A resident of Grand Prairie, Arlington, Fort Worth, Weatherford, or any other area in Texas can sue an insurance company for violations of the Texas Insurance Code under the Texas Deceptive Trade Practices Act. This is important because both of these areas of the law allow for favorable theories of recovery to the consumer who is wronged when dealing with an insurance company.
Texas Insurance Code, Section 541.151, specifically says that a person who sustains actual damages may bring an action against another for damages caused by the other person engaging in an act or practice, “specificaly enumerated in Section 17.46(b), Business & Commerce Code, as an unlawful deceptive trade practice …” The Business & Commerce Code is where the Texas Deceptive Trade Practices Act is located. The whole purpose of the DTPA is to prevent companies from doing wrongs to consumers.
In business and legal circles, Section 17.46(b) is referred to as the “laundry list” of things companies are prohibited from doing. Violations of this laundry list can result in actions by the States Attorney General plus numerous private causes of action by the consumer.
The Texas Insurance Code has its’ own laundry list of a prohibitions directed to the insurance companies. The biggest list is found in Section 541.051, which is in Subchapter B of the Texas Insurance Code. This Subchapter B has ten other Sections which define prohibited acts or practices by insurance companies. These are Sections 541.052 thru 541.061.
The laws spelled out in the Insurance Code and the DTPA are very similar to each other and the remedies available to an aggrieved consumer are also similar. What is important to an experienced Insurance Law Attorney is being able to use both these lists of laws to add more bite to any claim being pursued against the insurance company. And more importantly, atleast to this writer, is it allows for a claim to be made against the individual agent or adjuster involved in any claim being made. This is important because by being able to make a claim against an individual agent or adjuster, rather than only the insurance company allows the case to be in State Court where recovery is usually better for the consumer, rather than the case being held in Federal Court, where results are usually better for the insurance companies.