Articles Posted in Life Insurance

Dallas life insurance attorneys need to know this 1967, case from the Texas Supreme Court. The style is McFarland v. Franklin Life Ins. Co. Here is the relevant info.

This appeal involves an asserted right to recover a twelve per cent penalty and attorney’s fees under the Texas Prompt Payment of Claims Act. The principal question to be decided is whether Franklin Life Insurance, respondent, had reasonable grounds for anticipating rival claims. This Court said no.

In 1950 respondent issued a policy of insurance on the life of John V. McFarland, who was about nine years of age at the time. The policy was taken out by his parents, Bernard and Gwendolyn McFarland, the latter of whom is petitioner here. Bernard was named in the policy as primary beneficiary, and petitioner was designated as contingent beneficiary. John married in 1962 and died the following year. His father predeceased him; he was survived by his widow and petitioner. Petitioner brought this suit against respondent to recover the amount due on the policy plus the statutory penalty and attorney’s fees. Respondent interpleaded Mrs. John V. McFarland, admitted liability for the proceeds of the policy, and paid the funds into court. The trial court, sitting without a jury, awarded petitioner the money so deposited but allowed no penalty or attorney’s fee. The only question brought forward on appeal was whether petitioner is entitled to recover such penalty, attorney’s fee and court costs.

Grand Prairie insurance attorneys need to know what is prohibited to be put in a life insurance policy by an insurance company.

The Texas Insurance Code has sections that say what some of these prohibitions are.

Some of the more important sections are Texas Insurance Code, Sections 705.001 through 705.004. 705.003 tells us that an insurance policy provision that states that a misrepresentation, including a false statement, made in a proof of loss or death makes the policy void or voidable, has no effect, and is not a defense in a lawsuit brought on the policy unless the insurance company can prove the following:

Fort Worth life insurance attorneys need to know the areas of dispute concerning life insurance policies.

Life insurance coverage is pretty plain to understand. If the person whose life is covered under a life insurance policy dies, then the insurance company is to pay benefits to the named insured. Here are a list of reasons why a dispute may arise concerning the payment of benefits under a life insurance policy:

1) An insurance agent may misrepresent the benefits of his insurance company policy to induce the insured person to switch from another company to the one he represents and can make a commission from;

Fort Worth life insurance attorneys should know this – but here goes with a reminder.

The most common life insurance types are term, whole life, and universal life.

“Term” life insurance policies simply provide a death benefit in return for a premium payment. At the end of the policy year, or “term,” the insurance ends, and the policy has no value. Most of these are for 10 or 20 years. Because the insured person is only paying for the death benefit, term policies are cheaper in the early years. As the insured person gets older, the risk of death increases and so does the premium, so term policies may become more expensive that the other types of life insurance. Insurance companies typically sell term policies that promise a fixed premium for a set number of years as stated above. This means an insurance company that sells a term policy for a fixed period, such as 10 years, will not be allowed to increase the premiums during that 10 year period.

Fort Worth life insurance attorneys and those in Dallas and Weatherford need to know what the requirements are in a policy.

Texas Insurance Code, Section 1101.002(a), tells us life insurance policies must contain several prescribed provisions. These required provisions according to the Texas Insurance Code, generally include:

(a) Section 1101.003 says a life insurance policy must provide that the policy or the policy and the application for the policy constitute the entire contract between the parties;

Grand Prairie lawyers need to understand the legal purpose for insurance so that they can better advise clients about their cases.

The purpose for insurance is to compensate for a loss. It is not a way of gambling. The United States Supreme Court said in 1866, that an insurable interest is necessary for the following reasons:

To prevent gambling To reduce intentional loss To enforce the principle of equity Bringing this topic closer to the present a 1998, Tyler Court of Appeals case is worth knowing. It is styled, Stillwagoner v. Travelers Ins. Co.

Fort Worth life insurance lawyers may already know some of this – but just in case, here goes.

Life insurance pays a stated amount of benefits to the beneficiary upon the insured person’s death. The beneficiary is usually relatives but can be business partners and creditors. Usually, the policy has a “face amount value”. This would be the value paid by the insurance company upon the death of the insured. There are policies wherein the face amount is a starting point from which the amount stated is increased. An example would be a policy that pays a “double indemnity” for accidental deaths. This means that whatever the fact amount of the policy reads, such as $100,000, then that face amount doubles to $200,000 if death occurs as the result of an accident.

“Term” insurance policies pay a fixed amount stated in the policy if death occurs during the term of the policy. This is usually a stated time of 10 or 20 years.

Dallas insurance lawyers need to be able to understand and explain what an “insurable interest” is when asked.

A 1972, Amarillo Court of Appeals case helps explain an insurable interest. The style of the case is, North River Ins. Co. v. Fisher.

Here is some information to know:

Fort Worth life insurance attorneys need to know about this case. It is an opinion issued by the U.S. 5th Circuit Court of Appeals in 2005. It is styled, Monumental Life Insurance Company v. Hayes Jenkins.

Here are some facts:

In November 2000, the insureds, husband and wife, purchased a house executing a mortgage note and an escrow agreement with the lender. Two months later the lender, by agreement with the insurer, mailed an unsolicited application for a mortgage life insurance policy underwritten by the insurer. All the enclosed materials promised a payoff of the mortgage balance up to $300,000 in the event of one of the insured’s death and emphasized a “no risk” 30 day trial period. The insureds promptly completed and mailed the application. The husband died four days after the policy became effective, but before the mortgage company issued the first month’s premium payment and the wife demanded that the proceeds of the mortgage life policy be applied to liquidate the remaining loan balance pursuant to the terms of the policy. The insurer refused and filed a declaratory judgment action seeking a ruling that at the time of the husband’s death the policy was not in force for failure by the insureds to pay the required premium. The wife counterclaimed against the insurer for breach of contract and violations of the Texas Insurance Code and DTPA. She also filed a third party complaint against the mortgage lender asserting claims for breach of the escrow agreement, negligence, and violations of the DTPA and Insurance Code. The district court granted the insurer and the lender’s motions for summary judgment, dismissing all of the wife’s counterclaims and third party claims and this appeal followed.