Hail claims are a frequent source of litigation. Sometimes and expert is needed in these cases. The issue of using an expert in a hail damage case arose in this 2023 opinion from the Northern District of Texas, Dallas Division. The opinion is styled, Mohamed Bakri v. Nautilus Insurance Company.
This case arises out of Plaintiff Mohamed Bakri’s insurance claims for wind and hail damage. Bakri alleges that a winter storm during the Policy Period caused significant damage to his properties. After an investigation, Nautilus refused to cover the damage, claiming that it was merely cosmetic. In addition, Nautilus determined that any impairment beyond cosmetic damage occurred before the Policy Period.
Bakri sued Nautilus claiming violation of the Texas Insurance Code and breach of contract. Bakri had an expert to help prove his damages. Nautilus filed a motion to exclude the testimony of Bakri’s expert, Johnson, and moved for summary judgment.
The Court denied Nautilus’s motion.
Nautilus argues that Johnson’s testimony is inadmissible because (1) he is unqualified to testify on claims handling and (2) his opinions are unreliable and not supported by the facts.
Under Federal Rule of Evidence 702 a witness must be qualified as an expert by “knowledge, skill, experience, training, or education.” A qualified expert may testify if the expert’s specialized knowledge will aid the trier of fact and “(1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.” District courts must determine that expert testimony “is not only relevant but reliable,” and make “a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid” and “can be applied to the facts in issue.” The focus, however, “must be
solely on the principles and methodology, not on the conclusions that they generate.”
District courts have broad discretion to determine the admissibility of expert testimony. But the Daubert inquiry may not replace the adversarial system. Vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence.” Indeed, “while exercising its role as a gate-keeper, a trial court must take care not to transform a Daubert hearing into a trial on the merits.”
Nautilus argues that Johnson is not qualified to testify on claims handling because he is not a lawyer or expert on bad faith causes of action. But Johnson has sufficient knowledge, skill, and experience to testify as an expert on claims management. He has over twenty-five years of experience working as an adjuster for Pilot Catastrophe Services and has handled over 15,000 individual insurance claims. His testimony can therefore assist a jury in understanding the standards of proper claims management, and he can opine on whether Nautilus mishandled Bakri’s claims. This testimony does not require legal expertise in bad faith causes of action.
Additionally, Johnson’s report provides more than a mere application of law to facts. Indeed, he details where he believes Nautilus mishandled Bakri’s claims. The Court concludes that Johnson is qualified to testify as an expert witness.
Nautilus argues that Johnson’s opinions are unreliable because he has not shown which facts he relies upon or how he reached his conclusion. The Court disagrees. Johnson’s report details which documents and reports he relies upon for his analysis. And the report notes that he reached his conclusions using an “accepted industry standard methodology (Haag Engineering, Nelson Engineering and EFI Global Engineering) for recognizing damages to building structures.” Further, he provides specific incidents in which he believes Nautilus mishandled the investigation. “Adjuster Elizabeth Sharlot’s failure to investigate different sources for wind and hail damage during this policy period, Hail Strike shows 1.25-inch hail on 8/16/2020.”). The Court concludes that the report shows sound methodology and the evidence relied upon is sufficiently related to the case. Accordingly, the Court denies Nautilus’s motion to exclude Johnson’s testimony.
The Court then discussed the summary judgment issue.