Hail Damage Claims – Allocation

Hail damage claims, like a lots of other types of claims, have their own nuances that an insurance attorney needs to be prepared to address.

Here is a 2022, opinion from the Northern District of Texas, Fort Worth Division, that addresses a hail damage claim and the assertion that that the insurer made, that at least part of the hail damage, while real, occurred at a time when the policy was not in effect.  The style of the case is, Leo Parrish, et al. v. State Auto Insurance Company.

Parish had a policy with State Auto that covered the period November 2, 2019, to November 2, 2020.  The policy has a hail damage deductible of $5,921.  In March 2020, Parrish noticed neighbors receiving new roofs and subsequently had a neighbors roofer inspect his roof.  Parrish was told that his roof was also damaged and then Parrish made a claim against State Auto.

State Auto inspected the claim and conceded there was hail damage but that most the damage had occurred on a date prior to the policy effective date of November 2, 2019.  The State Auto adjuster determined the damage cause in the March 2020 storm was less than the Parrish deductible.

This lawsuit was filed in State Court against State Auto for various violations of the Texas Insurance Code and breach of contract.  State Auto removed the case to Federal Court on the basis of diversity jurisdiction and eventually filed the motion for summary judgment that is discussed here.  The Court ruled in favor of State Auto.

It is basic insurance law that an insured cannot recover under an insurance policy unless facts are pleaded and proved showing that damages are covered by the policy.Under the doctrine of concurrent causes, the insured is entitled to recover the portion of the damage caused solely by the covered peril.  The burden of proof is on the insured to segregate the damages attributable solely to the covered peril.

When covered and excluded perils combine to cause an injury, the insured must present some evidence affording the jury a reasonable basis on which to allocate the damage.  Failure to provide evidence upon which a jury or court can allocate damages between those that resulted from covered perils and those that did not is fatal to an insured party’s claim.

Defendant argues it is entitled to judgment as a matter of law because Plaintiffs have failed to allocate those damages covered by their homeowners policy from the damages that are not covered by it.  In support, Defendant has presented evidence that any hail damage on the roof occurred prior to its issuance of the homeowners policy.  Because Defendant has presented evidence that the hail damage Plaintiffs suffered occurred outside the policy period, and because Plaintiffs have presented evidence that shows that at least some hail damage occurred during the policy period, Plaintiffs now have the burden to present evidence affording a reasonable basis on which to allocate the damage.

Plaintiffs have provided no evidence that would allow the fact finder to allocate damage between that which occurred on March 19, 2020, and that which occurred before the policy periodPlaintiffs appear to argue that their evidence shows that the only damage to their roof occurred within the policy period.  However, this is a conclusory assertion, and is insufficient to raise a fact issue.  Plaintiffs have presented no evidence disputing Defendant’s evidence that prior hail damage occurred at their property and that hail damage occurred outside the policy period.

A review of Plaintiffs’ evidence shows they are not able to factually support the assertion that the hail damage only occurred on March 19, 2020 Plaintiffs first assert that Leo Parrish has disputed there was prior storm damage.  The reference however is to Leo Parrish’s deposition testimony where he testified that he does not know how someone could determine when damage occurred.  This does not support the assertion that there was no prior hail damage.

Neither do the citations to Plaintiffs’ expert witness testimony raise a fact issue on prior hail damage Plaintiffs’ expert Michael Ogden testified that he has provided an estimate of the total amount of damages Plaintiffs suffered, but not an opinion regarding when those damages occurred.  He also testified that he was not opining on whether the repairs he described were considered a loss under the homeowners policy or that he was testifying as to causation and that he cannot identify the date of any damage.  Plaintiffs’ expert Gary Johnson testified he does not know the dates of any of the damages because he simply relied on Plaintiffs’ statements as to the date of any damage and expert Michael Stall testified he had no independent opinion, apart from Plaintiffs’ statements, as to the
date of any damage.  Finally, Plaintiffs’ meteorologist did not contradict Defendant’s evidence that prior hail likely occurred at the property.

Based on the foregoing, Plaintiffs have not disputed that some of the hail damage on their roof occurred before the date at issue and before the applicable policy period.  Because the summary judgment evidence shows that there is covered and noncovered damage, Plaintiffs were required to point to evidence to permit the fact finder to apportion damages between those covered by the homeowners policy and those not covered by it.  They have failed to carry their burden in this regard.

It is true Plaintiffs are not required to submit expert testimony apportioning damages.  Plaintiffs must however submit some evidence from which the fact finder may reasonably allocate damage.  While Plaintiffs have identified that some damage occurred on March 19, 2020, this is insufficient to afford a reasonable basis to allocate the covered and noncovered damage.  Nor does it show that any covered damages exceed the $5,921 deductible.

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