Dallas Fort Worth Insurance Lawyer Blog

Life Insurance And ERISA

June 28, 2015 | Mark S. Humphreys

Forest Hill insurance lawyers who handle ERISA claims can tell you horror stories about the rulings and statutes that govern ERISA. The Washington Post published an article not long ago giving reasons and examples about some of the issues with ERISA life insurance claims.

Life insurance companies want employers with life insurance plans governed by ERISA. So eager are the largest insurers to get ERISA contracts that they sometimes cross a line, according to prosecutors in California and New York.

MetLife and Prudential have made improper undisclosed payments to brokers to win business, according to settlements. Each company paid $19 million to settle accusations by the New York Attorney General’s Office in 2006 that they had illegally paid brokers to get new corporate clients. In a similar case, MetLife paid $500,000 and Prudential spent $350,000 to settle with three California counties in 2008. The insurance companies did not admit to any wrongdoing in the cases.

ERISA And Life Insurance

June 27, 2015 | Mark S. Humphreys

Haltom City life insurance attorneys who handle ERISA claims should already know this, but here goes anyway.

Insurance companies can make erroneous arguments with near impunity when it comes to life and accidental death policies provided by companies with ERISA plans. That is because of loopholes in the ERISA laws intended to protect worker benefits.

Under ERISA – the Employee Retirement Income Security Act, insurers can even win when they lose because they can keep and invest claims money while cases are pending.

Life Insurance Lawyers Know This Already

June 25, 2015 | Mark S. Humphreys

Life insurance lawyers in Dallas already know what was published in the Washington Post. It is an article about the death of a loved one being the beginning of a hard fight with the life insurance company.

The article tells us of an experience by a Jane Pierce. Jane spent nine years struggling beside her husband, Todd, as he fought cancer in his sinus cavity. The treatments were working. Then in July 2009, Todd died in a fiery car crash at the age of 46. Todd’s death ended a fight with cancer but began a long fight with Todd’s insurance company, MetLife, for life insurance benefits.

A state medical examiner and a sheriff investigating the case concluded that Todd’s death was an accident. The accident was caused when Todd lost control of his silver GMC pickup after passing a car on a two-lane road. Sounds simple enough, right!?

Policy Cancellation – Late Payment

June 23, 2015 | Mark S. Humphreys

Fort Worth insurance attorneys will have clients come to them wherein the insurance company is denying a claim. The stated reason for denial is that the policy was cancelled due to late payment. The Austin Court of Appeals ruled on this issue in May 2015. The style of the case is, Plasma Fab, LLC v. Scottsdale Insurance Company.

Plasma Fab, an ornamental iron construction contractor, purchased a general liability policy from Scottsdale in May 2008 and financed payment through premium finance company BankDirect. BankDirect paid all premiums in advance, and Plasma Fab was to make monthly payments to BankDirect. The premium finance agreement gave BankDirect authority to cancel the policy on behalf of Plasma Fab and seek a refund of unearned premiums for nonpayment of premium “after proper notice has been mailed as required by law.” Plasma Fab was chronically late making payments, and twice the policy was cancelled and reinstated. It is the third cancellation that is at issue.

On November 24, 2008, BankDirect prepared a notice of intent to cancel the policy effective December 4, 2008, which was ten days following the date the notice was prepared. However, BankDirect did not mail the notice of intent to cancel to Plasma Fab until the next day, November 25, 2008, so that the stated date of cancellation was only nine days after the date the notice was mailed. On December 4, 2008, after 5:00 p.m., BankDirect mailed a notice of cancellation to Scottsdale effective December 4, 2008.

Arson Suspected?

June 21, 2015 | Mark S. Humphreys

Springtown insurance lawyers who handle fire cases need to read this article. One reason an insurance company uses for denying a claim is the assertion that the insured caused the fire, in other words arson by the insured. The Arizona Republic published an article on May 14, 2015, that brings into question the credibility of some fire reports. The article is titled, Ties Between Phoenix Fire Department, Insurer At Issue In Lawsuit. Here is what it tells us.

A so-called “hand-in-hand” relationship between the Phoenix Fire Department’s arson squad and a private insurance company is expected to come under scrutiny in the retrial of a civil lawsuit against the insurer by a woman wrongfully accused of setting fire to her home.

When the Maricopa County Attorney’s Office dismissed the criminal case against Barbara Sloan because of a lack of evidence, Deputy County Attorney Edward Leiter noted an “incestuous relationship” between the Phoenix Fire Department and Farmers Insurance, the case disposition worksheet says. The Judge agreed, writing that the Fire Department and insurance company seemed to work “hand in hand,” minutes show.

Drone Insurance?

June 20, 2015 | Mark S. Humphreys

Texas insurance lawyers need to be on the look out for this – drone insurance. I’m kinda curious about it – are you? The Insurance Journal published an article about this issue on May 13, 2014. It is titled, Market For Drone Insurance Expected To Take Off In Nest 5 Years. Here is what it says.

The use of drones could become common practice for almost 40 percent of businesses in fewer than five years, according to corporate risk managers.

Those same risk managers say they will buy drone insurance even if it’s not mandated.

Collecting Uninsured Motorist Coverage

June 18, 2015 | Mark S. Humphreys

Springtown insurance lawyers need to understand how to help a client recover uninsured motorist benefits (UM). In doing so, they would need to be aware of a 2015, Houston Court of Appeals [1st Dist.] opinion. The style of the case is, Oliver Vans, Jr. Mickey Dinh, Santos Reyna, and Lo Dinh v. Infinity County Mutual Insurance Company and Sandra Hightower.

Vans, Reyna, and Dinh (appellants) were traveling in a 1996 Camry, owned by Dinh, when it struck another vehicle. All three were injured. Vans took photos of the other vehicles license plant which was id’ed as a 1999 Olds owned by Orozco.

Appellants sued Orozco. Orozco filed a handwritten answer stating that she was neither the driver or owner of the Olds and that she had sold the vehicle to Zamora. She also sent a copy of the Bill of Sale that was signed by her and Zamora. She also sent a letter stating she did not have insurance on the vehicle and that Orozco did not have insurance either. Thus, appellants made a UM claim against Infinity.

How To Get Extra-Contractual Liability

June 16, 2015 | Mark S. Humphreys

Azle insurance lawyers need to be able to recognize when a case might have extra-contractual issues to litigate.

A mere breach of an insurance contract is not actionable under the DTPA or Insurance Code. There must be something more in the way of fraud or misrepresentation in order to establish a cause of action. A breach of contract, even if proven, does not constitute an “unconscionable” act.

A reasonable basis for an insurance company to deny a claim may establish a defense to a claim for breach of the duty of good faith and fair dealing. But this defense to a bad faith suit does not foreclose any other contractual claims, such as violation of the DTPA. violation of the Insurance Code or common law negligence. The Texas Supreme Court has repeatedly instructed that an insurance company will not be faced with a tort suit for challenging a claim of coverage if there was any reasonable basis for its denial of that coverage.

Notice To An Insurance Company Before Filing A Lawsuit

June 14, 2015 | Mark S. Humphreys

Saginaw insurance lawyers have to know the requirements to filing a lawsuit against an insurance company. The company is entitled to a pre-suit notice and failing to give notice can result in the case being thrown out of court.

Just sending a letter is not good enough. There are requirements to the content of the letter.

As a prerequisite to filing a lawsuit seeking damages for wrongs believed to be committed, the insured must give written notice at least 60 days before filing the lawsuit. The notice must tell the insurance carrier the specific complaint, the amount of actual damages and expenses, including attorney’s fees, incurred in asserting the claim. This requirement is found in the Texas Insurance Code, Section 541.154. Keep in mind it is not enough to just say, “hey you owe me $x.” The letter must be clear as to what the insurance company has done that is wrong and clear as to how any dollar figure asserted is calculated.

Is Smell A Loss Under Your Insurance Policy?

June 13, 2015 | Mark S. Humphreys

Here’s something for Texas insurance lawyers to have in their bag of knowledge. This comes from the “Claims Journal” and is about an opinion in New Hampshire but is relevant to Texas also.

The New Hampshire Supreme Court recently held that a persistent odor could constitute a “physical loss” under a homeowner’s insurance policy as long as the smell distinctly and demonstrably changed the condition of the property. The decision represents an important statement about policy interpretation, defining “physical loss” and applying pollution exclusions.

In the case before the court the insureds owned a condo that they rented to various tenants. Shortly after renting the upstairs unit, a tenant moved out complaining of a cat urine odor which had come through an open plumbing chase from the downstairs unit where another tenant owned multiple cats. After the insureds moved into the unit themselves and noticed the odor, a health inspector advised them to move out temporarily while the units were cleaned. Unfortunately, they could not rid the smell. They were unable to find new tenants and ultimately sold the condo at a significant loss.