Articles Posted in Hail Claims

The Northern District of Texas, Dallas Division issued an opinion dealing with hail damage and abatement of the case to compel appraisal.  This is becoming more and more common in hail damage claims.  The case is Nabors v. American Reliable Insurance Company, et al.

This claim arises out of water and hail damage to Nabors home.  The insurance company is American.  It is a declaratory judgment action regarding the scope of the policy’s coverage as well as damages for breach of contract and violations of the Texas Insurance Code against American.  American filed a motion to abate the proceeding and compel appraisal.

In this case, there was also a dispute over whether or not the adjuster assigned to the claim by American was properly joined as a defendant in this lawsuit or whether the joinder was merely an effort to defeat diversity jurisdiction in order to have the case remanded to State Court.  As in other cases in this blog, the examination by the Court was in favor of American.

What is the result oi an insurance company pays a claim after an appraisal even if you don’t agree with the appraisal?  This issue is addressed in a Houston Court of Appeals [14th Dist.] opinion.  It is styled, National Security Fire & Casualty Co. v. Hurst.

This is an appeal from a jury trial in favor of Hurst against National.  This appeals court reversed the jury trial results.

Dissatisfied with the initial estimate and payment, Hurst sued National and others for claims arising out of a wind and hail storm damage to his home.  This lawsuit also claimed violations of the Texas Prompt Payment of Claims Act.  National hired adjusters who assessed the damage and paid Hurst $3,524.56 (accounting for the $1,000 policy deductible), which Hurst accepted.  Hurst proceeded to file suit on September 7, 2010.

Lawyers who handle property damage claims learn real fast that the damages that exist on the property have to be properly segregated when making an insurance claim.  What does this mean?  The most common situation that arises is after a hail and wind storm.  An insured discovers damage to his home and makes a claim.  Nest, the insurance company says that all the damage is not covered.  A law suit results.

The law is clear that an insured has the burden of proving what damages occurred, when they occurred, and how they occurred.  Often times there is damage from a hail storm but some of the damage may have occurred in at a different time and in a different storm.  When this happens, it it he responsibility of the insured, not the insurance company to explain and prove when and how the damage occurred.

This is discussed in a 2006, Northern District of Texas case, styled, Atwill v. State Farm Lloyds.

The Eastern District, Sherman Division, issued an opinion in May 2017, that, yet again illustrates how to NOT sue an insurance adjuster.  The opinion is styled, Hidden Cove Park and Marina v. Lexington Insurance Company and Glenn Hollmuller.

Severe storms caused damage to Plaintiff Hidden Cove.  Plaintiff sued defendants Lexington and the adjuster, Glenn Hollmuller, alleging the adjuster failed to properly conduct an investigation into the cause of loss, failed to issue timely payments, and wrongfully delayed or denied claims.

The lawsuit was filed in State District Court and for breach of contract, and various violations of the Texas Insurance Code Chapter 541 and Chapter 542.

The Western District, San Antonio Division issued an opinion in a case that helps an insurance company keep his client’s case out of Federal Court by suing the insurance agent.  The opinion is styled, The New World Baptist Church, LLC v. Nationwide Property and Casualty Insurance Company, Kevin P. McLoughlin, and Michael Robert Stull.

Plaintiff owns a church under a policy issued by Nationwide and sold by McLoughlin, an insurance agent.  With respect to the sale of the policy, Plaintiff alleges that “Nationwide or its agent, McLoughlin, sold the policy, to Plaintiff.  Nationwide and / or McLoughlin represented to Plaintiff that the policy included wind and hailstorm coverage for damage to Plaintiff’s business ….  When Plaintiff negotiated the premium amount, McLoughlin represented that the policy Plaintiff purchased provided coverage for hail and wind losses.  Unfortunately, Nationwide later represented that the policy sold by McLoughlin did not afford full coverage.  Specifically, the policy sold by McLoughlin was not a full coverage policy, but rather, one with specific exclusions, ….  McLoughlin’s violations of the Texas DTPA include causing confusion as to policy benefits, and representing that the policy had benefits or characteristics that it did not possess.  … McLoughlin is liable to Plaintiff for common law fraud. … Specifically, McLoughlin represented to Plaintiff during the sale of the policy that the policy had benefits or characteristics it did not possess.”

Plaintiff suffered hail damage and made a claim for benefits and eventually a lawsuit was filed on the claim in State District Court and the was removed to Federal Court by the Defendants claiming that McLoughlin was improperly joined in order to defeat diversity jurisdiction.

Most insurance lawyers want to keep their cases out of Federal Court.  One way of doing this, if the opportunity exists, is to find fault with the way an adjuster handled the claim.  This is illustrated in a Northern District, Dallas Division opinion styled, Arlington Heights Memorial Post No. 8234 Veterans of Foreign Wars of the United States, Fort Worth, Texas v. Covington Specialty Insurance Company and Edward Martin Sewell, Jr.

Plaintiff initially sued Covington and Sewell in State Court for violations of the Texas Insurance Code, among other reasons.  The lawsuit was filed, according to Plaintiff, due to the improper handling of a claim Plaintiff made after a hail and wind storm.  Plaintiff alleges that Sewell (1) did not prepare any estimates or scopes of damages to the property or failed to provide those reports to the insured, (2) failed to hire any qualified experts to appropriately assess the damage, (3) delayed the claims process and failed to communicate with the insured, and (4) misrepresented the Policy’s coverage.

The Defendants removed the case to Federal Court based on 28 U.S.C, Section 1441(a), stating that Sewell was improperly sued in this case in an effort to defeat diversity jurisdiction.  If the Defendants can prove that Sewell was improperly joined in the case, then the case will remain in Federal Court.

The Fort Worth court of Appeals issued an opinion in May 2017, that illustrates the wrong way to pursue a claim and lawsuit for storm and hail damage.  The opinion is styled, Richard Seim and Linda Seim v. Allstate Texas Lloyds and Lisa Scott.

This a motion for en banc reconsideration.

The Seims sued Allstate and the adjuster, Scott for the denial of benefits after the Seims claim of hail and storm damage to their home.  The Seims filed suit claiming damage to their property occurred from a August 2013 storm.  They then filed an amended petition removing references to the August 2013 storm and asserted the damage stemmed from an April 2007 storm.  They amended their petition again stating the damage occurred in April 2007, April 2008, and May 2012.  They amended yet again stating the damage occurred in the August 2013 storm.  Allstate filed a motion for summary judgment on numerous grounds.

Tarrant County insurance attorneys will learn real fast that when asserting a claim against an insurance adjuster, the claim needs to be pled with specificity.  This is illustrated in a recent case from the Southern District, McAllen Division.  The opinion is styled, Ada Elizondo v. Great Lakes Insurance SE. et al.

This is an insurance case for damages to Ada’s property allegedly caused by a storm.  Dissatisfied with the adjustment and payment of her insurance claim, Ada filed suit against Great Lakes and their adjuster Jose Lopez.  The case was filed in state court and promptly removed to federal court based on diversity jurisdiction.  Lopez then filed a motion to dismiss and Ada filed a motion to remand.  Both motions concern whether Lopez is a proper party to this suit.

Under Federal Rule 15(a), Ada needs the consent of Lopez to amend her pleading and that is not given.  Thus, she must seek approval from the Court.  However, she did not attach a proposed amendment to her motion to amend.  The purpose of the amendment appears to be to defeat diversity jurisdiction and for that reason the Court will not allow amendment.

Does a violation of the Texas Prompt Payment of Claims Act survive an appraisal that is promptly paid?  This issue is addressed in an opinion from the San Antonio Court of Appeals.  The case is styled, Barbara Technologies Corporation v. State Farm Lloyds.

Barbara Technologies had a policy of insurance with State Farm insuring property that was damaged in a hail storm on March 31, 2013.  A claim was made on October 17, 2013 and on October 31, 2013, State Farm inspected the property.  On November 4, State Farm sent a letter stating the property sustained damage of $3,153.57, but did not issue payment because the amount was less that the $5,000.00 deductible.  On February 21, 2014, Barbara Technologies requested a re-inspection which was done and State Farm did not change it’s earlier statement.

Barbara Technologies filed suit for various violations of the Insurance Code including claims for violation of the Prompt Pay Act pursuant to Sections 542.058(a) and 542.060.

Hail damage claims often get resolved short of an actual trial.  The Houston Court of Appeals [1st Dist.] issued an opinion on a trial from a District Court.  The opinion is styled, Mark Groba v. German American Farm Mutual Insurance Company.

After Hurricane Ike hit his area, Groba made a claim for hail and wind damage to his property.  His insurer, German American, sent an adjuster who believed the loss totaled an amount slightly above Groba’s deductible.  Based on this low estimate, Groba filed a lawsuit against Great American for violations of the Texas Insurance Code.

Groba hired a construction expert and investigator, Daryl Quinney, who concluded the damage was far above the deductible amount.  Quinney visited the property twice at least six months after the hurricane.  He testified that in conducting his investigation and making his estimate, he assumed that the damages he observed did not exist before Hurricane Ike, saying:  “I was there to do a Hurricane Ike investigation so, therefore, my assumption is those damages resulted from the wind of Hurricane Ike.”  His estimate of damages was based on his observations, photographs, and loss estimation software.