Dallas Fort Worth Insurance Lawyer Blog

Insurance Denial – Potential Recovery

December 5, 2017 | Mark S. Humphreys

Being able to discuss the potential recovery when an insurance company wrongfully denies a claim is a topic any Dallas or Fort Worth insurance lawyer needs to be able to discuss with a client.

Policy benefits are the basic recovery allowed for an insurer’s breach of its contractual obligations. An insurer’s refusal to pay the insured’s claim causes damages at least in the amount of the policy benefits wrongfully withheld, according to the 1988, Texas Supreme Court case, Vail v. Texas Farm Bureau Mutual Insurance Company. The same Court in a 1996, opinion said that breach of contract allows recovery of benefit of the bargain damages, according to the case styled, Transportation Insurance Company v. Moriel.

In addition, 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. This is exemplified in Hernandez v. Gulf Group Lloyds, a 1994 opinion. It says one of the best established rules is that:

Insurance Protection When Being Sued

December 3, 2017 | Mark S. Humphreys

Relevant to Texas Insurance Law is a case reported on by the Cook County Record, an Illinois publication.

A Judge’s ruling in a traffic crash personal injury case could cost the insurance company, Liberty Mutual, $4.5 million, even though the policy at the heart of the case is supposedly capped at $25,000.

The judgement issued in this case is currently stayed pending an appeal at the U.S. Court of Appeals for the Seventh Circuit.

Intended / Third Party Beneficiaries

December 2, 2017 | Mark S. Humphreys

Insurance lawyers learn real fast to know who are the persons who can recover / benefit under an insurance policy.

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

A third person for whose benefit a contract is made may enforce the contract against the promissor. The controlling factor in determining whether a third party may enforce a contract is the intention of the contracting parties. This is illustrated in the 1985, 14th Court of Appeals opinion, Hermann Hospital v. Liberty Life Assurance Co.

Insurance – Breach Of Contract – Other Recovery

November 30, 2017 | Mark S. Humphreys

Information for Palo Pinto County Insurance Lawyers –

The Texas Supreme Court, in 1996, issued an opinion in a case styled, Liberty National Fire Insurance Co. v. Akin, that said: “Insurance coverage claims and bad faith claims are by their nature independent but, in most circumstances, an insured may not prevail on a bad faith claim without first showing that the insurer breached the contract.”

In 1998, the same court, in an opinion styled, Vail v. Texas Farm Bureau Mutual Insurance Co. said that contractual liability is not essential to establish extra-contractual liability, but it helps. The example in that case is an insurer that owed policy benefits under the contract may also be found to have acted unfairly in refusing to pay those benefits.

Anticipatory Breach Of Insurance Contract – Disability Claims

November 28, 2017 | Mark S. Humphreys

Weatherford insurance lawyers who handle insurance related matters need to understand that an anticipatory breach of the insurance contract has remedies under the law. This is best illustrated in disability policies where the insurance company is obligated to make monthly payments to the insured.

According to the 1937, Texas Supreme Court opinion styled, Universal Life & Accident Insurance Co. v. Sanders, when an insurance company is obligated by contract to make monthly payments of money to another absolutely repudiates the obligation without just excuse, the obligee is “entitled to maintain his action in damages at once for the entire breach, and is entitled in one suit to receive in damages the present value of all that he would have received if the contract had been performed, and he is not compelled to resort to repeated suits to recover the monthly payments.” Repudiation is conduct that shows a fixed intention to abandon, renounce, and refuse to perform the contract.

Another Texas Supreme Court is opinion is from 1976, and styled, Republic Bankers Life Insurance Company v. B.L. Jaeger.

Insurance And Oral Contract

November 26, 2017 | Mark S. Humphreys

Here’s something a lot of insurance attorneys may not realize.

An oral contract to insure is valid and enforceable. This is confirmed in the 1949, Texas Supreme Court opinion styled, Pacific Fire Insurance Company v. Donald. The oral agreement “is presumed to be made in contemplation of a policy containing the terms and conditions in customary use, and impliedly to adopt the same, and it is on this ground that such agreements are sustained as complete and binding contracts.”

Donald brought this suit against four insurance companies, one of which is Pacific to recover for the loss of 5500 bales of hay which were destroyed by fire while stored in a building. Donald based his action on an alleged oral contract between himself and Henry Moore, agent of Pacific. Donald prevailed at trial and this appeal followed.

Insurance And Contract Law

November 25, 2017 | Mark S. Humphreys

What all insurance lawyers know: Insurance policies are contracts, and as such are subject to rules applicable to contracts generally. This was stated in the 1994, Texas Supreme Court case, Hernandez v. Gulf Group Lloyds, and is still good law.

A party seeking to recover on an insurance contract must prove that the contract was in force at the time of the loss. Also, a party who claims under a policy is required to produce the insurance contract upon which he sues or to prove its terms. This was stated in the 1975, Tyler Court of Appeals opinion, Hartford Accident & Indemnity Co. v. Spain. This also, is still good law. To prove a breach off contract, the insured has to establish:

the existence of the contract sued upon;

Insurance – Theories Of Recovery

November 23, 2017 | Mark S. Humphreys

Insurance lawyers want to pursue the best theories of recovery when a client has a claim wrongfully denied. Some people just want to file a complaint with the Texas Department of Insurance. But, there are better ways to improve the situation.

Recovery based on theories of misrepresentation were discussed in the last posting.

Another way of recovery is based on “non-disclosures.” Closely related to misrepresentation is the theory that the insurance company, agent, or insured failed to disclose information. For example, if an exclusion is not adequately disclosed, the insurance company may be liable for breach of contract by relying on the exclusion to deny a claim. Failing to adequately disclose limitations or exception to coverage may also make the insurance company or agent liable for unfair insurance practices or deceptive trade practices.

Things Insurance Companies Do Wrong

November 21, 2017 | Mark S. Humphreys

Insurance transactions tend to resemble one another, so disputes arising from them tend to resemble one another. There are only so many ways that an insurance company and an insured can get crossways. Most cases present recurring problems that can be grouped into several categories. Insurance law is even more precedent driven than other areas, as courts try to construe similar policy language consistently. It is not surprising that cases start to look alike.

The key is find good authorities that match your facts, or to emphasize the facts that match good authorities.

Of course, the starting point is the contract itself. The initial inquiry almost always begins with the language of the contract to determine what is covered and what is not. Other tort and statutory theories may logically depend on the existence of coverage, or may exist independent of coverage. The interplay between recovery for breach of contract and recovery under other theories is discussed in numerous areas in this blog. Beyond suit for breach of contract, most insurance cases can be grouped into these categories – misrepresentations – non-disclosures – unfair settlement practices – and other misconduct.

Accidental Death And Dismemberment Policy

November 19, 2017 | Mark S. Humphreys

Abilene Texas lawyers who handle accidental death and dismemberment policy claims that are governed by ERISA, need to read this 2017, 5th Circuit Court of Appeals opinion. It is styled, Robert Ramirez v. United Of Omaha Life Insurance Company.

Ramirez traveled to West Texas and contracted a fungal infection that resulted in the removal of one of his eyes. He made a claim through the accidental death and dismemberment plan he had through his employer. The plan is governed as an ERISA plan. United of Omaha denied the claim, stating the infection that caused the removal of Ramirez’s eye was not the result of an “Accident” as that term is defined in the policy. United of Omaha was granted summary judgment by the District Court and this appeal followed.

The facts are undisputed. Following a trip to West Texas, Ramirez came in contact with a fungus and eventually was diagnosed with a condition known as coccidioidomycosis.