An insured under an insurance policy has a duty to cooperate with an insurance company investigation of a claim. This issue is discussed in the 2024 opinion, Henry & Lydia Ansah v. Nationwide Property and Casualty Insurance Company. The opinion is from the Southern District of Texas, Houston Division.
The Plaintiff’s allege that Nationwide underpaid their property insurance claim. Nationwide ended up filing a motion for summary judgement arguing the Plaintiffs are not entitled to further coverage because they failed to make the damaged property available for inspection or to document the damages.
On February 18, 2021, Defendant received from Plaintiffs a claim for damages to their dwelling and personal property caused by a freeze event that occurred the day before. On March 5, 2021, Defendant contacted Plaintiffs to discuss their claim and the claims process. Defendant began investigating Plaintiffs’ claim and paid $87,122.07 for dwelling damage and at least $35,984.83 personal property damage. Plaintiffs disputed Defendant’s valuation of their loss and invoked the Policy’s appraisal provision. The appraisers determined that the actual cash value of the dwelling damage was $78,936.05 less than what Defendant had paid.
Appraisal of the damaged property was not completed. On April 13, 2023, Defendant sent a letter to Plaintiff’s stating that Defendant’s appraiser had been trying to work with Plaintiff’s appraiser to get a full detailed list of the property and to review the claimed damage but was unfortunately had not received been able to view the property or received documents to view the alleged damages, or receipts of the property. In response Defendant was informed the property had been disposed of. Defendant then denied the claim based on a failure to cooperate with the investigation of the claim.
Plaintiffs brought this lawsuit in response, alleging breach of contract and various violations of the Texas Insurance Code.
Defendant filed the motion for summary judgement and the Court ruled in favor of Nationwide stating:
Under the Policy, Defendant has no duty to provide coverage if Plaintiffs fail to cooperate in the Defendant’s claim investigation or fail to show Defendant the damaged property and if Plaintiffs’ failure prejudices Defendant. Plaintiffs’ appraiser told Defendant’s appraiser that the damaged personal property was disposed of before the appraisal process was conducted. Plaintiffs’ discovery responses confirm that the property is not available and that there are no photographs or other documentation that would allow for appraisal. Plaintiffs state without evidence that they made the damaged personal property available for inspection. The only exhibit attached to Plaintiffs’ Response is a list of items that Plaintiffs claim were damaged. The list does not satisfy Plaintiffs’ duty under paragraph C.l.e of the Policy to cooperate with Defendant’s investigation, the duty under paragraph C.l.f to submit an inventory supported by bills and receipts, or the duty under paragraph C.1.g(l) to show Defendant the damaged property, and it does not provide evidence that would allow an appraiser to verify the items or the extent of damage.
Plaintiffs argue that Defendant failed “to conduct a proper and timely inspection. But Plaintiffs cite no evidence of when the items were disposed of or when Defendant first requested to inspect the items. Plaintiffs also offer no explanation why they did not photograph the damages before disposal. The court concludes that Plaintiffs failed to comply with the Policy. Plaintiffs’ failure prejudiced Defendant by hindering its ability to verify Plaintiffs’ personal property valuation through appraisal. Defendant has no duty under the Policy to make further payment for the damaged personal property. Defendant’s MSJ will therefore be granted.