Dallas Fort Worth Insurance Lawyer Blog

Elements Of An Insurance Transaction

November 18, 2017 | Mark S. Humphreys

Here is some very basic information that every insurance lawyer should be aware of. It is also information that every insurance consumer should know.

To understand the different ways disputes can arise, it is helpful to consider the sequence of events that is likely to occur involving an insurance issue. At its very simplest, the insurance transaction can be divided into the initial sale of the policy, and subsequent handling of claims. These can be broken down further to include:

(1) The sale of the policy: Initially, the consumer and insurance company or insurance company’s agent must communicate to establish a contractual relationship. Disputes may arise over what was asked for by the applicant, what was represented by the insurance company or agent, or the timeliness of the insurance company or agent in providing coverage. Issues may also arise about the truthfulness of the applicant or agent in disclosing information requested by the insurer;

Disability Claims – Illness Versus Accident

November 16, 2017 | Mark S. Humphreys

Lawyers who handle disability insurance claims know that the policy has to be read.

In a definition of “total disability” in an individual accident and sickness policy or hospital, medical, and dental service corporation subscriber contract, the inability to perform duties may not be based solely on an individual’s inability to perform “any occupational duty,” but the insurer may specify the requirement of the inability of the insured to perform all of the substantial and material duties pertaining to his or her regular occupation, or words of similar import, according to the Texas Administrative Code, Section 3.3012(b)

The policy may further provide coverage for “partial disability,” which is typically defined as the insured’s inability to perform one or more but not all of the essential duties of his or her employment or occupation.

Fort Worth Claims

November 14, 2017 | Mark S. Humphreys

Fort Worth lawyers who end up in Federal Court need to read this opinion from the Northern District, Fort Worth Division, Judge McBride. The opinion is styled, Antonio Perez v. Allstate Vehicle and Property Insurance Company, et al.

Perez initiated this action by filing a lawsuit in State District Court. Allstate removed the action to Federal Court, alleging diversity of citizenship and the required amount in controversy. This Court Ordered Perez to replead so that his pleadings complied Federal Court pleading standards found in Rule 8(a) and 9(b) of the Federal Rules of Civil Procedure, and directed Perez to file an amended complaint that complied with those requirements.

Perez filed his amended complaint. Despite the warning provided in the order for repleading, Perez’s complaint as amended was, with few exceptions, basically a repeat of his state court pleadings, alleging, in a conclusory way, violations of sections of the Texas Insurance Code, fraud, and conspiracy to commit fraud, breach of contract, and breach of the duty of good faith and fair dealing.

Underinsured Motorist Coverage Issues

November 12, 2017 | Mark S. Humphreys

Lawyers in the Dallas and Fort worth areas who handle underinsured motorist (UIM) cases need to read this 2017 opinion from the Texas Supreme Court. It is styled, Okelberry v. Farmers Texas County Mutual Insurance Co.

Steven Okelberry and his wife, Patricia, had an auto policy with Farmers that provided $500,000.00 in UIM coverage.

Steven and his two sons were injured in an 18-wheeler accident insured by Home State. Steven suffered a neck injury requiring surgery and the possibility of additional surgeries.

Auto Policy And Punitive Damages

November 11, 2017 | Mark S. Humphreys

Lawyers handling car wreck cases would be especially interested in this 2017 opinion from the Texas Supreme Court. It is styled, Farmers Texas County Mutual Insurance Company v. Jennifer L. Zuniga et al.

This is an appeal from the granting of a summary judgment in favor of Zuniga wherein Farmers had asked the court to rule that there is no coverage under the policy at issue for punitive damages. This Court reversed that summary judgment.

Determining whether exemplary damages for gross negligence are insurable requires a two-step analysis. First, the Court decides whether the plain language of the policy covers exemplary damages sought in the underlying suit against the insured. Second, if the Court concludes that the policy provides coverage, it determines whether the public policy of Texas allows or prohibits coverage in the circumstances of the underlying suit.

Home Owners Policy – Rebuild Costs

November 9, 2017 | Mark S. Humphreys

The San Antonio Division, Western District, issued an opinion dealing with rebuild costs under a homeowners policy that insurance attorneys need to read. It is styled, Kirk McClelland and Tamre McClelland v. Chubb Lloyd’s Insurance Company of Texas, and Robert Lynn Pritchard.

This is a dispute over coverage and the conduct of Chubb in its payments totaling $145,290.72 to the McClellands. The McClellands assert they are entitled to greater amounts and sued Chubb and its adjuster for breach of contract and various violations of the Texas Insurance Code and the Texas Deceptive Trade Practices Act. The Court granted summary judgment in favor of Chubb and the McClellands seek to alter that judgment. The course refused to alter the judgment.

The background facts are summarized as follows. The McClellands garage apartment was destroyed by fire. Chubb insured the property under a “Texas Standard Homeowners Endorsement” as well as a “Texas Platinum Homeowner’s Endorsement.” Their extended policy limits allowed for “reconstruction cost even if this amount exceeds the limit of liability for your dwelling or other structures as shown on the declarations page.” The Platinum Endorsement defined “reconstruction cost”:

Interpleader Action For Life Insurance

November 7, 2017 | Mark S. Humphreys

The Northern District of Texas, Dallas Division ruled on an interpleader case recently. It is styled, Primerica Life Insurance Company v. Sherry Purselley, et al.

The co-defendants in this case are Henslee, Lee, and Sherry Purselley. This is an effort to determine who owns the life insurance proceeds at issue.

Lee purchased the Policy and he was owner with Sherry the primary beneficiary. Later, Lee executed a Change Form that designated Sherry the Policy owner in 1992. She thus, became the new owner.

Getting The Insurance Adjuster Sued Is Important

November 5, 2017 | Mark S. Humphreys

Getting the insurance adjuster served with legal papers in a lawsuit is important and for some reason, overlooked. This is illustrated in an Eastern District, Sherman Division case styled, Robert Crawford v. Allied Property and Casualty Insurance Company, Laura Jones.

Crawford, a citizen of Texas, sued Allied, an Iowa Company and Jones, who is a Texas resident in State District Court. The suit arises out of the Defendant’s alleged improper handling of an insurance claim. Crawford suffered extensive damage to his property during a storm. Allied was Crawford’s insurer. Jones was hired by Allied to inspect and adjust Crawford’s loss. Thereafter, it is alleged that Jones conducted a substandard investigation and inspection of the property, prepared a report that failed to include all of the damages that she noted during the inspection, and undervalued the damages she observed during the inspection, all of which resulted in Allied denying Crawford adequate coverage under the policy. Crawford sued for breach of contract and sued Allied and Jones for violations of the Texas Insurance Code.

Allied and Jones removed the case to Federal Court based on diversity jurisdiction, alleging that Jones was improperly joined to defeat diversity jurisdiction.

Insurance Contract Provisions

November 4, 2017 | Mark S. Humphreys

A recent case filed in Tarrant County was removed to Federal Court, Northern District, Fort Worth Division. One issue dealt with the appraisal provision in the insurance contract. The style of the case is, Reese Hallak v. Allstate Vehicle and Property Insurance Company.

Hallak sued Allstate for breach of contract and violations of the Texas Insurance Code. Hallak’s petition alleges Allstate mishandled and underpaid him for two separate property damage claims. After removal to Federal Court, Allstate filed a Motion To Abate Pending Appraisal, arguing that, pursuant to the terms of the insurance contract between the parties, this case should be abated until conclusion of the appraisal process.

There is no specific federal statute or rule which expressly authorizes a motion to abate. The court’s decision to do so is largely a matter of judicial discretion.

Lawsuits In Federal Court – It Has To Be Right

November 2, 2017 | Mark S. Humphreys

Insurance attorneys with much experience learn real quick that the insurance companies prefer to litigate cases in Federal Court. The reason is that Federal Court is much less forgiving of mistakes and the Federal Courts look for reasons to dispose of a case. This authors opinion is that many of the Federal Courts put a priority on technical rules rather than substance. This authors opinion is bolstered by the fact that an insurance company will always attempt to get a lawsuit against them in State Court, removed to Federal Court.

This is illustrated in a 2017, opinion from the Southern District of Texas, McAllen Division. The case is styled, Maria Abdon v. State Farm Lloyds.

In this case, the court is considering State Farm’s motion for partial dismissal on the pleadings, as well as Abdon’s response and alternative motion for leave to amend. The Court granted State Farm’s motion for partial dismissal and denied Abdon’s motion for leave to amend.