Attorney Portrait Insurance

Texas Insurance Code 541 and 542

| Read Time: 3 minutes

In Texas, insurance companies owe a wide range of duties to their policyholders aimed at ensuring claims are promptly adjusted and settled in a fair manner. An insurance company that breaches these duties can be liable to the policyholder for additional damages, penalties, and attorney’s fees. The reason insurance companies are so closely regulated is the inherent advantage they have over their insureds who are depending on coverage from the insurance company that they paid premiums for.  In Texas, there are two separate bodies of law that penalize insurance companies for acting in bad faith. The first is a common law implied covenant of good faith that requires an insurance company to treat you honestly and fairly. In addition, Chapter 541 of the Texas Insurance Code lays out in detail when an insurer engages in an unfair method of competition and unfair or deceptive acts or practices. In addition, Chapter 542 details an insurer’s duties to pay claims in a timely manner. If you believe your insurance company acted in bad faith, you should contact a Texas insurance attorney as soon as possible. Proving a Bad Faith Claim in Texas When proving a bad faith claim in Texas, it is important to understand that you have the burden of proof. This means that you, with the help of your lawyer, must demonstrate how the facts of your case meet the requirements of a bad faith claim. There are two ways that you can prove your bad faith claim: either as a common law bad faith claim or a statutory bad faith claim. Common-Law Bad Faith Claim To prove a common law bad faith claim, you must show that your insurance company denied or delayed your claim even though liability was reasonably clear. The Texas Supreme Court recognized a common law claim for bad faith in 1983. English v. Fischer, 660 S.W.2d 521 (Tex. 1983). Since then, the Texas Supreme Court has upheld the common law claim for bad faith despite the passage of statutes prohibiting insurers from engaging in certain actions that give rise to specific penalties.  Statutory Bad Faith Claim To prove a statutory bad faith claim, you must prove that your insurance company violated Texas insurance code 541 or 542.  Causes of Action You Can Bring Under Chapters 541  There are several different causes of action you can bring against your insurance company under Chapter 541 of the Texas Insurance Code. These claims can be brought against both your insurance company and insurance professionals, such as adjusters.  Misrepresentation of a material fact or policy provision; Failing to reach a settlement in good faith when liability is reasonably clear; Failing to reasonably explain why a claim was denied; Failing to affirm or deny coverage within a reasonable time; and Refusing to pay a claim without conducting a reasonable investigation. A Texas insurance lawyer can help you determine which of these causes of action is best suited to your case. First-Party Bad Faith Claims It is important to understand the type of bad faith claim that applies to your case. A Texas insurance attorney can help you figure out which type of claim you should file. First-Party Bad Faith Claim A first-party bad faith claim arises when you file a claim against your own insurance company after an accident or event. For example, you have a house fire and file a claim with your insurance company for the damage to your dwelling and personal property. If your insurance company fails to settle your claim when it is clearly liable under the terms of the policy, you can file a first-party bad faith claim against your insurance company. Damages There are two major types of damages available in bad faith suits against an insurance company. These include actual damages and attorney fees and court costs. Actual damages refer to the financial harm you suffered as a result of your insurance company acting in bad faith. It is also important to note that you can recover three times your actual damages if you can prove your insurance company knowingly violated chapter 541 of the Texas insurance code. A Texas insurance attorney can help you determine the amount of damages you could recover. What Should You Do If You Believe Your Insurance Company Has Acted in Bad Faith? If you believe your insurance company has acted in bad faith, you should contact a Texas insurance lawyer today. We at The Johns Law Firm will determine the appropriate avenue to prove your bad faith claim. We will fight your insurance company and strive to get you the compensation you deserve. Contact us today to schedule your free consultation.

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Attorney Portrait Insurance

Bad Faith Insurance in Texas: Know Your Rights

| Read Time: 5 minutes

In Texas, insurance companies owe a wide range of duties to their policyholders aimed at ensuring claims are promptly adjusted and settled in a fair manner. An insurance company that breaches these duties can be liable to the policyholder for additional damages, penalties, and attorney’s fees beyond what is owed under the insurance policy. The reason insurance companies are so closely regulated is the inherent advantage they have over their insureds who are depending on the coverage they paid for.  In Texas, there are two separate bodies of law that penalize insurance companies for acting in bad faith. The first is a common law implied covenant of good faith that requires an insurance company treat you honestly and fairly. In addition, Chapter 541 of the Texas Insurance Code lays out in detail when an insurer engages in an unfair method of competition and unfair or deceptive acts or practices. Somewhat related is Chapter 542 of the Texas Insurance Code, which provides deadlines for an insurer to pay and settle claims. If you believe your insurance company acted in bad faith, you should contact a Texas insurance attorney as soon as possible. Proving a Bad Faith Claim in Texas When proving a bad faith claim in Texas, it is important to understand that you have the burden of proof. This means that you, with the help of your lawyer, must demonstrate how the facts of your case meet the requirements of a bad faith claim.  There are two ways that you can prove your bad faith claim: either as a common law bad faith claim or a statutory bad faith claim. Common-Law Bad Faith Claim To prove a common law bad faith claim, you must show that your insurance company denied or delayed your claim even though liability was reasonably clear. The Texas Supreme Court recognized a common law claim for bad faith in 1983. English v. Fischer, 660 S.W.2d 521 (Tex. 1983). Since then, the Texas Supreme Court has upheld the common law claim for bad faith despite the passage of statutes prohibiting insurers from engaging in certain actions that give rise to specific penalties.  Statutory Bad Faith Claim Under Chapter 541 There are several different causes of action you can bring against your insurance company under Chapter 541 of the Texas Insurance Code. These claims include:   Misrepresentation of a material fact or policy provision; Failing to reach a settlement in good faith when liability is reasonably clear; Failing to reasonably explain why a claim was denied; Failing to affirm or deny coverage within a reasonable time; and Refusing to pay a claim without conducting a reasonable investigation. Insurance companies, adjusters, and other personnel can be sued and held liable for bad faith insurance claim handling. There are numerous business practices that insurance companies may engage in that fall under the umbrella of bad faith. For example:  Undervaluing claims Delaying adjustment of claims Delaying payment of claims Misrepresenting terms of the insurance policy Pressuring a policyholder not to hire an attorney Ignoring portions of the claim during investigation and adjustment Canceling or changing the terms of insurance after making a claim Failure to communicate with the policyholder Not providing reasons for the insurance company’s determinations Failing to assign qualified personnel to adjust and investigate your claim Request unnecessary information to delay the claim adjustment process Alleging the insured engaged in fraud or criminal behavior without reasonable justification Bad faith normally requires you to prove that the insurance company didn’t just make an error, but that it engaged in intentional or grossly negligent conduct aimed at harming its insured. I often like to classify bad faith claims as either being obvious or not so obvious. An example of an obvious bad faith claim is where the insurance company knowingly makes misrepresentations to a policyholder. For example, the insurance company denies your insurance claim after being told by its own experts that the claim is covered by your policy. Another example of obvious bad faith may be an insurance company that misrepresents the terms of your insurance policy or changes the terms of the insurance policy without your knowledge.  Not so obvious bad faith often deals with the valuation of your claim. In many cases, an insurance company will estimate the value of your claim on the lower end. Although frustrating, this itself may not be bad faith. You need to compare the insurance company’s investigation and reports to what you are claiming. If your dispute with the insurance company is over the value of specific items that you are claiming, there may not be bad faith if the insurance company can prove that its valuation was reasonable. However, if the insurance company has ignored portions of your claim or estimated your damage in ways that are unreasonable, you may have a good claim for bad faith.  Damages for Bad Faith Conduct and Unfair Trade Practices If you establish bad faith, the following damages can be recovered:  Treble Damages, i.e. three times the amount the insurance company should have paid you. To get treble damages, courts tend to require that you prove the insurance company intentionally or knowingly acted in bad faith.  Attorney’s fees, interest, and court costs.  Interest on the delayed payments. Don’t Forget About the Prompt Payment Statute Chapter 542 of the Texas Insurance Code creates a number of requirements for insurers to respond to, investigate, and pay insurance claims. These requirements are separate and apart from the bad faith practices prohibited under Chapter 541. If an insurer violates this law, you are entitled to recover attorney’s fees and damages in the form of an annual 18% penalty.  To collect these damages, the law requires: (1) the policyholder had a claim under the policy; (2) the insurer is liable for the claim; and (3) the insurer failed to comply with a requirement of the statute.”  There are a number of specific requirements that you need to meet to collect attorney’s fees and damages for breach of the prompt payment...

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What Is Double Indemnity?

| Read Time: 2 minutes

A double indemnity clause is a type of provision found in many life insurance and accidental death and dismemberment policies. This type of clause allows for additional payout in the event of accidental death. However, insurance companies often make it difficult to classify the death as “accidental,” preventing you from getting the payment you may be entitled to. Contact the Johns Law Firm today to see if you qualify for a double indemnity claim and find out how we can help.  Double Indemnity Life Insurance Definition Double indemnity life insurance clauses require an insurer to provide a larger payout if the insured died as a result of accidental death. Very often, this additional payment will be double or even triple the amount that is provided for in the policy. Approximately 5% of all deaths in the United States are the result of an accident. Life insurance companies offer additional payouts for accidental deaths due, in part, to the low likelihood that you will die due to an accident.  Sometimes, however, insurers will try to deny double indemnity claims to avoid making additional payments that may actually be owed.  What Qualifies as an Accidental Death Determining what constitutes an “accidental death” is more complicated than you might think. Insurance policies will frequently carve out many exceptions to coverage under the policy. Below are some examples of deaths that generally qualify as accidental:  Murder,  Motor vehicle accidents,  Drowning, Falls, and Any other death not considered an “accident” by the insurer. But, for most causes of accidental death, the insurer will attempt to find an exception to coverage. The following are some common exceptions to coverage for a double indemnity claim:  Murder of the insured by a beneficiary under the policy; Accidents caused by the insured’s own alleged negligence; Accidental death where the insured was intoxicated; Suicide; and Natural causes. Even though there are many exceptions to coverage, this does not always mean that your claim should be denied. Having a lawyer who understands what does and does not qualify as an accidental death can greatly improve your chances of having your double indemnity claim paid.  What Can I Do If the Insurance Company Denies My Claim? Unfortunately, many insurers will deny double indemnity claims that should be paid. However, even if your claim is denied, you may be able to contest it.  For example, an insurer might deny a double indemnity claim based on their determination that the insured committed suicide. But, if you can prove that the death was, in fact, an accident and not a suicide, then your claim should not be denied. Likewise, an insurer might deny payment of the double indemnity benefit because it believes the accidental death was the result of the insured’s own negligence or intoxication. While these may seem like fairly standard exclusions, insurers can stretch their meanings to deny coverage. Why? A double indemnity payment is a huge hit on an insurer and it will do anything it can to avoid doing so. The good news is that having an experienced lawyer in your corner to argue on your behalf can make all the difference.  Dealing with the aftermath of a loved one’s death is challenging, and navigating a double indemnity insurance claim and subsequent denial can make matters feel even worse. At the Johns Law Firm, we want to make sure you feel taken care of.  If you or someone you know has had a double indemnity claim denied by an insurer, contact us today to see how we can help. 

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TX Life Insurance – Two-Year Incontestability Clause

| Read Time: 4 minutes

A life insurance policy is a contract between your insurance company and you, the policyholder. While the benefits of life insurance are clear, there is always a risk that a claim is denied because the information is omitted from an insurance application. To offset this risk, the Texas Legislature and most other states have enacted a law requiring all life insurance policies to contain an incontestability clause. See Texas Insurance Code, Section 1131.104. This law states that your insurance company cannot contest the validity of your life insurance policy after it has been in force for two years from its date of issue. The purpose of an incontestability requirement is to protect you from a challenge to the validity of your policy long after the policy has been issued. The idea behind this requirement is that a life insurer has a duty to investigate the medical history of its policyholders and must take affirmative steps to void a policy or readjust a premium within the first two years that the policy was issued.  However, a life insurer can refuse to pay a claim after the two-year incontestability period if it can prove that the insured made intentional misrepresentations in the insurance application. Texas Insurance Code, Section 705.104 Additionally, Texas Insurance Code, Section 1131.104 says that a statement you made relating to your insurability can’t be used against you in a suit contesting the validity of your policy, provided that your policy has been in effect for two years or more. However, your insurance company can use a written statement against you after the two-year incontestability period to try to prove that you made a material misrepresentation in your life insurance application. If your life insurance company tries to challenge the validity of your life insurance policy, you should contact a Texas insurance lawyer as soon as possible. How Does an Incontestability Clause Help You? When you purchase a life insurance policy, the clock begins running on the incontestability clause’s effective date. If your insurance company has not found an error in your application within two years of the date of the issue, it cannot cancel your policy unless one of a handful of exceptions is met. In other words, the insurance company has two-years to contest the information in the insurance policy.  If applicable, your beneficiaries will receive their benefits due to your policy even if your insurance company claims that misrepresentation in your application made the policy invalid. A Texas insurance lawyer can help you understand how the incontestability clause in your life insurance policy can help you. What Are Some Exceptions to Incontestability Clauses? Nevertheless, insurance companies can often cancel or modify your life insurance policy in a few circumstances. Misstated Age or Gender First, if you misstated your age or gender on your application, your insurance company may modify your insurance benefits to reflect your true age and gender. This is because many insurance policies contain a “misstatement of age” provision that specifies the insurance benefits will be adjuster based on the insured’s actual age.  Death during the Application Process Second, if you die before the incontestability clause expires, your insurance company may be able to cancel your policy if the applicant made any misrepresentations in the policy application. Importantly, the misrepresentations do not have to necessarily be material or intentional. Any misrepresentation or omission, even slight, can normally be used to cancel a policy before the expiration of the incontestability period. However, if the applicant did not make any misrepresentations or omissions in the policy application, and subsequently dies within two years after the policy was issued, the life insurance company is obligated to pay the claim.     Nonpayment of Premiums The life insurance company can always cancel a policy for failure to pay premiums regardless if it occurred before or after the two-year contestability period.   Insurance Fraud: Intentional Misrepresentations Your insurance company may also void your policy and refuse to pay if they can prove that the applicant engaged in insurance fraud. Insurance fraud occurs when you make deliberate misrepresentations to obtain benefits you’re not entitled to. The issue of fraudulent misrepresentations versus negligent omissions is the key source of conflict in many life insurance disputes. For example, a life insurance company may claim that an applicant’s failure to disclose a medical condition on the application is evidence of fraudulent intent. However, in most cases, that is not true. Many applicants innocently omit certain details about their medical history on a life insurance application. Think about all of the times you have been to the doctor and consider if you can recall every medical condition or diagnosis you have had. Many life insurance companies will seize upon an innocent omission to try to deny the claim. If your life insurance claim has been denied due to an alleged misrepresentation in the policy application, do not be dismayed. Insurance companies make money by denying legitimate claims. However, a Texas insurance lawyer can advise you as to whether one or more of these exceptions might apply to your case. What About Misrepresentations Caused by an Agent’s Negligence? One issue that comes up often is a misrepresentation or omission in the insurance application that was not the applicant’s fault. Instead, it was the fault of the insurance agent. Most of the time when you apply for life insurance your agent will walk you through the application and write down your information. In fact, it is not uncommon for the application to take place over the phone. We recently had a deposition in a case where the insurance agent admitted that he never asked questions as they actually read on the insurance policy. Think about that. How can you provide honest responses in an insurance application when the agent does not even ask you the correct questions.  Sometimes courts will impute the agent’s negligence onto the insurance company. This means that any misrepresentations or omissions in the application are the faults of the insurance company and the policy cannot be...

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Appealing Your Long-Term Disability Denial

| Read Time: 6 minutes

Having your long-term disability claim denied can be stressful and confusing. If this is an issue you are dealing with, you should take heart in the fact that most long-term disability claims are denied. This should not be surprising. Insurance companies make money by denying claims. What Is the Next Step? You are likely required to file an administrative appeal. Appealing a denied long-term disability claim is not easy. However, a long-term disability appeal is a lot like a redo. You get a second chance to compile and present medical and vocational evidence to try to have your claim accepted. For many, the assistance of an experienced disability insurance attorney to navigate the process is essential. ERISA Versus Non-ERISA Policies The Employee Retirement Income Security Act (“ERISA”) governs many employer benefits including disability insurance. If your disability benefits are provided by your employer, ERISA likely applies. ERISA regulates most aspects of how disability claims are processed. This includes the timeframes for making a claim determination. Under ERISA, when a claim is denied, an employee must appeal in accordance with the administrative appeals process. A policyholder cannot file a lawsuit for wrongful denial of the claim until the administrative appeals process has played out. The process of filing an administrative appeal can be time-consuming. In most cases, a policyholder will have 180 days from the date the claim has been denied to appeal. Only after the administrative appeal is denied can a policyholder file a lawsuit. Non-ERISA disability policies are governed by state contract law similar to most other insurance policies. There is no administrative appeal process. If your claim is denied, you can file a lawsuit. Steps to Making Your Disability Claim Even though you may have already received short-term disability benefits, this has little to do with whether you qualify for long-term disability benefits. For long term disability claims, your medical history and medical records are critically important. A policyholder must establish that he or she has a disabling condition. It is the policyholder’s burden to establish within a reasonable medical degree of certainty that a disabling condition exists and that the policyholder’s ability to work and earn wages has been impaired. Long-term disability policies tend to either be “own occupation” and “any occupation” policies.  Under “own occupation” policies, a policyholder is considered disabled when, due to an illness or accidental injury, he or she is unable to perform their current job. With this type of policy, the policyholder can qualify for benefits even if he or she can perform a job or occupation that is different from their “own occupation.” This differs sharply from “any occupation” policy in which an applicant is disabled when he or she is unable to work any type of job. For example, under any occupation policy, a contractor whose disability does not prevent him from working a light-duty job could not recover long-term-disability benefits. Many long-term disability claims involve significant potential recoveries and it is not uncommon for insurance companies to aggressively litigate claims. Experts often take on a significant role in disability claims. If your claim is disputed, you need a qualified team of experts to help establish that you are disabled. Establishing a Condition That is Consider Disabling Disability claims first and foremost are driven by medical opinion. A policyholder seeking benefits has the burden of establishing that he or she has a medical or psychological condition that is disabling. As a rule of thumb, the condition needs to be objectively serious. If your condition is insignificant or ill-defined, you probably will not qualify. Further, your physicians or medical experts need to help establish that your condition impacts your ability to work. This issue can be tricky depending on whether you have an “any occupation” or “own occupation” policy. Vocational evidence often comes into play in long-term disability claims. Vocational evidence is simply evidence related to your education, work experience, and ability to earn a living. In many cases, the insurance company may hire an expert to state that you can work your regular job, or, in the case of an “any occupation” policy, a different job. Similarly, an experienced disability attorney should retain a vocation expert to establish that the client is disabled within the meaning of the policy. The strength of a vocational expert’s opinion regarding disability largely depends on your objective medical evidence. If you have not been evaluated by the correct specialists to establish a disability, your claim will probably not be approved. This is why having an experienced long term disability attorney to assist you can be instrumental.   Why are claims denied? In many cases, disability claims are wrongfully delayed or denied, causing hardship and stress to the policyholder. However, sometimes claims are denied simply because the policyholder did not present enough evidence with their initial claim. It is the policyholder’s burden to establish the existence of a disabling condition. Most disability claims are denied due to a supposed lack of supporting medical or vocational evidence. For example, a policyholder may present evidence that they have been diagnosed with fibromyalgia but provide no further information as to how it impacts their ability to work. While fibromyalgia may, in reality, be a disabling condition, the fact the policyholder did not link their condition to vocational status may prevent their claim from being approved.  On the flip side, the insurance company is working hard with a team of experts to deny your claim. Most insurance companies have a list of preferred medical experts who they routinely send disability claimants to for evaluation. The insurance company’s experts will often differ sharply from your treating physicians and will almost always conclude that you are not medically disabled. While this is not fair, it is the way the disability process works. If you feel the insurance company is stacking the deck against you, you should consult with a disability insurance attorney.  What to Do After a Disability Claim is Denied? When a claim is denied, the policyholder should be provided...

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What is a Life Insurance Interpleader Action?

| Read Time: 4 minutes

You are hanging around your house when a process server knocks on your door and serves you with a Complaint for Interpleader. You may ask: What is this? What must I do next? Will this just go away? It will not just go away. The good news, you have been named as a party because you may be owed a large sum of money. The bad news, you have to make your claim in court.  Definition of Life Insurance Interpleader Action An interpleader is a very different type of legal case. Unlike a typical lawsuit in which a plaintiff sues a defendant, an interpleader is filed by a party referred to as a stakeholder who is holding some type of property – probably money – that may be owed to multiple people. The stakeholder initiates the interpleader action because it is concerned that it may give the property or money to the wrong person. Rather than be exposed to double liability, the stakeholder will force all parties with a claim to the property into court to make their claims. That way, the stakeholder avoids the potential liability of giving the property to the wrong party.  Life insurance interpleaders arise when people have competing claims for life insurance proceeds. An insurer will often deposit the money into the registry of the court and file an interpleader action forcing the claimants to work out their claims in court. That way, it will ultimately be up to the court system to determine who is entitled to the money. In essence, the insurance company puts up the money, wipes its hands, and walks away.  What Should You Do Once You Have Been Served?  First, we recommend that you contact an experienced life insurance attorney to discuss your options. Now that you have been forced into this situation, you need to expect the other person claiming the life insurance proceeds will have competent legal counsel. If you truly believe you are entitled to the life insurance proceeds, you need to assert your claim in court or risk losing.  You Need to Act Fast If the interpleader has been filed in federal court, you have 21 days to file your response. Failure to provide a timely response could lead to default and you losing your claim without even making an appearance in the case.  Federal or State Jurisdiction  Rule 22 of the Federal Rules of Civil Procedure permits an interpleader action to be filed in federal court as long as the court has subject matter jurisdiction over the case. Subject matter jurisdiction exists either because there is a federal question, i.e. a federal law that is implicated, or because their parties have diverse citizenships.  If your life insurance policy was issued through your employment, then there will probably be federal question jurisdiction because ERISA governs employer-sponsored benefits. There are also life insurance benefit programs for federal government workers that are also subject to federal question jurisdiction.  Diversity jurisdiction applies when the claim’s value exceeds $75,000.00 and the parties are citizens of different states.   Insurance carriers tend to prefer to file interpleader actions in federal court.  How Do You Make Competing Claims?  The reason an insurer files the interpleader is that there are multiple or competing claims for life insurance proceeds or to other property. To make a claim, you will need to file an answer to the interpleader action. It is also common to file a cross-claim against other claimants named in the complaint.   It is common for the insurer that filed the interpleader to seek leave of court to be dismissed from the case. It is normally the insurer’s position that they had fulfilled their duty by depositing the funds into the registry of the court and allowing the parties’ to make their claims. Sometimes the claimants may have separate claims against the insurance company. For instance, if the insurance company knew a person is the rightful beneficiary but proceeded to file an interpleader action anyways, the insurance company may be liable for penalties and attorney’s fees under a variety of prompt payment and bad faith claim handling laws.  Once you have filed a response, you will have the opportunity to discover evidence, hire experts, take depositions, and proceed to trial to prove that you are entitled to the life insurance proceeds.  There are a number of different case types that we tend to see more often with life insurance interpleaders: One: Lack of Capacity to Change Beneficiary We see a lot of cases where the insured changed the primary beneficiary later in life when the insured arguably lacks the mental capacity to understand that he was making the change. Along the same lines, we also see situations where people close to the insured may attempt to use undue influence, force, or duress to change the beneficiary. In these types of cases, objective medical evidence that the insured lacked capacity certainly helps challenge the change. In these situations, there are often nefarious actors with past history of wrongdoing involved with the insured. We have worked on multiple cases where a former felon released from prison suddenly becomes the insured’s caretaker. These cases can be difficult to prove and often rely on a combination of medical evidence and testimony to invalidate a beneficiary change.  Second: Divorce Many states will void an ex-spouse’s interest as a life insurance beneficiary in the event of divorce. Of course, there are numerous other exceptions to this rule. For instance, sometimes a property separation agreement will stipulate that a spouse is entitled to certain insurance benefits. Other times, an insured may list or re-inscribe the ex-spouse after the divorce.  Third: ERISA Preemption While most states will invalidate an ex-spouse’s beneficiary designation, life insurance policies that are governed by ERISA – a federal statute, do not follow a similar path. Under ERISA policies, the insured must change the beneficiary. If they do not, then the ex-spouse may be entitled to life insurance benefits.  Fourth: Homicide  Most states have “slayer statutes” on the...

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Examination Under Oath

| Read Time: 9 minutes

Most insurance policies allow the insurance company to require a policyholder to answer questions under oath and to produce documents and other information so the insurance company can investigate an insurance claim. This formal legal proceeding is called an examination under oath. The examination part of this process is requiring the policyholder to answer questions that are asked by a representative of the insurance company. In most cases, the insurance company’s representative is an attorney who has been hired to investigate the policyholder and provide the insurance company with advice about how to handle the claim. The examination normally takes place at a court reporter or attorney’s office. In most cases, an examination will last for at least a few hours and will be recorded by a court reporter. Under oath means the policyholder must swear to answer the questions truthfully. For many, an examination under oath can be highly stressful. To be completely upfront, an examination under oath is not common. They are often requested when the insurance company suspects the policyholder has done something wrong or has attempted to deceive the insurance company. Other times, the insurance believes there is a reason it can deny the insurance claim. Regardless, an examination under oath is an important event in an insurance claim that a policyholder needs to take seriously. Preparation is key to a successful outcome. In addition, refusing or failing to submit to an examination under oath can result in the denial of your insurance claim. Why Does an Insurance Company Want to Take My Examination Under Oath? Below are some common issues insurance companies often want to investigate during an examination under oath: The policyholder misrepresented the cause of the damage. The policyholder made misrepresentations in the policy application. The policyholder committed a crime related to the insurance policy. The policyholder committed fraud. The policyholder is seeking significantly more money than what the insurance company believes is owed. The policyholder has not answered the insurance company’s requests for information about the claim. The policyholder has hired a contractor, adjuster, or other experts who have a bad history with the insurance company or has a history of red flags. The insurance company believes the policy does not cover the claim. The insurance company believes there is a policy exclusion that applies.   These are not small or insignificant issues. However, it is important to remember that the mere fact that an insurance company wants to conduct an in-depth investigation of an insured does not mean it has a reasonable basis to deny an insurance claim. On the contrary, insurance policies are interpreted broadly by courts in favor of expanding insurance coverage as much as possible. Still, it is important for an insured who has had an examination requested to consult with an experienced insurance attorney to ensure he or she is adequately prepared for the examination. What Does Your Insurance Policy Require You to Do? Insurance companies tend to treat policyholders in a very abrasive and demanding manner when requesting an examination. This is especially the case when the policyholder is not represented by its own attorney. It is not uncommon for the insurance company to out of the blue give a policyholder a day and time to appear at a location to be questioned under oath. These demands normally include an extensive list of documents the insurance company insists that are brought to the examination or produced ahead of time. The insurance company may even claim that if the policyholder does not comply, he or she may be in violation of its duty to cooperate with the investigation.  For one, a policyholder does not have to appear for an examination on the day or time demanded by an insurance company. Policyholders have lives – jobs, children, and responsibilities. The most important thing a policyholder should do is stay in active communications with the insurance company. When it comes to scheduling the examination, we recommend first retaining an attorney to walk you through the specifics of your claim and communicate with the insurance company on your behalf. However, at a minimum, you should schedule your examination well enough into the future to gather the documents requested by the insurance company and review everything you need to be familiar with the claim. I’m often asked why does an insurance company gets to take an examination under oath? The right to take an examination under oath stems from the language in an insurance policy, which is a binding contract. Courts have repeatedly upheld an insurance company’s right to take an examination under oath as a contractual right that the policyholder agreed-to. The terms and conditions in the insurance policy must govern the relations between the insurer and the insured. Because an examination under oath is based on a contractual obligation, courts have ruled that the U.S. Constitution’s Fifth Amendment right against self-incrimination does not apply and that an insured must respond to questions that may implicate the insured in criminal activity. If the insured refuses to answer questions, the insurance claim may be denied. Most insurance policies contain a provision stating that an insurance company can take the examination under oath of the policyholder to investigate a claim. Some policies may require the insured to have others with knowledge of the claim to also submit to an examination. Examples of others who may have knowledge of a claim contractor, public adjusters, and residents. From the insurance company’s standpoint, these individuals may have knowledge about certain aspects of the claim. However, the policyholder ultimately can’t force someone else to sit for an examination and many insurance companies use this as a tactic to intimidate policyholders. Indeed, many insurers think the policyholder will cave in if the insurance company begins a wide-reaching investigation. It is very much likely that the insurance company is investigating the claim so aggressively because the case has tremendous value and this is how the insurance company can leverage you into taking a lowball settlement. Courts have struggled...

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Fire Insurance Claims: What You Need to Know

| Read Time: 3 minutes

When you have a fire at your home or business, it can turn your world upside down. Not only do you have to worry about what you lost, but you might be displaced until the damage can be remediated and repaired. A fire insurance claim provides the resources you need to restore order to your life. If your insurance company denies your claim or doesn’t provide a timely response, you need someone on your side. An experienced insurance dispute or property damages claim lawyer understands how to get the process back on track and fight for the compensation you deserve. Potential Problems in the Fire Insurance Claim Process You pay your insurance premiums every year to ensure that you have coverage in place if the unthinkable happens. After disaster strikes, you rightfully expect your insurer to step up and pay your claim. Unfortunately, your claim can be held up for a variety of reasons. Often the problem is simply a mistake or miscommunication on the insurance company’s part. In other cases, you could encounter potential bad faith issues, where the insurer: Refuses to investigate your claim, Delays paying your claim, Undervalues your claim, Makes false or misleading statements, or Wrongfully denies your claim. Meanwhile, you have no way to restore your home or business or get reimbursed for the funds you’ve already spent. Fire Insurance Claim Tips Submitting a fire insurance claim requires documenting the damages you incurred. Typically, you must provide information and documents such as: Photographs or videos of your property before the fire, Photographs or videos of the damage the property sustained, Detailed lists of all damaged or destroyed items, and Contractor estimates for repairs. Your policy may require you to dry out, clean up, and secure your home or business immediately after a fire, storm, or any other property damage event. If so, you should also include paid receipts for the following services as part of your claim: Damage remediation, Board-up and security measures, Any item you already replaced, and Any covered out-of-pocket expenses. If you plan to submit your claim yourself, you may struggle to determine the accurate value of your claim. Estimating the value of your fire insurance claim settlement is only one part of the process where a fire insurance claims attorney can assist you. Insurance companies often significantly underestimate fire damage claims. Smoke damage often requires extensive interior repairs or replacement of personal property that cannot be fully restored to its pre-fire condition. Examples of some items that are often undervalued or overlooked by insurance companies include:  Refinishing floors;  Repainting the interior of the home;  Replacing drywall that sustained significant smoke exposure;  Fully repairing electrical and ventilation systems;  Replacing insulation;  Replacement of an entire roof rather than a patch job.  In many cases, the property owner will be required to make significant code upgrades. For example, building codes may require the home’s electrical system or roof to be fully replaced due to the extent of the damage from the fire. These are items that insurance companies tend to overlook because they cost a lot of money.  The task of creating a content list can be daunting. If you have suffered a significant fire you may have hundreds of items that have been damaged, destroyed, or are need of restoration. With our clients, we often have them start by reviewing a master list of common household items and have them work backward to create a thorough contents list.  How a Property Claims Lawyer Can Help Talking to a property claim lawyer, such as one of the fire insurance claim lawyers at the Johns Law Firm, can help at any stage of the process. Whether you need assistance building and submitting your claim or you’ve already run into problems with the insurance company, an attorney can provide invaluable assistance. Calculating the value of your claim requires identifying and documenting your damages. Damages in a fire insurance claim might include costs for: Debris removal and cleanup, Repairing or rebuilding your home or business, Repairing or replacing damaged personal property, Temporary accommodations and expense, and Direct or out-of-pocket expenses. To get started, your lawyer will need a copy of your insurance policy and the insurer’s contact information. From there, your lawyer will handle this complex process and deal with the insurance company on your behalf. Talk to a Fire Insurance Lawyer for Help Your property insurance policy likely requires you to notify the insurer of damage and submit your claim within a short window of time. If you experienced a fire at your home or business, contact the Johns Law Firm as soon as possible. We fight to get you an advance on your claim immediately, so you can access the resources you need. We help protect your legal rights and compel the insurer to address your claim in a timely manner. If necessary, we won’t hesitate to take the matter to court to fight for your right to compensation. For a free consultation to discuss your fire insurance claim, contact us today.

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Attorney Portrait Insurance

Single-Car Accident in Warner Robins Kills 2 People

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Macon, GA (February 3, 2020) – Two people died after a single-car crash in Warner Robins on Saturday. The accident occurred around 6:55 p.m. near the intersection of Feagin Mill Road and Highway 41.  According to Capt. Ronnie Harlowe of the Houston County Sheriff’s Office, the driver, 33-year-old Elmer Cisneros, was driving northbound on Highway 41 when he drove off of the road and into a ditch, hitting a tree. Cisneros and his passenger, 49-year-old Juan Ramirez, died due to their injuries. The Houston County Sheriff’s Office is still investigating why Cisneros drove off of the road. Source: WMAZ Contact an Experienced Gulf South Car Accident Attorney Today Unfortunately, auto accidents like this happen far too often in Georgia. Police must investigate these crashes thoroughly to determine the cause and hold those responsible accountable. At The Johns Law Firm, we understand how devastating these accidents are for the families and friends of the victims.  If you sustain injuries or lose a loved one in an accident like this, please contact one of our Georgia car accident attorneys at 866-309-3499 to set up a free consultation. We will fight to get you the compensation you deserve. Our deepest condolences go out to the families of the victims of this horrible incident. If a family member would like the name of a person removed for any reason, please click the “Remove Post” link. REMOVE POST

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Attorney Portrait Insurance

Bad Faith Penalties Are Available When There Is Prompt Payment of Appraisal Award

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If you read your insurance policy closely, you will likely find an appraisal clause. What is this? In short, an insurance appraisal is a procedure for a policyholder and insurance company resolve disputes over the value of your claim. Our law firm has successfully handled numerous insurance appraisals, in some cases recovering more than 10 times the original amount paid to the policyholder. Let’s face it, insurance companies make more money when they don’t pay valid claims. Our law firm understands how to leverage your insurance policy for your benefit. While the appraisal process is supposed to provide an efficient mechanism to resolve an insurance dispute, it is still not proper for an insurer to undervalue your claim in the first place or wrongfully deny or delay your insurance claim. The Texas Prompt Payment of Claims Act is designed to penalize an insurer who unjustifiably denied, delayed, or underpaid a valid claim. However, it is not always quite that simple. Until recently, Texas courts have generally held that the payment of an appraisal award cleanses the insurer’s failure to promptly pay a claim. In other words, Texas courts permitted insurers to lowball an insured, force the insured to go file suit or go to appraisal, and as long as the insurer promptly pays the appraisal award, it would not face any liability for attorney’s fees or penalties even though the insurer significantly lowballed the claim in the first place. The Texas Supreme Court’s ruling in Barbara Technologies Corporation v. State Farm Lloyds says this is no longer the case. The Barbara Tech case involved a hail and wind claim in which State Farm estimated the damage at less than the $5,000.00 deductible. The policyholder filed suit and State Farm moved to compel appraisal. The appraisal award came back in excess of $195,000.00. State Farm promptly paid the appraisal award. After the appraisal award was rendered, Barbara Tech amended its complaint to seek attorney’s fees and penalties for violations of the Prompt Payment of Claims Act. Barbara Tech argued that State Farm acknowledged liability by paying the appraisal award and had failed to comply with the prompt payment statute by not timely issuing payment within 60 days after receiving all claim materials. The Texas Supreme Court held that an insurer may be in violation of the Prompt Payment of Claims Act if it delays payments beyond the statutory deadline regardless of whether the claim went to appraisal. In other words, simply paying an appraisal award may not cleanse an insurers’ failure to promptly pay a claim in the first place. What does this mean for Texas policyholders? It remains to be seen exactly how the holding in Barbara Technologies will be applied by lower courts. However, going to appraisal should no longer be viewed as a get out of jail free card for insurers who underpay claims. Getting Legal Help is the First Step Dealing with insurance companies can be a frustrating process. At Johns Law Firm, our attorneys understand how to leverage your insurance policy for your benefit. Contact us today to schedule a free consultation.

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