Dallas Fort Worth Insurance Lawyer Blog
Insurance Claim Denial due to alleged misrepresentations is common in insurance disputes. It is seen most often in life insurance claims. Less common is in homeowners claims. Here is a homeowner’s claim. It is a 2024 opinion from the Western District of Texas, San Antonio Division. It opinion is styled, Sanjay Malhotra, Monesha Gupta v. State Farm Lloyds.
This opinion is the result of State Farm filing a Partial Summary Judgment Motion. The claim arose from alleged damages caused by an April 28, 2021, hailstorm. The Plaintiffs sued State Farm alleging the claim had not been properly handled.
Throughout its Motion, State Farm contends the undisputed evidence shows this case in-volves an honest dispute as to the extent of damage to Plaintiffs’ property caused by the subject hailstorm and the cost of the work necessary to rectify this damage, and therefore, the causes of action for bad faith and unfair settlement practice must fail. As support for its argument that summary judgment should be granted for Plaintiffs’ common law bad faith claims, State Farm states the following: “The inspection included both the exterior and interior of Plaintiffs’ Property. Multiple inspections were done at the property and during those inspections, State Farm noted damage to some of the roof tiles, soft metals, gazebo and interior water damage and subsequently prepared estimates for the covered damages and issued payments to Plaintiffs after application of their deductible.”
State Farm presents no evidence and provides no record cites to support this statement. State Farm does attach as exhibits to its Motion evidence consisting of discovery responses to interrogatories and requests for production. However, State Farm provides no cites to this discovery nor does it explain how this discovery supports its position for summary judgment here. State Farm provides only conclusory arguments that it conducted a reasonable investigation, the undisputed facts reveal adequate basis for its action, and the basis of this action results from the parties’ bona fide coverage dispute. These conclusory statements are insufficient to satisfy its summary judgment burden of proof to show it had a reasonable basis to delay payment of Plaintiffs’ claim. Therefore, the burden does not shift to Plaintiffs to present summary judgment evidence to raise a genuine dispute whether State Farm’s inspectors or adjustor conducted an unreasonable investigation, or that State Farm’s investigation was calculated to underestimate or under-pay Plaintiffs’ insurance claim.
Next, State Farm seeks summary judgment on Plaintiffs’ “misrepresentation claims under common law fraud, breach of the duty of good faith and fair dealing, and Texas Insurance Code, sections 541.060(a)(1) and 541.061.” To the extent these arguments pertain to the asserted causes of action, State Farm fails to satisfy its burden of proof.
In support of this argument, State Farm states, “Plaintiffs’ discovery responses likewise do not support Plaintiffs’ claims, in fact Plaintiffs’ objected to each of the discovery requests and provided very few documents. Misrepresentation claims are based solely on alleged post-loss statements regarding the extent of damages to the Property. The Court will not search the record for material fact issues or to find a party’s ill-cited evidence. In addition, the Court will not weigh the evidence and must view all evidence
and draw all reasonable inferences in the light most favorable to Plaintiffs. Consequently, State Farm fails to satisfy its burden on these potential causes of action.
Because State Farm fails to satisfy its summary judgment burden, its Motion for Partial Summary Judgment will be denied.