Tag: Bad Faith

Arlington Insurance Lawyers

Arlington, Texas Hotel Owner Files Hail Damage Claim Lawsuit

Raizner Law has filed a hail damage claim lawsuit on behalf of an Arlington, Texas hotel owner against Zurich American Insurance Company after its hail damage claim was wrongfully denied under Texas law.

Our client operates a four-story hotel located on 54,537 square feet of land with 45,340 square feet of interior space. In May 2016, our Texas hotel owner client discovered extensive hail damage to the property from a hail storm that swept through Arlington. Substantial portions of the property’s roof, windows, and interiors sustained damage. The plaintiff promptly filed a claim with Zurich, alerting them to the extensive damages and asking that the cost of repairs be covered pursuant to the policy.

Zurich’s retained adjuster performed a cursory investigation of the property in April 2017 and prepared an estimate for payment to the plaintiff. The adjuster documented a minimal amount of damage, and then issued an underpayment based on its own faulty estimates.

In part, due to the significant underpayment, in July 2017, the plaintiff engaged a public adjuster to represent its interests. It was only after the plaintiff notified Zurich that it had hired a public adjuster that Zurich retained also a third-party company to perform an investigation of the property. The third-party determined the damages were the result of “long-term deterioration of the seals,” and recommended an additional, sub-standard payment.

Zurich’s claims-handling process omitted a wealth of facts, physical evidence, obvious damages, and meteorological data supporting the plaintiff’s claim. Zurich unreasonably determined the damage “was the result of long-term deterioration,” ignoring significant evidence to the contrary. The third-party report simply rubber-stamped the underpayment Zurich previously authorized.

Zurich Violated The Texas Insurance Code

Our client alleges Zurich violated numerous aspects of the Texas Insurance Code, including failing to attempt to effectuate the prompt, fair, and equitable settlement of a claim, failure to adopt and implement reasonable standards for prompt investigation of the claim, and misrepresentation of the policy under which it affords coverage to the plaintiff.

Arlington Insurance Lawyers

Policyholders deserve full protection under their policies. Many insurance companies prey upon uninformed policyholders unaware of their legal rights. If your insurance company is denying your claim or misrepresenting the terms of your policy, contact the Arlington insurance lawyers at Raizner Law today to schedule a free consultation to discuss your case.

Hurricane Damage Insurance Lawyers

New Bill Seeks To Investigate How Federal Government Failed Puerto Rico

Over a year has passed since Hurricane Maria devastated Puerto Rico, but the island is far from achieving a complete recovery. Puerto Rico’s slow recovery has been surprising to many; and, now lawmakers will formally investigate the exact cause of the island’s slow-paced recovery process.

Senator Kirsten Gillibrand, D-N.Y., has reintroduced a bill that would establish a third-party investigation into the actions and response of the federal government after Hurricane Maria. Specifically, lawmakers want to know why the government’s estimated death toll is so far below other estimates, why there was a lack of disaster preparedness, and how the telecommunication system became so inadequate. The investigation would also look into other matters that slowed down Puerto Rico’s emergency response.

Considering the disparity between the government’s estimated death toll and the death toll estimated by independent researchers at George Washington University commissioned by the Puerto Rico government, there appears to be much to sort out. Researchers at George Washington University conservatively estimated that as many as 3,000 Puerto Ricans died in Hurricane Maria and her aftermath, but President Trump has refused to acknowledge this as an accurate death toll and has stated he believed it was a conspiracy created by the Democratic Party.

The investigation would also look into how ten trailers filled with supplies for Puerto Rico were left to rot at a state elections office. The supplies were discovered months after the storm and were deeply needed by victims.

Slow Recovery For Puerto Rico

While the government’s actions or inactions play a huge part in Puerto Rico’s recovery, it is only one part of the puzzle. Insurance companies in Puerto Rico have been slow to process and pay out on property insurance claims, meaning Puerto Rican business owners have been forced to pay for repairs themselves, or worse, close their doors. The Puerto Rico Commissioner of Insurance has already levied millions of dollars in fines against the insurance industry, but that has done little to encourage them to process claims.

Helping Hurricane Maria Victims

The experienced lawyers at Raizner Law understand that Hurricane Maria victims are still struggling. We are representing condominium associations, business owners and real estate investors in delayed and disputed insurance claims in Puerto Rico. Contact us today for a free consultation to discuss your options and see how we can help.

Hurricane Harvey Wind Damage Lawsuit

Raizner Law Files Hurricane Harvey Wind Damage Lawsuit One Year After The Storm

One year after the devastation wrought by Hurricane Harvey, Raizner Law has filed a Harvey wind damage lawsuit on behalf of a Houston condominium complex owner against AmRisc LLC, Certain Underwriters at Lloyd’s London, Indian Harbor Insurance Company, QBE Specialty Insurance Company, Steadfast Insurance Company, General Security Indemnity Company of Arizona, United Specialty Insurance Company, Lexington Insurance Company, and the International Insurance Company of Hannover SE.

The insurance carriers, through the program design and management of AmRisc, sold a commercial property policy the plaintiff whereby the carriers would provide insurance coverage for the property. On August 26, 2018, Hurricane Harvey reached Houston and caused devastating damage. Hurricane Harvey damaged the roofing system, drywall, flooring, and other parts of the property. Immediately upon discovering the damage, the plaintiff filed a claim with the carriers and asked the cost of repairs be covered pursuant to the policy.

The insurance carriers, through AmRisc, assigned adjusters, consultants, and agents to the plaintiff’s file that were inadequate and improperly trained. Specifically, AmRisc, on behalf of all carriers, assigned the claims to a third party adjusting firm. In turn, the third party adjusting firm assigned the claim to its internal adjuster. The internal adjuster conducted an unreasonable and inadequate investigation. The claim process, inspections, and results were continuously delayed starting the day the claim was made. The carriers, Amrisc, and their agents reassigned the claim to different adjusters, refused to provide the insured with answers, ignored obvious damages at the property, and misrepresented policy benefits, all while the property sat in disrepair and they refused to issue any payments whatsoever.

Nearly two months after Hurricane Harvey hit, the internal adjuster performed a haphazard inspection of the property. Without relying on any qualified consultants whatsoever, the third party adjusting firm and its internal adjuster valued the hotel’s damages at $8,897.93, a number well below the policy deductible. The carriers relied on these findings and willfully refused to do their own investigation to verify the obvious damages. The carriers, AmRisc, and the third party adjusting firm all failed to pay or adjust the claim appropriately after liability was reasonably clear. Over the next several months, the claim was delayed under the guise of “additional investigation,” aimed at ultimately denying the plaintiff’s claim despite obvious evidence to the contrary. The carriers and AmRisc continued to bounce the claim around internally while refusing to provide answers to the plaintiff regarding covered damages. The carriers eventually wrongly denied the Hurricane Harvey commercial property damage insurance claim.

Violating the Texas Insurance Code

Our client cites numerous violations of the Texas Insurance Code, including failure to effectuate the prompt, fair, and equitable settlement of a claim, refusal to pay a claim without conducting a reasonable investigation, and failure to affirm or deny coverage of a claim to a policyholder within a reasonable time.

Get Help With Your Hurricane Harvey Wind Damage Lawsuit

It’s been just over a year since Hurricane Harvey devastated much of Texas, but many property owners are still struggling to rebuild because insurance companies aren’t paying out on valid claims. Get help with your Hurricane Harvey wind damage lawsuit today. Call Raizner Law for a free consultation to see how we can help.

Hurricane Harvey Insurance Lawyers

Victoria, Texas Hotel Owner Files Hurricane Harvey Insurance Lawsuit

Raizner Law has filed a Hurricane Harvey Insurance Lawsuit on behalf of a Victoria, Texas hotel owner against Palomar Specialty Insurance Company after its insurance claim was wrongfully denied under Texas Law.

Hurricane Harvey Causes Catastrophic Damage

On August 25, 2017, Hurricane Harvey made landfall in Texas and caused widespread damage. Our client’s Texas hotel is a two-story structure that contains a main lobby, offices, a restaurant, conference rooms, and 126 hotel rooms. When Hurricane Harvey swept through Victoria, Texas, the storm caused significant damage to the property. Sizeable portions of the property’s roof were compromised by wind. As a result, there was also interior damage to HVAC, ceiling, insulation, flooring, and drywall. Immediately upon discovering the damages, the plaintiff filed an insurance claim with Palomar.

Palomar’s claims-handling process resulted in a wrongful denial that omitted a wealth of facts, physical evidence, obvious wind damage, and meteorological data from Hurricane Harvey supporting the plaintiff’s claim. Palomar unreasonably pinned the loss on anything but the wind, an action designed to save Palomar hundreds of thousands of dollars in damages to the property and the business.

Palomar assigned an internal adjuster to handle the claim who was located in Indiana. The internal adjuster was unqualified, incapable of adequately assessing the damages to the property, and was the source of many delays throughout the claims process. After utilizing a preferred vendor to inspect the property in December, four months after Harvey hit, Palomar and the internal adjuster continued to delay claim resolution and ignored the insured’s requests for updates. The plaintiff and its representative continued to press Palomar for updates and/or an estimate of damages after their inspection, but they declined and ignored the requests. Two months after the inspection, three months after the initial inspection, and after the plaintiff’s representative continuously pressed Palomar and the internal adjuster for updates, the internal adjuster simply said Palomar was “still reviewing” the claim. Palomar eventually denied the claim in February 2018.

Violating the Texas Insurance Code

Palomar made numerous violations of the Texas Insurance Code, including failure to effectuate a prompt, fair, and equitable settlement of a claim, failure to adopt and implement reasonable standards for the investigation of a claim, and refusal to pay a claim without conducting a reasonable investigation.

Hurricane Harvey Insurance Lawyers

Policyholders that regularly pay their premiums deserve full coverage under their policies in the event of a natural disaster. If your business was damage by Hurricane Harvey and the insurance company has delayed, underpaid, or outright denied your claim, contact Raizner Law today for a free consultation.

Menchaca Ruling

Menchaca: Clarification of the Law Regarding Recovery On Insurance Claims

Menchaca Clarified Decades of Conflicting Case Law

USAA Lloyds v. Menchaca, a case recently decided by the Texas Supreme Court, sought to eliminate confusion regarding conflicting decisions about insureds’ claims against their insurance companies. The decision announced five rules about the relationship between insurance contract claims, which are claims against the insurance company for damages under the policy, and statutory claims under the Texas Insurance Code, which can give insureds additional damages.

Background: Gail Menchaca, Hurricane Ike, And USAA

Gail Menchaca’s home was damaged during Hurricane Ike in 2008. However, when she contacted her insurer, USAA, to report the claim they sent an adjuster who found minimal damages that did not exceed the policy’s deductible. Doubting this, Gail requested a second inspection, which rendered similar results, and USAA refused to pay Gail anything on her claim. Gail sued USAA to recover her policy benefits, costs, and attorney’s fees. She sued for breach of the policy and for unfair settlement practices and violations of the Texas Insurance Code. The jury found that USAA had fulfilled its obligations under the policy but that it still owed Gail $11,350 in damages plus $130,000 in attorney’s fees. This presented an interesting conflict in case law, which held both that Gail could recover at least her policy benefits under the Insurance Code, and that Gail could not recover under the code without a finding of a breach of the policy. The Court declared five rules in an attempt to reconcile its previous decisions.

The General Rule

The Court confirmed the general rule that an insured cannot recover policy benefits for an insurer’s statutory violation if the insured doesn’t have a right to those benefits in the first place. The insured must have actual damages caused by the statutory violation, and without coverage under the policy for the claimed damages there are no actual damages. If the policy does not cover the loss, there are no benefits to recover. However, there does not have to be an actual finding of breach of the policy to show the policy covered the loss and the insurer didn’t pay.

The Entitled-To-Benefits Rule

One of the most important clarifications in Menchaca was that an insured who establishes a right to receive benefits under an insurance policy can recover those benefits as “actual damages” for a statutory violation. The benefit to recovery under the statute is that an insured may recover additional penalties such as interest on their claim and attorney’s fees. We are currently handling a case before the Texas Supreme Court, Barbara Technologies Corp. v. State Farm Lloyds, which will further clarify whether statutory penalties survive payment of an appraisal.

The Benefits-Lost Rule

The third rule recognizes an insured’s right to recover benefits under the policy for a statutory violation, even if there is no coverage for the claimed damage, if the insurer’s conduct caused the insured to not have that coverage. For example, if an insurer misrepresents that a policy covers wind damage, and the insured relies on that representation to buy the policy, but the policy does not actually cover wind damage—under the benefits-lost rule, the insurer’s misrepresentation caused the insured to not have benefits it reasonably thought it had. Therefore, the insured can still recover benefits for wind damage as actual damages for a statutory violation under the benefits-lost rule.

The Independent-Injury Rule

Menchaca clarified the two aspects of the independent injury rule. First, if an insurer’s statutory violation causes an injury independent of the insured’s right to recover policy benefits, the insured may recover damages for the injury even if the policy does not entitle the insured to receive benefits. However, when an insured seeks to recover damages that flow from denial of the policy benefits, the general rule applies and precludes recovery unless the insured is entitled to policy benefits. Second, an insurer’s statutory violations don’t permit the insured to recover actual damages beyond the policy benefits unless the violation causes an injury that is independent from the loss of benefits.

The No-Recovery Rule

Under this rule, a corollary to the other four, an insured cannot recover any damages based on an insurer’s statutory violation unless the insured establishes a right to receive benefits under the policy or an injury independent of the right to receive benefits.

Barbara Technologies And The Unanswered Question in Appraisal Cases

A question still to be answered—perhaps in our Barbara Technologies case, which is currently pending before the Court—is whether in a case where a valid claim is rejected and then appraisal is invoked and paid, can the insured still recover statutory prompt payment penalties under Section 542 of the Texas Insurance Code. The holding in Menchaca— particularly the entitled to benefits rule— seems to suggest an affirmative answer, but another line of appraisal cases hold that nothing further can be recovered when an appraisal provided for in the contract is conducted and the award is paid in full. However, without the statutory penalties in the Insurance Code an insurer has no incentive to promptly settle or pay claims; the insurer can just wait months or years to invoke the appraisal provision and then be exonerated from paying interest and attorney’s fees on the claim. Hopefully, the Court will continue to recognize the rights of insured Texans who are being wrongfully abused by their insurance companies, and provide the statutory benefits the Legislature enacted to help prevent wrongful treatment of insureds in all cases where the insurer violated the statute.

Insured’s Who Are Not Timely Paid In Full Can Recover Statutory Penalties

If you have been mistreated by your insurance company during the claims process, or your payment has been wrongfully delayed, contact the experienced lawyers at Raizner Slania LLP, who can help get you the benefits you deserve.

fire damage insurance attorneys

Industrial Building Owner Files Bad Faith Insurance Lawsuit After Fire

Raizner Slania LLP has filed a bad faith insurance lawsuit on behalf of an industrial building owner against Certain Underwriters at Lloyd’s London – Brit Syndicate 2987 and Hibbs-Hallmark & Company after its insurance claim was wrongfully denied.

Catastrophic Fire Devastates Commercial Property

The plaintiff owns a scrap metal dealing business that processes metal and then sells it to mills for profit. The property encompasses nearly four acres of land and includes multiple buildings, including a large scrap metal yard, a main office building, and several covered areas throughout the property. The business also utilizes numerous machines and large pieces of equipment, such as excavators, shredders, and separators, among others.

On May 5, 2017, a catastrophic fire broke out at the property. As a result, the business equipment on the property was severely damaged. In addition to damaged business equipment, the plaintiff lost extensive business income as a result of the fire damage to the property. Two pieces of industrial machinery were completely destroyed and two others sustained significant damage.

The damaged machinery prevented the plaintiff from processing and preparing its scrap metal. Because of this, the plaintiff lost business on significant materials that could have been purchased and sold to mills for a profit in the course of ordinary business operations. The damaged machines meant the plaintiff was unable to process the metal, so the plaintiff was forced to resell bulk material after the fire. Unfortunately, the post-fire material had to be processed manually, which caused the materials to incur higher labor costs.

Soon after the fire, the plaintiff filed an insurance claim for substantial property damages and lost business income. The plaintiff asked that the cost of the damages be covered pursuant to the policy, but Lloyd’s has refused to make a full payment on the plaintiff’s claim.

Lloyd’s conducted an unreasonable and inadequate investigation of the damages to the equipment and looked to find policy exclusions in order to deny the claim. Lloyd’s wrongfully denied, underpaid, and delayed plaintiff’s claim for actual damages to the property and lost business income. Specifically, Lloyd’s has chosen to continue to deny and delay timely payment of the damages.

Violations of the Texas Insurance Code

Our clients cites numerous violations of the Texas Insurance Code, including the failure to effectuate a prompt, fair, and equitable settlement of a claim and misrepresentation of the insurance policy under which it affords property coverage to the plaintiff. Our client also alleges numerous violations of the Texas Deceptive Trade Practices-Consumer Protection Act.

Get Help With Your Insurance Claim

If your commercial insurance claim includes damage to specialty equipment, you will need the help of an experienced insurance attorney. Insurance companies often try to use dishonest tactics and misrepresentation to deny coverage for specialty equipment. At Raizner Slania LLP, our fire damage insurance attorneys have helped scores of clients with insurance claims and we know how to evaluate specialty equipment insurance claims. Contact us today to schedule a free consultation to discuss your case.