Articles Posted in Insurance Agents

Mineral Wells insurance lawyers already know about this case from the Eastland Court of Appeals. It is styled, Spurlock v. Beacon Lloyds Insurance Company.

Kelly Spurlock (Spurlock), as legal representative for the Estate of J.O. Spurlock, brought suit against Beacon to recover proceeds under a homeowner’s insurance policy for the loss of personal property that was allegedly stolen from a residence. Spurlock also named Grantham-Adkins Insurance Agency (Grantham-Adkins) as a defendant. Spurlock asserted that, if the homeowner’s insurance policy that was issued by Beacon did not provide coverage for the loss of personal property, Grantham-Adkins was negligent in failing to procure coverage for the loss. Beacon and Grantham-Adkins filed motions for summary judgment on Spurlock’s claims. The trial court granted the motions in separate orders. Spurlock appealed the trial court’s orders. This Court affirmed the Orders.

Spurlock owed and lived in a house in Mineral Wells, Texas, that was insured with Beacon through Grantham-Adkins.

Insurance lawyers in the Dallas and Fort Worth area will tell you that being in a position to be able to sue an insurance agent who has committed acts costing their clients money are sometimes easy targets. Not only are they liable for wrongs they may have committed, but they can also be held accountable for things they did not do.

Insurance agents can be important persons/entities to sue in a lawsuit. Most agents do not work by themselves. They work in an office with other insurance agents and have CSR’s working for them. CSR’s are Customer Service Representatives. Almost any of the people working in an insurance office such as the CSR’s, or anybody in a clerical role or who handles money, faxes/mails policies, gives advice, etc can be considered an agent of the insurance company who provides the policy.

Texas Insurance Code, Section 4001.052(a) says, “a person who solicits an application for life, accident, or health insurance or property or casualty insurance is considered the agent of the insurer issuing a policy on the application and not the agent of the insured in any controversy between the insurer and insured, the insured’s beneficiary or the insured’s dependents.”

Dallas insurance lawyers need to know this case discussing insurance agent liability. It is a 2008 opinion from the Corpus Christi Court of Appeals. The style is, Insurance Network of Texas v. Kloesel.

The Kloesel’s have owned and operated Kloesels’ Steakhouse since 1970. INT is an independent insurance agency. In 1993, the Kloesels wanted a different insurance company to safeguard their restaurant. The Kloesels approached Gary Nitsche, an insurance agent with INT, to discuss having INT procure insurance for their restaurant. When INT first procured a policy for the Kloesels, it obtained a policy that covered communicable disease claims. During the policy year, the Kloesels expressed their intent to add a horse-and-carriage operation to their restaurant. As a result, the carrier opted not to renew the Kloesels’ policy, which was set to expire in October 1994. INT notified the Kloesels of the need to change carriers and subsequently procured for them a general liability policy from Burlington, a surplus lines carrier, for the 1994-1995 policy year. The Burlington policy covered claims arising from the horse-and-carriage operation, which began in November 1994, but excluded communicable disease claims. The Kloesels paid the premiums for this policy and renewed it for the 1995-1996, 1996-1997, and 1997-1998 policy years.

During the 1997-1998 policy year, over ninety customers contracted Hepatitis A at the Kloesels’ restaurant; the Texas Department of Health concluded that this likely resulted from a food handler being infected with Hepatitis A. The Kloesels filed claims under the Burlington policy, but Burlington denied the claims based on the communicable disease exclusion. Two separate lawsuits were then filed against the Kloesels by the Simpsons and the Lairds–customers who had contracted Hepatitis A. Burlington defended the Kloesels in these two lawsuits under a reservation of rights. The Simpsons obtained a judgment in their favor worth $242,625. Eight months later the Lairds obtained a judgment in their favor worth $323,441. INT declined to cover the Kloesels for the amounts owed under the Simpson and Laird judgments.

Dallas insurance lawyers will occasionally have a claim against an agent. With that in mind, a Houston Court of Appeals [1st Dist.], opinion is worth reading. The opinion is styled Houston v. Escalante. Here is some of the relevant case information.

Escalante’s Comida Fina, Inc. sued its former insurance agent, Houstoun, Woodard, Eason, Gentle, Tomforde and Anderson, Inc., d/b/a Insurance Alliance for breach of contract and violations of the Deceptive Trade Practices Act and the Texas Insurance Code. The breach of contract claim was based on the failure to procure an insurance policy with coverages requested by Escalante’s, and the DTPA and Insurance Code claims were for misrepresentations and non-disclosure of information about the policy and the coverage afforded thereunder. The jury returned a verdict in favor of Escalante’s, and the trial court signed a final judgment awarding $56,835 in actual damages, $75,780 in additional damages for Insurance Alliance’s “knowing” violation of the DTPA and the Insurance Code, attorney’s fees, costs, and pre- and post-judgment interest.

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 with Ohio Casualty Group. The Ohio Casualty Policy provided, subject to certain exceptions, coverage against the loss of business income caused by an off-premises power or utilities outage. In 2005, Hurricane Rita struck Houston. Escalante’s subsequently made a claim against the policy and Ohio Casualty paid the claim.

Parker County insurance lawyers need to understand the responsibility that insurance agents have regarding getting coverage for one of their customers. A 1992, Texas Supreme Court case is good reading for understanding their responsibility. The style of the case is, May v. United Services Association of America. Here is some of the relevant information.

This case involves the scope of an insurance agent’s common-law duty to a customer in rendering advice about and procuring a policy for health insurance. May asserted only common-law causes of action, making no claim under the Texas Deceptive Trade Practices-Consumer Protection Act, or any other statute. While the jury found favorably for the Mays on a claim of the agent’s negligence, it failed to find for the Mays as to misrepresentation. On this verdict, the trial court rendered judgment for the Mays, but the court of appeals reversed. This court affirmed the judgment of the court of appeals because there was no evidence in the record before them that the agent breached the duty to use reasonable care, skill and diligence in procuring insurance in any way that proximately caused harm to the Mays.

On March 16, 1983, Faith May visited with insurance agent Wiley about the policy at issue. Wiley explained the basic provisions of the policy to her.

Dallas insurance lawyers need to understand when an agent can be held liable for mis-representations regarding an insurance policy. A 1998, San Antonio Court of Appeals case is a good read for understanding when this can be done. The style of the case is, Moore v. Whitney-Vaky Insurance Agency. Here is some relevant information.

Moore contends the trial court erred in granting summary judgment because Whitney-Vaky owed him a common law and statutory duty to disclose any limitation in his insurance coverage.

Moore repossessed an apartment complex known as Oakhills Village. After he reacquired the complex, McLain, an agent for Whitney-Vaky, asked whether he could handle the insurance for the complex. Moore did not recall specifically discussing any types of coverage with McLain; however, Moore had been responsible for obtaining insurance for businesses in the past and expected to receive fire, extended coverage, liability and workmen’s compensation coverage. When he received the policy from McLain, Moore did not discuss the contents of the policy with him; however, Moore thought when he bought liability insurance that he was being covered for any liability that may occur. Moore admitted that McLain never told him that the liability policy would cover all lawsuits against him.