Insurance Coverage Disputes
Insurance Claims Litigation Lawyer in Texas
Business owners purchase insurance to protect their interests and financial well-being when threatened by liability and losses. By entering into a relationship as an insured, they also expect to be treated fairly and in accordance to their policies by their insurance provider, and can suffer significant setbacks and strains when carriers dispute, delay, or underpay their valid claims. Fortunately, policy holders have rights and options.
As our Houston insurance law attorneys at Hendershot Cowart P.C. know all too well, insurance carriers do not always treat their policy holders as they should, especially when those policy holders are business owners and commercial entities with high stakes claims that can threaten their own financial interests. When insurance carriers fail to act in accordance to the terms of their policies, the duties they owe their insured, and the law, policy holders have the right to take action.
Insurance Disputes: Protecting the Rights of the Insured
Insurance carriers are bound by law to treat policy holders fairly and act in good faith when handling their claims. Unfortunately, that is not always the case. While failing to uphold this duty and acting in “bad faith” can take many forms, it often arises in disputes over policy provisions and the sufficiency of coverage.
For example, insurance companies may engage in any number of acts that can harm policy holders, including:
- Unreasonable delays
- Breaches of contract
- Gross negligence
- Unfair / incorrect coverage determinations
- Denied coverage
- Cancelled policies
- Willful misconduct
When evaluating the conduct of insurance carriers and their handling of valid claims, determining how they have failed to meet their obligations is critical to taking the most appropriate steps for resolution. This can involve assessing what provisions of a policy they dispute.
Common Provisions Subject To Dispute Include:
- Multiple coverage clauses, including multiple events that result in multiple deductibles
- Co-insurance clauses
- Duty to preserve clauses
- Notice of claims
- Appraisal clauses
- Exclusion provisions
- Incontestability clauses
- Anti-lapse clauses
- Alleged pollution exclusion or employee / contractor exclusion
As a firm that has earned national recognition for our work in matters involving business law, litigation, contracts, insurance claims, and construction law, we have the depth of experience to help clients assess how insurance companies handle their claims, raise or defend against various disputes, and take action to pursue the most appropriate pathway toward resolution – including arbitration and litigation.
We know insurance coverage issues, whether they involve substantial disputes over key provisions in a policy, insufficient benefits or coverage, or acts of bad faith, can be high stakes matters for our clients, which is why we work diligently to protect their rights and interests.
Insurance Disputes over Policy Exclusions
Many coverage disputes involve policy exclusions, or provisions which exclude or limit coverage for certain types of claims. They may also include various exemptions or exceptions from exclusions, and are often found in policies for Comprehensive General Liability (CGL), Errors and Omissions (E and O), Director’s and Officer’s Liability (D and O), and others.
Common Exclusions Include:
- Intentional misconduct
- Dishonest or criminal acts
- Bodily injury or property damage (including that which is “expected or intended”)
- Punitive damages
- Infringement or trade secret violations
Because exclusions are often subject to dispute in insurance coverage lawsuits and bad faith actions, and may potentially result in denied or insufficient coverage, it is strongly advised that policy holders carefully check the fine print and possibilities of things that might come up as an exclusion.
Your policy may not cover all incidents that may arise. It’s imperative to have an attorney review your policy prior to signing to ensure you’re getting the coverage that you need. Our legal team has experience successfully litigating disputes involving policy exclusions, which can be complex and subject to evolving case law, and is available to discuss how we explore your options, and protect your rights and interests through legal action.
Single or Multiple Occurrences and "Stacked" Deductibles
While the facts of a case and any policy are unique, policyholders can face challenges related to insurance coverage and multiple “occurrences” that require multiple deductibles.
For example, policyholders that purchase continuous insurance coverage (“blanket policies”) may be required by providers to satisfy multiple deductibles or SIRs (self-insured retention) before accessing the benefits of any policy. This can happen in any business or industry, and especially so when businesses are service-based, property owners, or involved in construction.
Common claims that may trigger multiple deductibles can include:
- Environmental claims
- Construction defect claims
- Claims involving multiple locations
- Natural disasters
In Texas, the general rule is that insured parties have the right to choose which policy to use when responding to a single occurrence that triggers multiple policies (often the policy has the lowest deductible). While there are ways to protect policyholders from insurance companies that “stack” deductibles, avoiding multiple deductibles depends on the existence of a single occurrence – which means disputes will often arise over whether or not losses arise from one or more occurrences.
Determining if there is a single occurrence or multiple occurrences depends in part on how policies define “occurrence,” as well as a policy’s terms regarding deductibles. For example:
- Some policies may specifically note that continuous or repeat exposure to conditions which are generally the same should be deemed one occurrence;
- When occurrence is not defined in an insurance policy, Texas courts apply a cause analysis when evaluating the facts and whether they constitute one or more occurrences in terms of the events which caused the underlying liability or losses.
Should disputes arise over what is and what is not a single occurrence, policyholders can work with experienced lawyers. to protect their rights. Though insurance companies want to protect their own interests and shift some of their own risks to the insured, they should not make policyholders pay more than one deductible or SIR for losses arising from a single occurrence. Any determination otherwise could constitute a carrier’s failure to uphold obligations they owed their insured.
Indemnification and Texas Anti-Indemnity Laws
Our insurance litigation lawyers often deal with issues related to indemnity clauses: contract provisions committing one party to compensate the other for losses arising out of a contract. They are of particular importance in construction contracts, as well as in transactions ranging from asset purchases or sales to health care, commercial transit, oil and gas, and more.
In Texas, this area of law changed significantly with the passing of the Texas Anti-Indemnity Act, which enacted industry-specific restrictions on certain broad-form indemnity obligations. For those dealing with such matters, meticulous evaluations, and carefully crafted solutions – whether it be enforcing or defending against a claim – are crucial to protecting one’s rights and interests.
Speak Personally With a Texas Insurance Litigation Attorney
Resolving insurance disputes and coverage issues is a matter heavily dependent on effectively interpreting policies and provisions, understanding prevailing laws and contractual duties, and assessing the unique facts of a case as they relate to existing laws, legislative updates, and case law. At Hendershot Cowart P.C., our legal team leverages our insight in these areas, as well as our work handling insurance, business, contract, and construction disputes on both a proactive and responsive basis to take a comprehensive approach when helping clients protect their rights and insurance policy holders.
If you would like more information about your case and how our nationally recognized law firm can be of assistance, please call (713) 909-7323 or contact us online to request an initial consultation. We serve clients and businesses throughout Houston and Texas.
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