Proving A Delay In Paying A Claim

Dallas insurance lawyers will tell you that when involved in a lawsuit, it is necessary to prove the case. In this regard, a recent opinion from the United States District Court for the Northern District of Texas, Dallas Division, needs to be read and understood. The style of the case is, Robert Bell and Cheryl Bell v. State Farm Lloyds. Here is the relevant information from the opinion.
Plaintiffs Robert and Cheryl Bell (“Plaintiffs”) purchased from Defendant an insurance policy covering property damage to Plaintiffs’ property. On June 22, 2012, after a hail and wind storm, Plaintiffs made a claim to Defendant for damage resulting from the storm. On June 27, 2012, Defendant acknowledged receipt of the claim and commenced an investigation. On July 24, 2012, State Farm adjuster Donald Kimberlin inspected Plaintiffs’ property with Mr. Bell and Plaintiffs’ contractor, Roland Vitullo. Kimberlin determined that Plaintiffs’ roof had been damaged and agreed that replacement was required. On August 21, 2012, Vitullo sent a copy of his estimate to Defendant. Defendant requested additional information.
On September 16, 2012, Defendant received an estimate from a public adjuster hired by Plaintiffs, Steve Whitehood of H&S Claim Recovery, that was lower than both Vitullo’s estimate and Defendant’s adjuster’s estimate. On September 21, 2012, Plaintiffs requested Defendant make a second inspection of their property. On October 6, 2012, Defendant sent another adjuster, Brandon White, who conducted an inspection with public adjuster Elvis Spoon. White estimated $32,907.45 in damages, which exceeded Kimberlin’s estimate. White’s estimate was sent to Plaintiffs. On December 13, 2012, after receiving a purported “final invoice,” for $32,879.33 from the construction firm that did the repair work, State Farm sent a payment for $32,907.45 less Plaintiffs’ deductible.
Plaintiffs filed suit for, among other things, violation of the Texas Prompt Payment of Claims Act.
Plaintiffs assert that Defendant failed to (1) timely acknowledge Plaintiffs’ claim, in violation of Tex. Ins. Code § 542.055; (2) accept or deny Plaintiffs’ entire claim within the statutorily mandated time, in violation of Tex. Ins. Code § 542.056; and (3) meet its obligations to make payment of a claim, in violation of Tex. Ins. Code § 542.058. Defendant emphasizes the absence of evidence of any failure by Defendant to comply with the deadlines in Sections 542.055, 542.056, and 542.058. These sections set out specific time requirements, but there is no evidence they were not met. Defendant presented evidence that Plaintiffs notified it of their claim on June 22, 2012, and that Defendant acknowledged receipt and commenced an investigation on June 27, 2012, within the fifteen day time limit required. Defendant, through its adjuster, inspected Plaintiffs’ property on July 24, 2012, and provided an estimate on the same date, and Mr. Bell conceded that the inspection was prompt, as required by the Texas Insurance Code.
Defendant also presented evidence that it paid Plaintiffs within the statutory time limit. Tex. Ins. Code § 542.058. After Plaintiffs requested a second inspection, Defendant conducted one promptly, and after the estimate was revised and increased, Defendant paid the appropriate statutory penalty in accordance with the prompt payment provisions of Tex. Ins. Code § 542. Accordingly, there is no evidence that Defendant violated these provisions of the Texas Insurance Code. Thus the Court Granted Defendant’s summary judgment on these claims.