Dallas Fort Worth Insurance Lawyer Blog

Duty To Cooperate With Insurers Investigation

August 31, 2019 | Mark S. Humphreys

Insurance lawyers understand that an insured has an obligation to cooperate with the insurance company investigation of a claim. This topic is briefly discussed in an article published by the State Bar of Texas, Insurance Section Journal. The article is titled, Texas Law And The Restatement Of The Law Of Liability Insurance: An Initial Comparison Of Blackletter Principles.

In most situations when an insured has a claim, he calls the insurance company, the insurance comes out, takes a statement, and a few days later the claim is resolved. But, that is not how it always occurs.

The law in Texas, is that an insured has a duty to cooperate with its insurance company in the defense of claims for which the insurer has a duty to defend. This was made clear in the 1993, opinion from the Texas Supreme Court styled, State Farm Fire & Cas. Co. V. S.S. These clauses, called cooperation clauses, are intended to guarantee to the insurance companies the right to prepare adequately their defense on questions of substantive liability. This was stated in the 1971, 5th Circuit opinion styled, Martin v. Travelers Indem. Co. The Restatement essentially recognizes this same duty and says:

$75,000 Pleading

August 28, 2019 | Mark S. Humphreys

Have we ever mentioned that the insurance companies prefer to fight cases in federal court rather than state court? And that insurance lawyers representing people who have a claim against their insurance company would prefer to litigate the case in state court?

Here’s a case dealing with the $75,000 pleading requirement to have a case heard in federal court. The case is from the Southern District of Texas, Houston Division, and is styled, Fernando Abascal v. United Property & Casualty Insurance Company.

Fernando filed suit in state court against United after United partially denied his claim for damage resulting from Hurricane Harvey. In his pleadings, Fernando stated that he “will never ask, receive, or take a judgment for any amount exceeding $75,000. United removed the case to federal court arguing that Fernando’s statement does not qualify as a binding stipulation and that Fernando’s demonstrates that the amount in controversy exceeds $75,000.00.

Anti-Assignment Clauses In Insurance Policies

August 25, 2019 | Mark S. Humphreys

The subject of anti-assignment clauses was discussed in an article published in the State Bar of Texas, Insurance Section, Journal. The article is titled “Texas Law And The Restatement Of The Law Of Liability Insurance: An Initial Comparison Of Blackletter Principles.”

The article is lengthy and a good read for lawyers dealing with this area of the law. One page of the article deals with anti-assignment clauses. It tells us this.

A 1994, Fort Worth Court of Appeals opinion styled, Tex. Farmers Ins. Co. v. Gerdes, says that anti-assignment clauses have been consistently enforced by Texas courts. Texas courts enforce anti-assignment clauses post-loss ad without requiring the insurer to show prejudice and this is reinforced by the 2010, U.S. 5th Circuit opinion styled, Keller Foundations, Inc. v. Wausau Underwriters Ins. Co. Thus, Texas courts will uphold anti-assignment provisions so long as they do not interfere with the operation of a statute.

Liability Insurance And Punitive Damages

August 24, 2019 | Mark S. Humphreys

The issue of whether or not punitive damages are covered under a liability policy is very important in a case where punitive damages are being sought by an injured party.

The State Bar of Texas, Insurance Section, published an article discussing this issue. The article is titled, Texas Law And The Restatement Of The Law Of Liability Insurance: An Initial Comparison Of Blackletter Principles.

Here is what it tells us.

Duty To Defend Insurance Claims

August 21, 2019 | Mark S. Humphreys

Many people think of insurance for covering something you own when it is damaged, such as your home or auto. Or, people thing if health insurance and life insurance. But there is another type of insurance that is important to all of us. That is liability insurance. This is the insurance that is suppose to protect you when someone sues you for something they allege you did wrong.

Here is some information from the State Bar of Texas, Insurance Section, Journal.

Under Texas law, the duty to defend depends on the language of the policy setting out the contractual agreement between insurer and insured. Whether an insurer has a duty to defend its insured is a question of law. An insurer must defend its insured if a plaintiff ’s factual allegations potentially support a covered claim, while the facts actually established in the underlying suit determine whether the insurer must indemnify its insured. Thus, an insurer may have a duty to defend but, eventually, no obligation to indemnify. The initial burden is placed on the insured to demonstrate that coverage exists considering only the policies and the underlying lawsuit papers. The burden then shifts to the carrier to establish that one or more of the policy exclusions apply to negate any otherwise-applicable duty to defend. Courts consider the factual allegations without regard to their truth or falsity, and resolve all doubts regarding the duty to defend in favor of the insured. Further, in making the determination, courts look to the factual allegations showing the origin of the damages claimed, not the legal theories or conclusions alleged. If the petition asserts one claim that could potentially be covered by the insurance policy, the insurer must defend the entire suit. The duty to defend is a sprawling topic on which Texas law and the Restatement of Insurance agree on many issues. For example, it is well settled that an insurer’s right to conduct the defense includes the authority to select the attorney who will defend the claim and to make other decisions that would normally be vested in the insured as the named party in the case. Likewise, the Restatement outlines the scope of an insurer’s right to control the defense as follows:

Sueing The Adjuster And The Texas Insurance Code

August 18, 2019 | Mark S. Humphreys

Here is another Texas Insurance Code, Section 542A.006 case. The opinion is from the Texas Southern District, Laredo Division. It is styled, Yarco Trading Company, Inc., et al. v. United Fire & Casualty Company, et al.

This case was filed in State Court and United removed the case to Federal Court. United argued the adjuster was improperly joined and after citing Texas Insurance Code, Section 542A.006, accepted responsibility for the adjuster, thus, arguing that the adjuster had to be dismissed, resulting in diversity jurisdiction pursuant to 28 U.S.C., Section 1441(a). Yarco sought to have the case remanded to the State Court.

First, the court addressed the improper joinder argument and ruled in favor of Yarco.

Insurance Policy Interpretation

August 17, 2019 | Mark S. Humphreys

Here is an opinion from the Fort Worth Division, Northern District of Texas, that discusses insurance policy interpretation. The opinion is styled, Suzann Ross v. Hartford Lloyd Insurance Company.

Ross had homeowners insurance coverage with Hartford and suffered a windstorm loss. Ross made a claim for benefits and Hartford adjusted the claim and paid the amounts it believed it owed under the policy. The main dispute was whether the roof damage needed to be totally replaced or just a portion replaced. Ross sued Hartford and Hartford filed this Motion For Summary Judgment on her claims.

The relevant policy language reads in pertinent part:

Claim Of Fraud Against Insurance Company

August 14, 2019 | Mark S. Humphreys

Claiming an insurance company has committed fraud, as in all fraud claims, it must be stated who communicated the fraud, what was said, when it was said, where it was said, and how the statement was fraud. All of this is particularly true when the lawsuit is in Federal Court where the pleading requirements are much more stringent.

This is illustrated in the case discussed in an earlier blog styled, Nancy Roberson v. Allstate Vehicle and Property Insurance Company. The case is from the Southern District of Texas, Houston Division.

This case arises from a tree falling on the home of Roberson, who was insured by Allstate. Roberson made a claim and the adjuster assigned by Allstate came back with a repair estimate that was far below what Roberson believed was needed to compensate her for her loss. Roberson filed a lawsuit alleging many causes of action against Allstate but the one discussed here is her allegation of common-law fraud.

Time Limits To File Lawsuits

August 11, 2019 | Mark S. Humphreys

There are deadlines for filing lawsuits and if those time limits are not honored, then there is no case. This is illustrated in a Southern District, Houston Division, opinion released on July 2, 2019. The case is styled, Nancy Roberson v. Allstate Vehicle and Property Insurance Company.

Roberson sued Allstate in state court asserting causes of action for breach of contract, violations of the Texas Insurance Code, violations of the Texas Deceptive Trade Practices Act, (DTPA) and common law fraud. Allstate timely removed the case to federal court. Allstate then filed a Rule 12(b)(6) Motion to Dismiss.

The background in this case is that Roberson had Allstate coverage for her home when in February 2016, she filed a claim for hail damage. An adjuster determined that her roof was in great condition and that her loss was below her deductible.

Insurance Definition Of “Accident”

August 10, 2019 | Mark S. Humphreys

The title of this blog topic should be “Insurance Company Gone Wacko”.

The case at issue here is from the Fifth Circuit Court of Appeals. It is styled, Frederking v. Cincinnati Insurance Company.

This case involves Frederking being injured by an insured of Cincinnati who was intoxicated at the time of the automobile wreck. The insured caused a wreck between the vehicle he was driving and the vehicle being driven by Frederking, causing injury to Frederking. A jury found in favor of Frederking and Cincinnati refused to pay based on their assertion that the wreck was not the result of an accident as that term is used in the policy.