Dallas Fort Worth Insurance Lawyer Blog

Claim Denial Attorneys – The Insurance Agent Lied To Me

June 26, 2021 | Mark S. Humphreys

Insurance lawyers often see situations where the agent selling the insurance policy made false representations regarding the policy at issue. Here is how the Courts look at these situations.

According to the 1990, Texas Supreme Court opinion styled, DeSantis v. Wackenhut Corp., a false representation must involve an existing or past material fact, rather than a statement of opinion, judgment, probability, or expectation in order to constitute actionable fraud. Statements concerning future contingent events, sales talk, “puffing,” and other similar statements are not considered actionable misrepresentations. This was stated in a 1978, Tyler Court of Appeals opinion styled, Hicks v. Wright and other cases. And according to a 1976, Dallas Court of Appeals opinion styled, Stone v. Enstam, representations concerning future events are not actionable unless at the time the statement or promise was made, the person making it did not intend to perform.

As to suing the insurance agent, a 1960, Fort Worth Court of Appeals stated in a case styled R. O. McDonnell Dev. Co. v. Schlueter, that all persons who commit fraud are liable for the consequences of such fraud. All parties to a fraudulent transaction are responsible for the acts or representations of the other participants undertaken based upon a mutual understanding or in furtherance of common plan, design or scheme.

Insurance Agents – Fraud

June 21, 2021 | Mark S. Humphreys

Claims denial attorneys know that many claims arise because an insurance agent committed a fraud when selling the policy. A fraud cause of action requires proof of the following elements:

1. a material representation was made;

2. the representation was false;

Insurance Company Liability For The Acts Of An Agent

June 19, 2021 | Mark S. Humphreys

The vast majority of insurance policies are sold by insurance agents. So, are the insurance companies responsible for the acts of these agents?

The first step to determine whether an insurance company is vicariously liable is to determine whether the agent who engaged in the conduct was acting as the insurance company agent.

The question — “Who are agents?” was answered, until recent years, by one statute. Formerly, article 21.02 broadly defined “agents” to include any person who performed certain actions on behalf of an insurance company. As part of the ongoing codification of Texas statutes, the old article 21.02 is now found in Texas Insurance Code, Sections 4001.003 and 4001.051.

Insurance Lawsuits Under Texas Insurance Code, Section 542A.006

June 14, 2021 | Mark S. Humphreys

Here is another lawsuit litigated under Texas Insurance Code, Section 542A.006. The opinion is from the Western District of Texas, San Antonio Division, and is styled, Farzin Tabib and Shahla Afshar v. Metropolitan Lloyds Insurance Company Of Texas and John Crouch.

The Court is asked to consider two motion. A Motion to Dismiss with Prejudice Pursuant to Texas Insurance Code, Section 542A.006, filed by Lloyds and Plaintiffs Motion to Remand. This Court denied the Motion to Remand and dismisses Crouch without prejudice, and finds the motion to dismiss moot.

As long as a nondiverse party, Crouch, remains joined, the only issue the court may consider is that of jurisdiction itself. Federal courts always have jurisdiction to determine their own jurisdiction. This limited authority permits the court to grant a motion to remand if a nondiverse party is properly joined, while also permitting the court to deny such a motion if a party is improperly joined and, in so doing, to dismiss the party that has been improperly joined.

Long Term Disability Claims

June 12, 2021 | Mark S. Humphreys

Long Term Disability (LTD) claims are not uncommon in the insurance world. Some of these claims are easy to see and understand, such as an amputation. Other LTD claims are less easy to see and understand, such as chronic conditions and conditions that do not show up easily on tests and can be very subjective. It is the other type of LTD claims that end up being denied by insurance companies.

While many denied claims can be contested by hiring an insurance lawyer, many are complicated legal battles. What makes too many of these LTD claims even harder to contest if denied, is when the plan is through a person’s employer and governed by the Employee Retirement Income Security Act (ERISA).

A 2021 opinion from the Southern District of Texas, Houston Division, deals with an LTD claim that is governed by ERISA. The opinion is styled, Mark Calkin v. United States Life Insurance Company In The City Of New York.

Hail Damage Claims –

June 7, 2021 | Mark S. Humphreys

This is a case about hail damage. But, this is not the significance of the case.

The Northern District of Texas, Dallas Division, issued an opinion on April 28, 2021. The opinion is styled, Alejandro Martinez Perez and Claudia A. Lopez Orozco v. Allstate Vehicle And Property Insurance Company and Stephen McKinney.

The significance of this case is that the Plaintiff’s filed a motion for summary judgement and Allstate did not respond to the motion. In 27 years of practicing law, this is the first time I have noticed an insurance company law firm not respond to a summary judgment motion.

Bad Faith Insurance – Multiple Inspections

June 5, 2021 | Mark S. Humphreys

There are many actions or inactions an insurance can be accused of that may amount to bad faith. One of those is discussed in a 2021 opinion from the Northern District of Texas, Sherman Division. The opinion is styled, Deanne M. Hinson v. State Farm Lloyds.

A Magistrate Judge was assigned to hear a Motion for Summary Judgment on the case. The Magistrate Judge ruled in favor of State Farm and Hinson appealed that ruling to the sitting Judge. The sitting Judge affirmed the finding of the Magistrate.

This is a hail damage claim that was originally filed in State Court and then removed to Federal Court. The Magistrate ruled in favor of State Farm on all of Hinson’s causes of action. Hinson is appealing the decision as to one cause of action only.

Reasons For Insurance Company Denying An Insurance Claim

May 31, 2021 | Mark S. Humphreys

When an insurance lawyer has someone call about an insurance company denying a claim, an experienced insurance lawyer will always ask if the potential client knows about any other reasons the claim could be denied. The reason this question is asked is that an insurance company can deny a claim for one reason today and if that reason ends up being faulty, the insurance company can find another reason for denying a claim. As long as one reason for denying a claim is a proper reason, it does not matter that another reason for denial turns out to be incorrect.

This is partially discussed in a 2021, opinion from Houston First Court of Appeals. The opinion is styled, Amy Powell v. USAA Casualty Insurance Co.

This Court ruled in favor of USAA after USAA filed a motion for summary judgment.

Accidental Death Insurance Policy – ERISA

May 29, 2021 | Mark S. Humphreys

Life insurance lawyers will have situations where a person has died and the issue is whether or not the death was an “accidental death” and did any exclusion apply to the accidental death.

Here is a 2021, opinion that deals with an accidental death policy with an exclusion and on top of that, the policy is governed by the Employee Retirement Income Security Act (ERISA). The opinion is from the United States Court of Appeals, 5th Circuit. It is styled, Luis Lebron v. National Union Fire Insurance Company of Pittsburgh, Pennsylvania; AIG Claim, Incorporated.

Luis had an accidental death policy he purchased through his employer that insured himself and his wife, Barbara. The policy was issued by National Union and contained an exclusion for death caused “in whole or in part” by “illness, sickness, disease, bodily or mental infirmity, medical or surgical treatment (unless treating a covered injury), or bacterial or viral infection, regardless of how contracted (except when bacterial infection results from an accidental cut or wound or accidental food poisoning).” Under this ERISA plan National Union had authority to determine benefit eligibility as the plan administrator.

Bad Faith Insurance Claim – Breach Of Contract

May 24, 2021 | Mark S. Humphreys

An argument that insurance companies make in many “bad faith” claims is that there can be no bad faith unless or until there is a breach of the insurance contract. To reach the level of bad faith insurance, most of the time there has to be a breach of the insurance contract – but not all the time.

The Dallas Court of Appeals says there it is not necessary to have a breach of the insurance contract for there to be a bad faith claim. And the Court backs up his decision by citing the Texas Supreme Court. The opinion is styled, In Re Allstate Fire And Casualty Insurance Company and Latina Foster.

Before the Court are relators’ petition for writ of mandamus, real party’s response, and relators’ reply to the response. Relators contend they are entitled to mandamus relief because the trial court abused its discretion by denying their special exceptions complaining about real party’s failure to plead a claim for breach of contract, and by failing to quash relator Latina Foster’s deposition because it is premature. Entitlement to mandamus relief requires relators to show both that the trial court clearly abused its discretion and that relators have no adequate appellate remedy. Although the Court questions the scope of the identified deposition topics, based on relators’ arguments and the record, we conclude relators have failed to show a clear abuse of discretion. Further, in light of the Texas Supreme Court’s recent opinion in, In re State Farm Mutual Automobile Insurance Co., from Mar. 19, 2021, the trial court did not abuse its discretion by denying relators’ special exceptions. In that opinion the Texas Supreme Court concluded the insurer was not required to plead a breach of contract claim to recover for extra-contractual claims.