Dallas Fort Worth Insurance Lawyer Blog

Duty Of An Insurance Agent In Texas

May 27, 2010 | Mark S. Humphreys

Whether your agent is in Grand Prairie, Arlington, Mansfield, Richardson, Plano, Fort Worth, or anywhere else in Texas, he has duties he owes to his insurance clients. So, what are an agents duties?

For starters, insurance agents do not have a general duty to obtain coverage nor to make sure any coverage you get is adequate. On the other hand, courts have found insurers liable for affirmative misrepresentations, and an insurance agent who undertakes to procure insurance for another owes a duty to a client to use reasonable diligence in attempting to place the requested insurance and to inform the client promptly if unable to do so. This is discussed in the 1992, Texas Supreme Court case, May v. United Services Association of America.

What if the notice of expiration on an insurance policy is sent to the agent rather than to the policy holder it was intended for? Then the agent is responsible for forwarding that information. This was the issue in Kitching v. Zamora and Horn v. Hedgecoke Insurance Agency.

Negligence And Insurance Agents In Texas

May 26, 2010 | Mark S. Humphreys

Let’s say your insurance agent is in Aledo, Arlington, Azle, Grand Prairie, Fort Worth, Mansfield, Weatherford, or anywhere else in Texas. Now, let’s say he does something wrong in the way he handles your insurance needs. Can he be held liable for what he does or fails to do for you?

The answer is yes. An agent can be held accountable on a number of different theories of law related to insurance. He can also be held accountable under the most fundamental of legal theorys, that being “negligence.”

The Lectric Law Library defines negligence as, “The failure to use reasonable care. The doing of something which a reasonably prudent person would not do, or the failure to do something which a reasonably prudent person would do under like circumstances. A departure from what an ordinary reasonable person would do in the same community.”

Named Driver Exclusions In Automobile Policies In Texas

May 24, 2010 | Mark S. Humphreys

Auto policy holders in Grand Prairie, Arlington, Fort Worth, Mansfield, Azle, Dallas, Weatherford, or any other city in Texas would want to know what all that “stuff” in their auto policy means. One part that is pretty easy to explain is the “Named Driver Exclusion.” This is other times called the “515-A Exclusion” or “515-A Endorsement”.

The normal automobile insurance policy is going to have a part that reads, “You agree that none of the insurance coverage afforded by this policy shall apply while ______________ is operating your covered auto or any other motor vehicle. These exclusions and endorsements are legal in insurance contracts. The language used is partly governed by laws published in the Texas Insurance Code. See Sections 1952.051 et al and Sections 2301.001 et al. As for the “Named Driver Exclusion”, it is legal and is intended to give policy holders the option to exclude from coverage drivers who, by virtue of their driving history or other factors, are deemed high risk drivers. This category of drivers would include drivers who have been convicted of violating the Driving While Intoxicated laws found in the Texas Penal Code, drivers with too many moving violations, too many wrecks, and other high risk drivers such as teenagers who have just got their license. It is important to realize that almost all of these drivers can get insurance but the cost of the insurance is much higher than what other drivers must pay.

The Texas Corpus Christ Court of Appeals decided a case in 1996 that is often cited for the validity of the Named Driver Exclusion. The style of the case is, Janie Zamora, Pete Zamora, Jesus Toc, and Gracie Vela v. Dairyland County Mutual Insurance Company. In this case the excluded driver was Gracie Vela, who was driving Jesus Toc’s vehicle. She had a wreck with the Zamoras causing them injury. In this case, the court upheld the validity of the exclusion and discussed the reasons for its validity.

Bad Faith / Reasonable Basis

May 23, 2010 | Mark S. Humphreys

How does the policyholder in Grand Prairie know if his insurance company is acting in bad faith? This same question might be asked in Arlington, Aledo, Mansfield, Fort Worth, or anywhere else in Texas.

When an insurance company denies a claim it should be obvious that there are times when they have a good reason for doing so. But how do you know if their reason is a good reason or not? What the courts ask or look for is, “proof that the insurance company had a reasonble basis to deny the claim, delay payment, or cancel the policy.” Legally, this is often times called the “bona fide dispute” defense, an insurance company will use to escape some of the liability accusations that are tied to bad faith cases. Another way of putting this is, an insurance company is not liable merely for being wrong on a coverage issue, only for being unreasonable. Even an experienced Insurance Law Attorney will often times have trouble knowing for sure whether the actions and conduct of the insurance company rise to the level of bad faith. Some cases are easy to call, but some are not.

A Texas Supreme Court case, decided in 1994, styled, Transportation Insurance Company v. Moriel, states:

Underinsured Motorist Claims In Texas

May 20, 2010 | Mark S. Humphreys

If you live in Grand Prairie, Aledo, Arlington, Mansfield, Fort Worth, Azle, Weatherford, or anywhere else in Texas and you have car insurance, you were given the chance to purchase underinsured motorist coverage on your automobile. So, how does it work?

An example of how some of it works is explained in the case, Lilith Brainard, et al. v. Trinity Universal Insurance Company. This is a 2006, Texas Supreme Court case.

This case had three main issues: (1) whether underinsured motorist (UIM) insurance covers prejudgment interest on monies the wrongdoer owes; (2) if so, how to apply settlement credit to the calculation; and (3) how does the insured recover attorneys fees.

Homeowners Claim And Winning In Court

May 18, 2010 | Mark S. Humphreys

How do I know I’ll win if I sue? Whether you live in Grand Prairie, Weatherford, Arlington, Mansfield, Newark, Keller, Irving, or any other place in Texas, that would be a good question. The first part of answering that question would be to find out whether your case is in State Court or Federal Court. Whenever an individual is sueing an insurance company, an experienced Insurance Law Attorney will tell you that your best chance for success is to be in State Court.

In the case, Sharman McGilbert v. Safeco Insurance Company of Indiana, Odette Goer, and Gary Waddell, McGilbert sued in State Court and Safeco Insurance Company of Indiana immediately tried to have the case removed to Federal Court. Safeco failed in their effort.

This case was decided on April 22, 2010, in the United States District Court, Southern District Texas, Houston Division, by District Judge Gray H. Miller. The case was originally filed in the 11th Judicial District Court of Harris County, Texas. Judge Miller remanded the case back to the 11th after Safeco’s unsuccessful attempt to have it removed.

Commercial Policies And Coverage On Pickups

May 17, 2010 | Mark S. Humphreys

Lots of business owners in Grand Prairie, Mesquite, Arlington, Fort Worth, Aledo, or any other town in Texas are going to have insurance coverage for the vehicles they use in their businesses. The question is: Do they have the right coverage for the vehicles?

The United States District Court, Southern District of Texas, issued a judgment on April 21, 2010 that addressed this issue. In this case, United States District Judge, Lynn N. Hughes, ended up telling one business that they did not have the insurance coverage they thought they had. The style of the case is, Canal Indemnity Company v. Williams Logging and Tree Services, Inc. et al.

Willie Williams owns a logging company, Williams Logging and Tree Services, Inc. One morning he was driving his company car, a 2003 GMC Sierra pickup, when he hit a motorcyclist. The injured man sued Williams in the 278th District Court, Walker County, Texas.

“Standing” To Sue For Bad Faith

May 16, 2010 | Mark S. Humphreys

Who has “standing” to sue an insuance company for bad faith. Does someone living in Grand Prairie, Arlington, Mansfield, Keller, Colleyville, Fort Worth or Dallas?

USLegal defines “standing” this way:

Standing is the ability of a party to bring a lawsuit in court based upon their stake in the outcome. A party seeking to demonstrate standing must be able to show the court sufficient connection to and harm from the law or action challenged. Otherwise, the court will rule that you “lack standing” to bring the suit and dismiss your case.

Bad Faith Insurance And Fire Claims

May 15, 2010 | Mark S. Humphreys

When a house burns in Grand Prairie, Arlington, Colleyville, Keller, Mansfield, Fort Worth, Azle, Aledo, or Weatherford, or anywhere else in Texas; What happens when the house catches on fire? Will the insurance company pay for the damages?

In, State Farm Fire & Casualty Insurance Company v. Simmons, the answer was no until the case went to court. At that point, State Farm Fire & Casualty Company (State Farm) was eventually ordered to pay the damages. This is a 1998, Texas Supreme Court case. In this case, the Simmons had moved into a new home and spent monies improving the property and buying items for the inside of the house. Their house had been burglarized in the middle of the day and later those responsible were located.

Mr. Simmons, a construction supervisor, had experienced down time from work and the Simmons had missed house payments. They later refinanced the house. They continued to experience problems with vandalism and other strange occurrances around the house.

Bad Faith And Homeowners Insurance

May 13, 2010 | Mark S. Humphreys

There are homeowners in Grand Prairie, Arlington, Mansfield, Weatherford, Aledo, Fort Worth, and everywhere else in Texas. 95% of those homeowners have insurance. So how do you know if your insurance company is violating the “bad faith” laws in Texas?

Here is a 1997, Texas Supreme Court case to read to give some insight into the above question. The case is, State Farm Lloyd’s v. Ioan and Liana Nicolau.

In the insurance claim giving rise to this dispute, the Nicolau sought coverage for extensive foundation damage to their home. The homeowners policy, issued by State Farm Lloyds, (State Farm) generally excludes losses caused by “inherent vice,” or by “settling, cracking, bulging, shrinkage, or expansion of foundations.” Under an express exception, however, these exclusions do not apply to losses caused by an “accidental discharge, leakage or overflow of water” from within a plumbing system.