Articles Posted in Claims Refusal

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.

Here is a case where the insurance company complains that it did not receive proper pre-suit notice of the claim.  The Court disagreed with the insurance company.

This is a 2022 opinion from the Northern District of Texas, Dallas Division.  It is styled, Douglas D. Dailey, et al., vs. Amguard Insurance Company.

Dailey sued Amguard in State Court and Amguard timely and properly removed the case to Federal Court then moved under the Texas Insurance Code, Section 542A.005(a)(1), to abate the case until the 60th day after Dailey give notice that complies with Section 542A.003 of the Texas Insurance Code.

Insurance claims attorneys know that the insurance statutes require that a notice letter be sent to an insurance company before filing suit.  The notice letter is to be sent 60 days before filing the lawsuit.  The purpose is to allow a settlement or resolution of the case before either side incurs legal costs and fees.

Failure to provide the notice letter can result in not being able to make a claim for attorney fees among other claims.  This notice letter requirement is the subject of a 2020, opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, Paradise Fruits And Vegetables, L.P. v. National Fire & Marine Mutual Insurance, et al.

The case is an insurance despite between Paradise and two of its previous property insurers.  First, Paradise seeks payment from a company referred to as “National Fire” for its refusal to cover damage to Paradise sustained in two storms in 2019.  Second, Paradise asserts its sustained storm damage in 2020 while insured by its new insurer, State Auto.  State Auto denied the claim made related to the damage in the 2020 storm.

Insurance claims that are denied caused the insured to incur attorney fees unless they are going to accept the denial.  So, how do Judges look at attorney fees?  This is answered in a 2021 opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, Linda Veach v. State Farm Lloyds.

Veach sued State Farm under her homeowner’s property insurance policy, claiming she suffered damage to her roof after a storm.  State Farm sent out an adjuster who decided Veach had only suffered minimal damage to her roof.

Veach sued State Farm for breach of contract and numerous violations of the Texas Insurance Code, the Texas DTPA, and breach of the duty of good faith and fair dealing.

Insurance lawyers should understand the interaction between the Texas Insurance Code and the Texas Deceptive Trade Practices Act (DTPA).

Texas Insurance Code, Section 541.151(2) cross references and prohibits conduct defined in Section 17.46(b) of the DTPA.  The DTPA statute applies to all types of consumer transactions, not just insurance, so many of the provisions are not directly relevant.  The most relevant subsections prohibit:

DTPA, Section 17.46(b)(2) –  causing confusion or misunderstanding as to the source , sponsorship, approval, or certification of goods or services,

There are deadlines for filing lawsuits and if those time limits are not honored, then there is no case.  This is illustrated in a Southern District, Houston Division, opinion released on July 2, 2019.  The case is styled, Nancy Roberson v. Allstate Vehicle and Property Insurance Company.

Roberson sued Allstate in state court asserting causes of action for breach of contract, violations of the Texas Insurance Code, violations of the Texas Deceptive Trade Practices Act, (DTPA) and common law fraud.  Allstate timely removed the case to federal court.  Allstate then filed a Rule 12(b)(6) Motion to Dismiss.

The background in this case is that Roberson had Allstate coverage for her home when in February 2016, she filed a claim for hail damage.  An adjuster determined that her roof was in great condition and that her loss was below her deductible.

Here is a case from the Northern District of Texas, Fort Worth Division, wherein the dates of the alleged damage incurred because of hail, is in dispute.  The style of the case is, LTG & Associates, Inc. v. Monroe Indemnity Insurance Company.

This is a summary judgment case granted in favor of Monroe.

LTG owns several properties that are insured by Monroe.  LTG alleges that on or about April 1, 2015, and March 23, 2016, the properties suffered damage due to a severe hail and windstorm.  The storm is alleged to  have caused incredible damage.  LTG further claims that Monroe hired adjustors for both storms to provide biased engineering reports so that it could deny coverage.  It is also alleged that on both occasions the adjustors wrongfully and intentionally ignored objective evidence of the wind and hail storm.

Renter’s insurance claims are not really much different than a homeowners claim.  But one distinction that sometimes appears is the language in a renter’s policy will often times shorten the statute of limitations.  This is seen in the 2018, San Antonio Court of Appeals opinion styled, Terry Granger v. The Travelers Home And Marine Insurance Co.

This is a summary judgment case rendered in favor of Travelers and affirmed on this appeal.  The relevant policy language reads:

For Insurance Law Attorneys there are two other aspects that are important in the case. 1) opposing counsel and 2) your client.

The relationship with the insurance company lawyer makes a difference as far as how smoothly the case is processed.  Most of the lawyers involved on both sides in first-party insurance cases will have dealt with each other in other cases.

One way of making the case proceed more smoothly for both of you and your clients is getting on the phone and talking to the lawyer.   This happens less with the use of email communications but talking on the phone is much more productive and a good way to work out disputes without having a Judge work it out for you.  Getting in front of a Judge is going to cost more money and there is no assurance of the result.