Articles Posted in Bad Faith Insurance

Dallas insurance lawyers will all have tales of people who lost cases they might have otherwise won if only they had hired an experienced Insurance Law Attorney. This is illustrated in a Dallas Court of Appeals case styled, Marqueth Wilson v. Colonial County Mutual Insurance Company. Please understand that even with an attorney Wilson may have lost this case but here they did not even stand a chance.

According to Wilson’s original petition, on June 24, 2012, he was driving on Scyene Road in Dallas when an object fell off of the car traveling in front of him. The object hit his car, causing property damage. He further alleged the impact of “hopping the curb” caused bodily injury to his lower back, neck, shoulders, and legs.

At the time of the incident, his insurance policy included uninsured motorist, underinsured motorist, comprehensive and collision coverage, rental reimbursement, and personal injury protection (“PIP”). Wilson alleged that despite giving Colonial the opportunity to honor his policy, the insurance company refused; therefore, he filed suit for breach of contract, negligence, bad faith, and private nuisance.

Benbrook insurance lawyers need to know who can properly be a plaintiff in a lawsuit against an insurance company. In order to sue an insurance company, the plaintiff must have “standing.”

A 1996, 5th Circuit Court of Appeals opinion states that an intended beneficiary under a policy of insurance has standing to sue under the Texas Insurance Code statutes. After reviewing Texas cases and other 5th Circuit cases, the court concluded that “if the Texas Supreme Court were presented with the question before us it would hold that standing under (Section 541) is satisfied by not only those who can establish privity of contract or reliance on a representation of the insurer, but also by those who can establish that they were an intended third party beneficiary of the insurance contract.” The court set out the standards under Texas law for third party beneficiary status:

(a) the claimant was not privy to the written agreement between the insured and insurer;

Arlington insurance lawyers need to be able to answer the above question when someone comes into their office with a complaint. Simply put, standing means the legal right to be in court on a case.

Texas Insurance Code, Section 541.151 grants a cause of action to a person who sustains actual damages caused by another person engaging in any unfair insurance practice or deceptive trade practices.

The Texas Supreme Court in a 2000, case stated the law that to assert a cause of action a plaintiff must be: (1) a “person” as defined by the statute; or (2) injured by another’s unfair or deceptive acts.

Fort Worth insurance lawyers know the statutes dealing with insurance misrepresentations can be found in the Texas Insurance Code. Several sections deal with this issue. The different types of misrepresentations that are prohibited by statute are found in sections, 541.051, 541.052, 541.053, 541.055, 541.059, 541.060(a)(1), and 541.061.

These misrepresentations are also against the law under the DTPA, Section 17.46(b), which is incorporated into the Texas Insurance Code. Both the DTPA and Insurance Code prohibit misrepresentation by non-disclosure.

Section 541.051 broadly prohibits making any statement misrepresenting the terms of a policy, or the benefits, advantages, or dividends of a policy, making misrepresentations about the financial condition of an insurer, misrepresenting the true nature of any policy or class or policies, or making any misrepresentation to a policy holder for the purpose of inducing or intending to induce the policy holder to allow an existing policy holder to lapse, forfeit, or to surrender his insurance. This provision is sometimes referred to as the “anti-twisting” provision, because the latter portion is aimed at preventing one insurer stealing away the insureds of another insurer by making misrepresentations.

Grand Prairie insurance attorneys need to know what insurance company unfair settlement practices are and how to recognize them. The Texas Supreme Court and lower courts have opinions issued describing what has happened in certain situations. However, the Texas Insurance Code has specific statutes that are helpful for insurance lawyers.

The Texas Insurance Code, Section 541.060 lists particular practices to be knowledgeable of. The statute prohibits engaging in any of the following unfair settlement practices with respect to a claim by an insured or beneficiary:

(1) misrepresenting to a claimant a material fact or policy provision relating to coverage at issue;

Dallas insurance lawyers handling bad faith claims need to read this 2015 opinion from the Beaumont Court of Appeals. It is styled, National Lloyds Insurance Company v. Latosha A. Lewis.

Lloyds appealed the trial court’s judgment in favor of Lewis following a jury trial. In seven appellate issues, Lloyds challenged (1) the legal sufficiency of the evidence supporting the jury’s findings regarding causation, damages for mental anguish, breach of contract, and breach of the DTPA, and exemplary damages, (2) the trial court’s inclusion in the charge of an instruction regarding waiver and its refusal to include an instruction on spoliation, (3) and the trial court’s rendition of a judgment that allegedly failed to force Lewis to make an election of remedies. This Court affirmed the trial court’s judgment as modified.

The facts of this case are long and detailed and need to be read for a good example of what the courts deem to be bad faith. In the case, this court upheld an award of mental anguish damages to Lewis because of the conduct of Lloyds in handling her claim for damage.

A Fort Worth insurance lawyer needs to know when there was a misrepresentation of an insurance policy. A 1994, Corpus Christi Court of Appeals is worth reading on this topic. The style of the case is Celestino v. Mid-American Indemnity Insurance Company. Here is some of the information from that case.

Celestino is the assignee of Sabastian. The instant dispute involves Sebastian’s insurance policy, which Donald Donaho of the Donaho Insurance Agency (Donaho) purchased from Mid-American through underwriters Richard McNeil and Pro., Inc. With the full participation and cooperation of Sebastian, the Celestinos sued Mid-American.

As chief executive officer of Sebastian, Tommy Funk determines what insurance the company requires and obtains the necessary coverage. Funk maintained a primary policy for both workers’ compensation insurance and employer’s liability insurance as well as an umbrella policy for excess employer’s liability coverage. A later change in policies resulted in coverage with Mid-American.

Lawyers handling bad faith cases in the Dallas and Fort Worth areas need to recognize a bad faith case when they see it. This is not always easy. An El Paso Court of Appeals case from 1996, is an example. The style of the case is, Columbia Universal Life Insurance Co. v. Miles.

Miles met with his insurance agent to change his heath insurance coverage. The agent filled out the application by asking Miles the questions listed on the application. Miles testified that he provided the agent with a complete medical history. The agent said Miles only talked about the conditions that appeared on the application. It turned out that Miles had an extensive medical history that was not listed on the application including immune deficiency and other chronic illnesses. Miles says he signed the application without signing it.

Shortly after filling out the application, Columbia called Miles to conduct a personal history interview and to confirm the information on the application. Miles told Columbia that the information on the application was true and correct. He did not mention his other medical problems and the policy was issued.