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Here is a 1980, Texas Supreme Court opinion wherein the Court found no bad faith and in fact found in favor of the insurance company.  The opinion is styled, Life Ins. Co. of the Southwest v. Overstreet.

This was an unusual case in that the dispute was over whether or not a premium had been timely paid.

Maxie Overstreet, the insured, died on April 24, 1974, at which time he had not paid the 1974 annual premium on the policy.  Life Insurance Company (LIC) says that by the date of death, the policy had lapsed because the premium had fallen due on March 15, 1974, the thirty-one-day grace period had expired on April 15, and the insured’s death on April 24 had occurred nine days after the grace period’s termination.  Jacquei Overstreet says that the premium payment date was April 18 rather than March 15, that non-payment of the annual premium on April 18 did not end the policy until thirty-one more days, and that Overstreet’s death on April 24 was well within the grace period.

When experts are needed in a homeowners claim, it is good to see how courts look at experts.  The United States District Court for the Western District of Texas, San Antonio Division, issued an opinion on July 1, 2022, that deals with experts.  The opinion is styled, FB & SB Leasing, LLC vs. Chubb Lloyds Insurance Company of Texas.

Chubb filed a motion to exclude the testimony of Michael B. Couch, who had been named by the Plaintiff as an expert.  The court denied Chubbs motion and stated as follows.

In this first–party insurance dispute involving a property experiencing plumbing problems
and foundation issues, Chubb presents two reliability arguments to support excluding the opinion testimony of Plaintiff FB &SB Leasing’s sole causation expert, Michael B. Couch.  Chubb urges first that Couch’s report provides insufficient information about his methodology. Second, Chubb argues Couch relied on mistaken or incorrect underlying data when opining that there were multiple leaks at the property.  There’s no dispute that Couch’s testimony, if reliable, would be relevant.  Chubb also doesn’t dispute Couch’s qualifications.  As argued, and on this record, Chubb’s complaints go to the eventual weight a jury might afford the testimony and are most appropriately addressed at trial via cross-examination or through introduction of competing expert testimony.

Insurance lawyers need to be keeping up with the way courts are interpreting the new Texas Insurance Code, Section 542A.  This is discussed in this 2021 opinion from the Northern District of Texas, Amarillo Division.  The opinion is styled, Ashlee Green v. Allstate Vehicle and Property Insurance Co.

Here, Plaintiff had a property coverage policy with Allstate and alleges she suffered damage caused by a severe storm.  The adjuster, Steven Buchert, found $4,005.17 of damages while Plaintiff seeks damages that totals to $46,472.15.  A lawsuit was filed in State Court suing Allstate and Buchert for various violations of the Texas Insurance Code, Chapters 541 and 542.

Allstate filed its Written Notice of Election of Legal Responsibility for Agent pursuant to Section 542A.006, accepting liability for Buchert’s actions or omissions related to the case.  The state court dismissed Buchert with prejudice and Allstate filed it’s notice of removal.

Insurance policy language and the Facts of a situation have to be read together to determine whether or not coverage applies to a claim.

Here is a 2021, opinion from the Southern District of Texas, Houston Division, that originates from a claimed pipe burst and the insurance company denial of the claim.  The opinion is styled Lee & Charletha Henry v. Allstate Vehicle and Property Insurance Company.

The Henry’s had a homeowners insurance policy with Allstate.  The Henry’s claim a pipe burst on the second-floor bathroom, causing damage to the first-floor kitchen area.  Allstate denied the claim asserting the policy does not cover the claimed damage because the damage to the kitchen wall and the interior does not appear to be sudden and accidental but the result of ongoing water intrusion from the expansion joint.  The Henry’s sued for breach of contract and various violations of the Texas Insurance Code, Prompt Payment of Claims Act, and the Texas Deceptive Trade Practices Act.

Being the person or entity that purchased the insurance policy does not mean that you cannot still make a claim under the policy and thus, sue if necessary.

The Texas Insurance Code grants standing to “persons”, the Texas Deceptive Trade Practices Act (DTPA) gives standing to “consumers.”  A consumer is one who seeks or acquires goods or services according to the DTPA, Section 17.45(a).

Pursuant to the 1987, Texas Supreme Court opinion styled, Aetna Casualty & Surity Company v. Marshall, a person suing under the Insurance Code does not have to prove he is a consumer.

Almost all insurance contracts contain appraisal clauses.  These clauses are discussed in a January 2020 opinion from the Southern District of Texas, McAllen Division.  It is styled, Erasmo Gonzalez v. Allstate Texas Lloyds.

In this case, the Court had urged the parties to discuss appraisal early in the case and both parties assured the Court that appraisal would not be necessary.  Months later, Erasmo invoked the appraisal provision in the insurance contract.  This Court Ordered the appraisal and discussed it’s reasoning.

The appraisal process determines the value of damages, and courts decide liability.  Absent illegality or waiver, the Texas Supreme Court has generally held in favor of enforcing appraisal clauses because denying the appraisal would vitiate the insurer’s right to defend its breach of contract claim.  An insured waives its right to appraisal where (1) the parties reached an impasse; (2) there was unreasonable delay between the point of impasse and the insured’s demand for appraisal; and (3) the insurer shows it has been prejudiced by such delay.  Waiver requires intent, either the intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right.