Beneficiary Of Life Insurance Can Assert First Party Claims

Life insurance attorneys in Fort Worth know that a beneficiary of a life insurance policy can assert claims against an insurer that denies benefits of a life insurance claim. This is pointed out in 1996, San Antonio Court of Appeals opinion styled, Mendoza v. American National Insurance Co. Here is some of the relevant information.
Jerry Mendoza was the named insured under a $25,000 life insurance policy purchased from American National on August 1, 1991. The October premium, which was due on the first, was not paid. The policy provided for a thirty-one day grace period.
The summary judgment evidence revealed that on Friday, November 1, 1991, the last day to pay under the grace period, American National’s agent and district manager, Leon Sitka, verbally agreed to extend the grace period to Monday, November 4, 1991. This agreement or representation by Sitka was contrary to the terms of the policy, which only authorized American National’s president, vice-president or secretary to extend the time for payment of premiums.
Jerry Mendoza died in an automobile accident on November 3, 1991, and the premium was never paid.
This is the second summary judgment rendered in this case. This court previously affirmed the first summary judgment as to Mendozas’ breach of contract, negligence and bad faith claims but reversed as to Mendozas’ claims for Insurance Code and DTPA violations and intentional infliction of emotional distress.
Mendoza contends both Stephanie Carrion, the widow of Jerry Mendoza, and Mendoza’s mother, as representative of the Estate of Jerry Mendoza, had standing to assert the Insurance Code and DTPA violations. In its brief American National addresses these contentions but also argues that Eloisa and Emeterio Mendoza, Jerry Mendoza’s parents, individually, lacked standing to assert these violations.
The DTPA protects consumers; therefore, consumer status is an essential element of a DTPA cause of action.
In order to qualify as a consumer under the DTPA, two requirements must be established. First, the person must seek or acquire goods or services by purchase or lease. Second, the goods or services purchased or leased must form the basis of the complaint. The absence of privity between the plaintiff and the defendant does not preclude the plaintiff from establishing standing as a consumer. A plaintiff’s standing as a consumer is established by his relationship to the transaction, not by a contractual relationship with the defendant.
Unlike the more restrictive standing requirement under the DTPA, the Insurance Code provides a cause of action to any person who has been injured by another’s engaging in unfair or deceptive acts or practices in the business of insurance as declared.
As the named beneficiary of the policy, Carrion would clearly be injured as a result of Sitka’s alleged misrepresentation. Therefore, Carrion has standing as an injured person to assert a cause of action under section
The court found Carrion had standing as a consumer to raise the DTPA and Insurance Code claims.