Dallas Fort Worth Insurance Lawyer Blog

Underinsured / Uninsured Auto Claims In Texas

February 6, 2010 | Mark S. Humphreys

Residents of Dallas, Fort Worth, Arlington, Grand Praire, Weatherford, or any other town in Texas should be interested in a question posed by an attorney the other day on a web-site, to other attorneys who sub-scribed to the site. It was a question dealing with uninsured and underinsured (UM) automobile coverage.

In the situation, a potential client had come into the attorneys office. The potential new client had been involved in an accident where the other person did not have enough insurance coverage to fully cover the damages this potential new client had suffered. Sounds simple so far. Here was the problem: More than two years had past since the accident had occurred. The question posed was: Can I recover more money from the UM coverage on the injured persons automobile policy.

This was the issue in the case Raul C. Franco et ux., v. Allstate Insurance Company. In the Franco case, Franco sought to recover damages due to the death of their daughter in an automobile accident. The lawsuit had been filed approximately three years after the date of the accident. The applicable statute of limitations for an injury claim was two years.

Arbitration In Insurance Contracts

February 5, 2010 | Mark S. Humphreys

Lots of insurance policies are issued with arbitration agreements written into them. Almost never, will the person taking out the insurance policy be aware of, or ask about an arbitration agreement being part of the insurance policy. Residents of Dallas, Fort Worth, Arlington, Grand Prairie, Weatherford, or any any city or town in Texas can be adversely affected by these arbitration clauses in the insurance policy.

Lake Texoma Highport, LLC, v. Certain Underwriters at Lloyd’s of London, et. al., is a recent case discussing arbitration clauses in insurance policy’s. This case was decided on December 28, 2009, and is good reading to try and understand the way courts look at arbitration clauses.

Lake Texoma Highport, LLC (“Highport”) owns a marina. In early 2005 and early 2006 and in 2007 Highport instructed defendant Houstoun, Woodward, Eason, Gentle, Tomforde and Anderson, Inc. d/b/a Insurance Alliance (“Insurance Alliance”) to locate a property insurance policy. Insurance Alliance provided Highport with a property insurance agreement from defendant Certain Underwriters at Lloyd’s of London (“Lloyd’s”). Highport suffered damages and filed a claim under the policy. Highport then learned for the first time that CRC Insurance Services, Inc (“CRC”) and Bowood Partners, Limited (“Bowood”) were active participants in procurment of the insurance policy.

Insurance Company Fights Hard To Have Case Fought In Federal Court

February 4, 2010 | Mark S. Humphreys

Insurance companies prefer to have lawsuits litigated and fought in Federal Court. Attorneys who represent individuals and companies in Dallas, Fort Worth, Arlington, Grand Prairie, Weatherford, or any other community in Texas, prefer to be in the local State and County Courts. There are several reasons an insurance company prefers to be in Federal Court, but the bottom line is, it is better for them to be in Federal Court.

One fight an insurance company recently lost was in the case, Rosario Mayorga, v. Government Employees Insurance Company. The opinion on this case was issued on January 20, 2010.

The Mayorga case was originally filed in the 79th District Court of Jim Wells County. Mayorga sued Government Employees Insurance Company (GEICO) and the adjuster, Sean Hicks. GEICO is an insurance company with its headquarters located outside of Texas, which is a condition that would allow for the case to be removed to Federal Court. However, the adjuster, Hicks, was a Texas resident which would prevent removal. GEICO claimed that Hicks was improperly sued and because he was improperly sued the case should be allowed into Federal Court.

Excess Insurance Case In Texas

February 3, 2010 | Mark S. Humphreys

The United States Court of Appeals for the Fifth Circuit recently decided a case wherein the insured argued that he had an excess insurance policy. The court decided that his policy was not an excess insurance policy.

The case is styled “Danny Kirk, v. Universal Underwriters of Texas Insurance Co.” In this case, Universal Underwriters of Texas Insurance Co. (“UUT”), issued to Olympic International Trucks, Inc. d/b/a Olympic Ideal Lease (“Olympic”) an insurance policy. Kirk, who was injured by a tractor-trailer unit leased to Gulf Coast Building Supply (“Gulf Coast”), asserted that the policy issued to UUT was an excess policy.

The court analysed the policy. Reading Part 500 of the UUT Policy, it provided liability insurance to Olympic for injuries arising out of “garage operations” or “auto hazard.” Auto hazard included coverage of “anyone else required by law to be an insured while using an auto under a lease or rental agreement, within the scope of Olympic’s permission.” The UUT Policy provided that it only covered Olympic’s lessees if “at the time of the accident, the insurance required by the lease or rental agreement is not collectable.”

A Case Of Insurance Fraud

February 2, 2010 | Mark S. Humphreys

Most of the time when someone thinks of insurance fraud, they think about a staged accident, arson, or something else along these lines, where a person or company is trying to get money out of an insurance company that is not legitamate. Another example is lying on the insurance application. Here is a short story about a company making a false workers compensation report to the State. This case is a California incident but could just as easily have been an incident that happened with a business in the Dallas – Fort Worth area, like Arlington or Grand Prairie, or even out in Weatherford, in Parker County.

This article was found in the Los Angeles Times, in the Business Section. The title of the article is “Staffing Firm Pays $20 Million to Settle Fraud Allegation” and was reported on January 25.

The company, Staffing Services, Inc., was in the business of providing temporary workers to other businesses. They were accused of underpaying premiums to the State Compensation Insurance Fund, the state’s workers’ compensation carrier of last resort. Regulators filed charges against the company on November 26, 2008, accusing it of misrepresenting the number of employees and their job descriptions so it would pay smaller insurance premiums.

Insurance Companies Fighting With Insurance Companies In Texas

February 1, 2010 | Mark S. Humphreys

Most people would not realize how much time and money is spent with insurance companies fighting with other insurance companies. Most of these fights result from situations where a person or company has more than one policy. An example would be where an Arlington resident buys some insurance in Grand Prairie, Dallas, Fort Worth, or maybe out in Weatherford or wherever but also buys another policy at the same time or later on from another company or agent. Next, an incident happens, the result of which is the policyholder has to file a claim or seek coverage through the policies of insurance. Then what happens is, the companies start fighting with each other about which one has to pay the claim or pay the costs of defending the claim asserted. The following case is yet another example of this type of situation.

The United States Fifth Circuit Court of Appeals handed down a decision is one of these cases on January 4, 2010. The style of the case is, Trinity Universal Insurance Company; Utica National Insurance; National American Insurance Company, Subrogees of Lacy Masonery Inc., v. Employers Mutual Casualty Company.

In this case, Employers Mutual Casualty Company (EMC) and the others issued commercial general liability insurance policies to Lacy Masonry, Inc. Lacy was sued. Trinity defended and eventually settled the case on behalf of Lacy. Utica defended and eventually settled the case on behalf of Lacy. And, finally, National defended and eventually settled the case on behalf of Lacy. EMC refused to defend or participate in the settlement.

Insurance Companies Duty To Defend Lawsuit In Texas

January 31, 2010 | Mark S. Humphreys

The United States Court of Appeals for the Fifth Circuit, decided another case this month dealing with the duty of an insurance company to defend a lawsuit filed against one of its insureds. The decision on this case was handed down by the court on January 4, 2010. The case was an appeal from the United States District Court for the Southern District of Texas. The Fifth Circuit, located in Louisiana, handles appeals that would arise out of Dallas, Fort Worth, Arlington, Grand Prairie, small towns like Weatherford, and all other places in Texas.

In the opening paragraph of the decision the court makes the following statement, “We have occasion once again to take up the seemingly simple task of determining whether an insurance company owes a duty to defend an underlying liability lawsuit, and because the insurer in this case indeed has such a duty, it is also an occasion to again remind: when in doubt, defend.” As stated in this blog in the past, the courts draw a distinction between the obligation of an insurance company to defend an insured who has been sued and the obligation of an insurance company to pay a claim.

The case at issue here is styled, Essex Insurance Company v. Hines. The policy was a “Commercial General Liability Coverage” and another one called a “Commercial Property Coverge” policy. The facts here are relevant to deciding the existence or lack there of, as it relates to coverage in the wording in the policy. What Essex was failing to see was how Texas law applies in the difference between the duty to defend and the duty to pay under a policy of insurance.

Another Chinese Drywall Case

January 30, 2010 | Mark S. Humphreys

Lucky for the homeowners in the Dallas, Fort Worth, Arlington, Grand Prairie, Weatherford, and surrounding areas, the Chinese drywall cases are a non-issue. But for many of the people along the Texas Gulf Coast and other Gulf Coast areas, it is a major and expensive problem.
WCI Communities is a homebuilder in the Southeastern United States. They had to file bankruptcy in 2009 because of issues related to Chinese drywall. This situation is discussed in the Insurance Journal. The article in the Insurance Journal is titled “WCI Chinese Drywall Trust Files Suit Against 14 Insurers”. The WCI Drywall Trust was formed in July 2009, after the bankruptcy of the homebuilder WCI Communities and its subsidiaries. Its purpose is to assume liability for claims alleging harm from Chinese drywall installed in homes built by WCI. More than 700 homeowners may seek recovery through the Trust.
The Trust filed suit against 14 insurance companies in the United States District Court, Eastern District of Louisiana, seeking indemnification for losses arising from claims for the development and sale of homes allegedly containing defective Chinese manufactured drywall.

An Appeal From A Louisiana District Court Ruling

January 29, 2010 | Mark S. Humphreys

The following case was decided in Louisiana. It is relevant for two reasons. One is, Texas courts will look to other courts and their rulings for guidance on cases. The second reason, is the United States Court of Appeals for the Fifth Circuit is the Federal Court most Texas case will end up being appealed to when the case is in Federal Court.

The case is Stephen Williams; Vanessa Williams v. Allstate Indemnity Company. In this case the William’s home suffered a serious property damage loss during Hurricane Katrina. The William’s home was insured under a homeowners’ policy issued by Allstate that provided $123,000 in coverage for the primary structure, $12,300 in coverage for other structures, and $61,500 in coverage for the home’s contents.

The William’s reported the loss on August 31, 2005 and Allstate inspected the property on October 17, 2005 and ultimately paid the William’s a total of $134,762.43. These payments were made at various times until the last was paid in March 2007. The William’s sued for the full policy limits. The trial level court ruled for Allstate and this appeal was filed.

Appraisal In Insurance Texas Insurance Disputes

January 28, 2010 | Mark S. Humphreys

A lot of insurance contracts have written into them an appraisal clause or paragraph. Whether you bought the policy in Grand Prairie, Arlington, Dallas, Fort Worth, or out in Weatherford, Texas, you could be forced to submit to an appraisal process if the insurance company insists on enforcing that portion of the insurance contract.

A recent case, JM Walker, LLC v. Acadia Insurance Company, is an example of how these situations are sometimes handle. Each case would be different depending on the wording of the appraisal provision in the contract and the facts of the case.

In this case, Walker was the owner of five building in North Richland Hills, Texas. The roofs of the building suffered damage from a hailstorm. Walker submitted a claim to Acadia, but Acadia denied coverage after its adjuster determined that the roofs did not need to be replaced and that the damage that did exist, was less than the $5,000 deductible that applied in the case.