The law of comparative causation under property insurance policies is reasonably settled in Texas. If there is a loss as a result of two concurring perils, one insured and one not, the loss is covered only to the extent it can be traced to the covered peril. However, what happens when a peril which is not covered is caused by a peril which is covered? As the Plaintiffs learned in National Fire Ins. Co. of Pittsburgh, PA v. Valero Energy Corp., 777 S.W.2d 501 (Tex.App.—Corpus Christi 1989, writ denied), there is still no coverage unless the terms of the policy allow coverage where an otherwise excluded peril is itself caused by a covered peril.
While writing last week’s post, Texas Windstorm Insurer Settles 2,400 Hurricane Ike Slab Claims, I almost quoted Texas attorney Steve Mostyn, who explained that Texas law really left no other rational choice. Burdens of proof are crucial when it comes to close cases, and Texas places a unique and difficult coverage burden on policyholders. An article in the Houston Chronicle titled Windstorm Insurer to Settle Some Ike Cases quoted Mostyn:
Property insurance policies are written in complex language. The fact that there are so many different interpretations and disputes about the language by some very bright people is probably enough evidence to prove that point. David Rossmiller wrote a post, Corban v. USAA: A few (more) words about anti-concurrent causation, which had me thinking about words used in an insurance policy and what a policy covers. He stated:
The editors of Slabbed deserve some type of honor. What do they get for all the education about events of the day they provide? My hat is off to them. All of us are the better for it.
Valued Policy Laws (VPLs) are relatively easy to define as those that require payment of policy limits in the event of a “total loss” caused by a covered peril, even though the insurance carrier could rebuild the property for less.…
Continue Reading Florida’s Valued Policy Law and the “Total Loss” Conundrum in Multiple Causation Losses
On June 4, 2009, Merlin Law Group will host the second in a series of seminars for Texas-licensed public adjusters: Texas Hold ‘Em #2—Down to the Nitty Gritty of Adjustment—Nine Months After Ike, at the Hotel Derek in Houston, Texas. Response to the first seminar was very favorable with many public adjusters asking when we would do it again.
Since last May, just before we opened our Houston office, I have been reviewing and pondering causation and burdens of proof found in Texas insurance cases. While writing yesterday’s post regarding sinkhole coverage cases, I came across two Florida cases that demonstrate Florida’s view that policyholders truly have minimal proof requirements coverage under all-risk property insurance policies. Texas insurance case law does not follow this majority view. I will explain how they are different in two posts. Today will focus on Florida law. Tomorrow, I will provide Texas case examples and some practical suggestions so Texas policyholders do not get surprised at trial. I figure the insurance company adjusters and attorneys do not need any more help, so they get no suggestions.
On Tuesday, we filed an amicus brief in the Corban v. USAA case. A copy of it is here for anyone to view.
This case is important because the Mississippi Supreme Court is going to rule on how anti-concurrent causation language is interpreted. Previously, only federal courts have made such rulings. Mississippi Court’s ruling…
The Mississippi Department of Insurance finally issued its report regarding State Farm’s claims handling following Hurricane Katrina. The findings were long and will undoubtedly be subject to criticism and interpretation. I am certain State Farm publicists will try to undermine the Rigsby sisters’ claims even more since the report essentially concluded that their assertions were unsubstantiated. State Farm will also point to the findings that no penalties were warranted. Those same State Farm publicists will NOT point out that the investigation found State Farm employees were not forthright in their interviews. State Farm attorneys will certainly not tell judges or others that State Farm employees had various and contradictory explanations as to what the anti-concurrent language means and how it worked in the adjustment of claims in Mississippi.
Continue Reading Mississippi Insurance Department Finds State Farm Wrongdoing But Not With Evil Intent
Wind versus flood. Insurance companies will use causation to deny claims just as they did in the hundreds of cases we litigated after Ivan and Katrina. We will retain meteorologists and structural engineers as this issue will be litigated in Texas and western Louisiana. Rimkus and Haag are located in Texas. I wonder how many outcome oriented reports they will issue this time around to support lowers claims payments by insurance companies. I wonder whether the insurance industry has made a bonafide search for engineering firms that are not beholden to them and who will write reports that are in the customers’ best interests. I am not holding my breath.