Claim Of Fraud Against Insurance Company

Claiming an insurance company has committed fraud, as in all fraud claims, it must be stated who communicated the fraud, what was said, when it was said, where it was said, and how the statement was fraud.  All of this is particularly true when the lawsuit is in Federal Court where the pleading requirements are much more stringent.

This is illustrated in the case discussed in an earlier blog styled, Nancy Roberson v. Allstate Vehicle and Property Insurance Company.  The case is from the Southern District of Texas, Houston Division.

This case arises from a tree falling on the home of Roberson, who was insured by Allstate.  Roberson made a claim and the adjuster assigned by Allstate came back with a repair estimate that was far below what Roberson believed was needed to compensate her for her loss.  Roberson filed a lawsuit alleging many causes of action against Allstate but the one discussed here is her allegation of common-law fraud.

Allstate filed a motion to dismiss the claims under Rule 12(b)(6), which requires pleading to meet federal standards.

As has been made clear by the Fifth Circuit, a common law fraud claim must satisfy Federal Rule of Civil Procedure 9(b).  This Rule requires that a plaintiff state an alleged fraud with particularity.  In this case, the Rule requires Roberson to state the who, what, when, where, and how of the alleged fraud by pleading the time, place and contents of the false representations, as well as the identity of the person making the misrepresentation and what that person obtained thereby.

In this case, the state court petition alleges that each “misrepresentation described above concerned material facts that absent such representations, Roberson would not have been acted on as she did.”  The petition only identifies one misstatement.  The allegation that the adjuster allegedly lied about the repair estimate by telling Roberson that the only roof slope damaged by the tree was the farthest point north of the sough slope of the house.  The Court stated, “This allegation does not satisfy when the statement was made, as required by Rule 9(b).  The fraud claim was dismissed, but the Court allowed Roberson a chance to amend the complaint.