Bad Faith Insurance

Mental Anguish Insurance Claims

January 2, 2014 | Mark S. Humphreys

Fort Worth insurance lawyers need to be able to recognize a claim wherein conduct arises to a level allowing recovery for mental anguish damages. The 1999, Fort Worth Court of Appeals case styled, “Mid-Century v. Foreman” is helpful. Here is some of the relevant information.

Joyce Foreman was involved in a car accident with Karl Buehner. Foreman’s policy included $250,000 in underinsured (UIM) benefits. Foreman settled with Buehner’s insurance for the limits of $20,000. Because of extensive medical bills, Foreman filed an UIM claim with Mid-Century. Fisher, the Mid-Century adjuster, mailed an acknowledgement of the claim and a request for information. Foreman told Fisher that they had previously settled their liability claim and that they had hired a lawyer. As a result, Fisher stopped all contact with Foreman.

Foreman sued Mid-Century to recover contractual and extra-contractual damages. After reviewing Foremans’ medical records, the claim was denied.

Misrepresentations In Insurance

October 17, 2013 | Mark S. Humphreys

Dallas insurance attorneys know that misrepresentations in insurance are essentially the same as misrepresentations in any other area of law.

The Texas Supreme Court told us in 1990, that a false representation must involve an existing or past material fact, rather than a statement of opinion, judgment, probability, or expectation in order to constitute actionable fraud. This is from the case styled, DeSantis v. Wackenhut Corp.

The Tyler Court of Appeals in 1978, said that statements concerning future contingent events, sales talk, “puffing,” and other similar statements are not considered actionable misrepresentations. The Tyler case is styled, Hicks v. Wright.

Different Policy? Same Coverages?

October 8, 2013 | Mark S. Humphreys

Dallas area insurance attorneys need to be aware of the opinion issued by the Houston Court of Appeals, First District of Texas, in August of 2013. The style of this case is Houstoun, et al v. Escalante’s Comida Fina, Inc.

Here is some background information.

Between 2003 and 2008, Escalante’s owned and operated four restaurants in the Houston area. Between 2003 and 2006 the property and casualty insurance policy on the restaurants was through Ohio Casualty Group, which provided coverage, with certain exceptions, in the event of loss of business income caused by an off-premises power or utilities outage. After Hurricane Rita hit Houston in 2005, Escalante’s claimed against the policy and Ohio Casualty paid.

Fraud And Misrepresentations In Insurance

October 5, 2013 | Mark S. Humphreys

Grapevine insurance attorneys need to be able to recognize when fraud or misrepresentation occurs in the insurance context.

To accuse an insurance agent or insurance company of fraud there needs to be proof of the following elements:

1) a material representation was made;

Exemplary Damages In DTPA and Insurance Cases

September 26, 2013 | Mark S. Humphreys

Tarrant County lawyers need to be able to understand the case facts that will get them to exemplary damages. To know the difference between the threat of and the reality of getting them based on what transpired in the case.

Texas case law clearly allows for the recovery of exemplary damages in cases involving violations of the Texas Insurance Code and violations of the Texas Deceptive Trade Practices Act (DTPA). In 1994, the Texas Supreme Court issued an opinion in the case styled, Transportation Insurance Co. v. Moriel.

In Moriel, which was a “bad faith” case, the court held that the plaintiff must show that the insurance company had “no reasonable basis” to deny or delay payment of the claim and that the insurance company committed an act that was likely to cause serious injury beyond the injury associated with the underlying breach of the insurance contract. The court suggested that punitive damages could be recovered if the insurance company denied coverage for medical care knowing the insured would suffer serious injury, or denied disability coverage with the inherent extraordinary degree of hardship that would result.

First Party Insurance

September 24, 2013 | Mark S. Humphreys

Mineral Wells insurance lawyers need to know the difference between first party claims and third party claims and how that relates to bad faith insurance claims.

The Texas common law duty of good faith and fair dealing extends protection to the insured, whether the insured obtained the insurance coverage directly or coverage was obtained some other way for the insured. The 1987, Texas Supreme Court, in the case, Arnold v. National County Mutual Fire Insurance Co. recognized a common law duty of good faith and fair dealing owed to an insured, which arises from the “special relationship” established by the insurance contract. In the 1988 case, Aranda v. Insurance Company of North America, the Texas Supreme Court extended this duty of good faith and fair dealing to a worker insured under a workers’ compensation policy purchased by his employer.

An injured third party claimant lacks standing to sue the negligent driver’s liability insurance company for breach of the duty of good faith and fair dealing. We know this from the 1994 Texas Supreme Court case, Allstate Insurance Company v. Watson.

Duties Of Insurance Company When Claim Is Made

August 15, 2013 | Mark S. Humphreys

Dallas insurance lawyers should be able to discuss all of the enclosed with you.

The Texas Insurance Code, Section 542.055, says an insurance company shall acknowledge receipt of a claim within 15 days after they receive notice of a claim and begin its investigation and request from the claimant all they reasonably need at that time to further their investigation. So what happens after that?

No additional deadlines are triggered until the insurance company receives all items, statements, and forms reasonably required by the insurance company. Once the insurance company receives that information, seven new responsibilities arise:

What Insurance Companies Have To Do

August 13, 2013 | Mark S. Humphreys

Parker County lawyers who handle insurance cases need to know some of the duties imposed on insurance companies when handling a claim for benefits.

The Texas Prompt Payment of Claims Act is found in the Texas Insurance Code. It details the duties imposed on an insurance company when a claim is made.

When an insurance company receives notice of a claim from one of its insureds, there are four duties that are imposed on them.

Texas Insurance Code And The Texas Deceptive Trade Practices Act

July 23, 2013 | Mark S. Humphreys

Here is some information that all Dallas and Fort Worth insurance lawyers should know.

The Texas Insurance Code sections and Deceptive Trade Practices Act(DTPA) were adopted together by the Texas Legislature in the 1970’s as part of a reform legislation package. They are interrelated and incorporate each other.

Texas Insurance Code, Section 541.008 tells us the provisions of the Code are to be liberally construed and applied to promote its underlying purposes to define and prohibit unfair and deceptive practices in the business of insurance.

Insurance Misrepresentation

July 11, 2013 | Mark S. Humphreys

Dallas insurance lawyers need to know insurance misrepresentation when they see it. The Texas Insurance Code Section 541.061(2) makes it illegal for an insurance company to fail to disclose relevant information. The Texas DTPA does the same thing in Section 17.46(b)(24). There are several sections of the insurance code that make misrepresentation illegal, most of which is found in Chapter 541.

Section 541 prohibits making any statement, whether it is oral or in writing, misrepresenting the terms of a policy, the benefits, advantages, or dividends of a policy, among other things. The purpose of the statute of in preventing one insurer to make misrepresentations in efforts to induce a policyholder from changing to another company.

Section 541.052 prohibits making any advertisement or statement containing any assertion, representation, or statement with respect to the business of insurance or with respect to any person in the conduct of his insurance business that is untrue, deceptive, or misleading, whether it be oral or in writing.