Dallas Fort Worth Insurance Lawyer Blog

Homeowners Policies And Hail Claims

May 27, 2017 | Mark S. Humphreys

Parker county insurance lawyers will see lots of homeowners claims resulting from hail damage claims. When this occurs and the insurance company does not want to pay the claim and a lawsuit is filed, the likely result is the insurance company trying to have the case heard in Federal Court. An Eastern District, Sherman Division opinion deals with this situation. The opinion is styled, Lopez v. Allstate Vehicle and Property Insurance Company.

When a hail storm hit the Lopez home, a claim was filed with Allstate. The adjuster, Gary Harbison was assigned to investigate the claim and he concluded there was no damage and any potential damage had occurred prior to the storm. A lawsuit was filed and Harbison was sued with the allegations against him being that he conducted a substandard and improper investigation, that he was scared of losing his job, and he was fraudulent in his report because the Lopez’s public adjuster had found much more damage. Lopez claims damages totaling $30,646.73.

The lawsuit was filed in Denton County Court alleging breach of contract, violations of the Texas DTPA, and violations of the Texas Insurance Code, fraud, negligence, and gross negligence.

ERISA And Administrative Review

May 25, 2017 | Mark S. Humphreys

ERISA lawyers can tell you how important the administrative record is when fighting adverse determinations in ERISA cases. This is illustrated in a 2017 case from the U.S. District Court, Southern District of Texas, Houston Division. The opinion is styled, Elaine Wilson v. Blue Cross and Blue Shield of Texas.

This case is before the Court on a Motion for Summary Judgment filed by BCBS. The Court ruled in favor of BCBS. BCBS insured Wilson under a group health plan which is organized under the Employee Retirement Income Security Act of 1974, and provides for impatient hospital expenses, medical and surgical expenses, and preventative care. The Plan specifies that coverage does not extend to, in relevant part, the following:

1. Any services or supplies which are not Medically Necessary and essential to the diagnosis or direct care and treatment of a sickness, injury, condition, disease, or bodily malfunction.

Exhausting Administrative Remedies – ERISA

May 23, 2017 | Mark S. Humphreys

Exhausting administrative remedies is the law when it comes to ERISA claims. This is again illustrated in a 2017 opinion from the U.S. 5th Circuit. The opinion is styled, Memorial Hermann Health System v. Southwest LTC, Limited Employee Benefits Plan; Southwest LTC, Limited.

Memorial sued Southwest seeking payment of medical bills incurred by a patient covered by a Southwest health benefits plan. The district court granted summary judgment in favor of Southwest, concluding that Memorial failed to exhaust administrative remedies. This appeal followed.

The patient, C.W., was covered by an ERISA governed plan managed by Southwest. Maritain was the third party administrator. C.W. incurred over $400,000 in medical bills as a patient at Memorial. C.W. assigned her insurance benefits to Memorial, who sought collection from Maritain.

Denial Due To Exclusion In Policy

May 21, 2017 | Mark S. Humphreys

There are several reasons an insurance company will deny coverage under an insurance policy. Probably the most common reason is due to a misrepresentation in the policy application. The second most common reason is based on exclusions or limitations in the policy. This makes reading the policy and comparing that policy language against the facts in the case to see whether or not the coverage denial can withstand scrutiny.

The U.S. District Court Southern District, Galveston Division, issued a good opinion discussing this issue in 2017. The opinion is styled, Robert Garner; dba Kustom Kolors Boatworks, Ex Rel, et al v. Nautilus Insurance Company.

Nautilus issued a CGL policy to Garner and during the policy period, Garner was sued by a customer, Andrew Dykes, who alleged Garner did poor repair on his boat and caused further damage to his boat by the work that Garner performed. He sued Garner under the Texas Deceptive Trade Practices Act.

Life Insurance For Government Employees

May 20, 2017 | Mark S. Humphreys

It’s bad enough when private insurance companies mistreat life insurance beneficiaries but an April 2017, story from the Chicago Tribune shows that the U.S. Government does the same thing. The story is titled, USPS Agrees To $49 Million Settlement For ‘Dawdling” In Paying Life Insurance Beneficiaries.

It’s bad enough for family members when a loved one dies.

Getting cheated by Uncle Sam afterward makes it worse.

Texas Slayer Statute

May 18, 2017 | Mark S. Humphreys

Life insurance lawyers know about Texas Insurance Code, Section 1103.151. Also known as the Texas Slayer Statute, it states:

A beneficiary of a life insurance policy or contract forfeits the beneficiary’s interest in the policy or contract if the beneficiary is a principle or an accomplice in wilfully bringing about the death of the insured.

Section 1103.152, goes on to say the proceeds of the policy go to the contingent beneficiary if there is one or goes goes to the estate if there is not.

Remember – There Is An Obligation To Cooperate With Your Own Insurance Company When Making A Claim

May 16, 2017 | Mark S. Humphreys

Experienced insurance law lawyers in Hamilton, Texas, know the above is true. This obligation is illustrated in a 2017, hail damage claim opinion out of the Southern District, Houston Division. The opinion is styled, Metro Hospitality Partners, Ltd., d/b/a Crowne Plaza Hotel v. Lexington Insurance Company.

When a business sues its property insurer and the type of damage is clearly covered, the usual pattern is that the insurance company has failed to pay anything, has failed to pay anything close to what the insured claimed, or has taken too long to pay. This case is different. Here, the property insurer promptly adjusted the claim the insured presented and paid a large sum within the month after the hailstorm that damaged the insured’s hotel. The insurer identified and paid what it concluded were the remaining amounts owed about two months after that. The insured claimed that more money was owed. The insurer asked for documents and information substantiating the demand for additional payment. The insured refused. The policy required the insured to “cooperate” with the insurer. What we have here, says the insurer, is a failure to cooperate. What we have here, says the insured, is a breach of the insurance contract and of the duty of good faith and fair dealing.

After a hail storm, the insured, Metro, promptly notified its Lexington. Lexington quickly responded, inspected, and identified the amount of covered damage and the amount it owed. The parties disputed whether the hailstorm damage justified an insurer-paid new roof, or whether normal wear and tear made a new roof Metro’s responsibility.

Insurance Policy Interpretation

May 14, 2017 | Mark S. Humphreys

Insurance lawyers need to understand how the Courts interpret insurance policies. The 1991, Texas Supreme Court opinion styled, National Union Fire Insurance Company of Pittsburgh, PA. v. Hudson Energy Company, Inc., is good reading on this subject.

On May 23, 1980, Hudson, the president of Hudson Energy purchased a Cessna P-120 from Johnny Walker, owner of Eastex Aviation. The plane was a single engine model equipped with dual controls. Hudson sought Walker’s help in obtaining insurance. Walker contacted Ragsdale, an employee of Cooper Aviation Insurance. Walker was the only one to have direct contact with Ragsdale. Hudson submitted an insurance application showing he was a student pilot. In a letter to Hudson dated June 10, 1980, Ragsdale explained that the quoted insurance premium was based on an understanding that Hudson was a private pilot and that such information was necessary before a policy could be issued. Hudson then completed a new application indicating he was a private pilot. An insurance binder from National Union was issued on May 30, 1980, and the policy was effective for one hear beginning May 23, 1980.

On July 13, 1980, Hudson, his flight instructor (Bishop) and a passenger flew the plane with both having control of the plane’s controls at various times. The plane crashed when landing while both Hudson and Bishop were attempting to operate the controls.

Bad Faith Insurance

May 13, 2017 | Mark S. Humphreys

For Texas insurance lawyers, here is a new opinion from the Texas Supreme Court. It is styled, Menchaca v. Texas Lloyds.

This claim arises from an insured’s claim for losses sustained during Hurricane Ike. The insured sued USAA for (1) breach of contract and for (2) Unfair Settlement Practices under the Texas Insurance Code. As damages for both claims, the insured sought only policy benefits plus court costs and attorney’s fees. In evaluating the bad faith claims brought by the insured against USAA, the Supreme Court acknowledges that some of its previous decisions have created uncertainty in the law. As a result, this opinion is designed to put that uncertainty to rest as nearly as possible.

The primary issue is whether the insured can recover policy benefits based on jury findings that the insurer violation the Texas Insurance Code and that the violation resulted in the insured’s loss of benefits the insurer “should have paid” under the policy, even the jury also failed to find that the insurer failed to comply with its obligation under the policy. USAA argued that because the jury found there was no breach of contract, Menchaca could not recover for “bad faith” or extra-contractual liability as a matter of law. The Court disagreed with USAA and re-affirmed its holding in Vail v. Texas Farm Bureau Mut. Ins. Co., where the Court held that an insurer’s “unfair refusal to pay the insured’s claim causes damages as a matter of law in at least the amount of the policy benefits wrongfully withheld.”

When Policies Are Ambiguous

May 11, 2017 | Mark S. Humphreys

What do Texas Courts do when a policy is ambiguous? Guidance on the answer is provided in a 2009, Texas Supreme Court opinion styled, Progressive County Mutual Insurance Company v. Regan Kelley.

Regan Kelley was struck by a car while riding her horse. Medical expenses for her injuries are alleged to exceed $1 million. After receiving $100,000 in benefits from the motorist’s insurer, Kelley made a claim with Progressive for underinsured benefits under a policy issued to her parents, which also covered Kelley. Progressive paid the policy limits of $500,025 to cover the remaining damages. Kelley then made a claim under an alleged second policy with a limit of $500,025, also issued by Progressive. At the time of the accident, Progressive insured five of the Kelleys’ vehicles. Four vehicles were listed on a two page document, and the fifth was listed on a separate two page document. However, the documents had separate policy numbers. Nevertheless, Progressive denied there was a second policy and refused to make any additional payments.

Kelley sued Progressive for breach of contract and Insurance Code violations, while Progressive sought a declaratory judgment requiring it to pay the maximum policy limit amount under only one policy.