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Whether you are an attorney in a small town like Hamilton or Evant Texas or the Dallas Fort Worth metropolitan area, life insurance lawyers can tell you that the most common reason claims for life insurance benefits being denied is that there was a misrepresentation in the policy application.

A 1932, El Paso court of Appeals opinion is still good law.  The opinion is styled First Texas Prudential Insurance Co. v. John Pipes.

John Pipes brought suit against First Texas for their refusal to pay policy benefits of $132.00 on this life insurance policy that insured his wife Ludie.  John won at trial and this appeal by First Texas followed.

Texas Hill Country life insurance lawyers will tell you that a life insurance policy has to be read carefully.  This even means that the initial application has to also be read very carefully.  This is illustrated in a 1999, San Antonio Court of Appeals opinion.  The opinion is styled, Carolyn Noseff v. Tower Life Insurance Company, et al.

Mr. Noseff applied through an agent for a life insurance policy with Tower Life Insurance Company.  He died before the policy was delivered.  It is undisputed that delivery of the policy and collection of the first premium was a valid condition precedent to the policy’s going into effect.  His wife sued alleging that Tower Life failed to use ordinary care in delivery of the policy.  Tower Life moved for summary judgment, which was granted.  Mrs. Noseff, the wife of Mr. Noseff, filed this appeal.

This San Antonio Court of Appeals affirmed the summary judgment in favor of Tower Life.  The policy stated that it would not take effect until “the policy is delivered to the owner and the first full premium is accepted by the Company while the proposed Insured is alive …”.  There is no question that Noseff died without taking delivery of the policy, and signing off on the policy amendments.  While Texas courts have long recognized that an insurance agent owes a duty to a client at the inception of coverage, Texas does not recognize a claim against an insurance company for failure to deliver an insurance policy.  The cases relied upon to establish that an insurance agent can be liable to an insurance applicant if the agent fails to follow through on the promised performance does not pertain to the insurance company’s liability.  An agent or broker undertakes to procure insurance for another is paid therefore.

Dallas Texas life insurance lawyers will know this case and use it where necessary.  The case is from 1938, and was issued by the El Paso Court of Appeals.  It’s style is, National Life & Accident Co. v. Dickinson.

This is a judgment case wherein National Life sued Vera Dickinson, to cancel a life insurance policy issued on Vera’s husband, Fred.  National Life alleged that Fred made misrepresentations in his application for life insurance.  Fred later died.

The particular matters about which it was alleged Fred gave untrue and false answers were: (a) If he had ever had syphilis, and he answered “No,” whereas he did have; (b) he was asked about consulting a physician, and he answered “No,” whereas he had consulted a physician for various ailments; (c) whether he had been an inmate of a hospital, and answered “No,” when he had been an inmate of a hospital; (d) he was asked to give the names of physicians consulted, and he gave the name of only one, when he had consulted several; (e) he was asked if any physician ever gave unfavorable opinion of his health with reference to military or naval service, to which he answered “No,” when he had appeared before a medical board in 1933, and on examination was disqualified for active duty in the navy on account of his health, and he was then so advised; (f) it was alleged that the policy and application provided that the policy should not become effective unless it was delivered to Fred while he was in good health, and that Fred was not in good health when the policy was delivered to him.  National Life alleged that by reason of the matters stated the insurance contract never took effect, and rescission was sought on that ground.

As most Llano insurance  lawyers can tell someone, the answer to the titled questions is:  It Depends!

A 1976, Waco Court of Appeals opinion gives some guidance on an answer.  The case is styled, Westchester Fire Insurance Company v. English.

Posing as husband and wife when in fact they were not married, Reaves Hickey and Carolyn Meadows purchased a frame house and two lots from Fannie English.  English conveyed the property to Hickey and wife Carolyn. by warranty deed with a vendor’s lien note.  These documents were executed in front of and notarized by Westchester agent, Kenneth Logan.  At closing Logan issued a standard homeowners policy on the house and contents.  The premiums were paid and accepted by Westchester.  A few months later and contents were destroyed in a fire.  Westchester failed to make cover the claim, a lawsuit was filed, and prior to trial Westchester learned for the first time that Hickey and Meadows were not married.

Fort Worth life insurance lawyers need to read this case on the Slayer’s Statute. The statute is found at Texas Insurance Code, Section 1103.151. The case is from the Houston Court of Appeals [14th Dist.]. It is styled, Rumbaut v. Labagnara.

Texas law disallows recovery of life insurance proceeds by a beneficiary who is a party to willfully causing the insured’s death. This case requires the court to decide whether gross negligence is subsumed within the notion of willfulness. The court held it is not.

Appellant’s wife Ana Maria Rumbaut was lost at sea, when a sudden storm arose in the Gulf of Mexico where the two of them were sailing. Because Mrs. Rumbaut’s will named appellant as executor of her estate, he applied for probate upon his return. Appellees, Mrs. Rumbaut’s sons by a previous marriage, contested the application and alleged that appellant had willfully caused their mother’s death.

Insured persons with life insurance in Grand Prairie, Fort Worth, Arlington, Dallas, Mesquite, Richardson, Carrollton, Farmers Branch, and other places in the DFW metroplex area will find this case informative.

In 2006, the Texas Supreme Court issued an opinion in the case styled, Minnesota Life Insurance Company v. Vasquez. Here are some of the facts.

Minnesota Life issued a Mortgage Accidental Death Insurance policy to the Vasquezs’, promising to pay their home mortgage in the event either died due to an accident. The insured husband later apparently fell, hit his head, and died. The insured wife filed a claim with Minnesota Life requesting payment of the balance due on the mortgage and submitted copies of the death certificate and autopsy report. Minnesota Life took six months to pay the claim because the death certificate made coverage unclear and the hospital was slow to produce the remaining medical records that had been requested. Ms. Vasquez filed a lawsuit alleging that Minnesota Life had knowingly engaged in an unfair and deceptive act, in violation of the Texas Insurance Code. The jury found that Minnesota Life knowingly violated the Insurance Code and that Ms. Vasquez was entitled to $60,000 for mental anguish, $250,000 in additional damages, and $37,000 in attorney fees. The court of appeals affirmed and Minnesota Life appealed to the Texas Supreme Court.

Someone in Grand Prairie, Arlington, Dallas, Irving, Carrollton, Farmers Branch, Lewisville, Hurst, Euless, Bedford, or anywhere else in the metroplex area would just get mad and frustrated with an insurance company treating them wrong, by continuing to ask for paperwork and documents that they don’t really need to evaluate and settle a claim. Usually the insurance company is just trying to wear you out. Here is a case where they did not get away with it.

In 2004, the Corpus Christi Court of Appeals issued an opinion in the case styled, Minnesota Life Insurance Company v. Elia L. Vasquez. Elia sued Minnesota Life for knowing violations of the Texas Insurance Code and for mental anguish associated with those violations. We will deal with the knowing violations part of the opinion. Here are some of the allegations and facts.

Elia alleged that Minnesota Life unreasonably delayed payment of the proceeds of an accidental death policy that insured the life of her deceased husband. Minnesota Life contended that the cause of death was not clearly accidental and the delay was caused by its need to obtain additional medical records. The hospital from which the records were sought was unresponsive and did not turn over the requested documents to Minnesota Life for five months. Upon receipt of these records, Minnesota Life paid Elia’s claim.

Persons living in Fort Worth, Dallas, Grand Prairie, Arlington, Irving, Mesquite, Garland, Richardson, Carrollton, Farmers Branch, and other places in Texas might enjoy this case. It tells us how someone who does not consult with an experienced Insurance Law Attorney is just wasting their time doing a lawsuit by themselves.

The opinion in this case was issued on June 2, 2011, by the Austin Court of Appeals. The style of the case is, Cynthia Ulett Lynch v. State Farm Mutual Automobile Insurance Company. Lynch was appealing from a summary judgment against her based on res judicata.

Here is some background.

Most homeowners in Weatherford, Mineral Wells, Aledo, Hudson Oaks, Willow Park, Azle, Peaster, Brock, Millsap, Cool, and other communities in Parker County would not be very interested in the legal technicalities associated with an insurance dispute. Instead they would hire an experienced Insurance Law Attorney and let that person handle the legal aspects of dealing with the insurance company. However, knowing a little about how it sometimes works can be informative.

The 14th Texas Court of Appeals in Houston issued an opinion on May 26, 2011. The style of the case is “In Re Liberty Mutual Group, Inc.” This case is called a “mandamus proceeding” and arises from a dispute over the amount of the covered loss under a homeowner’s insurance policy. On April, 18, 2011, Liberty filed this action asking the appeals court to compel, the Honorable Mike Miller, Judge of the 11th District Court of Harris County, to abate the underlying lawsuit until an appraisal to determine the amount of the covered loss had been completed. This appeals court denied the request.

Here is some background information. After Hurricane Ike, the homeowners filed a claim under their insurance policy with Liberty. A dispute arose over the amount of the covered loss. Liberty invoked the appraisal process pursuant to the terms of the insurance policy. The appraisal was underway when the lawsuit was filed against Liberty. Liberty answered the lawsuit and then filed a motion to abate the case until the appraisal process was completed.

A policyholder in Dallas, Fort Worth, Grand Prairie, Arlington, Crowley, Addison, Mesquite, Garland, Carrollton, Richardson, Mansfield, Rendon, or anywhere else in Texas who has a policy of insurance will probably find a provision in that insurance policy that they submit to an examination under oath if the insurance company requests one. Most people might have an idea what that means, but are not positive.

An examination under oath is not a situation where an insurance adjuster talks to you on the phone and asks you for permission to record the interview. The recorded phone interview is requested on almost all claims that are filed. The insurance adjuster likes to get a recorded version of what you are claiming before you have a lot of time to think about what you are saying and before you have a chance to get “lawyered up.” This recorded phone interview is usually completed within a few days of making the claim and in some cases on the same day. The adjuster asks a bunch of questions about whatever the incident is that you are reporting and then based on what you have told them, they begin conducting an independent investigation. The reality is that in most cases the recorded statement does not really hurt the insured’s claim. The problem of course is in the cases where it does hurt. And also, rarely, will the insured know that what seems like innocent statements, can be used as justification for denying the claim or limiting the value of the claim. What is important to know is that a person does not have to agree to a recorded interview.

The examination under oath is a serious matter. When this is being conducted, the insurance company is usually looking for justification for denying the claim. This examination under oath is usually carried out by an attorney who is hired by the insurance company. It usually takes place in the lawyers office. You are usually invited to attend by certified and regular mail. The examination under oath is recorded by a certified court reporter who places you under oath “to tell the truth – the whole truth – and nothing but the truth”, or something to that effect.