Bad Faith


Bad Faith in Texas Survives . . . this Round

April 7th, 2017 By David L. Plaut

The USAA v. Menchaca opinion, which has been eagerly (and anxiously) awaited by insurers and insureds was released today. The Texas Supreme Court reversed and remanded the judgment in the policyholder’s favor in this Hurricane Ike case.  The jury had determined there was no breach of contract, but found an Insurance Code violation, including an unfair or deceptive practice and an unreasonable investigation.  The jury awarded Plaintiff $11,350 in damages. In reversing the judgment, the Court announced the five following important principles
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South Texas Jury Hits USAA with Big Damages in Hailstorm Case

February 28th, 2017 By David L. Plaut

  Five years after a South Texas hail storm, a Hidalgo County jury awarded homeowner John Griffith damages of $1,244,500 against USAA Texas Lloyd’s Co. (“USAA”) and at least $200,000 against claim adjuster AllCat Claims Service, L.P. (“AllCat”).  Griffith – a principal of the McAllen-based Griffith Law Group – filed the lawsuit alleging the defendants intentionally undervalued the cost of damages to his home during the inspection process.  He alleged the 2012 hail storm damaged his roof, pool, pool deck,
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San Antonio Court of Appeals Issues Strong Appraisal Opinion

January 30th, 2017 By Sheila Tan

Adding to a line of Texas cases that found appraisal resolved all issues regarding a dispute over the cost and scope of damage to a homeowner’s property, the Fourth Court of Appeals in San Antonio recently affirmed a trial court’s decision to grant summary judgment after completion of appraisal and payment of the appraisal award by State Farm in Garcia v. State Farm Lloyds. No. 04-16-00209-CV, 2016 WL 7234064 (Tex. App.–San Antonio Dec. 14, 2016, no pet. h.). In Garcia,
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New Fifth Circuit Decision Revisits Stowers Liability in the Multiple-Insured Context

January 7th, 2017 By David L. Plaut

If you were paying attention to friends and family over the holidays and not reading slip opinions, you may have missed the recent Fifth Circuit decision in OneBeacon Ins. Co. v. T. Wade Welch & Assocs., 841 F.3d 669 (5th Cir. 2016).   Wade Welch held that a valid Stowers demand could offer to settle with one and not all insureds under a policy.   Id. at 677-82. Under Texas law, an insurer may be liable for negligently failing to settle within
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