I know, I know.  Nobody reads the policy.  But, not reading the policy and understanding it can be a killer.  This is illustrated in a May 2022, opinion from the United States 5th Circuit Court of Appeals.  The opinion is styled, Bradford Realty Services, Incorporated v. Hartford Fire Insurance Company.

The Policy at issue in this case is a commercial building policy.  It provides coverage for losses “caused by or resulting from water that backs up from a sewer or drain.”  It also excludes coverage for damage caused by rain unless the Property “first sustains damage by a covered Cause of Loss to its roof or walls through which the rain . . . enters.”


In September 2018, heavy rains swept over the insured property.  Drains on the building were clogged.  The clog and a subsequent leak caused extensive damage to the inside of the property.  Bradford filed a claim that was subsequently denied by Hartford with Hartford saying the damage was caused by rain that did not enter the building through damage caused by the storm and thus fell into the Policy’s exclusion for damage caused by the rain.

When an insurance company denies a claim, 99% of the time the claim the insured has against the insurance company is a claim for breach of contract.  Issues related to “bad faith” and statutory violations of the Texas Insurance Code are relevant and important but usually those do not matter unless or until it is shown that the insurance contract was breached by failure to pay the claim.

A 2022, opinion from the Northern District of Texas, Amarillo Division, discusses the breach of contract part of an insurance claim.  The opinion is styled, Valleyview Church of the Nazarene v. Church Mutual Insurance Company.

The full facts of the case can be read in the opinion.  Church Mutual filed a motion for summary judgment.

A claim against an insurance company generally speaking, will involve at least two distinct claims.  One for a breach of the insurance contract and a second claim for the insurance company acting in “bad faith” in their handling of the claim.  This issue was discussed in a 2022 opinion from the Northern District of Texas, Dallas Division.  The case is styled, Claire Garcia v. Allstate Vehicle and Property Insurance Company.

Allstate had filed a Motion to Sever and Abate the contract claim from the bad faith claims alleged to be violations of the Texas Insurance Code, Sections 541.060 and 542.060, plus violations of the Texas Deceptive Trade Practices Act and fraud.

Garcia experienced hail damage to her home and filed a claim for coverage through her home insurer, Allstate.  Allstate sent an adjuster to Garcia’s home who calculated an estimate of $843.68.  Later, another agent calculated an estimate of $1,166.84.  After applying deductibles, Garcia was not receiving any monies for the claim.

To show an insurance company has acted in “bad faith” an insured must first show that the insurance company has breached the insurance contract.  This is discussed in a 2022, opinion from the Western District of Texas, San Antonio Division opinion.  The opinion is styled, Rosemarie Wheeler v. Safeco Insurance Company of Indiana.

Wheeler had her home insured through Safeco.  Wheeler contends her home was damaged in a hail storm that occurred on or about May 28, 2020.  The claim was reported on May 30, 2020, and Safeco scheduled an inspection on June 13, 2020.  The adjuster, Doug Lehr, determined that there was hail damage but that most of the damage was cosmetic.  A small check was issued for the damage determined to be non-cosmetic.

Wheeler hired a public adjuster, Elvis Spoon, who prepared an estimate that totaled $140,617.62.  Spoon disagreed the roof damage was cosmetic but did not provide any additional information to dispute Lehr report.

To show an insurance company has acted in “bad faith” an insured must first show that the insurance company has breached the insurance contract.  This is discussed in a 2022, opinion from the Western District of Texas, San Antonio Division opinion.  The opinion is styled, Rosemarie Wheeler v. Safeco Insurance Company of Indiana.

Wheeler had her home insured through Safeco.  Wheeler contends her home was damaged in a hail storm that occurred on or about May 28, 2020.  The claim was reported on May 30, 2020, and Safeco scheduled an inspection on June 13, 2020.  The adjuster, Doug Lehr, determined that there was hail damage but that most of the damage was cosmetic.  A small check was issued for the damage determined to be non-cosmetic.

Wheeler hired a public adjuster, Elvis Spoon, who prepared an estimate that totaled $140,617.62.  Spoon disagreed the roof damage was cosmetic but did not provide any additional information to dispute Lehr report.

Experienced Life Insurance Attorneys need to understand the areas of dispute that arise in the context of life insurance.

Life insurance is fairly straightforward.  If the insured dies during the policy term, the insurance company pays the benefits.  The following are some ways that disputes may arise.

a.  The life insurance agent may misrepresent the benefits of his insurer’s policy to induce the insured to switch from another company.

Life Insurance lawyers who read this Blog, or for that matter, anybody who reads this Blog eventually learns that there are many wrongs an insurance agent will commit to get a sale.  Most of their income from an insurance company is based on getting a percentage of the premiums.  In other words, most agents work on a commission basis.

The Texas Department of Insurance regulates life insurance agents and the Texas Insurance Code also regulates insurance agents.

Today’s short focus is on a different form of fraud which is sometimes committed by an agent when selling life insurance.

Bad Faith insurance lawyers are always questioning themselves on where the line is drawn regarding bad faith claims.  This issue is discussed in this 2022, opinion from the Western District of Texas, San Antonio Division.  It is styled, Dr. John Winston, III v. State Farm Lloyds.

State Farm filed a motion for summary judgment regarding Winston’s bad faith allegations.

Winston sued State Farm regarding a claim for damage to Dr. Winston’s residence caused by a hail storm.

There are many reasons an insurance company use to deny a claim.  One of those reasons is a requirement in almost all insurance policies that an insured provide timely notice to the insurance company of a claim.  The primary reason the insurance company requires a quick, “timely” notice, is so that they can investigate the claim while it is new.

Here is a 2022, opinion form the Dallas Court of Appeals.  The opinion is styled, Richland Trace Owners Association v. Landmark American Insurance Company, Vericlaim, Inc. and Jason Roberts Keen.

The facts of this case are unique to the case.  However, the general discussion about a claim being submitted in a timely manner needs to be understood.

Here is an interesting claim denial.  The case is a 2022, from the Southern District of Texas, Houston Division.  It is styled, Sergio and Maria Weitzman v. Allstate Vehicle and Property Insurance Company.

The Weitzman’s bottle wine in Argentina and sell it, for money, to and through their Texas company, Serca Wines, LLC.  In 2019, a fire destroyed 7,727 bottles stored in Argentina awaiting shipment to, and sale from, the United States.  The Weitzman’s made a claim through their homeowners policy for the loss.  The policy covered personal property located away from the residence, but with a business property coverage limit of $200.00.  Allstate paid $200.00.  The Weitzman’s, representing themselves sued Allstate alleging the wine business is a hobby and that the bottles were personal property.  They sued for the policy limits of $303,000.00.

The undisputed facts in the record, which includes the tax returns for the relevant period and a few invoices, as well as responses to written discovery, show that as a matter of law, the $200.00 policy coverage limit for business property located away from the insureds’ residence applies.  Allstate’s motion for summary judgment was granted.

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