Dallas Fort Worth Insurance Lawyer Blog

Delaying In Paying Insurance Claim

November 1, 2018 | Mark S. Humphreys

Here is an opinion from the 14th Court of Appeals that concerns the Prompt Payment of Claims Act. The opinion is styled, William Marchbanks v. Liberty Insurance Corporation.

This is an appeal from the trial court granting summary judgment in favor of Liberty. This appeals court affirmed the trial court.

Marchbanks reported a hail damage claim to Liberty and the same day Liberty acknowledged the claim and sent an adjuster to the property the next day. The adjuster determined that any roof damage was not storm related and Liberty sent a denial letter explaining no storm related damaged was found.

Duty To Cooperate

October 30, 2018 | Mark S. Humphreys

Here is a Dallas, Texas opinion that insurance lawyers need to read. It is from the Dallas Court of Appeals and is styled, American National County Mutual Insurance Company v. Jonathan A. Medina.

On October 30, 2009, Angel Freeman ran a stop sign and crashed into Medina who was riding a motorcycle. The cycle was totaled and Medina was injured. Angel had a 1998 Dodge Ram that was listed as a covered vehicle on an ANPAC policy belonging to Paul and Katie Freeman. Angel is Paul’s sister.

After the wreck, a question arose as to who owned the Ram. and whether it was insured by Paul’s policy. If the truck was not owned by Paul, it could not be covered by the policy. Paul and Angel both told ANPAC that Paul sold the vehicle to Angel for cash four weeks before the accident, on October 1, 2009, and both gave written statements to ANPAC to that effect. Angel never put the title into his name. ANPAC cancelled the policy effective October 1, and refunded premiums paid. On December 8, 2009, ANPAC notified Medina of the decision and closed the file.

It’s Not Always Easy To Dismiss A Case

October 27, 2018 | Mark S. Humphreys

Most of the time, Courts are happy to have a case dismissed from their docket. An Eastern District of Texas, Sherman Division, opinion is an exception to that general situation. The opinion is styled, Mike And Jacqueline Sanchez v. Safeco Insurance Company of Indiana.

The Sanchez’s filed a Motion to Dismiss Without Prejudice and the Court denied the motion. Here is why.

The Fifth Circuit recognizes that as a general rule, motions for voluntary dismissal should be freely granted unless the non-moving party will suffer some plain legal prejudice other than the mere prospect of a second lawsuit. The primary purpose of Rule 41(a)(2) is to prevent voluntary dismissals which unfairly affect the other side, and to permit the imposition of curative conditions.

Paperwork Has To Be Right When Suing An Insurance Company

October 25, 2018 | Mark S. Humphreys

The papers filed in Court have to be proper when suing an insurance company. A Southern District of Texas, McAllen Division opinion illustrates this rule. The opinion is styled, Alfredo Murillo Jr., et al v. Allstate Vehicle and Property Insurance Company.

Alfredo suffered damage after a hail and or windstorm and sued Allstate alleging Allstate failed to “cover the true costs of repairs … including but not limited to, repair and/or replacement of the roof and any exterior damage,” and that Allstate “failed to properly adjust the claim and summarily improperly paid the claim.” Alfredo’s complaint contains no other specific factual allegations beyond general allegations that Allstate’s investigation of the claims was “unreasonable,” and that Allstate “failed to properly scope” Alfredo’s damages, and that Allstate delayed in the payment of the true cost of damages. In all other respects, Alfredo’s complaint is a form petition that merely restates the legal elements of his claims.

Allstate filed this motion for partial dismissal pursuant to Federal Rule 12(b)(6) for failure to state a claim for which relief can be granted and Rule 9(b) for failure to plead with particularity.

Statute Of Limitations In Insurance Cases

October 23, 2018 | Mark S. Humphreys

The statute of limitations is a legal issue that must be taken into account in every case. This case from the Southern District of Texas, Laredo Division,does a good job of discussing the statute of limitations in insurance cases. The case is styled, Gilberto Rodriguez v. State Farm Lloyds.

This is an insurance coverage dispute that arose out of a water pipe bursting in Gilberto’s home. State Farm filed a motion for summary judgement, part of which dealt with the limitations issue. The Court granted State Farm’s motion.

Here are relevant facts and discussion:

Potential Recovery For Bad Faith Claims

October 21, 2018 | Mark S. Humphreys

Whether you are talking about life insurance claims, homeowners claims, disability claims, auto claims, or other types of first party claims, policy benefits are the basic recovery allowed for an insurance company breach of the contractual obligations. An insurer’s refusal to pay the insured’s claim causes damages in at least the amount of the policy benefits wrongfully withheld. This is supported in the Texas Supreme Court cases, Vail v. Texas Farm Bureau Mutual Insurance Co. and Transportation Insurance Co. v. Moriel.

In addition, the same court stated in Hernandez v. Gulf Group Lloyds, an insured should be able to recover consequential damages that are the foreseeable result of the insurer’s breach of contract. Numerous cases hold that insurance policies are subject to the same rules as other contracts. One of the best established rules is that:

Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally; i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties at the time they made the contract as the probable result of the breach.

ERISA Win

October 20, 2018 | Mark S. Humphreys

Here is a rare win in an ERISA case. Unfortunately the win is the the 7th Circuit Court of Appeals rather than the 5th Circuit which controls most ERISA plans for readers of this blog.

The ERISA case is styled, Susan Hennen v. Metropolitan Life Insurance Company. The case does illustrate how to win an ERISA case.

Hennen had received short term disability (STD) benefits for two years as the result of a back injury. Hennen then applied for long term disability (LTD) benefits. The disability plan that Hennen had contained a two year limit for neuromusculoskeletal disorder, subject to exceptions, including one for radiculopathy, a “Desease of the peripheral nerve roots supported by objective clinical findings of nerve pathology.” After Metlife terminated Hennen’s benefits, she sued under ERISA, arguing that Metlife’s determination that she did not have radiculopathy was arbitrary and capricious. The court hearing the case had granted summary judgment in favor or Metlife. This appeals court reversed the ruling saying Metlife acted arbitrarily when it discounted the opinions of four doctors who diagnosed Hennen with radiculopathy in favor of one physician who ultimately disagreed, but only while recommending additional testing that Metlife declined to pursue.

Assignment Of Insurance Proceeds

October 18, 2018 | Mark S. Humphreys

Like other contract rights, the right to insurance proceeds can be assigned, giving the assignee the right to recover under the policy.

This issue is discussed in the 1968, Texas Supreme Court opinion styled, McAllen State Bank v. Texas Bank & Trust Company, Trustee.

Texas Bank claimed proceeds of a life insurance policy as successor to the named beneficiary asserting the policy was pledged as security for a loan made to the deceased.

Intended Beneficiaries Of Insurance Policies

October 16, 2018 | Mark S. Humphreys

If a person or entity is not a named beneficiary, can they be an intended beneficiary?

Other persons who may sue for benefits under an insurance contract are “intended beneficiaries” also known as “third party beneficiaries.”

A third party for whose benefit an insurance contract is made may enforce the insurance contract against the promissor. As discussed in the 1985, opinion from the 14th Court of Appeals, styled, Hermann Hosp. v. Liberty Life Assur. Co., the controlling factor in determining whether a third party may enforce a contract is the intention of the contracting parties.

Additional Insureds Under An Insurance Policy

October 14, 2018 | Mark S. Humphreys

An additional insured is a party protected under an insurance policy, but who is not named within the policy. A common example of an additional insured is a person who, although not specifically named, is covered under a liability policy by a definition of “insured” that extends protection to interests, strictly according to a status, such as employees or common members of a household. This is most commonly seen in personal automobile polices such as when a friend drives a car with the owners permission. A party typically becomes an additional named insured pursuant to an agreement obligating the named insured to add the additional named insured to the named insured’s pre-existing insurance policy. This is discussed in the 1997, Austin Court of Appeals opinion styled, Western Indem. Ins. Co. v. American Physicians Ins. Exch.

The Western Indemnity case is a summary judgment ruling. In the case, the wording of the policy was discussed at length. In making it’s ruling the court noted that both the terms “additional insured” and “additional named insured” have clear technical meanings. An additional insured is a party protected under an insurance policy, but who is not named within the policy. A common example of an additional insured is a person who, although not specifically named, is covered under a liability policy by a definition of “insured” that extends protection to interests, strictly according to a status, such as employees or common members of a household. On the other hand, an additional named insured is a person or entity specifically named in the policy as an insured subsequent to the issuance of the original policy. A party typically becomes an additional named insured pursuant to an agreement obligating the named insured to add the additional named insured to the named insured’s pre-existing insurance policy.

As in all situations where an insurance company is not promptly paying a claim for coverage, a person should seek the help of an Experienced Insurance Law Attorney.