Weatherford lawyers handling insurance claims need to have an understanding of about “good faith and fair dealing” as it relates to an insurance company’s duty it owes one of its insureds.
This is an area of law that a lot of attorneys do not know a lot about. Insurance law cases are not as well known as cases related to criminal law, family law, personal injury, bankruptcy, probate and business matters. There are a lot of statutes related to insurance, most of which are found in the Texas Insurance Code. But there is relevant law related to Insurance Law that is also found in the Texas Criminal Code, and the Texas Code of Criminal Procedure, the Texas Transportation Code, and the Texas Labor Code, to name a few.
The State Bar of Texas, Insurance Law Section, recently published information related to the duty an insurance company owes to one of its insureds. This article dealt with the duty of “good faith and fair dealing” that is owed by the company to its customers.
The article deals with what questions are given to a jury for them to answer at the conclusion of a trial in a first party insurance case.
The questions given to a jury at the end of a trial are known as the “charge.”
An experienced Insurance Law Attorney is going to approach and work a case from a standpoint of having an idea what questions are going to be in the “charge” for the jury to answer. Having a good idea what the questions are going to be, the attorney can then work the case with the goal of getting favorable answers to those questions.
Courts, for the most part, currently use “The Pattern Jury Charge” in deciding which questions the jury are going to be asked to answer.
The current “charge” reads:
“An insurer fails to comply with its duty of good faith and fair dealing by —
Failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement of a claim when the insurer’s liability has become reasonably clear [or]
Refusing to pay a claim without conducting a reasonable investigation of the claim [or]
Canceling an insurance policy without a reasonable basis.”
There are currently, efforts underway to change the PNC charge to read as follows:
“An insurer fails to comply with its duty of good faith and fair dealing by failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement when the insurer knew, or should have known, that its liability has become reasonably clear.”
or “An insurer must reasonably investigate a claim. A failure to reasonably investigate a claim does not excuse an insurer from knowing whether its liability has become reasonably clear.”
The Texas Supreme Court held in the 1987, case, Arnold v. National County Mutual Fire Insurance Company, that “… a duty of good faith and fair dealing exists.”
Currently, some of the reasons for accusing an insurance company for violating their duty of “good faith and fair dealing” can be found in the Texas Insurance Code, Section 541.060.
Knowing and understanding what these jury questions are likely to be, enables an attorney to ask his client questions that go to the heart of the strength or weakness of any potential claim. It is important to be able to articulate specific facts and see if those facts fall into a category to be call “bad faith.” Or as the case may be, to find out things that were not done by an insurance company that should have been done.
Most people will not understand all that needs to be proved. All they know is that they were not treated right. They had an insurance policy, they suffered a loss, they made a claim for benefits, and now that claim is either being denied or being dragged out far beyond a reasonable amount of time.
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