There is lots of information available about actions to be taken before a lawsuit is filed.  There is also a lot of information available about the potential wrongs of an insurance company, it’s agents and adjusters.  What is rarely discussed is the work an insured has to do in a lawsuit.  When we say”insured” we are speaking of the person, not the person’s lawyer.

This issue can be seen in a 2022 opinion from the Austin Court of Appeals.  The style of the opinion is Michael V. Wright and Phyllis F. Wright v. State Farm Lloyds.

In this case, the Wrights sued State Farm for breach of contract and various violations of the Texas Insurance Code.  The lawsuit arose out of the way the Wrights were treated after they made a claim for benefits after a fire loss.

Here is a case wherein one of the issues was whether or not an employee was eligible for Long Term Disability (LTD) based on the definition in the policy of “full time” employee.

This is a 2022, case is from the 5th Circuit Court of Appeals. It is an appeal from the Northern District of Texas.  The opinion in the case is styled, James W. Newsom v. Reliance Standard Life Insurance Company.

Newsome had a policy that, among other things, provided short term disability (STD) benefits and LTD benefits.  The plan is governed by the Employee Retirement Income Security Act of 1974 (ERISA).

Insurance claims attorneys know that the insurance statutes require that a notice letter be sent to an insurance company before filing suit.  The notice letter is to be sent 60 days before filing the lawsuit.  The purpose is to allow a settlement or resolution of the case before either side incurs legal costs and fees.

Failure to provide the notice letter can result in not being able to make a claim for attorney fees among other claims.  This notice letter requirement is the subject of a 2020, opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, Paradise Fruits And Vegetables, L.P. v. National Fire & Marine Mutual Insurance, et al.

The case is an insurance despite between Paradise and two of its previous property insurers.  First, Paradise seeks payment from a company referred to as “National Fire” for its refusal to cover damage to Paradise sustained in two storms in 2019.  Second, Paradise asserts its sustained storm damage in 2020 while insured by its new insurer, State Auto.  State Auto denied the claim made related to the damage in the 2020 storm.

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.

Accidental Death Insurance claim denials are all too common.  This type of insurance is usually very inexpensive.  This is for a couple of reasons.  One is the vast majority of people die for reasons unrelated to an accident.  The other is the policies have exclusionary language in them excluding coverage for deaths that most would consider to be accidental but they are not covered because of the exclusionary language.  A common example is an exclusion for an accidental death involving drugs or alcohol.

Here is a case that does not involve drugs or alcohol.  Its exclusionary language is different.  This is a 2022 opinion from the Eastern District of Texas, Sherman Division.  It is styled, Shemily Ortiz v. Reliastar Life Insurance Company.

The deceased, William Ortiz, had an accidental death policy with Reliastar.  Upon his death, Shemily made a claim for benefits that was denied by Reliastar based on their contention that Williams death was not covered under the language stating there is no coverage for death “directly or indirectly caused by … Physical or mental illness.”

Life Insurance claims and Divorce.  Shall the two never intertwine.

Here is a 2022, opinion from the Northern District of Texas, Dallas Division, that will drive a life insurance attorney crazy.  The opinion is styled, Amy Cannon v. Mae Katheryn Bryant.

This case is a life insurance case.  The insured had a life insurance policy with State Farm.  When the policy originated, the insured was married to Ms. Cannon and named her as the beneficiary.  A year before the insured died, he and Ms. Cannon divorced.  After the death of the insured, Ms. Bryant asserts that she is entitled to the Policy proceeds as the successor beneficiary under the Policy and as the mother and heir of her son because the Insured’s and Ms. Cannon’s January 22, 2016 divorce decree did not designate Ms. Cannon as a beneficiary under the Policy, and the Insured did not redesignate Ms. Cannon as his beneficiary under the Policy after their divorce as required by Texas law and section 9.301 of the Texas Family Code.

The Texas Insurance Code provides for penalties to insurance companies who pay a claim late.  This is illustrated in a 2022, opinion from Texarkana Court of Appeals.  The opinion is styled, State Farm Mutual Automobile Ins. Co. & State Farm County Mutual Ins. Co. Of Texas v. Greg Rumbaugh.

Greg Raumbaugh sued State Farm after State Farm failed to pay personal injury protection (PIP) benefits “not later than the 30th day after the date the insurer received satisfactory proof of a claim,” as required by Texas Insurance Code, Section 1952.156.  Cross motion for summary judgement were filed and the trial court ruled in favor of Rumbaugh.  This appeal followed.  The sole question raised in this appeal is whether the trial court erred by resolving crossmotions for summary judgment in Rumbaughs favor, thereby determining that he was entitled to statutory penalties under Section 1952.157 of the Texas Insurance Code even though PIP benefits were paid before the lawsuit was filed.

PIP coverage is a form of nofault insurance.  PIP’s limitation to medical expenses and lost wages, along with its collateral-source and no-fault features, are designed to simplify and hasten claim resolution and payment.  Because Section 1952.157 provides for “a penalty of 12 percent,” among other things, if an insurer fails to pay PIP benefits “when due,” the trial court properly ruled that Rumbaugh was entitled to statutory penalties when PIP benefits were paid past Section 1952.156’s statutory deadline, even though they were paid before the lawsuit was filed.

Bad Faith Insurance Lawyers learn early on that the preferred places to litigate claims against insurance companies are State and County Courts, not Federal Court.  Here is a 2022, opinion from the Northern District of Texas, Dallas Division, wherein the insureds prevailed in their attempt to litigate in State Court.  The opinion is styled, Searcy Ferguson and Hanna Ferguson v. Cincinnati Insurance Company and John W. Schuster.

This is a claim for residential property insurance coverage after a hail storm.  Plaintiffs suffered hail damage and filed a claim with their insurer, Cincinnati.  Cincinnati assigned Schuster to adjust the claim.

Schuster issued a report denying Plaintiffs claim for benefits based on an engineering from EDT, an engineering firm.  Plaintiffs hired their on engineer to provide Schuster and Schuster turned the report over to EDT.  EDT determined there was some damage but that the damage was minimal compared to Plaintiffs report.

The Amarillo Court of Appeals issued an opinion on February 2, 2022, that is important as it relates to cases involving hail and wind damages to roofs of structures.  This opinion has a bit less to do with insurance and more to do with the roofing contractor business as it is regulated by the Texas Department of Insurance.  The opinion is styled, Stonewater Roofing, Ltd. Co. v. Texas Department of Insurance et al.

Here is some background.

In 2005, the Texas Legislature enacted provisions under the insurance code
regulating “public insurance adjusting.”
Public insurance adjusters are frequently hired by an insured to help resolve and settle insurance claims.  The enacted provisions, Texas Insurance Code, Sections 4102.051, provide that a public insurance adjuster must be licensed in order to adjust insurance claims on an insured’s behalf.  Under these provisions, pursuant to Code Section, 4102.163, any person or entity defined as a contractor is prohibited from adjusting insurance claims for properties at which the contractor is, or will be, providing contracting services.  Likewise, licensed public insurance adjusters are prohibited from providing any contracting services on property at which they are, or will be, providing public insurance adjusting services.  In other words, acting as a public insurance adjuster and a contractor on the same claim is a statutorily
defined conflict of interest according to Section 4102.158(a)(1).

Insurance companies and insurance agents have no general duty to obtain coverage nor to make sure the coverage is adequate.  On the other hand, courts have found insurance companies liable for affirmative misrepresentations, and an insurance agent who undertakes to procure insurance for another owes a duty to a client to use reasonable diligence in attempting to place the requested insurance and to inform the client promptly if unable to do so.  This is discussed in numerous cases, including, the 1992, Texas Supreme Court opinion, May v. United Services Ass’n of America.  Also, the 1999, 1st Court of Appeals opinion, Frazier v. Texas Farm Bureau Mutual Ins. Co.

An agent has a duty to keep the customer informed about the insurance policy’s expiration date when the agent receives information pertaining to expiration date that is intended for the customer.  This was discussed in the 1985, Texas Supreme Court opinion, Horn v. Hedgecoke Ins. Agency.

Additionally, the court in May suggested an agent could be found negligent if an explicit agreement or course of conduct showed the agent undertook to determine the customer’s insurance needs and counseled the customer as to how they could be met.

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