Don’t Let Them Get Away With It: Understanding Texas Insurance Bad Faith Claims
When disaster strikes, you rely on your insurance company to be there for you. You pay your premiums faithfully, trusting that when you need them most, they will uphold their end of the contract. Unfortunately, some insurers fail in this duty, engaging in practices that can be legally categorized as bad faith.
In Texas, policyholders have strong legal protections to fight back against this misconduct. Understanding what constitutes a bad faith claim and the remedies available is the first step toward securing the compensation you deserve.
What is Bad Faith Insurance?
In Texas, every insurance contract includes an implied covenant of good faith and fair dealing. This means your insurance company has a duty to handle your claim honestly, fairly, and promptly. Bad faith occurs when an insurer breaches this duty by unreasonably denying, delaying, or underpaying a valid claim when they knew, or should have known, that their liability was reasonably clear. It goes beyond simple negligence or a good-faith dispute over coverage—it’s a deliberate or reckless disregard for the policyholder’s rights.
Texas law allows for two primary types of bad faith claims:
- Common Law Bad Faith
This claim is based on the insurer’s fundamental breach of the duty of good faith and fair dealing. To prove common law bad faith, you must show that:
- The insurer denied or delayed payment of a claim.
- The insurer had no reasonable basis for the denial or delay.
- The insurer knew or should have known that it lacked a reasonable basis.
- Statutory Bad Faith (Texas Insurance Code)
This is often a more powerful tool for policyholders, as it focuses on specific violations of the Texas Insurance Code, primarily Chapters 541 and 542. These statutes explicitly outline unfair and deceptive practices.
Common Examples of Bad Faith Tactics
While every case is unique, several tactics repeatedly appear in Texas bad faith claims:
- Unreasonable Claim Denial: Denying a claim without conducting a thorough or proper investigation.
- Unjustified Delays: Excessively prolonging the claims process, often hoping the policyholder will give up or settle for less. This includes repeatedly requesting unnecessary or redundant documentation.
- Lowball Offers: Offering a settlement amount significantly—and unreasonably—lower than the true value of the covered loss.
- Misrepresenting Policy Terms: Lying or misleading the policyholder about the coverage, policy limits, or applicable deductibles.
- Failing to Explain Denial: Denying a claim without promptly providing a clear, detailed, and reasonable explanation for the decision.
Recoverable Damages in a Bad Faith Lawsuit
A successful bad faith claim can allow you to recover damages that go far beyond the original policy benefits. In Texas, recoverable damages may include:
- Actual Damages (Policy Benefits): The amount of money the insurance company should have paid for your covered loss under the policy.
- Interest/Statutory Penalties: Under Chapter 542 (Prompt Payment of Claims Act), if an insurer delays payment, you may be entitled to an additional 18% interest per year on the claim amount, plus attorney’s fees.
- Extracontractual Damages: Damages caused by the insurer’s bad faith conduct that are independent of the policy benefits. This may include damages for mental anguish.
- Treble Damages: If you can prove that the insurer acted knowingly (or with conscious indifference) in violating the Insurance Code (Chapter 541), you may be awarded up to three times the amount of your actual damages.
- Attorney’s Fees and Court Costs: A successful claim under the Texas Insurance Code typically requires the insurer to pay the policyholder’s reasonable attorney’s fees.
What to Do If You Suspect Bad Faith
If you feel your insurance company is mistreating you, the actions you take can be critical for any future legal action.
- Document Everything: Keep a detailed record of every interaction, including dates, times, names of adjusters/representatives, and a summary of what was discussed. Save all correspondence (letters, emails, texts).
- Read Your Policy: Review your insurance policy thoroughly to understand your coverage, duties, and the steps required to file a claim.
- Hire Legal Counsel: Bad faith claims are complex and highly fact-dependent. An attorney experienced in Texas insurance law can help determine if the insurer’s actions crossed the line and guide you through the process of holding them accountable.
Don’t wait and don’t settle for less than you are owed. If you are facing an unreasonable delay or denial from your insurer in Texas, it may be time to contact the Lawrence Law Firm.
Who Can File a Wrongful Death Lawsuit?
In most states, like Texas, the surviving spouse, children, and parents are permitted to file wrongful death claims on behalf of a deceased family member.
If the decedent didn’t have children or wasn’t married at the time of death, the wrongful death lawsuit can be filed by the decedent’s parents or by the estate itself through the Executor or Administrator.
If your loved one did not create an estate before they died, which is required to pursue and recover survival or “pre-death” damages, our team of probate lawyers can create the estate and, if you agree, seek to have you appointed as the “administrator” of the estate.
What is the Deadline for Filing a Wrongful Death Lawsuit in Texas
Texas sets the time limit that family members have to file a wrongful death statute in the Texas Civil Practice & Remedies Code. Section 16.003 states that “a person must bring suit not later than two years after the death of the injured person.”
While the statute provides the surviving spouse, children, and parents as long as two years to file the lawsuit, it is CRITICAL TO FILE SUIT AS QUICKLY AS POSSIBLE. The sooner you file your wrongful death lawsuit, the sooner you will be able to preserve and protect important evidence that would likely disappear or be destroyed if you had not filed your lawsuit.
What Damages are Available in Wrongful Death Cases?
When a spouse, parent, or other family member is tragically killed, the decedent’s family is left with unbearable grief and, often times, piling expenses with little or no income to pay them. This is especially true when the decedent was the household’s primary wage earner, and his or her salary was used to pay the mortgage, car notes, health insurance premiums, groceries, tuition bills, and other living expenses.
A monetary recovery may seem inconsequential and of little consolation, but, unfortunately, the bills continue even in your loved one’s absence and can add tremendous stress to what’s already the most difficult time of your life. A wrongful death suit is the only way families can hold at-fault parties accountable for their loved one’s death and ensure that they’re able to move forward, financially, in their loved one’s absence.
In a Texas wrongful death lawsuit, families may seek several types of damages to compensate for the losses they’ve suffered. These damages include economic, non-economic, and, in some instances, punitive damages.
Economic Damages
Economic damages are meant to cover the tangible financial losses that result from a loved one’s death. These can include:
- Medical Expenses:Any medical bills related to the deceased’s final injury or illness, including emergency care, hospital stays, surgeries, and other treatments leading up to their death, can be recovered.
- Funeral and Burial Costs:The cost of the funeral, burial, or cremation services can be included in the compensation sought.
- Loss of Financial Support: If the deceased provided financial support to their family, the surviving family members can recover the value of that lost income. This calculation often includes the wages the deceased would have earned and potential raises, bonuses, and other benefits they would have received over their lifetime.
- Loss of Inheritance:If the deceased would have contributed to an inheritance or estate during their lifetime, surviving family members can be compensated for their lost inheritance.
- Loss of Services:Families can also seek compensation for the loss of services the deceased would have provided, such as household chores, childcare, and other contributions to the family’s day-to-day life.
Non-Economic Damages
Non-economic damages are meant to compensate for the intangible losses that result from a wrongful death. While more challenging to quantify, these damages are often significant:
- Loss of Companionship and Society: Surviving family members may seek compensation for the loss of the deceased’s companionship, love, and affection. This applies to spouses, children, and parents deprived of the emotional support and guidance the deceased would have provided.
- Loss of Consortium:A spouse may recover damages for the loss of marital benefits, including comfort, companionship, and intimate relations.
- Loss of Parental Guidance:If the deceased was a parent, their children may be compensated for the loss of parental guidance, nurturing, and education that they would have received had their parent lived.
- Pain and Suffering: Although Texas does not allow recovery for the pain and suffering of the deceased in a wrongful death action, surviving family members may be able to recover for the mental anguish and emotional distress they endure as a result of the loss. This can include grief, anxiety, depression, and other emotional hardships.
- Punitive Damages to Punish the Negligent Parties
In some instances, Texas law allows for the recovery of punitive damages, also known as exemplary damages. These are not meant to compensate for losses but to punish the defendant for particularly egregious or reckless behavior and to deter similar conduct in the future. Punitive damages can be awarded if the defendant’s actions were willfully negligent, grossly reckless, or malicious. However, these damages are not available in every case and typically require a higher burden of proof.
What is a Survival Claim and How is it Different than a Wrongful Death Claim?
The purpose of a wrongful death lawsuit is to hold the negligent person or company accountable, prevent the same dangerous conduct from injuring or killing others in the future, and compensate the surviving family members for the emotional suffering and financial losses they’ve experienced as a result of their loved one’s death.
A survival action, on the other hand, is different.
Survival claims are filed by the surviving family members to recover damages for any pain and suffering the deceased experienced in the minutes, hours, or days leading up to their death. Unlike the damages in a wrongful death case, the pre-death damages recovered through a survival claim belong exclusively to the decedent’s estate and are divided among their survivors.
To successfully pursue a survival claim in Texas, you must demonstrate that:
- As the plaintiff, you represent the decedent’s estate
- The deceased had a personal injury cause of action
- The deceased would have been able to sue for personal injury if they had lived
- The defendant’s wrongful act caused the victim’s injury.
When there is evidence that the decedent suffered and experienced pain before they passed away, our lawyers will always file a wrongful death AND survival claim to ensure that the surviving family members receive the absolute maximum compensation available for their losses and the decedent’s pre-death suffering.
Survival Damages Belong to the Estate and are Divided Between Living Family Members
Unlike the damages in a wrongful death case, the damages recovered through a survival claim belong exclusively to the decedent’s estate and are divided up among living family members.
When there is evidence that the decedent suffered and experienced pain before they passed away, our lawyers will always file a wrongful death AND survival claim to ensure that the surviving family members receive the absolute maximum compensation available for their losses and the decedent’s pre-death suffering.
Common Causes of Wrongful Death
At the heart of any wrongful death case is a breach of responsibility. Whether an employer cutting corners on safety or a commercial driver making reckless decisions, these actions—or inactions—can lead to deadly outcomes. In Texas, some of the most common causes of wrongful death include:
Truck and 18-Wheeler Accidents
18-wheelers and other large trucks pose a significant threat on the road, especially when drivers are overworked, or vehicles are improperly maintained. Negligence in maintaining the truck, driver fatigue, ignoring critical safety regulators, and reckless driving increase the risk of a serious crash. The occupants of other vehicles account for the majority of deaths (70%) in fatal 18 wheeler accidents.
Pipeline Accidents and Explosions
Pipeline explosions often result in catastrophic injuries or death. All too often, these incidents are entirely preventable and result from poor maintenance, insufficient inspections, or negligence in following safety protocols.
Commercial Bus Accidents
Greyhound and other commercial bus companies are responsible for safely transporting thousands of people to destinations across the country every day. When bus drivers or companies are negligent—whether through poor vehicle maintenance, driver error, or ignoring safety standards— the result is often a catastrophic injuries and fatalities.
Car Accidents
Reckless or negligent driving is a leading cause of wrongful death on the roads. Whether it’s speeding, distracted driving, or driving under the influence, when a driver fails to exercise reasonable care, the consequences of a car crash can be tragic for those sharing the road.
Proving Wrongful Death: Elements of a Successful Claim
In a wrongful death lawsuit, proving negligence is essential in holding the responsible party accountable for the pain and loss they’ve caused. Under Texas law, this requires establishing the following four elements:
Duty of Care
You must first demonstrate that the defendant owed a duty of care to your loved one. This means the defendant had a legal obligation to act in a way that would prevent harm. For example, a truck driver has a duty to obey traffic laws and drive safely, while an oil company has a duty to maintain safe working conditions in hazardous environments.
Breach of Duty
After establishing that a duty of care existed, you must show that the defendant breached their duty. This breach occurs when someone fails to act as a reasonable person would under similar circumstances. Whether it’s reckless driving, ignoring safety protocols, or failing to maintain equipment, the defendant’s actions—or lack thereof—must be shown to have violated their duty of care.
Causation
Proving causation involves linking the defendant’s breach of duty directly to your loved one’s death. In other words, you need to show that the defendant’s negligence or recklessness caused the fatal incident. For instance, if a trucking company’s failure to maintain its vehicles led to a deadly crash, that negligence is the direct cause of the death.
Damages
The final element requires demonstrating that the death resulted in damages, including medical bills, lost income, and loss of companionship.
How a Wrongful Death Lawyer Can Help
Enduring the loss of a loved one is always difficult, particularly in the case of a wrongful death that resulted from another party’s negligence. Survivors face the challenges of making funeral arrangements, managing medical bills, and juggling daily responsibilities, all while coping with profound emotional pain. The legal system is complex, and insurance companies often exploit grieving families by pressuring them into accepting settlements far below what they deserve.
If you attempt to manage everything alone, you risk missing important deadlines, losing critical evidence, or inadvertently giving up compensation that could secure your family’s financial future. A lawyer can alleviate these burdens, allowing you and your family to focus on healing, knowing that someone is advocating for your interests and working to protect your future.
- Investigating the Cause of Death: A wrongful death lawyer conducts a thorough investigation, gathering police reports, medical records, surveillance footage, and witness statements to determine how and why the fatal incident occurred. If necessary, they work with accident reconstruction specialists and forensic experts to build a solid case.
- Identifying Liable Parties: Determining liability for a wrongful death isn’t always straightforward, especially in the case of a fatal truck or 18-wheeler crash, workplace accident, or other incident where multiple parties could be at fault. An experienced attorney will have the knowledge and resources to identify all of the responsible parties and ensure you and your family pursue every potential avenue of compensation.
- Handling Insurance Companies– Insurance companies often try to minimize payouts or deny claims altogether. A wrongful death lawyer protects your rights, negotiates with insurers, and prevents you from accepting a lowball settlement that doesn’t cover the full extent of your loss. In fact, according to the Insurance Research Council, families who hire a lawyer recover settlements that are, on average, 3.5 times higher than those who do not.
- Contacting Bill Collectors: A wrongful death often leaves families with thousands in medical and funeral bills, not to mention other expenses. Your attorney can contact bill collectors to inform them of the pending claim, helping to delay or reduce financial pressure while you’re grieving and your case is progressing.
- Calculating Damages: Your lawyer will know how to calculate both your economic damages (medical expenses, funeral costs, lost income, and future financial support) and non-economic damages (pain and suffering, loss of companionship, and emotional distress) to ensure you receive the maximum compensation possible for your loss.
- Filing the Wrongful Death Lawsuit: Texas law imposes strict deadlines for filing wrongful death claims. A knowledgeable attorney will ensure your lawsuit is filed on time and meets all legal requirements, preventing costly mistakes that could jeopardize your right to compensation.
- Proving Negligence or Wrongdoing: To win a wrongful death lawsuit, you must prove that the defendant’s negligence, recklessness, or intentional misconduct caused your loved one’s death. Your attorney will know how to locate and preserve necessary evidence, and they’ll have the resources to consult expert witnesses to assist in building a compelling case.
Representing You at Trial: If the insurance company refuses to offer the maximum compensation possible, your wrongful death attorney will advocate for you and your family in court, significantly increasing the likelihood of a favorable outcome.
For a free initial consultation contact the Lawrence Law Firm today.
Being involved in a car crash is a shocking and overwhelming experience. Even a minor fender-bender can leave you confused about what to do next, especially if you’ve sustained an injury. Your actions immediately following the accident are crucial for your safety, your potential injury claim, and dealing with insurance. Here is a step-by-step guide on what you should do right after an injury-causing car accident.
Step 1: Prioritize Safety and Seek Medical Attention
Your health and safety are the absolute top priority.
- Move to Safety: If possible, move your vehicle to the side of the road or a safe location out of the flow of traffic. If you cannot move the vehicle, turn on your hazard lights.
- Check for Injuries: Immediately assess yourself and any passengers for injuries. Even if you don’t feel pain right away, adrenaline can mask symptoms.
- Call 911 (or local emergency services): Call for an ambulance if you or anyone else is seriously injured. You must also report the accident to the police, as an official police report is vital for your insurance claim and potential legal case.
- See a Doctor Immediately: Whether you take an ambulance or not, see a medical professional (ER, urgent care, or your primary care physician) as soon as possible. Do not wait. Some injuries, like whiplash or internal injuries, may not manifest for hours or days. A medical record created right after the crash is the strongest evidence linking your injuries to the accident.
Step 2: Gather Essential Information
While the police are on the scene, or if you must collect information yourself, be systematic. Use your phone to take pictures and notes.
- Exchange Information: Get the following details from the other driver(s):
- Full Name and Contact Information
- Insurance Company Name and Policy Number
- Driver’s License Number
- Vehicle Make, Model, Year, and License Plate Number
- Document the Scene: Take detailed photos before the vehicles are moved, if safe to do so. Photograph:
- Damage to all vehicles.
- The position of the vehicles.
- Traffic signs, skid marks, or road conditions.
- Visible injuries (bruises, cuts, etc.).
- Identify Witnesses: Ask any bystanders for their names and contact information. Their independent statements can be invaluable.
- Note the Details: Write down the date, time, and exact location of the crash, along with a brief description of how the accident happened while it’s fresh in your mind.
Step 3: Be Careful What You Say (At the Scene and Afterward)
This is one of the most critical pieces of advice.
DO NOT admit fault, apologize, or make any statements that could be interpreted as accepting responsibility for the crash, even if you think you were partly to blame.
- To the Police: State only the facts as you know them. Do not speculate or guess.
- To the Other Driver: Keep the interaction minimal and focused only on exchanging information.
- On Social Media: Do not post photos or details about the accident or your injuries on social media.Insurance companies routinely monitor these accounts for anything that might contradict your claim.
Step 4: Contact Your Insurance Company
You are required by your policy to report the accident promptly, regardless of who was at fault.
- Notify Them: Call your insurer and give them a basic account of the facts.
- Keep it Brief: Provide only necessary information. Do not give a recorded statement until you have consulted with a legal professional. You do not have to provide detailed descriptions of your injuries over the phone to the adjuster.
Step 5: Consult a Personal Injury Attorney
If you have sustained an injury, you should speak with an attorney as soon as possible.
- Why You Need a Lawyer: An attorney can protect your rights, deal with the aggressive tactics of the at-fault driver’s insurance company, investigate the crash, and ensure you receive fair compensation for all your losses, including medical bills, lost wages, and pain and suffering.
- Contingency Fees: Most personal injury lawyers work on a contingency fee basis, meaning they only get paid a percentage if they win your case, so there are no up-front costs.
Key Takeaways for Injury Victims
Action | Why it Matters |
Get Medical Help | Creates an official record linking your injury to the accident. |
Call the Police | An official police report is required for most claims. |
Never Admit Fault | Any statement can be used against you by the insurance company. |
Hire an Attorney | Protects your right to full compensation for your injuries. |
Recovering from a car accident is a difficult process, but knowing these steps can help you navigate the immediate aftermath effectively.