Dallas Fort Worth Insurance Lawyer Blog

Flood Insurance Policies

April 8, 2018 | Mark S. Humphreys

Flood insurance premiums are calculated based upon geographic maps setting forth the boundaries for various flood zones.

Because most property insurance policies covering property at fixed locations exclude flooding, flood insurance must be purchased separately. In 1969, Congress created the National Flood Insurance Program to administer the sale of flood insurance. National flood insurance is available directly from the Federal Insurance Administration or through hundreds of private insurers who participate in federal insurance programs. The Federal Emergency Management Agency (FEMA) reinsurers private companies against flood losses.

Contract claims must be filed in federal court, and are subject to strict requirements of the policy and federal law. Insureds still have the right in the Fifth Circuit to bring suit on extra-contractual claims under state law against a flood insurer, according to the 1993 opinion, Spence v. Omaha Indem. Ins. Co. It should be noted that there is a disagreement in this area as to whether the National Flood Insurance Act of 1968, preempts state law in this area.

Crop Insurance Lawyers

April 7, 2018 | Mark S. Humphreys

Insurance lawyers who work in rural areas of Texas will see situations involving crop insurance.

Some insurance companies sell property coverage to mitigate against the risk of loss to farm crops caused by environmental perils including drought, flooding, hail or other weather conditions. Crops can be insured under various types of insuring agreements including coverage limited to losses caused specifically by hail. Crop insurance is also available through the Federal Crop Insurance Corp. (FCIC), an agency of the federal government designed to facilitate the placement of crop insurance through private insurance companies. The placement of a policy through the FCIC does not automatically create a federal question jurisdiction over such claims. (Keep in mind that for most people, the local State District Courts and County Courts are more favorable venues to fight with an insurance company than is a Federal Court). The 1997, Eastern District of Texas opinion styled, Bullard v Southwest Crop Insurance Agency, is a case which decided that not all FCIC cases have to be heard in federal court. Insureds under crop policies maintain all of the traditional contractual and extra-contractual remedies against their crop insurance company. This also, was stated in the Bullard case. An insured may elect to sue the FCIC if a dispute develops over a crop claim, but any such suit must be brought in a United States district court otherwise possessing jurisdiction to hear the dispute.

Crop policies are usually sold with one of the traditional cause of loss forms — broad, special, or basic. Hail policies also frequently require the injured plants to be in a certain state of growth or development at the time of injury or damage from hail in order to be covered.

Uninsured Motorist Coverage And Physical Contact Rule

April 5, 2018 | Mark S. Humphreys

Here a question for your insurance law attorney … If a car swerves into my lane and I drive off the road and wreck my car to avoid the accident, does my uninsured motorist (UM) policy cover the damages? Answer … NO!

An auto policy includes within the definition of UM vehicle a hit and run vehicle whose operator or owner cannot be identified. This definition incorporates the Insurance Code’s requirement in Section 1952.104(3) that there be physical contact when the owner or operator of the reported UM vehicle is unknown or unidentified. This is further illustrated in the 1986, Texarkana Court of Appeals opinion, Goen v. Trinity Universal Insurance Company.

Likewise, a drive-by shooting in which there is no collision does not meet the UM physical contact requirement.

Commercial Insurance On Business Income

April 5, 2018 | Mark S. Humphreys

Insurance for commercial businesses can take many forms. So what about the loss of business income?

Because commercial property losses can result in a decrease or loss of business income, many commercial property insurance companies offer business income insurance. An insurer of business income coverage agrees to pay for any actual loss of “business income” the named insured sustains due to the necessary suspension of “operations” during the “period of restoration” following a loss. For the loss to be covered, the operations must be suspended because of the physical loss of, or damage to, property at covered premises caused by a covered cause of loss. This is explained in the 1996, Southern District of Texas opinion styled, Royal Indemnity Insurance Co. v. Mikob Properties, Inc.

Business income insurance covers loss of “business income,” usually defined as the reduction in net income that results from suspension of operations due to a physical loss at the insured’s premises.

Insurance – Builders Risk Insurance

April 3, 2018 | Mark S. Humphreys

There are many different types of insurance. Under the category of commercial insurance is an insurance called Builders Risk Insurance.

Buildings under construction create unique coverage problems which builders risk insurance attempts to alleviate. Because builders risk insurance forms are designed to cover buildings or structures under construction, they attempt to specify the point at which construction is deemed to be completed and when coverage ceases. At that point, the building owner needs to obtain a BPP or other comparable property coverage to replace the builders risk policy.

The builders risk form covers the building or structure being built, building materials and supplies intended to become a permanent part of the building, and temporary structures. Like the BPP, the builders risk form must be combined with the basic, broad or special cause of loss form and any necessary endorsements to form a complete policy.

Insurance For Condominiums

April 1, 2018 | Mark S. Humphreys

Insurance lawyers practicing law in urban areas will usually be around a lot of condominiums. Most people do not realize there is insurance that is specifically for condominiums.

Two Insurance Services Office (ISO) commercial property forms have been designated for condominium property exposures:

Condominium Association Coverage Form; and

Insurance Agents Gone Bad

March 31, 2018 | Mark S. Humphreys

Any insurance lawyer who handles many cases will see situations where the insurance agent is simply a criminal. The Insurance Journal has published two stories where an agent has been convicted for his actions.

The first one is from June 2016 and is titled, Texas Insurance Agent Arrested In Scam Targeting Elderly Clients. The story tells us about a Lubbock based insurance agent being arrested and charged with defrauding elderly victims through an annuity scam.

The Texas Department of Insurance reported that Joseph Allen Gaines was arrested last month on charges that he kept clients’ money that was intended to be used to purchase annuities.

Special Form Coverages For Business Property

March 29, 2018 | Mark S. Humphreys

Another type of coverage that insurance lawyers see is called, Special Form Coverage. Special Form Coverage is the broadest form commercial coverage. The special form provides “all risk” insurance which covers any accidental cause of loss unless specifically excluded by the policy.

The special form contains the following exclusions, which are also contained in the basic form and broad form:

1) ordinance or law

Business Property Policy Exclusions

March 27, 2018 | Mark S. Humphreys

When an insurance attorney gets a new client on an insurance related claim, one of the first things he wants, is a copy of the policy to read. And when he reads the policy, he wants to know what the exclusions are that are in the policy.

The basic form and broad form business policy contains exclusions. In fact, the many pages of an insurance policy are, when read, pages explaining what is excluded or limitations on what will be paid. Sample exclusions on the broad form are:

Ordinance or law — When a building is not in compliance or conformity with local building codes or laws and must be rebuilt or replaced, local laws require that the new structure conform to current requirements. Because ordinance or law exposures are not anticipated by basic premium rates, the cause of loss forms contain an ordinance or law exclusion, which excludes any part of a loss resulting from the enforcement of any ordinance or law regulating the construction or repair of property. This is discussed in the 1962, Texas Supreme Court opinion styled, Employers Mutual Casualty Co. of Des Moines v. Nelson.

Business Personal Property Coverage – Duties Of Insured

March 25, 2018 | Mark S. Humphreys

Like all property insurance policies, the Business Personal Property (BPP) policy imposes a number of duties on the insured. Insurance attorneys will tell these duties constitute conditions precedent to coverage; that is, the insured must comply with these requirements before the insurance company is obligated to pay any loss. This requirement was made clear in the 1999, 5th Circuit opinion styled, Griggs v. State Farm Lloyds. These duties generally include:

the insured must provide notice to the insurer of the loss
the insured must preserve the property as much as possible