When policyholders file an insurance coverage declare, they anticipate their insurer to pay losses. Most policyholders have by no means learn their coverage nor would admire what it even means with nuanced protection causation guidelines making use of that modify from state to state. A current case delivered to my consideration by legal professional Steve Badger involving house owner Ebony Mitchell and Praetorian Insurance coverage Firm highlights some key classes for policyholders, public adjusters, restoration contractors, and attorneys. 1 It’s a cautionary story of how failing to show causation can sink a declare and the way insurers use the distinctive Texas view of “concurrent causation doctrine” as a robust protection.
Ebony Mitchell had house owner’s insurance coverage with Praetorian and filed a declare after a windstorm broken her property. Mitchell claimed that Praetorian underpaid the declare. The insurer argued that a lot of the injury wasn’t from the windstorm however from non-covered causes, together with improper roof tarping and bathtub water spillover. When Mitchell pushed again, the corporate caught to its place, main her to file a lawsuit. The case made its strategy to federal courtroom, the place Mitchell misplaced earlier than the matter even went to a jury.
Mitchell’s largest downside was proving what a part of her damages have been truly brought on by the windstorm. Texas regulation is completely different from different states and requires policyholders to separate lined damages from non-covered ones—primarily inserting the burden of proof that parts of loss are lined from these which can be excluded. Because of this if an insurance coverage firm claims a number of the injury got here from an uncovered supply, the burden falls on the policyholder to indicate in any other case.
This authorized idea falls below Texas’ distinctive view of the concurrent causation doctrine. No person else follows it, and I’ve identified that the insurance coverage business doesn’t educate its adjusters this technique of loss adjustment below all danger insurance policies. Not surprisingly, it has turn out to be a favourite software for insurance coverage corporations seeking to keep away from paying claims in Texas. If lined and uncovered damages are combined collectively and might’t be separated, the insurer wins by default. No different state within the union has this rule.
To assist her declare, Mitchell relied closely on an estimate known as the “Quantum Estimate,” which detailed the prices to restore her property. However there was an issue: the estimate didn’t say who wrote it, and it didn’t clarify what induced the damages. The courtroom dominated that with out proof of authorship or an knowledgeable explaining how the injury was associated to the windstorm, the estimate was nugatory as proof.
Despite the fact that Mitchell later tried to repair the error by submitting an affidavit confirming the estimate’s authenticity, the courtroom wasn’t moved. The decide dominated that even when the estimate was correctly authenticated, it nonetheless wouldn’t have modified the end result as a result of it didn’t set up causation. With that, the case was over, and Praetorian’s denial stood.
This case serves as a reminder that proving protection isn’t nearly exhibiting injury—it’s about proving what induced it. Too usually, policyholders concentrate on the price of repairs with out correctly documenting the trigger. Insurance coverage corporations with expert counsel definitely admire that proof counts and use it to their benefit. If a declare goes to courtroom, a Texas insurer will be anticipated to argue that the policyholder hasn’t met their burden of proof. With out clear, expert-supported proof linking damages to a lined occasion, Texas courts, in contrast to courts in different states, will possible aspect with the insurer.
Policyholders, their representatives, and even contractors working within the insurance coverage restoration area have to be proactive. They need to make sure that their reviews embrace not simply restore prices but additionally a transparent and possible rationalization of what induced the injury. Policyholders and public adjusters should collect robust documentation that segregates lined damages from excluded ones.
Attorneys ought to anticipate the Texas concurrent causation protection and be prepared with knowledgeable testimony that may break it down. The policyholder on this case was represented by the Dick Regulation Agency. Steve Badger has been preserving a working commentary about this regulation agency on his LinkedIn messaging. Policyholders ought to rigorously choose counsel based mostly on popularity, expertise and outcomes moderately than pithy promoting with implied reference to at least one’s genitals.
Some insurance coverage corporations aren’t within the enterprise of creating funds simple and are searching for methods to forestall paying any greater than is required. If you wish to win the battle for protection, you want greater than only a exhibiting of injury through the coverage interval and an estimate if the loss happens in Texas.
In Texas, you want proof that holds up below authorized scrutiny below this woefully incorrect and uniquely utilized protection rule. In any other case, the insurer will all the time have the higher hand in causation circumstances. Texas policyholders who perceive this actuality and put together accordingly will stand a a lot better likelihood of securing the protection they rightfully deserve.
For these wanting to review the remedy of causation in Texas, we’ve written many articles about this. I’d recommend State Farm Wins Texas Worn-Out Roof Injury Case: Lesson About Texas Hail Injury Instances, Professional Testimony, and the Very Distinctive Texas Concurrent Causation Rule, and a put up written 14 years in the past, Concurrent Causation in Texas. Causation protection guidelines will be very advanced, and it’s particularly so in Texas.
Thought For The Day
“Don’t mess with Texas. That features its barbecue, its beer, and particularly its ladies.”
—Matthew McConaughey
1 Mitchell v. Praetorian Ins. Co., 24-20205 (5th Cir. Mar. 24, 2025). (See additionally, appellate briefs or Appellant and Appellee).
