Interpreting An Insurance Policy

Insurance And Business Owners

March 31, 2011 | Mark S. Humphreys

Business owners in Grand Prairie, Fort Worth, Dallas, Arlington, Cedar Hill, Irving, De Soto, Duncanville, Mesquite, Garland, Carrollton, Farmers Branch, Richardson, and other places in Texas might be interested in the following case if they find themselves in a position where they are buying or selling a business.

The style of the case is, Ford Bacon & Davis, L.L.C. v. Travelers Insurance Co., et al. This case was decided on March 14, 2011, by the United States Court of Appeals for the Fifth Circuit. This is a case where one company purchased the assets of another company.

A 1996 Asset Purchase Agreement (the agreement) was between Ford, Bacon & Davis, L.L.C. (FBD LLC) and Ford, Bacon & Davis, Inc. (FBC Inc.) The agreement explicity excluded coverage relevant to this lawsuit, which is “asbestos related lawsuits.”

Home Owners Claims

March 29, 2011 | Mark S. Humphreys

Home owners in Grand Prairie, Arlington, Pantego, Fort Worth, Lake Worth, Dallas, Mansfield, De Soto, Duncanville, and other places in Texas would naturally wonder at times about exactly what types of coverages they have on their homeowners policies. Of course the answer is a lawerly “it depends.”

One case to look for in guidance for part of the answer is found in the case, Gomez v. Allstate Texas Lloyds Insurance Company. This is a 2007, Fort Worth Court of Appeals case. This is a liability insurance dispute concerning coverage under a homeowner’s policy for bodily injury arising out of a “four-wheeler” all terrain vehicle. One of the issues was the trial court’s interpretation of the scope of the policy’s recreational vehicle exception to the motor vehicle exclusion. Another issue was whether or not Allstate had a duty to defend the lawsuit that had been filed.

The Gomezes sued Jamy and Lara Johnson for injuries alleged to have occurred when Austin Gomez (6 years old) was a guest at the Johnson’s home, and Jamy placed Austin on a four-wheeler with no protective gear and allowed him to operate the vehicle. The lawsuit papers allege that Austin lost control and “went over an embankment.” The lawsuit alleges several things that the Johnson’s did wrong in contributing to the cause of this accident.

A Ruling In An Appraisal Case

March 24, 2011 | Mark S. Humphreys

For someone in Grand Prairie, Arlington, Mansfield, Fort Worth, Dalworthington Gardens, Cedar Hill, Duncanville, De Soto, Crowley, or anywhere else in Texas, the issue of “appraisal clauses” in insurance contracts will occassionally come up. How these clauses in an insurance contract work can be confusing to the normal insured, to experienced Insurance Law Attorneys, insurance adjusters, and the courts.

For the most part, the appraisal clause in an insurance policy comes into play when the insured and the insurance company disagree on the value of a claim. In other words the insurance company agrees they owe money on the claim, but the amount of money they owe may be in dispute. This is common when agreeing to the value of items like, jewelry, antiques, and rare collections. But this dispute can also come up in more common claims such as hail damage claims to roofs.

The Court of Appeals in Beaumont, Texas, issued an opinion on March 10, 2011, that is controversial and is an issue that will play out further in other cases in the future if not in a further appeal in this case. The style of the case is, In Re Southern Insurance Company.

Interpretation Of Policy

March 19, 2011 | Mark S. Humphreys

For folks in Grand Prairie, Arlington, Fort Worth, North Richland Hills, Hurst, Euless, Bedford, Keller, Colleyville, Saginaw, Lake Worth, and other places in Texas, interpreting an insurance policy is something that is very hard to do. Even an experienced Insurance Lawyer cannot always assure someone who asks what an outcome may be if there is a dispute.

Based on decisions and opinions issued by courts in Texas, an experienced Insurance Law Attorney can give guidance to probable outcomes of disputes. Here is one of those cases that the attorney would have read and used as a resource.

The case is Colony Insurance Company v. ACREM, INC. d/b/a Stetsons Nightclub, and was decided by the United States District Court for the Southern District of Texas Houston Division. The opinion was issued on February 23, 2011.

Commercial Policy Interpretation

March 17, 2011 | Mark S. Humphreys

Business owners in Weatherford, Parker County, Aledo, Azle, Mineral Wells, Millsap, Hudson Oaks, Brock, Springtown, Poolville, Cresson, and other communities through out Texas would naturally wonder about the coverages provided in their commercial insurance policies. Very few people would understand all the language. This lack of understanding extends to insurance agents, insurance companies, and even the courts and experienced Insurance Law Attorneys. The value of attorneys who deal in this area of the law is that they can provide guidance in how the courts would ultimately decide in the cases where there is a dispute. The Spreme Court of Texas recently decided a case where policy interpretation was part of the issue in controversy. The case is, The Burlington Northern and Santa Fe Railway Company F/K/A The Atchison, Topeka and Santa Fe Railway Company v. National Union Fire Insurance Company of Pittsburg, Pa. The opinion in this case was issued on February 25, 2011.

This is an insurance coverage dispute case. The insurance company took the position that based on policy language and the pleading in the lawsuit in which their insured was sued that they had no duty to defend the lawsuit or pay any damages. This is known as the “eight corners rule”, the eight corners being the “four corners” of the insurance contract and the “four corners” of the pleading, or lawsuit papers. In other words, when the two are read together, is there anything in the lawsuit allegations that invoke responsibility by the insurance company in the insurance contract to defend their insured or pay for any damages that may be part of the lawsuit.

National Union filed summary judgement motion with the trial court that was granted. The first level appeals court upheld the trial court decision. The Texas Supreme Court reversed the court of appeals and remanded the case back to the trial level for further determinations.

Statute Of Limitations In Insurance Policy

February 24, 2011 | Mark S. Humphreys

Here is one for policy holders in Grand Prairie, Arlington, Dallas, Fort Worth, Garland, Mesquite, Irving, Richardson, Wylie, Highland Park, Oak Cliff, and other parts of Texas to consider. What is the statute of limitations for sueing under an insurance policy? Well, it depends.

The Texas Civil Practices & Remedies Code, Section 16.051, says:

Every action for which there is no express limitation period, except an action for the recovery of real property, must be brought not later than four years after the day the cause of action accrues.

Appraisal In Insurance Policies

February 20, 2011 | Mark S. Humphreys

Policy holders in Grand Prairie, Arlington, Dallas, Fort Worth, Flower Mound, Haslet, Saginaw, Newark, Benbrook, Crowley, Cedar Hill, Hutchins, and other places in Texas will wonder what an “appraisal clause” in their insurance policy means. Insurance companies put these in policies because it is a good thing for them. There are ways of getting around these clauses, but an experienced Insurance Law Attorney needs to be consulted.

Many property insurance policies contain appraisal clauses. These clauses define a process for appraising the value of the damaged property, if the parties cannot agree. Common provisions call for each party to choose an appraiser. Those appraisers then choose a neutral third appraiser, called an umpire. If the parties or their appraisers cannot agree on an umpire, either party may petition a court to appoint one. Once the appraisers and umpire are chosen, they value the loss. If all do not agree on the value, the decision of any two will control. The intent is to give the insurance company and the insured a simple, speedy, and fair means of deciding disputed values. This was stated in the Texas Appeals Court in Waco, as far back as 1938. The reality however is that this is not always the case.

When two appraisers do not agree, the umpire does not simply choose between them. It is the duty of the umpire to ascertain and determine, in the exercise of his own judgment and as the result of his own investigation, the values of the disputed items. This is what a San Antonio Appeals Court said in 1994.

Definition Of Residence In Insurance Policy

February 19, 2011 | Mark S. Humphreys

Here is a case for someone in Grand Prairie, Arlington, Weatherford, Mineral Wells, Mansfield, Cedar Hill, Duncanville, De Soto, Granbury, Burleson, Lake Worth, and other places through out the state of Texas to be aware of. The case is styled, State Farm Fire and Casualty Company v. Matthew Lange. The opinion in this case was issued on January 11, 2011, by Judge Keith Ellison, out of the United States District Court, Southern District Texas, Houston Division.

Before getting into the facts and final outcome of this case, it is noteworthy to point out that Mr. Lange did not have an attorney in this case. In other words, he was pro se, or representing himself.

This case arose out of a one-vehicle accident on February 5, 2009. Two of the passengers in Lange’s car were killed as a result of the accident. The sole determination in this case is whether Lange was insured under his parents’ Personal Liability Umbrella Policy (the “Policy”) at the time of the accident.

Assignment Of Insurance Claims

February 17, 2011 | Mark S. Humphreys

Someone in Grand Prairie, Arlington, Dallas, Fort Worth, Grapevine, Colleyville, Keller, North Richland Hills, Roanoke, Azle, Hurst, Euless, Bedford, or anywhere else in Texas who has a claim may run into a situation where they are considering to assign their claim to someone else. There are multiple reasons they might want to do this. Before actually assigning a claim it might be wise to read the following case.

The case is, Nautilus Insurance Company, et al. v. Concierge Care Nursing Centers, Inc., et al. This case was decided by the United States District Court for the Southern District of Texas, Houston Division, on December 23, 2010. Here is some background:

In 1999, Brae Burn Construction Company, Inc. (Brae Burn) entered into a contract to build a skilled nursing facility for Concierge Care Nursing Centers, Inc. (Concierge). Brae Burn entered into subcontracts with Nevco Waterproofing, Inc. (insured by Nautilus Insurance Company), Antex Roofing, Inc (insured by Travelers), Mitchell Chuoke Plumbing, Inc. (insured by Amerisure) and Conex Constructors, Inc. (insured by Evanston). In August 2000, a Certificate of Substantial Completion was issued, and Concierge took possession and control of the building.

Insurance Policy Conditions

February 13, 2011 | Mark S. Humphreys

For someone in Grand Prairie, Arlington, Dallas, Fort Worth, Irving, Hurst, Euless, Bedford, Garland, Mesquite, Carrollton, Richardson, or anywhere else in Texas, it is sometimes difficult to understand the conditions that are written in a policy and how those conditions apply to a claim the insured person is making to the insurance company.

An insurance contract may impose conditions on the insured. For example, almost all policies are going to require that the insured give notice of the claim as soon as is practicable when a claim arises. The insured also has a duty to to co-operate with the insurance company in its investigation of the claim. Most policies require that the insured file a formal proof of loss, if the insurance company requests it. When the insured commits a material breach of the insurance contract, the insurance company is excused from its obligation under the insurance contract. In this regard, it then becomes important to understand what a “material” breach is.

In trying to understand what a “material” breach is, the case, Rueben and Anita Hernandez v. Gulf Group Lloyds, decided in 1994, by the Texas Supreme Court is a good case to look at for guidance.