Dallas Fort Worth Insurance Lawyer Blog

Insurance Definition Of “Accident”

August 10, 2019 | Mark S. Humphreys

The title of this blog topic should be “Insurance Company Gone Wacko”.

The case at issue here is from the Fifth Circuit Court of Appeals. It is styled, Frederking v. Cincinnati Insurance Company.

This case involves Frederking being injured by an insured of Cincinnati who was intoxicated at the time of the automobile wreck. The insured caused a wreck between the vehicle he was driving and the vehicle being driven by Frederking, causing injury to Frederking. A jury found in favor of Frederking and Cincinnati refused to pay based on their assertion that the wreck was not the result of an accident as that term is used in the policy.

Under-Insured Motorist Claim And Contract

August 7, 2019 | Mark S. Humphreys

The Western District of Texas, San Antonio Division, issued an opinion on July 1, 2019, discussing the handling of under-insured motorist (UIM) claims and how they are handled by the courts. The case is styled, Laura Lee Green v. Allstate Fire And Casualty Insurance Company.

Green sued Allstate for UIM benefits under breach of contract theories of law among other causes of action and Allstate filed a motion to dismiss.

Green was involved in an accident with Shana Dorsey who was alleged to be under-insured and Green then made a claim against Allstate for UIM benefits. It is alleged that Allstate failed to make an offer of settlement, failed to provide a reasonable explanation of the basis for denying Green’s claim, refused to affirm or deny coverage within a reasonable time, refused to pay Green’s claim without conducting a proper investigation, and refusing to pay the claim after liability had become reasonably clear.

Live Insurance Policies – Incontestability Clauses

August 4, 2019 | Mark S. Humphreys

The Texas Insurance Code requires that life insurance policies contain incontestability clauses. These are a provision that a policy will be incontestable after it has been in force during the lifetime of the insured for two years from its date, except for nonpayment of premiums. This is found in Section 1131.104 for individual life insurance policies and Sections 705.101 – 705.105 for group life policies. The effect of these clauses is to limit defenses so they can apply only during the first and second policy years.

The Texas Supreme Court, in 1972, stated the purpose of an incontestability clause is to protect the insured from a contest as to the validity of the policy after the set period has expired. The opinion is styled, Minnesota Mutual Life Insurance Company v. Morse.

A problem has arisen from the statutes in that they do not specify whether the policy date or the effective date is considered its date; this creates an ambiguity that must be construed against the insurer. And an insurer may not place a more onerous incontestability clause in the policy than the one prescribed by statute, although it may provide a shorter period than that prescribed. This was made clear in the 1982, Houston 14th Court of Appeals opinion styled, Parchman v. United Liberty Life Insurance Co.

Life Insurance Claim Denial – Knowledge of Misrepresentation

August 3, 2019 | Mark S. Humphreys

Life insurance lawyers need to be know this 1990, opinion from the Texas Supreme Court. It is styled, Koral Industries v. Security-Connecticut Life Insurance Co.

It is not uncommon for a beneficiary of a life insurance policy to concede that misrepresentations regarding health were made on an application for life insurance. What they will contest is that the insurance company should have known of the misrepresentations.

In the Koral case, Koral sought insurance on one of its key employees, Lewis Lindsey. Lindsey did not disclose on the insurance application his medical history regarding treatment over the previous five years a history which included hospitalization in 1981, 1982, and 1983, and counseling and treatment for depression and excessive use of alcohol. Further, he had been treated for mental or nervous disorders from 1976-78, and his physician had treated him for anxiety.

Texas Prompt Payment Of Claims Act – Texas Supreme Court

July 31, 2019 | Mark S. Humphreys

The Texas Supreme Court has rendered an opinion which concerns the Texas Prompt Payment of Claims Act (TPPCA). The opinion issued on June 8, 2019, and is styled, Barbara Technologies Corporation v. State Farm Lloyds.

In this case, the Texas Supreme Court reversed the appeals court judgment, which had granted summary judgment in favor of State Farm, and remanded the case to the trial court for further proceedings.

This case arose out of a wind and hail storm that damaged Barbara Tech’s property on March 31, 2013. Tech filed a claim with State Farm on October 17, 2013, pursuant to the insurance policy, requesting coverage of the cost of repairs. State Farm promptly inspected the costs of repair and denied Tech’s claim based on the assertion that the damage totaled $3,153.75, which was less than Tech’s $5,000 deductible. Tech requested a second inspection and State Farm conducted another inspection finding no additional damage.

Texas Insurance Code, Section 542A Opinion

July 28, 2019 | Mark S. Humphreys

Here is another Federal opinion discussing Texas Insurance Code, Section 542A. The opinion is from the Eastern District of Texas and is styled, John McAdams v. Palomar Specialty Insurance Company, Wellington Claim Service, Inc. and Nicholas Abdallah.

McAdams had a homeowners insurance policy with Palomar when he suffered damages alleged to have been caused by Hurricane Harvey. Palomar assigned Wellington to investigate the claim and Wellington assigned adjuster Nicholas to inspect the claim.

The claim was not sufficiently covered according to McAdams and he eventually filed suit against Palomar, an out of state defendant, and against Wellington and Nicholas, both in-state defendants. McAdams alleged wrongs committed in the claims handling process.

Texas Insurance Code, Section 542A

July 27, 2019 | Mark S. Humphreys

Texas Insurance Code, Section 542A, is being used regularly now by insurance companies to prevent Plaintiffs from defeating diversity jurisdiction.

This Insurance Code Section was discussed by a court in the Southern District of Texas, Houston Division, in a case styled, Robert Ewell v. Centauri Specialty Insurance Company, et al.

Ewell filed a claim with Centauri, who insured Ewell’s home, for property damage alleged to have occurred during a severe storm on August 25, 2017. Steven Wiley is the adjuster assigned to investigate the claim. Centauri is alleged to have failed to pay the full amount of the claim.

Insurance Adjusters And Mediation

July 24, 2019 | Mark S. Humphreys

The vast majority of insurance cases are Ordered by a Court to participate in a mediation. There is good reason for this. Most cases, if they do not settle before mediation, will settle at mediation. The settlement brings an end to the litigation between the parties and saves court time and resources. For mediation to be successful, the parties with full settlement authority and the attorneys need to be present. So what if a particular person does not show up at the mediation? What is that person is the person most knowledgeable about the case?

The El Paso Court of Appeals issued an opinion in a mandamus case styled, In Re: Mary Anne Vinson. This case arises out of a car wreck between Jaime Soto and Stephanie Dutchover wherein Soto sued Dutchover for negligence in causing a car wreck and the resulting damages. Dutchover was insured by Allstate and Vinson was the adjuster assigned to handle the claim and the adjuster most familiar with the case.

The trial court signed an order appointing a mediator and further stated: “All Parties and their representatives with full settlement authority shall attend the mediation process, with their counsel of record.” Vinson did not attend the mediation but another adjuster did attend.

One Way To Stay Out Of Federal Court

July 21, 2019 | Mark S. Humphreys

Like it or not, an insured suing his insurance company has a much better chance of getting a favorable or more favorable result in State Court versus Federal Court. And, the insurance companies know this. As a result, an insurance company is always seeking to have a case heard / litigated in the Federal Court.

Here is a case wherein the insured was able to defeat the efforts of the insurance company to have the case heard in Federal Court. We don’t know whether this was the best way of doing it without knowing more about the Facts in the case but at the least the insured was successful in being able to litigate his case in State Court.

The case is from the Southern District of Texas, Galveston Division, and is styled, Ronald Mason v. Evanston Insurance Company.

Hail Damage Claims

July 20, 2019 | Mark S. Humphreys

Lawyers handling hail damage claims have to prove the claim. This is illustrated in a Southern District of Texas case styled, Faustina Ortiz v. United States Liability Insurance Group, et al.

Ortiz owns a restaurant in Conroe, Texas. He had a policy of insurance with United that provided coverage for windstorms and hailstorms wherein the policy period was from January 26, 2016, to January 26, 2017. On August 23, 2016, a claim was filed with United asserting that on May 26, 2016, a hailstorm caused extensive damage to the building and walls.

United’s adjuster inspected the building on September 6. He photographed and found (1) deterioration, (2) poor maintenance, (3) numerous gaps in the roof, and (4) earlier repairs.