Claims against adjusters for violations of the Texas Insurance Code must be very specific.  This is illustrated in a 2021, opinion from the Eastern District of Texas.  The opinion is styled, Fred Vernon, II v. Palomar Specialty Insurance Company, Wellington Claim Services, Inc., One Call Claims, David Cardenas, and Tanya Spalding.

This case was filed in State Court and Palomar caused the case to be removed to Federal Court asserting that the adjusting companies were improperly joined in an effort to defeat diversity jurisdiction.  Vernon filed a motion to remand which is the subject of this opinion.

Pursuant to 28 U.S.C., Section 1332, in removed cases where, as here, there is no suggestion that a federal question is involved, subject matter jurisdiction exists only if there is complete diversity among the parties and the amount in controversy exceeds $75,000.00.

Here is an insurance policy case from the Tyler Court of Appeals issued in October 2021.  The opinion is styled Irajabedinia v. Lighthouse Property Insurance Company.
This is a homeowners claim for coverage after Hurricane Harvey.  The damage occurred on August 28, 2017.  The claim was timely filed and Lighthouse paid in a letter dated October 13, 2017.  Plaintiff believed the claim was underpaid but did not do anything else until January 28, 2019, when a letter was sent to Lighthouse pursuing the claim further.  On March 14, 2019, Lighthouse responded saying the claim had already been paid and the file was closed.  Later, on October 1, 2019, Plaintiff’s attorney sent a more formal demand for coverage.
On December 3, 2019, Plaintiff demanded an umpire be appointed which was done on December 9, 2019.  Lighthouse refused to participate, stating that limitations had passed on October 14, 2019.  Plaintiff filed suit on December 30, 2019.

Life insurance claim denial cases are usually based on the insurance company’s assertion that the insured made misrepresentations in the life insurance application.  A 2021, opinion from the United States 5th Circuit needs to be read when handling these types of cases.  The opinion is styled, Mirna Guzman v. Allstate Assurance Company.

In this case, Saul Guzman died after suffering a seizure.  He was 28 years old.  Mirna, Sauls wife and the beneficiary of the policy made a claim for policy proceeds.  Allstate rescinded the policy and refused to pay and a lawsuit resulted.  Allstate filed a motion for summary judgment and the District Court granted the motion in favor of Allstate.  This Court reversed that ruling.

In the life insurance application process, Saul answered a question in the negative about using tobacco or nicotine.  Evidence appears to show the answer should have been yes.

Many times, for a life insurance lawyer, the question is, When did the life insurance coverage take effect.

This question was partially answered in a 1980 opinion from the Eastland Court of Appeals.  The opinion is styled, Durham Life Ins. Co. v. Cole.

Kim Cole, a widow, individually and as next friend for her two minor children, sued Durham claiming benefits under a group life insurance policy written by Durham.  A trial resulted in a judgment against Durham for $10,000 together with penalty of $1,200 and attorney fees of $5,000.  Durham appealed and this Court ruled in favor of Durham.

Bad Faith insurance is a frequent topic when a person feels like they have been treated improperly by their insurance company.  This issue is discussed in a 2021 opinion from the Eastern District of Texas.  The opinion is styled, Aspen Specialty Insurance Company v. Yin Investments USA, LP.

This opinion was issued on competing Motions For Summary Judgment.  The only part discussed here deals with the “bad faith” claims at issue.

As stated by the Court, in Texas, insurance companies have a duty to deal fairly and in good faith with an insured in the processing of claims.  To succeed on a bad-faith claim, the insured must establish the absence of a reasonable basis for denying or delaying payment of the claim and that the insurer knew, or should have known, that there was no reasonable basis for denying or delaying payment of the claim.

Here is an interesting twist on how to stay in State Court when suing an insurance company.  This is a 2021 opinion from the Northern District of Texas, Dallas Division is styled, Nayeb Family, LP v. Certain Underwriters At Lloyd’s London Subscribing To Policy No. CSSFQP0000024-00 and HD&S Management, LLC.

Nayeb Family, LP (NFLP) was insured by Lloyd’s.  A large windstorm caused significant damage to NFLP’s buildings while it was undergoing remodel by HD&S.  HD&S had covered exposed parts of the building to try to prevent damage when the storm hit but the building still suffered significant damage.

NFLP made a claim with Lloyd’s and eventually NFLP sued Lloyd’s in State Court against both Defendants alleging various Insurance Code violations against Lloyd’s  and negligence against HD&S.

An old Insurance Lawyer once stated about “bad faith” that if you have to have an expert to tell you whether the insurance company acted in bad faith, or not, then there probably not bad faith in whatever the insurance company did.

In 2021, a court in the Western District of Texas, San Antonio Division issued an opinion discussing bad faith.  It is styled, Richard Riley v. Safeco Insurance Company of Indiana.

The claim arises out of a claim being asserted by the insured, Riley, against his insurance company, Safeco.  The claim is for hail damage to Riley’s metal roof.  After a hail storm Riley made a claim for damages and Safeco assigned adjuster Doug Lehr to inspect the claim.  Lehr, after his initial inspection retained an engineering firm, Rimkus Consulting, to determine whether the damage to the roof was cosmetic or structural.  Rimkus determined the damage was structural.

Here is a case that originated in a Fort Worth State District Court that insurance attorneys need to read.  The opinion is from the Northern District of Texas, Fort Worth Division.  It is styled, Yolonda Carney v. Allstate Vehicle And Property Insurance Company et al.

The facts of the case are undisputed.  This is claim by a homeowner, Yolonda, against her insurance company, Allstate, for hail damage.  Yolonda sued Allstate and the adjuster, after Allstate failed to respond to respond to a demand letter.  Yolonda filed a lawsuit against both of them in the Fort Worth State Court.  Allstate removed the case to this Federal Court and simultaneously elected to assume the adjuster’s liability in connection with insurance code claims against him.  Allstate contends that the adjuster is improperly joined due to Allstate accepting liability for the adjuster.

Title 28 U.S.C. Section 1441(a) permits the removal of “any civil action brought in a state court of which the district courts of the United States have original jurisdiction.”

Insurance lawyers learn real quick the difference between a case being litigated in Federal Court versus State Court.  This is illustrated in a 2021 opinion from the Western District of Texas, San Antonio Division.  It is styled, Craig Janssen v. Allstate Vehicle & Property Insurance Company.

This is a claim for damages to Janssen’s property caused by a hailstorm.  Janssen asserts that he suffered damages, that Allstate is his insurer, and that after filing a claim, Allstate failed to properly inspect, investigate, and assess damages and wrongfully denied and underpaid the covered damages.  Janssen filed a lawsuit in State Court for various violations, including damages under the Texas Insurance Code, Section 541.060 and Section 542.  Allstate had the lawsuit removed to Federal Court.

Federal Rule of Civil Procedure 8, requires that a Defendant be given fair notice of the claim and the grounds upon which the plaintiff relies.  To satisfy this pleading requirement, at a minimum, a plaintiff must provide a short and plain statement of each cause of action asserted to show entitlement to relief under Rule 8(a)(2). This pleading standard does not require detailed factual allegations but does demand more than conclusory allegations of wrongdoing.

Life Insurance Lawyers have many potential clients where in the basis for denial of the claim is that insured made a misrepresentation in the policy application within two years of making the application.  This two years is called the contestability period.  After two years the policy is supposed to be incontestible.  The Southern District of Texas, Houston Division, issued an opinion in September 2021, wherein one of the issues dealt with the incontestability period.  The style of the opinion is, Pruco Life Insurance Company v. Blanca Monica Villarreal and Transamerica LIfe Insurance Company v. Blanca Monica Villarreal.

In this case, the insured had purchased two very large life insurance policies from the Pruco and Transamerica.  The details of the case can be read in the opinion as can the other issues presented.  Discussed here is the issue of Incontestability.

Villarreal moved for partial summary judgment on this issue that the policies are incontestable on that basis that under Texas law, insurance policies cannot be contested after remaining in effect for two years during the insured’s life.  Villarreal argues that even if Texas law permits insurers to raise a material and intentional misrepresentation defense after the two years, that challenge would not apply here because the life insurance policies did not contain the language reserving the right to raise the challenge.  Additionally, Villarreal argues that the defense would apply only if the insured (Rosendi) was residing in Texas “during the term of his life insurance policies.”  The insurers oppose on the basis that an exception to incontestability exists when an insurer can prove material and intentional misrepresentations and that the exception applies to Rosendi’s life insurance policies because he was “in” Texas when he contracted for the policies
and when the policies were delivered to him.

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