Justia Insurance Law Opinion Summaries

Articles Posted in Supreme Court of Texas
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In this insurance dispute, the Supreme Court denied a writ of mandamus compelling the trial court to render judgment in favor of Insurer on the jury's verdict, holding that the trial court did not abuse its discretion in declining to render judgment on the verdict.Insured sought underinsured motorist (UIM) benefits from Insurer. Insurer in this case declined to participate in a jury trial to establish the at-fault motorist's liability and demanded a separate trial on its liability under the UIM policy. Before trial on the UIM claim, the court commenced a jury trial on Insured's negligence claim against the at-fault motorist. The parties settled and the claim was dismissed without rendition of judgment on the jury's verdict. Insurer then argued that a separate trial on the UIM claim was no longer necessary because of the jury's findings and the settlement payment. The trial court denied Insurer's motion for judgment based on the jury verdict from the negligence trial. Insurer sought mandamus relief. The Supreme Court denied relief, holding (1) collateral estoppel did not bind Insured to a verdict that was not reduced to judgment; and (2) Insurer's post-dismissal consent to be bound by the negligence suit's outcome did not make the negligence verdict enforceable against Insured in the contract suit. View "In re USAA General Indemnity Co." on Justia Law

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The Supreme Court conditionally granted a petition for a writ of mandamus directing the trial court to vacate its order granting a motion to strike a counteraffidavit served under Tex. Civ. Prac. & Rem. Code 18.001 and precluding the offering party from contesting the reasonableness of the subject medical expenses at trial, holding that the trial court abused its discretion.In granting the motion to strike, the trial court concluded that the counteraffidavit failed to comply with the requirements of section 18.001. The court then prohibited the offering party from testifying regarding the reasonableness and necessity of the medical bills. Petitioner petitioned the Supreme Court for a writ of mandamus. The Supreme Court conditionally granted relief, holding that the trial court erred by striking the counteraffidavit and by granting relief that found no legal basis in section 18.001 for the purported failure to comply with the statute. View "In re Allstate Indemnity Co." on Justia Law

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The Supreme Court conditionally granted mandamus relief in these actions challenging rulings on a Rule 91a motion to dismiss, holding that the the trial court abused its discretion in denying Insurer's motion to dismiss Insured's claim for negligent failure to settle.A liability insurer (Insurer) settled claims against its insured (Insured) within policy limits but obtained a release that was contingent on Insured paying a portion of the settlement. Insured paid and then brought this action seeking reimbursement, alleging claims for negligent failure to settle and for breach of contract. Insurer filed a motion to dismiss, which the trial court denied. Insurer sought mandamus relief. The court of appeals granted relief as to the breach of contract claim but concluded that the trial court properly refused to dismiss the claim for negligent failure to settle. Both parties sought mandamus relief. The Supreme Court conditionally granted mandamus relief to both parties, holding (1) the trial court abused its discretion in denying Insurer's motion to dismiss Insured's Stowers claim for negligent failure to settle; and (2) the court of appeals erred in ordering the trial court to dismiss Insured's claim for breach of the contractual obligation to indemnify. View "In re Farmers Texas County Mutual Insurance Co." on Justia Law

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In this long-running class action suit, the Supreme Court reversed in part and affirmed in part the decision of the court of appeals affirming the district court's grant of summary judgment in favor of Insureds but reversing the portion of the judgment ordering Insurer to issue the disputed insurance policies at a determined premium, holding that Insurer correctly interpreted the subject policy.At issue was how to interpret a homeowners insurance policy that had been out of use for almost twenty years. Insurer sent a notice of non-renewal to its insurers that it had decided to stop offering broad "all-risk" policies. Plaintiff, on behalf of herself and a class of similarly situated people, brought this suit seeking a declaratory judgment that the non-renewal was effective and that class members were entitled to renew their all-risk policies. The trial court granted summary judgment to Plaintiff and the class. The court of appeals affirmed in part and reversed in part. The Supreme Court reversed in part, holding that Insurer was entitled to summary judgment on the breach of contract claim for non-renewal of the policies and that remand was required for the trial court to address any remaining matters. View "Farmers Group, Inc. v. Geter" on Justia Law

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In these original proceedings arising from suits by holders of underinsured motorist (UIM) insurance seeking recovery against their insurers following traffic accidents the Supreme Court held that insureds who bring only Insurance Code claims seeking policy benefits as damages must also succeed in an initial "car crash" trial in order to lay the predicate for their statutory claims.Following traffic accidents, holders of UIM insurance sought recovery against their insurers. The insureds, however, did not sue for breach of their insurance companies and brought only extracontractual Insurance Code Claims. In both cases, State Farm filed motions for bifurcated trial under Rule 174(b). After the trial courts denied State Farm's motions, State Farm petitioned for mandamus relief. In response, Petitioners argued that because they brought only statutory claims and because there were no breach of contract claims to try first, no bifurcation of trial was required. The Supreme Court granted mandamus relief, holding that although Petitioners' claims were not labeled breach of contract Petitioners nevertheless just establish State Farm's liability under their insurance policies as a prerequisite to recovery on their Insurance Code claims. View "In re State Farm Mutual Automobile Insurance Co." on Justia Law

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The Supreme Court reversed the judgment of the court of appeals affirming the trial court's grant of summary judgment in favor of Insurer in this insurance dispute, holding that payment of an appraisal award does not absolve the insurer of statutory liability when an insurer accepts a claim but pays only the part of the amount it owed within the statutory deadline for payment.Homeowner reported a claim to Insurer for damage to his home. Insurer accepted Homeowner's claim and paid part of it before the statutory deadline. Dissatisfied with the amount, Homeowner sued, seeking full payment of the claim plus interest and attorney's fees under the Teas Prompt Payment of Claims Act, Tex. Ins. Code Chapter 542. While the suit was pending but after the statutory deadline had passed, Insurer invoked the policy's appraisal process, and the appraised awarded Homeowner more than Insurer paid. Insurer paid the difference then moved for summary judgment. The trial court granted summary judgment, and the court of appeals affirmed. The Supreme Court reversed, holding that because Insurer did not pay the amount that "must be paid" before the statutory deadline, it was not entitled to summary judgment. View "Hinojos v. State Farm Lloyds" on Justia Law

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In this dispute over the amount that air ambulance providers may recover from workers' compensation insurers, the Supreme Court held that Texas law requiring that private insurance companies reimburse the fair and reasonable medical expenses of injured workers is not preempted by a federal law deregulating aviation and that federal law does not require Texas to mandate reimbursement of more than a fair and reasonable amount for air ambulance services.PHI Air Medical, LLC, an air ambulance provider, argued that the federal Airline Deregulation Act (ADA) preempted the Texas Workers' Compensation Act's (TWCA) fee schedules and reimbursement standards. An administrative law judge held that PHI was entitled to reimbursement under the TWCA's standards. On judicial review, the trial court declared that the ADA did not preempt the TWCA's reimbursement provisions. The court of appeals reversed. The Supreme Court reversed, holding (1) because the price of PHI's service to injured workers is not significantly affected by a reasonableness standard for third-party reimbursement of those services, the ADA does not preempt that standard; and (2) the ADA does not require that Texas compel private insurers to reimburse the full charges billed for those services. View "Texas Mutual Insurance Co. v. PHI Air Medical, LLC" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals concluding that an insurer's payment of an appraisal award barred an insured's claims under the Texas Prompt Payment of Claims Act (TPPCA), Tex. Ins. Code chapter 542, holding that payment of an appraisal award does not extinguish TPPCA liability as a matter of law.After Insured's property sustained damage from a storm, Insurer valued the property damage at $5,153. Believing the property damage was undervalued, Insured sued, alleging breach of contract and extra-contractual claims and invoking the policy's appraisal clause. Appraisers valued the damage at almost $15,000. Insurer paid the balance of the award and then filed a motion for summary judgment. The trial court granted the motion. The court of appeals affirmed, concluding that, as a matter of law, Insured could not maintain his TPPCA claim because Insurer paid the appraisal award. The Supreme Court reversed and remanded the case, holding that the court of appeals' opinion was inconsistent with this Court's recent decisions on the issue. View "Perry v. United Services Automobile Ass'n" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals concluding that an insurer's payment of an appraisal award barred an insured's claims under the Texas Prompt Payment of Claims Act (TPPCA), Tex. Ins. Code chapter 542, holding that payment of an appraisal award does not extinguish TPPCA liability as a matter of law.After Insured's property sustained hail and wind damage, Insurer valued the property damage at $387. Believing the damage was undervalued, Insured sued, alleging breach of contract and extra-contractual claims. Insurer successfully moved the trial court to compel appraisal, and the appraisal award exceeded Insurer's prior estimates. Insurer paid the award and then filed a motion for summary judgment. The trial court granted the motion and rendered a take-nothing judgment. The court of appeals affirmed, concluding that, as a matter of law, Insured could not maintain his TPPCA claim because Insurer paid the appraisal award. The Supreme Court reversed, holding that the court of appeals' opinion was inconsistent with this Court's recent decisions on the issue. View "Marchbanks v. Liberty Insurance Corp." on Justia Law

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In this case involving the collusive fraud of an insured and the driver of the other car involved in a car crash the Supreme Court adopted an exception to the eight-corners rule to determine the liability insurer's duty to defend, holding that courts may consider extrinsic evidence regarding whether the insured and a third party suing the insured colluded to make false representations of fact for the purpose of securing a defense and coverage.Osbaldo Hurtado Avalos and Antonio Hurtado (collectively, the Hurtados) sued Karla Guevara after the car accident and sought coverage from Loya Insurance Company (Insurer). Insurer furnished an attorney to defend Guevara, but when Insurer discovered that Guevara and the Hurtados had lied to secure coverage Insurer denied both a defense and coverage. The trial court rendered judgment against Guevara, who assigned to the Hurtados her rights against Insurer. Hurtados then filed suit against Insurer. The trial court granted summary judgment for Insurer. The court of appeals reversed, holding that Insurer had duty to defend under the eight-corners rule. The Supreme Court reversed, holding that the trial court (1) correctly considered extrinsic evidence regarding whether Guevara and the Hurtados colluded to secure a defense and coverage; and (2) correctly determined that the evidence conclusively showed collusive fraud. View "Loya Insurance Co. v. Avalos" on Justia Law