Dallas Fort Worth Insurance Lawyer Blog

Proper Claims Against The Adjuster

December 16, 2017 | Mark S. Humphreys

Too many times, the claims against an adjuster fail when those claims are removed to Federal Court. There was a successful claim recently in the Southern District, Houston Division. It is styled, Lillie Jean Hooper v. Allstate Texas Lloyd’s, et al.

Hooper suffered storm damage and submitted a claim to Allstate for severe damage to her roof and home, and water damage.

The adjusters assigned to the claim were Katherine Hernandez and Joe Bobbitt. They conducted a assessment and later a second assessment of the claims submitted by Hooper. Hooper alleges the adjusters intended to deny her claim and fabricated explanations of the visible damage that attributed them to causes not covered by the policy. Hooper own evaluator estimated the damage at $26,459.86.

“Using” An Automobile For Insurance Coverage

December 14, 2017 | Mark S. Humphreys

Insurance lawyers will see situations where there is a question whether or not the “uninsured motorist” (UM) provisions of a policy apply to provide coverage. An interesting case was heard in the Amarillo Court of Appeals dealing with this issue. It is styled, Jesse Salinas v. Progressive County Mutual Insurance Co.

Jesse appeals a summary judgment in favor or Progressive.

Jesse was a passenger in a one vehicle accident that was stolen. No one had permission to drive, occupy, or otherwise use the vehicle.

Proof Of Loss Requirement

December 12, 2017 | Mark S. Humphreys

Probably all homeowner policies require a “Proof Of Loss” (POL) be filed before a lawsuit be filed against the insurance company. This issue is addressed in the Northern District, Dallas Division opinion, Gwendolyn Pamphile v. Allstate Texas Lloyds.

Before the Court was a motion to dismiss filed by Allstate. This arose out of an insurance dispute wherein Pamphile suffered hail damage during a storm and made a claim to Allstate for benefits. Allstate assigned an adjuster who evaluated the claim and Allstate made payment based on the adjusters evaluation. Unsatisfied with the payment Pamphile submitted a POL form with her own repair estimate and one day later, filed suit against Allstate. Allstate removed the case to federal court and filed their motion to dismiss.

Federal courts can adjudicate claims only when subject matter jurisdiction is expressly conferred and must otherwise dismiss for lack of subject matter jurisdiction.

Accidental Death Policy

December 10, 2017 | Mark S. Humphreys

Lawyers handling accidental death life insurance policies would want to read all cases dealing with this subject. Here is a 5th Circuit opinion styled, Abdul Salam Badmus v. Mutual of Omaha Insurance Company.

In August 2010, Mutual issued an Accidental Death Policy to Selem Babtunde Badmus (Selem), providing a $750,000 death benefit. The policy provided no beneficiary but was changed to designate Selem’s brother, Abdul Salam Badmus (Badmus) as beneficiary in July 2013. In March 2013, Badmus filed a claim seeking the policy benefits, alleging Selem died in an auto accident in Lagos, Nigeria, on January 24, 2014. Mutual sent Badmus forms to complete and requested documents in support of the claim. They received back partially completed forms and none of the requested documents. Upon discovery of numerous discrepancies Mutual hired Worldwide Resources, Inc. (Worldwide) to investigate the claim. Worldwide ultimately concluded that most of the information submitted was suspect and Mutual denied the claim.

In May 2015, Badmus filed suit for breach of contract and violations of numerous sections of the Texas Insurance Code. Again choosing to undertake an independent investigation, Mutual uncovered a series of name-change forms indicating that “Selem Babatunde Badmus,” residing at Badmus’s address in Houston, Texas, applied for a name change to “Abdul Salam Badmus” on May 21, 2016, over two years after Selem’s alleged death in Nigeria. shortly thereafter, Badmus was indicted for felony insurance fraud based on the insurance claim he filed with Mutual.

Lawsuits In Homeowners Cases

December 9, 2017 | Mark S. Humphreys

Insurance lawyers know that one of the more common claims arise from homeowners claims. Trying to keep the case in State or County Court is most favorable for the homeowner. However, doing that is more and more difficult. This is illustrated in the 2017, Northern District, Fort Worth Division opinion, William Mauldin v. Allstate Insurance, et al.

After damages were suffered to the residence of William, he made a claim against his homeowner’s policy with Allstate. A lawsuit was eventually filed against Allstate and the adjuster Mayella Gonzalez for violations of the Texas Insurance Code and the Texas DTPA.

Allstate and Gonzalez removed the case to Federal Court under 28 U.S.C. Section 1441(a), alleging that the adjuster Gonzalez was improperly joined in an effort to defeat diversity. When improper joinder is alleged, the Court does a Rule 12(b)(6) type of analysis to determine whether there is a chance of recovery against Gonzalez.

Responsibility Of Insureds

December 7, 2017 | Mark S. Humphreys

An insurance contract will impose conditions on the insured person or entity. For example, most policies require that the insured give notice of the claim and cooperate with the insurance company. Policies may require that the insured file a formal proof of loss, if the insurer requests one. When one party to a contract commits a material breach of that contract, the other party is discharged or excused from any obligations to perform. In the 1994, Texas Supreme Court opinion, Hernandez v. Gulf Group Lloyds, the court said that the breach be “material.” The court explained stating:

In determining the materiality of a breach, courts will consider, among other things, the extent to which the non-breaching party will be deprived of the benefit that it could have reasonably anticipated from full performance … The less the non-breaching party is deprived of the expected benefit, the less material the breach ….

The other factors courts consider in determining the materiality of a breach are: (1) the extent to which the injured party can be adequately compensated for the part of that breach of which he will be deprived; (2) the extent to which the party failing to perform or to offer to perform will suffer forfeiture; (3) the likelihood that the party failing to perform or to offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances; (4) the extent to whic the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing.

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.