Claims Denial

Bad Faith And Homeowners Insurance

May 13, 2010 | Mark S. Humphreys

There are homeowners in Grand Prairie, Arlington, Mansfield, Weatherford, Aledo, Fort Worth, and everywhere else in Texas. 95% of those homeowners have insurance. So how do you know if your insurance company is violating the “bad faith” laws in Texas?

Here is a 1997, Texas Supreme Court case to read to give some insight into the above question. The case is, State Farm Lloyd’s v. Ioan and Liana Nicolau.

In the insurance claim giving rise to this dispute, the Nicolau sought coverage for extensive foundation damage to their home. The homeowners policy, issued by State Farm Lloyds, (State Farm) generally excludes losses caused by “inherent vice,” or by “settling, cracking, bulging, shrinkage, or expansion of foundations.” Under an express exception, however, these exclusions do not apply to losses caused by an “accidental discharge, leakage or overflow of water” from within a plumbing system.

Holding Insurance Company Liable For Bad Faith

May 12, 2010 | Mark S. Humphreys

What if a resident of Grand Prairie is involved in a wreck on his motorcycle with an uninsured driver? Any difference if he is a resident of Fort Worth, Arlington, or Dallas? Answer – not for anyone in Texas.

This is what happened in the 1987 case, Glen Arnold v. National County Mutual Fire Insurance Company. This Texas Supreme Court case is an insurance contract dispute. Arnold was severly injured when the motocycle he was operating was struck by an uninsured motorist. Arnold had uninsured motorist benefits protection on the policy he had with National County Mutual Fire Insurance Company (National). Arnold made a demand for payment and the independent adjusting firm hired by National recommended the claim be paid. In spite of this, National refused to pay.

Arnold sued and won a judgment exceeding the policy limits then sued National for breaching its duty of good faith and fair dealing.

Bad Faith Insurance In Texas

May 8, 2010 | Mark S. Humphreys

The guy in Grand Prairie, Arlington, Weatherford, Fort Worth, Dallas, or any other place in Texas, wonders what he can do when his insurance company does him wrong. Usually when an insurance company does something that is wrong with one of their insured policyholders, that is called “bad faith” insurance.

Changes in insurance laws in recent years have made it more difficult to make bad faith claims against insurance companies. But this concept of bad faith is definitly not dead. The Texas Department of Insurance has a complaint department that does investigate improper conduct by insurance companies. That is the good news. The bad news is that they seldom do anything except in the most extreme cases where the wrongs are big and affecting thousands of people. What they often times end up telling individuals is that they should consult an experienced Insurance Law Attorney to further pursue complaints. It is not that they don’t care, it’s that they do not have the staff to be pursuing all the wrongs being committed.

A person should never give up when being wronged by one of these companies. The Texas Insurance Code has contained within it, statutes with a lot teeth for attorneys to use in making an insurance company pay for the wrongs it commits. Section 541.060, is titled “Unfair Settlement Practices” and lists several acts, or examples of inaction, that will subject an insurance company to civil liability to the person being wronged.

Auto Coverage In Texas And Gun Racks

May 5, 2010 | Mark S. Humphreys

What if you are a “good ole boy” in Weatherford, Texas? Or for that matter, in Arlington, Grand Prairie, Fort Worth, or Dallas, and you have a gun rack in your vehicle. In the gun rack you have a loaded firearm. Next, the firearm is accidently discharged. Will your insurance company cover the resulting damages to others? The answer is a lawyerly answer for you: It depends.

Here is an interesting case issued by the Texas Supreme Court. This case discusses how the facts should be analysed to see if coverge will exist. The case, decided in 1999, is styled, Mid-Century Insurance Company of Texas, a division of The Farmers Insurance Group of Companies, v. Richard Tanner. The cite is, 997 S.W.2d 153.

The question for the court to decide in this case was whether the underinsured motorist provision of a standard Texas personal auto policy covers the insured’s bodily injuries resulting from the unintentional discharge of a shotgun on a gun rack in a pickup truck parked nearby. The answer, in this case, depended on whether, within the meaning of the policy, the injuries resulted from “an accident” “arising out of” the “use” of the truck.

In Texas – Who Do You Sue?

April 6, 2010 | Mark S. Humphreys

You live in Grand Prairie, Fort Worth, Arlington, Dallas, Weatherford, or anywhere else in Texas and you get treated wrong with your insurance policy – Who do you sue? The answer is not very hard.

First of all …. seek the advice of an experienced Insurance Law Attorney. Then …

The Texas Insurance Code, Section 541.151, provides that a person who has sustained damages caused by another’s engaging in unfair or deceptive insurance practices may sue the person engaging in those acts or practices. Texas Insurance Code Statute, 541.002(2) defines “person” to mean “an individual, corporation, association, partnership, reciprocal or interinsurance exchange, Lloyd’s plan, fraternal benefit society, or any other legal entity engaged in the business of insurance, including an agent, broker, adjuster or life insurance counselor.”

Who Can Sue? … A “Person” Or A “Consumer”

April 5, 2010 | Mark S. Humphreys

Is a Grand Prairie resident who purchases an auto policy a person or a consumer for purposes of Texas law? What about residents of Arlington, Fort Worth, Weatherford, or Dallas? Why does it matter?

The Texas Insurance Code allows “persons” to bring claims against insurance companies and their agents. The Deceptive Trade Practices Act (DTPA) gives this power to “consumers”. The DTPA, Section 17.45(4) defines consumer as one who seeks or acquires goods or services.

Someone suing under the Insurance Code does not have to prove he is a consumer. This is told to us in the 1987, Texas Supreme Court case, Aetna Casualty & Sur. Co. v. Marshall.

Unfair Settlement Practices In Texas

March 27, 2010 | Mark S. Humphreys

Grand Prairie residents, residents of Arlington, Mansfield, Fort Worth, Dallas, Weatherford or anywhere else in Texas have the same insurance laws apply to each other. They all need to know there is a law that prohibits unfair settlement practices in the State of Texas.

Texas Insurance Code, Section 541.060, is titled “Unfair Settlement Practices”. It is the law that prohibits these types of actions. The statute prohibits engaging in any of the following settlement practices with respect to a claim by an insured person or his beneficiary:

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

Misrepresentations In Texas Insurance

March 26, 2010 | Mark S. Humphreys

Grand Prairie residents and residents of Arlington, Dallas, Fort Worth, Mansfield, Weatherford, and any other town or city in Texas have a right to have their insurance company and agent be honest with them. Misrepresentation of an insurance policy in Texas is illegal under the Texas Insurance Code and Texas Deceptive Trade Practices Act.

The Texas Insurance Code, Section 541.061, states that misrepresentation of an insurance policy in Texas is an unfair method of competition or an unfair or deceptive act or practice in the business of insurance. The title of Section 541.061 is “Misrepresentation of Insurance Policy”.

A violation of this section of the Texas Insurance Code is also a violation of the Texas Deceptive Trade Practices Act. As it relates to insurance misrepresentation, this section of the Insurance Code states that it is illegal to misrepresent features of an insurance policy by:

Texas Unfair Insurance Practices

March 23, 2010 | Mark S. Humphreys

Regardless of what kind of insurance you have purchased or where in Texas the purchase occurred, the same law applies. So residents of Grand Prairie, Arlington, Mansfield, Dallas, Fort Worth, or Weatherford, all get treated the same.

This will be the first part of a several part writing on “unfair insurance practices”.

Chapter 541 if the Texas Insurance Code, is where the definition and prohibition for unfair and deceptive insurance practices is found. These sections of the Insurance Code are Sections 541.001 thru 541.061, Section 541.151 thru 541.162, and 541.453.

Texas Health Insurance Cancellation

March 22, 2010 | Mark S. Humphreys

Everybody in the Dallas, Fort Worth area, including Grand Prairie, Arlington, Mansfield, and out in Weatherford have some form of health insurance. The majority of this insurance is private plans.

The Texas Supreme Court decided a case in 1994 that still has relevance today. The style of the case is, Union Bankers Insurance Company v. Thomas D. Shelton and Ann Shelton. The issue in the case dealt with misrepresentation in the insurance policy application.

Here are the facts. In April 1988, Mr. Shelton applied to Union Bankers Insurance Company (Union) for a health insurance policy. Mr. Stone completed the application with the agent’s assistance. In response to certain medical history questions, Mr. Shelton indicated that he had never been treated for, and had no indications of, any disorders of the skeletal or muscular systems. Union subsequently issued a policy. Seven months after the policy was issued, Mr. Shelton underwent a total hip replacement to correct necrosis of his left hip joint. He then filed a claim for benefits. Union denied the claim, saying that the necrosis was an undisclosed pre-existing condition.