Dallas Fort Worth Insurance Lawyer Blog

Claim Denial Lawyers – Misrepresentation

November 30, 2020 | Mark S. Humphreys

Here is a life insurance denial case that is a bit confusing at the least. The opinion is a 2020, opinion from the Western District of Texas, San Antonio Division. It is styled, Tina M. Hale, as next of kin of Michael Hale, Deceased v. Assurity Life Insurance Company.

On May 4, 2016, Mr. Hale obtained a 20-year term life insurance policy with a face value of $250,000 (the “Policy”) issued on form “I L0760”. Mr. Hale paid a monthly premium of $141.81, based on the rate for a 42-year-old non-smoker. After Mr. Hale’s death, an investigation revealed that he had been untruthful in his answer to the tobacco question on his life insurance application, and the Policy should have been issued with a Standard Tobacco rating rather than a Standard Non-Tobacco rating. Assurity applied the premiums as if they had been paid toward a policy with a Standard Tobacco rating issued on form I L0760 and determined that the benefits payable under the policy were $99,724.74. Id. In April 2019, Plaintiff obtained an illustration from Assurity, using form “I L1702”, for a 42-year-old male, tobacco-rated, 20-year level term policy with a benefit of $250,000, indicating a monthly premium of $107.23—less than the premium Mr. Hale had paid on his non-tobacco-rated policy. Plaintiff asserts that the illustration demonstrates that she is entitled to an additional death benefit of $150,275.76 (the difference between the face value of the Policy and the settlement amount), plus a refund for premium over payments totaling $726.18, and 3% interest from the date of Mr. Hale’s death.

A lawsuit resulted wherein Plaintiff asserting cause of action for negligence, negligent misrepresentation, gross negligence, deceptive insurance practices, and violations of the Texas Deceptive Trade Practices Act (“DTPA”), DTPA tie-in statutes, Texas Insurance Code and Breach of Contract.

Claims Denial Law Firm – Intentional Act Or Accidental?

November 28, 2020 | Mark S. Humphreys

The primary purpose of liability insurance is to cover harms caused by negligence. Thus, an intentional act is not covered. This is discussed in a 2020, opinion from the Eleventh Court of Appeals. The opinion is styled, Joe Torres v State Farm County Mutual Insurance Company of Texas.

This is an appeal from a Stowers action against State Farm. In trial, the jury found that State Farm’s insured, Edward Aguilar, intentionally cause injury to claimant, Joe Torres. The trial court entered a take nothing judgment in favor of State Farm and this appeal followed.

This case arises out of Aguilar getting drunk, getting into an altercation with Torres, Aguilar getting in his car and leaving the scene, then turning around and running his insured vehicle into Torres.

Claim Denial Attorneys And Giving Pre-Suit Notice

November 23, 2020 | Mark S. Humphreys

Claim denial attorneys know that a prerequisite to filing a lawsuit against an insurance company for a first party claim is to give a pre-suit notice letter. Failure to do so will result in a loss of potential causes of action. This is illustrated in a 2020, opinion from the Southern District of Texas, Houston Division. The opinion is styled, Nexxt Holding, Inc. v. Travelers Cas. Ins. Co. of Am.

Nexxt Holding sued Travelers in 2020, alleging that Travelers failed to pay repair costs due under the insurance policy after a August 2017 storm. Nexxt asserted Texas statutory and common-law claims and sought actual, consequential, and statutory damages, as well as attorneys’ fees. Travelers answered the lawsuit and filed a verified plea of lack of presuit notice under Texas Insurance Code, Section 542A.003.

Texas Insurance Code, Section 542A.007(d) states that, if an insured plaintiff asserts a first-party claim for storm damage against its property insurer and the defendant insurer “pleads and proves” that it “was entitled to but was not given a presuit notice stating the specific amount alleged to be owed . . . under Section 542A.003(b)(2) at least 61 days before the date the action was filed . . . the court may not award to the [plaintiff] any attorney’s fees incurred after the date the defendant files the pleading with the court.”

Claim Denial Attorney And Lawsuits

November 21, 2020 | Mark S. Humphreys

Here is a case from the Northern District of Texas, Dallas Division, that discusses the voluntary / involuntary rule related to joining adjuster in a lawsuit. This 2020, opinion is styled, Jason Bowers and Casi Bowers v. Chubb Lloyd’s Insurance Company of Texas.

The Bowers who alleged to have suffered hail and wind damage sued their insurer, Chubb, and Chubb’s adjuster Bernard Dang, for denial of the claim.

On July 28, 2019 the Bowers provided the defendants with the pre-suit notice required under Texas Insurance Code, Section 542A.003. Then on October 22, 2019, filed suit in State Court against Chubb and Dang.

Claims Denial And Suing The Insurance Company

November 16, 2020 | Mark S. Humphreys

When a claim gets denied and the insured has to file a lawsuit, a decision has to be made as to which Court the lawsuit should be filed. For the insured, that decision is usually to file suit in the State or County Court. However, the insurance company is virtually always going to remove the case to Federal Court when it can do so.

The above brings us to a 2020, opinion from the Western District of Texas, San Antonio Division. The opinion styled, Pablo Cerda v. Allstate Fire and Casualty Insurance Company, discusses what sometimes happens if everything is not done properly by the attorney.

The undisputed facts show Cerda filed an Original Petition in State Court naming Allstate as the sole defendant on March 27, 2020. On May 6, 2020, at 3:21 p.m., Allstate filed in this Federal Court its Notice of Removal, attaching the Original Petition and other required documents. Also on May 6, 2020, at 3:27 p.m., Cerda filed in State Court a First Amended Petition. Finally, at 3:51 p.m., on May 6, 2020, Allstate filed in State Court its Notice of Removal of the case to this federal court.

In Which County Can An Insurance Company Be Sued

November 14, 2020 | Mark S. Humphreys

The issue of which county is a proper county to file a lawsuit against an insurance company is not normally an issue. However, a 2020, Beaumont Court of Appeals had this issue before them in a mandamus action styled, In Re Mountain Valley Indemnity Company, Shane Waddell, Lonnie Tidwell, National General Insurance Company, and Prostar Adjusting.

Plaintiff sued the above Defendants, including the insurance company and adjusters and agents in a lawsuit arising out of homeowners insurance policy claim wherein Plaintiff’s home suffered property damage. Plaintiff filed the lawsuit in Jefferson County, where some of the acts complained of occurred, and then Defendants filed a motion to have the case transferred to Montgomery County, where the home is located, pursuant to Texas Civil Practices & Remedies Code, Section 15.011. The Judge in the case denied the Defendants motion to transfer the case and this mandamus action ensued.

Defendants argued that Section 15.011 is a mandatory venue provision and since the property was located in Montgomery County, it was mandatory that the case be heard there. They also argue that Section 15.032, a permissive venue statute applies because Montgomery County is where the insured property is located.

Suing The Insurance Agent Who Sold The Policy

November 9, 2020 | Mark S. Humphreys

Insurance lawyers learn quickly that when suing an insurance agent who sold a policy that the allegations against the agent must be specific. Being too general with allegations can result in a battle being fought in Federal Court when usually the lawyer would want the fight to be in State Court. This is illustrated ina 2020, opinion from the Eastern District of Texas, Sherman Division. The opinion is styled, Oscar Bermudez and SA Polo, Inc. v. Indemnity Insurance Company of North America and Tin Top Insurance Agency, LLC.

Plaintiffs, Bermudez and SA Polo are residents of Texas. Plaintiffs engaged Tin Top, a Texas citizen, to help them get insurance to cover property owned by Plaintiffs. Indemnity, a resident of Indiana, issued and sold a policy to Plaintiffs. After a storm that caused damage to their property, Plaintiffs submitted a claim to Indemnity. The claim was denied.

A lawsuit was filed in State Court and Indemnity removed the case to Federal Court, citing lack of diversity in that the agent, Tin Top, was not properly joined. In so doing, Indemnity filed a Rule 12(b)(6) motion to dismiss Tin Top. Plaintiffs filed a Motion to Remand.

Penalty For Not Timely Paying A Claim

November 7, 2020 | Mark S. Humphreys

Insurance lawyers need to read this 2020, opinion from the United State Fifth Circuit Court of Appeals. It is a good opinion for attorneys who represent policy holders. The opinion is styled, Jesus Agredano: Margaret Agredano v. State Farm Lloyds.

The Agredando’s sued State Farm after State Farm denied their claim for windstorm damage to their home. The District Court granted summary judgment in favor of State Farm on various causes of action but allowed the Agredano’s breach of contract claim to be presented to a jury, which granted a verdict in the Agredano’s favor. Althoughm the Agredano’s had sought attorney’s fees and statutory interest of 18%, the District Court ruled that the failure to specifically plead relief under Texas Insurance Code, Section 542.060 barred the requested relief and entered judgment only in the amount of the breach of contract damages found by the jury, together with pre-judgment and post judgment interest. This appeal was filed. This Court reversed and remanded to the District Court for reconsideration consistent with this opinion.

Two provisions of the Texas Insurance Code are relevant. Section 542.058 provides a cause of action against insurers who delay paying claims:

Life Insurance – ERISA – Alcohol

November 2, 2020 | Mark S. Humphreys

Here is a life insurance case which is governed by the Employee Retirement Income Security Act (ERISA). The opinion is from the Southern District of Texas, Houston Division. It is styled, Heidi Ballard v. Lincoln Life Assurance Company of Boston.

The deceased had an accidental death life insurance policy which was governed by ERISA. The death resulted when the deceased, riding as a passenger in a golf cart, was thrown out of the car after the driver of the cart suddenly and unexpectedly accelerated the cart. This was witnessed by others.

Lincoln Life denied the claim based on an exclusion in the policy excluding an accidental death that is the result of consuming alcohol.

Turning In An Insurance Claim

October 31, 2020 | Mark S. Humphreys

Properly notifying an insurance company about a claim is not always as simple as it might seem. This is illustrated in a 2020, opinion from the Northern District of Texas, Dallas Division. The opinion is styled, Vela Wood PC, et al v. Associated Industries Insurance Company, Inc.

This case is before the Court on competing motions for summary judgment. Because the Plaintiff’s notice of this claim was ruled to be untimely, the Court founds against Plaintiffs and in favor of Associated.

The pertinent part of the two policies at issue, a 2017 and 2018 policy, in this case states that as “a condition to coverage, the Insured shall provide the company written notice of any Claim made against any Insured as soon as practicable, but in no event later than: (i) the expiration date of this Policy; (ii) the expiration of the Automatic Extended Reporting Period; or (iii) the expiration of the Optional Extended Reporting Period, if purchased. Under the terms of the policies, a “Claim” is defined as “a written demand received by the Insured for monetary Damages which alleges a Wrongful Act,” including “the service of suit or any civil proceeding in a court of law or equity, including any appeal therefrom, which is commenced by the filing of a complaint, motion for judgment, or similar proceeding.”