Dallas Fort Worth Insurance Lawyer Blog

Life Insurance And The Right To The Proceeds

February 2, 2016 | Mark S. Humphreys

A 1955, Beaumont Court of Appeals case discusses a life insurance issue that comes up every once in a while. The case is styled, Pritchett v. Henry.

Here is the relevant information from the case.

Howard Pritchett and his wife, Clyda Pritchett, the appellants, filed their suit against the appellee, Percy B. Henry, and certain life insurance companies; they alleged that they are the parents of Melba Henry, who had been the wife of appellee Percy B. Henry; that on or about January 8, 1955 Percy B. Henry shot and killed his wife, Melba Henry, unlawfully and illegally killing and murdering her. They further alleged that at the time of the alleged willful killing of Melba Henry by her husband, Percy B. Henry, there were in existence several policies of life insurance insuring the life of Melba Henry and the said Percy B. Henry was the beneficiary in said life insurance policies. They further alleged that they were the next of kin of the deceased, Melba Henry, after the appellee Percy B. Henry, and prayed the court to forfeit the interests of the appellee Henry in all policies of life insurance by virtue of Article 21.23 of the Insurance Code of Texas, V.A.T.S. This Article is now found in the Texas Insurance Code, Section 1103.151.

Insurance Fraud By Customers

January 31, 2016 | Mark S. Humphreys

Irving insurance lawyers and all insurance lawyers want to spend their time suing insurance companies that commit wrongs against their customers. In doing this, one has to be aware of situations where the customer is the one committing fraud on an insurance company. Otherwise, a lot of time and effort can be spent on a losing case.

The Claims Journal ran an article titled, “Worst Insurance Fraud Scams of 2014” that is interesting. Here are highlights.

A driver rockets his $1-million Bugatti into a salty lagoon … Two kids perish in a home insurance arson their own mother set … A cancer doctor pumps healthy patients with toxic chemotherapy in a $125-million insurance plot.

Bad Faith Insurance – How Tough Is It?

January 30, 2016 | Mark S. Humphreys

Mineral Wells insurance lawyers and all insurance lawyers who keep up with what is happening in bad faith litigation will find this article interesting. It is from the Claims Journal and is titled, Going on the Offensive in Defending Bad Faith Claims. I do not agree with this article but here is what it says.

Insurance bad faith claims are one of the most contentious and hardest fought types of lawsuits in all of civil litigation. In particular, a great deal of time, effort and costs are expended by insurers in the defense of bad faith lawsuits. And in most cases, more time and money is spent by the insurer in the discovery stage of a bad faith lawsuit than in any other phase of the litigation. One of the unique aspects of bad faith litigation is the extraordinary lengths that claimants will go to force insurers to defend arduous, burdensome and seemingly endless written discovery requests, a maneuver that is geared specifically at gaining leverage and compelling a settlement out of the insurer. Over time, insurers have become quite adept at effectively defending against these discovery tactics.

However, perhaps the most overlooked aspect to bad faith litigation defense is the insurer’s own written discovery requests. As part of an effective, comprehensive litigation plan, the implementation of an offensive, aggressive discovery strategy involving the insurer’s own written discovery requests can turn the tables on a claimant and serve as a vital tool in limiting or, ideally, completely disposing of a wide variety of bad faith claims early in the litigation process.

Life Insurance Company Unsure Who To Pay

January 28, 2016 | Mark S. Humphreys

Weatherford life insurance attorneys need to know what an insurance company will do when they are unsure who is entitled to life insurance benefits. The answer is that they will file an “interpleader” and notify all people who might have a claim. This was the procedure followed in a 1957 case from the Fort Worth Court of Appeals. The style of the case is Murray v. American National Insurance Company.

American issued a policy on the life of Otis Carl Murray in which his wife, Sarah Lou Murray, was named beneficiary. Otis died on July 24, 1955. Sarah was indicted by the grand jury of Runnels County on August 24, 1955, for the death of her husband.

Sarah, on September 1, 1955, made demand on American for payment of the proceeds of the policy. Proof of death submitted did not reveal the cause of death of the insured. Less than thirty days after demand for payment, American advised Sarah’s attorney it was prepared to pay the amount due under the policy, subject to a valid and satisfactory release of liability, but called attention to the fact it had been put on notice that Sarah was under indictment for the death of her husband, and that if suit were filed American would pay the money into court and resist payment of costs, penalties and attorney’s fees on the ground it had not denied liability. Through the month of September American corresponded with Sarah’s attorney requesting completion of proofs of death.

Insurance Company – This Wasn’t Right

January 26, 2016 | Mark S. Humphreys

The Texas Tribune published an article titled, Prosecutors, Insurer Change Controversial Funding Deal. Texas attorneys and all people who buy insurance should sense there was something wrong with this deal.

Responding to a flood of criticism about its unusual financial arrangement with a large insurance company, the Travis County District Attorney’s Office is dramatically restructuring its workers’ compensation fraud unit and implementing new safeguards against potential abuse and conflicts of interest.

The changes come in the wake of a series of reports by The Texas Tribune and the Austin American-Statesman that raised questions about the cozy relationship between government prosecutors and Texas Mutual Insurance Company, the state’s largest provider of workers’ compensation policies.

Life Insurance – Interpleader

January 24, 2016 | Mark S. Humphreys

Fort Worth life insurance lawyers will see situations where a life insurance company admits it owes money under a life insurance policy but is unable to determine who is owed the money. The proper action is for the life insurance company to interplead the money into a court. A 1957, Fort Worth Court of Appeals describes this situation. The style of the case is, Sarah Lou Murray v. American National Insurance Company.

Appellee American National Insurance Company issued a policy on the life of Otis Carl Murray in which his wife, appellant Sarah Lou Murray, was named beneficiary. The insured died on July 24, 1955. Appellant was indicted by the grand jury of Runnels County on August 24, 1955, for the death of her husband.

Appellant, on September 1, 1955, made demand on appellee for payment of the proceeds of the policy. Proof of death submitted did not reveal the cause of death of the insured. Less than thirty days after demand for payment, appellee advised appellant’s attorney it was prepared to pay the amount due under the policy, subject to a valid and satisfactory release of liability, but called attention to the fact it had been put on notice that appellant was under indictment for the death of her husband, and that if suit were filed appellee would pay the money into court and resist payment of costs, penalties and attorney’s fees on the ground it had not denied liability. Through the month of September the appellee corresponded with appellant’s attorney requesting completion of proofs of death.

Life Insurance Interpleader

January 23, 2016 | Mark S. Humphreys

Dallas life insurance lawyers know what an interpleader is and the circumstances under which, cause insurance companies to interplead life insurance proceeds into the court. An old 1931 case illustrates this. The case is styled, McCormick v. Southwestern Life Ins. Co. and is from the Waco Court of Appeals.

This is an interpleader filed by Southwestern in the District Court against Marjorie McCormick and Mike Lively and Ben Sleeper as guardian of the estate of Adelaide McCormick. Southwestern admitted they owed money under the insurance policy but unsure who to pay. Marjorie was the named beneficiary on a policy insuring the life of Andrew McCormick. Adelaide was the only surviving child. Ben was the assignee of the proceeds of the policy from Marjorie. The interpleader resulted from the allegation that Marjorie had intentionally caused the death of Andrew and thus, had forfeited her interest in the insurance proceeds.

The purpose of the remedy of interpleader is to protect an innocent stakeholder, (Southwestern) who is willing and ready to pay the funds int his hands to the party or parties entitled to receive the same. It is an efficacious and wholesome remedy. This is allowed to protect the stakeholder from conflicting claims.

Complying With The Policy

January 21, 2016 | Mark S. Humphreys

Fort Worth lawyers will tell you to comply with the policy provisions when making a claim. In this regard, a case from the U.S. District Court McAllen Division is a good read. It is styled, Belinda Santa Maria v. State Farm Lloyds, et al.

This a summary judgment ruling and there were other motions pending but due to the ruing in favor of State Farm, the Court deemed the other motions of no consequence.

Plaintiff’s claims arise from damage sustained to their property as a result of a storm event on March 29, 2012. Plaintiffs reported the claim on April 11, 2012, and State Farm inspected the property on May 2, 2012, estimating the loss at $7,028.04. On the same day, State Farm issued a check for $2,177.16, after adjusting for depreciation and deductible.

Federal Court And Underinsured Coverage

January 19, 2016 | Mark S. Humphreys

Weatherford lawyers who sue insurance companies need to know how to stay out of Federal Court if they want to properly represent their clients. It cannot always be done but understanding the law in these matters is important. A U.S. Northern District, Dallas Division case is good reading on this issue. The style of the case is, Felecia D.Davis v. Eduardo Vargas Reyes, et al.

Davis filed suit in State Court against Vargas for injuries arising from a car wreck. After Davis settled with Vargas, she amended her petition and added Amica Mutual Insurance (Amica) to this lawsuit, seeking underinsured benefits and she sued the Amica adjuster, Carolina Glenn. She then filed a second amended petition alleging that her claims against Vargas had been settled. Amica properly removed the case and alleged in its removal that Vargas, a Texas citizen, should be disregarded because the claim against him had already been settled. Amica is a citizen of Rhode Island and thus there was diversity of citizenship allowing the removal.

Davis contended that even though she had settled with Vargas, diversity of citizenship is determined as of the time she originally filed suit in State Court, meaning Vargas’ Texas citizenship precludes removal. Davis also contended the State Court had never entered an order dismissing the claims against Vargas so Vargas’ Texas citizenship cannot be disregarded.

Hail Damage Claims

January 17, 2016 | Mark S. Humphreys

Dallas area attorneys who handle hail damage claims need to read this opinion from the 5th Circuit Court of Appeals. The style of the case is, Vincent Stagliano v. The Cincinnati Insurance Company.

This is a first-party insurance dispute over coverage for damage to commercial property allegedly caused by a hailstorm. The District Court granted summary judgment in favor of Cincinnati.

The facts in this case are straightforward. Plaintiffs own a number of properties in and around Dallas, and Cincinnati provided loss protection from August 14, 2010, to August 14, 2011. On June 21, 2011, a claim was submitted for damage to one of the properties that occurred as a result of a hail storm on May 24, 2011. The claim was paid. A year and eight months later, claims for several other properties alleged to have been damaged in the same storm were submitted and Cincinnati denied these claims.