider at risk for large tornado and hail losses beyond Texas, Oklahoma and Kansas, said Howard Botts, executive vice president at CorelLogic Inc.'s spatial solutions business, who creates natural hazard databases for the industry. The U.S. Gulf Coast, Minnesota and Wisconsin are among areas now considered at higher risk, he said.
"It often takes catastrophic events, or large loss events, to get the attention of senior management," Botts said in a phone interview. Insurers are "much more sensitive to losses now that they can't offset that with their investments."

When someone in Weatherford, Mineral Wells, Aledo, Willow Park, Hudson Oaks, Azle, Springtown, Millsap, Brock, or anywhere else in Texas really gets mistreated in an insurance case, that person will probably have a claim for mental anguish. So, how does that work?
A 2004, Corpus Christi Court of Appeals case gives some insight on the answer. The style of the case is, Minnesota Life Insurance Company v. Elia L. Vasquez. Here is some background.
Elia Vasquez alleged that Minnesota Life Insurance Company unreasonably delayed payment of the proceeds of an accidental death policy that insured the life of her deceased husband. As part of the lawsuit, Vasquez sued for mental anguish damages. The jury awarded her $60,000 in mental anguish damages. There were other issues in the case which are not discussed here.
In reviewing the mental anguish award, the court stated Texas law which says: To support an award of mental anguish, a party must present either direct evidence of the nature, duration, and severity of her mental anguish, thereby establishing a substantial interruption in her daily routine, or circumstantial evidence of a high degree of mental pain and distress that is greater in degree than mere worry, anxiety, vexation, embarrassment, or anger. If a party's pre-existing medical condition deteriorates or is compounded because of the torts of another party, the worry and pain associated with the aggravated condition can be considered mental anguish. Mental anguish can be established through testimony from the injured party explaining how she felt and how her life was disrupted. Other cases that had evidence to serve as examples included evidence of insomnia, humiliation, and an inability to function and maintain a normal relationship with family, feelings of physical pain, and an affect on work and family relationships.
In this case, Vasquez testified that during the time Minnesota Life was delaying the payment of the accidental death claim, she could not sleep due to the stress from the uncertainty of her financial situation. She was worried about the effect of the delayed payment on the mortgage on her home and felt that her "whole world" had caved in. Although her doctor had told her not to return to work for at least another year because of various health problems, she was so concerned about the loss of her home that she began looking for work. Vasquez was a diabetic, and she testified that during this waiting period, she experienced an increased blood-sugar level that her doctor attributed to her stress levels. Her blood-sugar levels were sufficiently altered to require a change in her medical regimen, from taking pills to having daily insulin shots. The court said that this evidence alone more than satisfies the requirements of legal sufficiency.
The relevance of this case to an Insurance Law Attorney, is that the case discusses the requirements of successfully obtaining a judgment on a mental anguish claim. Mental anguish is not that hard to prove in a case involving personal injury such as in a car wreck claim, but is much harder to prove in cases where an insurance company denies a claim or is slow in paying a claim.

Insured persons in Weatherford, Mineral Wells, Aledo, Azle, Springtown, Hudson Oaks, Willow Park, Brock, Millsap, and other places in Parker County may have a situation arise where a policy of insurance they have is cancelled. A natural question at times may be - How does that work?
To find out about the procedures for policy cancellation, a person can seek several sources for an answer.
1) Get the insurance agent who sold the policy to explain. The problem with this answer is that sometimes the agent may have made a mistake or may have reasons to not be completely honest with his answers or explanations.
2) Check with an experienced Insurance Law Attorney. Most attorneys who handle many insurance disputes is going to run across situations where an insurance company claims a policy has been cancelled and an investigation shows that the cancellation was improper and unwarranted and the cancellation is being used as a reason for not paying a proper claim.
3) Check with the Texas Department of Insurance website. Their website contains lots of insurance information and can either answer or give guidance to a lot of questions. If someone feels like they should file a complaint, the website has information for filing a complaint. This writer would suggest that if you have reached a point with your concerns such that you feel filing a complaint is necessary, then you also need to have an Insurance Law Attorney involved. You would not want something put into a complaint to be something that ends up hurting your rights.
4) The Texas Insurance Code has sections devoted to the proper procedures insurance companies must follow in canceling the various types of insurance policies that are written and in circulation.
5) The policy itself will often have within itself, the procedures they should follow in canceling the policy.
6) Speak with someone at the insurance company. Hear what they have to say. But, still follow up with an attorney.
The Texas Insurance Code, Section 551.103 says that cancellation of an insurance policy occurs when the policy is cancelled without the consent of the insured. This means coverage has terminated and the insurance company refuses to to provide additional coverage to which their customer is entitled under the policy.
Reasons an insurance company can cancel a policy are discussed in Section 551.104. This section says a policy can be cancelled for (1) non-payment of premiums, (2) submission of a fraudulent claim, or (3) the Texas Department of Insurance determines it is necessary.
Other reasons stated in that section include:
1) There is an increase in the hazard covered by the policy that is within the control of the insured and would produce an increase in the premium rate of the policy.
2) If the driver's license or motor vehicle registration of the named insured or any other motor vehicle operator who resides in the same household as the named insured is suspended or revoked.
3) The insurance company can cancel an auto policy effective on any 12 month anniversary of the original effective date of the policy if notice of cancellation is mailed not later than the 30th day before the effective cancellation date.
4) The insurance company may cancel any insurance policy other than an auto policy or homeowners policy if the policy has been in effect less than 90 days.
5) An auto policy can be cancelled if it has been in effect less than 60 days.
6) A homeowners policy can be cancelled if it has been in effect less than 60 days and the insurance company identifies a condition that creates an increased risk of hazard that was not disclosed in the application for insurance coverage and is not the subject of a prior claim; or, before the effective date of the policy, the insurance company does not accept a copy of a required inspection report (there are other conditions to this part) and is dated not later than the 90th day before the effective date of the policy.
There are several other statutes dealing with cancellation of insurance policies.
What needs to be taken from this writing is that when an insurance company cancels a policy, they may not have a legally recognized right of making the cancellation and they may have not followed the proper procedures.
Many times violations of the above will not make a difference, but if a person has a claim and the claim is being denied because of cancellation issues, it becomes very important to check and see if proper procedures were being followed.

There are times for someone in Grand Prairie, Arlington, Fort Worth, Dallas, De Soto, Duncanville, Cedar Hill, Crowley, Mansfield, and other places in Texas to get with an Insurance Law Attorney to understand how certain aspects of insurance claims are to be handled.
In 1999, the Court of Appeals, Fourteenth District, Houston, had a case of "first impression," meaning they were presented with an argument for the first time. The case dealt with an argument for offset and settlement credit against uninsured motorist coverage by a negligent third party. The dispute arose out of a multi-car accident.
The style of the case is, "Ann M. Bartley a/k/a Anne Marie Tadlock v. Martell Rae Guillot." Here are some facts:
Guillot originally sued Ward, Bustos (uninsured), and Bartley (insured). Before trial, Guillot settled with Allstate, her uninsured motorist carrier, for $20,000 for the injuries she sustained in the accident caused by Bustos. The settlement agreement limited Allstate's subrogation rights to any damages recovered from Bustos or any other uninsured motorist. Bustos was dismissed and Ward was nonsuited. Thus, Guillot proceeded against Bartley only and recovered $30,000. Bartley moved the court for a set-off in the amount of $20,000, the amount Guillot received from Allstate. This request was made pursuant to Texas Civil Practices & Remedy Code, Section 33.012. The trial court refused, and Bartley perfected this appeal.
The issue before the court was whether a negligent driver is entitled to receive credit from an independent insurance policy procured by the injured party. This is what made this a case of "first impression" in Texas. An insurance company who pays under contract for a loss or injury for the wrong of another is subrogated to the rights of the creditor or injured person against the wrongdoer. The insurer's right to subrogation derives from the rights of the insured.
Here, Allstate paid Guillot, the insured, pursuant to Guillot's uninsured motorist policy for the multi-car collision. This entitled Allstate to stand in the shoes of Guillot and assert any claims that Guilot was entitled to assert. However, Allstate decided not to exercise its subrogation rights. Thus, Allstate allowed Guillot to receive more money than the damages awarded by the jury because it did not attempt to collect from Bustos. (A total of $50,000).
In discussing this case, the court pointed out that what Bartley really seeks is reimbursement or contribution from Bustos via Allstate's payment to Guillot under her uninsured motorist policy. However, Allstate stands in the shoes of Guillot not the shoe's of the joint tortfeasor. Bustos, the uninsured alleged joint tortfeasor, was not a party to the suit. To prevent what has occurred, Bartley could have joined Bustos in a cross action as a third party defendant creating an opportunity for the jury to adjudicate Bustos's liability, if any. This would have allowed Bartley to seek contribution or reimbursement from Bustos for any damages attributable to Bustos. To offset the $30,000 Bartley owed as damages by Allstate's $20,000 settlement, would allow Bartley to receive contribution from the plaintiff and not a codefendant. Allstate's liability arose from the fault, if any, of the uninsured motorist Bustos, not that of the insured driver, Bartley.
As stated, this was a case of first impression for the court and as such is not the type of situation that is going to happen very often.

People in Grand Prairie, Arlington, Saginaw, Bedford, Hurst, Euless, Grapevine, Colleyville, Grapevine, Keller, Boyd, Newark, or anywhere else in and around Tarrant County should know a little bit about the insurance company they are buying their insurance from.
The Texas Department of Insurance is a good resource to use to learn about almost all insurance companies doing business in the State of Texas. Their web-site is easy to navigate and contains lots of useful information on insurance companies and insurance agents and insurance adjustors. It has information related to licensing and information related to complaints filed. There is also a lot of information about the financial viability of the companies.
The site has lots of general information. Surfing their web-site will usually result in finding out information you did not know and are glad you discovered.
The Houston Chronicle published an article on November 4, 2011, titled, Farmers Insurance Leads in Consumer Claim Complaints. The article is written by Purva Patel, who has written numerous articles covering the insurance industry in Texas.
The article tells us that Farmers Insurance has received more complaints about its handling of homeowners claims than any other insurer in Texas, yet it is the third largest insurer. Most people only look at prices when shopping for insurance. But rest assured, that when if comes to making a claim for benefits that you want an insurance company that is going to be responsive to your claim and fulfill their responsibilities under the contract of insurance. The number of complaints filed against Farmers is 207, between October 1, 2010, and September 30, 2011.
State Farm, the largest insurer had 198, while Allstate the second largest insurer, had 159. The number of complaints does not tell the whole story because many people do not file legitimate complaints because they either do not know how or they hired an attorney who helped to get the situation resolved.
A spokesman for Farmers says, "Everyone we deal with is dealt with as fairly, efficiently and as quickly as we can to resolve their issues, and we work very diligently to resolve each and every claim."
The number of complaints for most all insurance companies is small compared with the thousands of claims handled each year. But again, the number of complaints actually filed does not usually tell the whole story.
Texas Watch, a consumer watchdog group, says the data is still an important measure of how companies stack up against each other.
A spokesman for Texas Watch says "Farmers stands out as a company with more complaints than anyone else, and that's a very telling distinction."
The data does not include complaints about coverage or premium issues, but those dealing with payment delays, underpayments, denials and other matters pertaining to how claims are handled.
Unfortunately from a evaluation standpoint, the numbers do not break down how many complaints are justified. What is relevant though is that the Texas Department of Insurance can dismiss complaints without investigating if it feels the complaints fall outside its jurisdiction.
The spokesman for Texas Watch said "We weren't interested in what TDI thought of the complaints. We were interested in how many people were registering dissatisfaction with their carrier."
The arthur of this blog would suggest that an experienced Insurance Law Attorney should be consulted before filing a complaint with TDI. The reason is that the wording used in the complaint needs to be proper in case a lawsuit ensues. The person filing a complaint does not want something they wrote in a complaint to come back and hurt their claim.

Home owners in Grand Prairie, Arlington, Grapevine, Colleyville, Irving, Crowley, De Soto, Dallas, Fort Worth, Mesquite, Lake Worth, and other places in the DFW metropolitan area do not have some of the fears and concerns that home owners along the Gulf Coast have. But there are always concerns about claims denials resulting in a homeowner taking a loss. So, being aware of other ways of recovering losses is important.
The Miami Herald ran a story on October 26, 2001, titled Homeowners File Lawsuit Against Chinese Drywall Manufacturer, Distributor.
The history of these Chinese drywall claims is pretty easy to follow. After storms hit the Gulf Coast area in the early part of this decade, a lot of the damaged homes were repaired using Chinese drywall. This drywall was defective causing problems with home owners and devaluing effected homes.
The article tells us that lawyers representing South Florida homeowners with defective Chinese drywall went on the offensive, pursuing separate legal claims against both the manufacturer and a distributor of the toxic product.
In Miami-Dade Circuit Court, a group of lawyers pressed for punitive damages against the German-based drywall manufacturing company Knauf and its Chinese outpost Knauf Plasterboard (Tianjin) Co. The homeowners' original complaints sought compensatory damages, and the motion for punitive damages could potentially lead to steeper penalties if Knauf is found to be liable for the tainted drywall used during the re-builds.
Knauf manufactured millions of sheets of Chinese drywall, which contains toxins that can corrode pipes and electrical wiring in homes, emit foul odors and cause breathing problems.
"They engaged in conduct that endangered every American consumer that had defective drywall," said the homeowners attorney. He compared the drywall to a "ticking time bomb." "They concealed it from the American consuming public in order to protect their financial interests."
The Judge presiding over the case, stopped short of allowing all plaintiffs to seek punitive damages, indicating that the individual cases will have to be heard on their merits, saying, "Each plaintiff must meet his or her burden of proof."
The article tells us that the cases are complex and likely to be drawn out because of the large number of parties and allegations involved.
Knauf maintains they have acted in good faith with respect to drywall it sold in the United States. Knauf cited proof of their good faith by pointing out their remediation program, which was the company's idea.
As South Florida homeowners seek to recover damages from the drywall manufacturer, they are also going after the Miami-based distributor that bought more than a million sheets of Chinese drywall from Knauf.
A new lawsuit filed against Miami-based Banner Supply Co. claims that the company kept distributing the Chinese drywall even after it learned about the defects, and entered into a secret agreement with Knauf to keep silent.
The lawsuit alleges that company directors Arthur and Jack E. Landers learned the drywall was defective back in 2006, but conspired with the manufacturer to conceal the problem from homeowners. The lawsuit claims Banner engaged in a secret agreement with Knauf to replace its supply of defective drywall with U.S. made drywall and remain silent about the defects.
Banner denied the allegations.
An attorney for Banner said in a statement, "While it may be easiest to pursue a small, Florida-based company rather than focus on the German conglomerate that manufactured the defective drywall, the fact remains that Banner Supply didn't create the drywall problem."
For its part, Banner agreed to a $54.5 million settlement with more than 3,000 affected homeowners, some of whom have opted out to pursue separate claims. Banner also launched a $100 million lawsuit against Knauf.

Few people in Grand Prairie, Arlington, Mansfield, Fort Worth, Hurst, Euless, Bedford, or other places across Tarrant County like the use of credit scoring to get insurance. It is allowed in Texas.
The Insurance Journal ran a story on October 6, 2011, titled "Mass. Agents Gathering Signatures for Insurance Credit Score Ban."
The article tells us that a Massachusetts independent agents group is confident that banning auto insurers' use of credit scores and other socioeconomic factors will become law in coming months.
According to the article, The Massachusetts Association of Insurance Agents (MAIA) said it is preparing member agencies to start gathering 69,000 signatures to register voters to put this question on the 2012 state ballot.
Massachusetts is already one of a few states with strict policies on the use of credit scores and other socioeconomic factors. Regulators there will not approve rate filings for auto or homeowners insurance that include the use of credit scoring. But supporters of the ban want it signed into law so that a different administration will not change it.
Only one state, Hawaii, has a law that bans the use of credit reports for auto insurance underwriting and rating, according to the Insurance Information Institute. Proposition 103, in California, prohibits the use of a credit score for rating auto policies unless specifically allowed by the regulator.
Washington State, passed a law in 2002, prohibiting cancellations after 60 days and non-renewals based on credit scores. Maryland bans the use of credit in homeowners policies and in auto insurance underwriting decisions on existing business.
So far, 26 states have adopted laws and regulations based on a model law by the National Conference of Insurance Legislators (NCOIL), according to the Property Casualty Insurers Association of America.
This law requires insurers to disclose to consumers that a credit report may be used and to notify the policyholder in compliance with the Fair Credit Reporting Act when credit is the basis for an adverse action. It prohibits the use of credit information as the sole basis for refusal to insure, to non-renew or cancel. It also bans the use of disputed data or information identified as medical collection accounts in the credit report. And it encourages insurers to take into account extraordinary life events, such as catastrophic illness or the death of a spouse.
Credit factors are used because insurers and actuarial studies have shown a consistent link between low credit scores and auto insurance claims. Actuarial studies have shown that how a person manages his or her financial affairs is a good predictor of insurance claims. Most people have no idea they are beneficiaries of credit-based insurance scoring.The insurance company, Nationwide, states that studies show incorporating a credit-baased score and credit history allows the company to better predict insurance losses. Other rating factors in addition to credit that influence auto insurance premium include: age or driving experience; how the vehicle is used; driving and claims history; make and model of the vehicle; and geographic location. According to Hartford, Conn., based insurance research firm Conning & Co., more than 90 percent of all insurers use credit information when determining premiums.
This is an issue that is not going to go away. People for credit scoring say it is necessary for the insurers to properly evaluate risk. Those people against credit scoring say that it unfairly discriminates against those people who have smaller incomes.

Farmers and ranchers in Weatherford, Mineral Wells, Aledo, Springtown, and other places in Parker or Palo Pinto counties may have to deal with crop insurance issues on occasions. Here is a legal case that deals with crop insurance.
The case was decided by the United States District Court, Eastern District of Texas, Paris Division, in 1997. The style of the case is John Earl Bullard v. Southwest Crop Insurance Agency, Inc., Blakely Crop Hail, Inc., Farmers Alliance Mutual Insurance, Co.
There is a federal law called the Federal Crop Insurance Act. Due to the inherent risks of insuring crops, insurance companies in the early 1900's refused to write multi-peril crop insurance policies. In an effort to remedy the problem, Congress passed the Federal Crop Insurance Act (FCIA) in 1938. Is purpose was to "promote the national welfare by improving the economic stability of agriculture through a sound system of crop insurance ...." To carry out this purpose, Congress created an agency within the Department of Agriculture known as the Federal Crop Insurance Corporation (FCIC). The FCIC assists in carrying out the goals of the FCIA by providing crop insurance to farmers in the following ways: (1) selling insurance through private insurance agents, (2) reinsuring private insurance companies that provide crop insurance, and (3) providing crop insurance directly to the farmer.
In this case, Bullard seeks benefits allegedly due under a multi-peril crop insurance policy purchased from Southwest to cover Bullard's 1995 nursery crop. This policy was reinsured by the FCIC under the provisions of the FCIA.
In 1995, Bullard made a claim for benefits . The insurers denied the claim. Bullard filed a lawsuit in State District Court alleging (1) breach of contract; (2) violations of the Texas Deceptive Trade Practices Act; (3) violations of the Texas Insurance Code; (4) negligence; (5) negligent misrepresentation; (6) breach of duty of good faith and fair dealing in settling an insured's claim for loss; (7) breach of duty of good faith and fair dealing to timely adjust a claim; (8) conspiracy; and (9) declaratory judgment. The insurers removed the case to Federal Court, alleging federal question jurisdiction pursuant to 28 U.S.C. Section 1331. In so doing, the insurers alleged the FCIA and its corresponding regulations completely preempt all state law causes of action against FCIC-reinsured entities and that Bullards failure to plead violation of the federal laws was an attempt to avoid federal court.
In response, Bullard asserted that the FCIA does not completely preempt his state law causes of action and, since he has pled no federal claim, the federal court should remand the case back to the state court. Thus, the ultimate question at this point for this federal court was whether or not removal jurisdiction existed over Bullard's state law claims.
The court noted that Bullard alleged the nine state law causes of action noted above. That he did not mention mention or implicate the FCIA or any federal law. Yet, the defendants are alleging federal question.
This federal court then began a several page discussion of the laws regarding removal, the "artful pleading doctrine" and the federal laws regarding crop insurance and associated legislation and the intent of the legislation.
The court noted that the present version of section 1508(j) was created by the passage of H.R. 4217 on October 13, 1994. A previous version of H.R. 4217 which was adopted by the Senate read: "if a claim for indemnity is denied by the Corporation or by the private insurance provider, an action on the claim shall only be brought against the Corporation or Secretary 'or insurance provider' in the United States District Court ...." However, the final version passed by both the House and Senate reads: "if a claim for indemnity is denied by the Corporation or by the private insurance provider, an action on the claim may be brought 'against the Corporation or Secretary' only in the United States District Court ...."
By opting to exclude the phrase "or insurance provider" in the final version, Congress appears to have addressed the exact subject at issue in the present case. If Congress had included this phrase, it would have clearly granted federal jurisdiction over suits against insurance providers. It declined to do so.
In short, this case did remand the case back to the state court.
This is a case where, once again insurance companies are trying to have a case against them, removed to federal court. They believe that their chances of prevailing in claims against them are much better when the claim is in federal court rather than state court.

Most people in Grand Prairie, Arlington, Irving, Fort Worth, Colleyville, Dallas, Mesquite, Garland, and other places in the Dallas/Fort Worth metroplex do not really understand what a "loss of consortium" claim is.
A 1981, Texas Supreme Court case described a loss of consortium claim as "companionship, emotional support, love, felicity, and sexual relations," and recognized that loss of consortium involves harm to "the intangible and sentimental elements" of a marriage.
How a loss of consortium claim works as it relates to an insurance policy claim was discussed in a 1987, Texas Supreme Court case styled, Ella Jo McGovern v. Linda Kay Williams et al. This case concerned the liability of an insurance company under an auto liability policy. Here is some background.
Robert McGovern and wife, Ella Jo, sued Linda Williams for damages arising out of an auto accident. State Farm, the insurer for Ms. Williams, intervened and tendered $10,000 as full payment of its policy limits. The trial court determined that $10,000 was the applicable policy limit and discharged State Farm from any further liability. This court upheld the trial court ruling.
Robert McGovern, a City of Dallas employee, sustained personal injuries in an auto accident. The City, as subrogee, initiated suit against Linda Williams for Mr. McGovern's personal injuries. Mr. and Mrs. McGovern later brought a separate suit against Ms. Williams and others for Mr. McGovern's personal injuries and for Mrs. McGovern's loss of consortium. Ms. Williams' policy with State Farm insured Williams to the extent of $10,000 per person and $20,000 per occurrence for bodily injury claims. State Farm tendered the $10,000 pursuant to the "per person" policy limit. Mrs. McGovern disputed the amount of the tender, contending that she and Mr. McGovern were each entitled to $10,000 in insurance proceeds and that State Farm's obligation was $20,000.
At issue in this case was whether loss of consortium is a separate "bodily injury" to a spouse for purposes of applying the minimum insurance policy limits contained in Williams' policy and required by the Texas Safety Responsibility Law (TSRL). Mrs. McGovern contends that her claim for loss of consortium constitutes a "bodily injury" as that term is used in the TSRL and that she is entitled to independently recover from State Farm under the $10,000 "per person" liability limit.
Mrs. McGovern argued the TSRL was intended to encompass loss of consortium as a separate "bodily injury" because the legislature's general intent in enacting the statute was to protect persons from loss caused by negligent motorists. She contended that bodily injury is not limited to actual physical contact but is to be construed liberally to include mental anguish and emotional trauma. For support, she relied on the 1981 case mentioned above.
In discussing this case, the court said the TSRL refers to liability limits due to bodily injury or death to any one or more persons in any one accident. It is undisputed that only Mr. McGovern was involved in the accident giving rise to his personal injuries. Thus, because only one person was involved in that accident, the limit of State Farm's liability is $10,000.
In further discussion, the court stated that the term "bodily injury" cannot be reasonably construed to incorporate loss of consortium. While it is true that loss of consortium is a separate and independent cause of action, that action is a derivative claim that arises only as a consequence of injuries to one's spouse. The fact that Mrs. McGovern has a separate cause of action for loss of consortium does not mean, as Mrs. McGovern asserts, that loss of consortium constitutes a "bodily injury."

Anybody in Grand Prairie, Arlington, Fort Worth, Mansfield, Crowley, Burleson, Benbrook, Lake Worth, Azle, Saginaw, or anywhere else in Tarrant Count should be concerned about rising cost of insurance.
The Houston Chronicle published an article on September 20, 2011, dealing with auto insurance and rising rates. The author is Purva Patel who investigates and writes lots of articles concerning insurance in the state of Texas. The title of the article is, "Insurers Raising Auto Rates."
The article tells us that many of the state's larger auto insurers are raising rates across the state. These insurers include but are not limited to, Allstate Fire & Casualty, USAA, State Farm, and Farmers Insurance.
There appear to be two reasons claimed for the need to raise rates. One is the the new minimum liability rules in Texas that require drivers to have policies that cover a minimum of $30,000 per person for injuries and up to $60,000 for injuries per accident. Also the new minimum limit for property damage is $25,000 per accident.
Insurance Council of Texas, is an insurance industry trade group. According to them these rate increases are in part to reflect the changes in Texas law raising the minimum coverage amounts to the amounts mentioned in the prior paragraph.
Another insurance trade group, Southwestern Insurance Information Service, also cited rising fees for hospital and physician services related to automobile accidents. In support of their position, they cite U.S. Department of Labor statistics showing medical costs increasing 3.3 percent over last year.
The article points out that some insurers are lowering rates and points to some State Farm policy holders decreases. This means that consumers can benefit by shopping around and asking about discounts.
Allstate has raised its rates 3 percent for some of its insureds but points out that it is their first rate increase in three years.
USAA has filed notice of its intent to raise auto rates an average of 8 percent statewide. It pointed out that this increase does not effect all of their policy holders.
Farmers increase averaged about 3 percent for new customers and for renewals starting in July.
There are breakdowns by counties available on the amount of increases.
State Farm Mutual Automobile Insurance Co., the state's largest auto insurer, plans to raise rates on renewals starting October 3, 2011. Many areas are not seeing increases but some, such as Harris County, where Houston is located, are seeing rate increases as much as 1.9 percent.
No one denies the need for these companies to be able to make a profit, otherwise they would not exist. The concern to an experienced Insurance Law Attorney is that in the insurance company's desires to make profits, they deny legitimate claims that have been bargained for as part of the insurance policy contract. Of course when this happens, the insurance company may be breaking the law and advice needs to be sought as soon as possible.

For sure, anybody in Grand Prairie, Arlington, Fort Worth, Hurst, Euless, Bedford, or anywhere else in North Texas wants to get rates as cheaply as they can on their homeowners insurance policy, but they would like to thing their coverage is staying the same. Well that may not be the case.
The Houston Chronicle published a story On September 12, 2011, which most homeowners would be interested to know. The author is Purva Patel, who has written on the topic of insurance before. The title of the article is, "State Farm Move Could Mean Less Homeowner Coverage."
The article tells us that State Farm has proposed changing home insurance deductibles. Most anybody who has tried to get their rates lowered knows that buy raising the deductible, the yearly cost for the insurance goes down. What is different here is that State Farm is trying to make the new coverage mandatory. Consumer advocates warn this would hurt some.
It does not sound like a lot, but the proposal is to move all current customers to a minimum 1 percent deductible starting in December. That means deductibles would be charged as a percentage of the home's insured value rather than a flat dollar amount.
For example, the owner of a house insured for $200,000 with a flat $1,000 deductible and a $10,000 claim would collect $9,000 from his insurance company. With a 1 percent deductible, the homeowner would only recover $8,000 because the 1 percent deductible translates to $2,000.
With a 5 percent deductible, the amount recovered would be $0.
State Farm is asking the Texas Department of Insurance, to allow this in order to keep from raising premiums.
Right now, consumers have an option. They can take a flat dollar amount deductible, such as $500 or $1,000, or they can get a percentage deductible. The effort here is to make the percentage deductible mandatory, with 1 percent being the lowest.
The consumer group, Texas Watch, says this simply means higher costs for consumers and is against it.
In addition to this change, State Farm is also asking for an overall increase in rates.
They say the increases are necessary because the company paid out more than $350 million in catastrophe claims in 2011 to date, mainly "due to spring hail storms and wildfires."
State Farm is also, on a positive note, intending to increase a discount for customers who have both cars and homes insured with the company to 25 percent from 20 percent.

For someone in Grand Prairie, Arlington, Fort Worth, Hurst, Euless, Bedford, Grapevine, Colleyville, Keller, Roanoke, Saginaw, or anywhere else in Tarrant County or Texas, knowing and understanding the deductibles in an insurance policy is important.
The Washington Post ran an article on September 8, 2011, titled "Irene Storm Damage Led Insurers To Apply Prohibited Deductible Charges."
The article, written by Joe Stephens, tells about some insurers incorrectly applying deductibles to claims resulting from Irene damages in Maryland. The person in the story, Judi Nowottnick, a school teacher, lost electrical power for eight days She had two refrigerators containing four dozen crabs and $1,000 of other food which spoiled. On top of that, she spent an additional $400 on fast food while the electricity was out.
After submitting a claim for the $1,400, her insurance company, with which she had taken out a deluxe policy to cover such losses, invoked a "tropical cyclone" clause and increased her out-of-pocket deductible from $500 to $10,530.
Guess what? That's a 2,000 percent increase!
After doing this to Nowottnick and other Maryland homeowners who submitted similar claims, the Maryland Insurance Administration, informed the insurers that this was improper.
While the clause itself is proper, the application of the clause was illegal because Nowottnick was living in a county to which the clause did not apply.
For the clause to apply, a county had to be located in a part of the State that was subject to a hurricane warning and the county Nowottnick lived was not subject to the hurricane warning.
Policy's in different states will have different clauses that apply depending on the circumstances. For example, in Virginia, companies may issue policies that increase deductibles for any "named storm," even for general wind damage. Insurance companies in Washington, D.C. also have a variety of options. Of course, this points out why homeowners need to make sure they understand what their policies cover and what they do not cover. Depending on the coverage, some homeowners may want to purchase other types of policies or have additional endorsements to existing policies.
Insurance companies first widely introduced percentage deductibles after earthquakes struck the western United States in the early 1990's. After Hurricane Isabel in 2003, companies began expanding their use to limit payouts for hurricanes in the South and East and for tornadoes and hail in the Midwest.
In the United States today, more than a dozen states on the East and Gulf coasts allow hurricane deductibles. They typically range from 1 percent to 5 percent of the insured value of a home. In Nottwick's case, her home was insured for $351,000, so her 3 percent deductible would be more than $10,000. That meant Nowottnick would have been required to pay that amount before insurance kicked in to cover the remainder of the damages.
In this case, a Maryland law that was passed in 2008 requires insurers to provide their customers with an annual notice about the deductibles. Virginia introduced a notification requirement in 2004.
Neither Nowottnick nor other homeowners interviewed for the article said they recalled being warned.
What happens is that homeowners get all these papers explaining the deductibles and changes in the mail but are unable to understand what they mean.
Each state has its own laws regulating how changes are made in policies and how notice of these changes are to be communicated to policyholders. In Texas, the Texas Department of Insurance regulates this issue.
One thing to keep in mind. Whenever you run into a situation where it does not seem that you are being treated properly by your insurance company, you should consult with an experienced Insurance Law Attorney.