Archive for category Insurance Law
What is hospice care?
Posted by David Leon in Estate planning and probate, Insurance Law, Medicaid planning on 28/08/2010
Hospice care refers to a change in the style of treatment of a disease. Typically, hospice care refers to medical treatment or therapy in light of the impending death of a patient. The goal of hospice is to help terminally ill patients with “comfort care.”
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What is an ADL?
Posted by David Leon in Estate planning and probate, Insurance Law, Medicaid planning on 28/08/2010
In insurance and Medicaid/Medicare lingo, ADL is often used as an acronym for Activities of Daily Living. Activities of Daily Living are considered essential to daily personal duties of self maintenance. These duties including personal hygiene, getting dressed, using the restroom, and eating. Normally, these activities are placed on a checkbox style grid, and an applicable insurance policy will pay on an amount based upon the number of ADLs that a subscriber can or cannot perform on a daily basis.
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Are life insurance proceeds subject to the debts of the deceased person?
Posted by David Leon in Estate planning and probate, Insurance Law on 25/12/2009
In most cases, no, life insurance proceeds are not subject to estate debts. The most common exception is when the “estate” is a listed beneficiary (which is improper under Texas law, but that’s a discussion for another day.) In most cases, life insurance is a contract between the insured and the life insurance company, to pay benefits to a beneficiary. The deceased person’s estate (to which most debts attach) is not involved in the process. The notable exceptions are life insurance policies specifically geared towards credits. A common example is a credit life policy. In this policy, an insured purchases a policy to cover a specific debt, such as a mortgage. This way, should the insured die, the mortgage is paid off in full.
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Can a common law spouse be a beneficiary of a life insurance policy?
Posted by David Leon in Contract law, Estate planning and probate, Insurance Law on 25/12/2009
Yes. A life insurance applicant may appoint anyone (or any entity) as a beneficiary on a life insurance policy, even a common law spouse. Also, if a common law marriage was in existence, then a common law spouse may have community property interests in a life insurance policy (purchased after the marriage) if the spouse is not listed as a beneficiary.
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Is it possible to prove a common law marriage after death?
Posted by David Leon in Estate planning and probate, Insurance Law on 25/12/2009
Yes. However, the burden of proof shifts after the second anniversary of the death of the purported spouse. If successfully proven, the date of the inception of the common law marriage may be determined by the court.
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What is the law in Texas regarding a common law spouse and life insurance?
Posted by David Leon in Estate planning and probate, Insurance Law on 25/12/2009
A common law marriage in Texas, if proven, carries the same validity as a ceremonial marriage. Accordingly, if there is a proven common law marriage, then the Texas rules regarding life insurance beneficiaries would apply.
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I was in an accident, but not at fault. My insurance paid the claim. What about my deductible?
Posted by David Leon in Insurance Law, Personal injury, auto accident, slip and fall law on 20/09/2009
The insurer may go after a third party for your deductible, or authorize the insured to go after himself or herself.
The controlling statute is Texas Insurance Code Sec. 542.204. ACTION TO RECOVER DEDUCTIBLE. (a) Notwithstanding any other provision of this code and except as provided by Subsection (b), if an insurer is liable to an insured for a claim that is subject to a deductible payable by the insured and a third party may be liable to the insurer or the insured for the amount of the deductible, the insurer shall:
(1) take action to recover the deductible against the third party not later than the first anniversary of the date the insured’s claim is paid; or
(2) pay the amount of the deductible to the insured.
(b) An insurer is not required to take action or pay the amount of the deductible as required by Subsection (a) if, not later than the earlier of the first anniversary of the date the insured’s claim is paid or the 90th day before the date the statute of limitations for a negligence action expires, the insurer:
(1) notifies the insured in writing that the insurer does not intend to take further collection actions against the third party; and
(2) authorizes the insured to take further collection actions.
(c) This section applies regardless of whether the third party who may be liable for the amount of the deductible is insured or uninsured.
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An insurance company wrongfully delayed paying my claim. Is there a penalty?
Posted by David Leon in Insurance Law on 20/09/2009
Yes, if there is an unreasonable delay in paying a claim, an insurance company can be held liable for attorney fees, 18% interest and other damages. The controlling statutes from the Texas Insurance Code are listed below.
Sec. 542.058. DELAY IN PAYMENT OF CLAIM. (a) Except as otherwise provided, if an insurer, after receiving all items, statements, and forms reasonably requested and required under Section 542.055, delays payment of the claim for a period exceeding the period specified by other applicable statutes or, if other statutes do not specify a period, for more than 60 days, the insurer shall pay damages and other items as provided by Section 542.060.
(b) This section does not apply in a case in which it is found as a result of arbitration or litigation that a claim received by an insurer is invalid and should not be paid by the insurer.
Sec. 542.060. LIABILITY FOR VIOLATION OF SUBCHAPTER. (a) If an insurer that is liable for a claim under an insurance policy is not in compliance with this subchapter, the insurer is liable to pay the holder of the policy or the beneficiary making the claim under the policy, in addition to the amount of the claim, interest on the amount of the claim at the rate of 18 percent a year as damages, together with reasonable attorney’s fees.
(b) If a suit is filed, the attorney’s fees shall be taxed as part of the costs in the case.
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The insurance company stated that they have accepted and will pay my claim. How much time do they have?
Posted by David Leon in Insurance Law on 20/09/2009
Generally speaking, an insurance company has five business days to pay an accepted claim. If the insurance company requires paperwork from a party, then the five days begins on receipt of the paperwork.
The controlling statute is Texas Insurance Code Sec. 542.057. PAYMENT OF CLAIM. (a) Except as otherwise provided by this section, if an insurer notifies a claimant under Section 542.056 that the insurer will pay a claim or part of a claim, the insurer shall pay the claim not later than the fifth business day after the date notice is made.
(b) If payment of the claim or part of the claim is conditioned on the performance of an act by the claimant, the insurer shall pay the claim not later than the fifth business day after the date the act is performed.
(c) If the insurer is an eligible surplus lines insurer, the insurer shall pay the claim not later than the 20th business day after the notice or the date the act is performed, as applicable.
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How will I know if an insurance company has accepted or rejected my claim?
Posted by David Leon in Insurance Law, Personal injury, auto accident, slip and fall law on 20/09/2009
An insurance company generally has fifteen days to accept or reject a claim, or ask for more information. If there is a reasonable suspicion of arson, then the time extends to 30 days. If a claim is rejected, the insurance company is obliged to tell the claimant the reasons why.
The controlling statute is Texas Insurance Code Sec. 542.056. NOTICE OF ACCEPTANCE OR REJECTION OF CLAIM. (a) Except as provided by Subsection (b) or (d), an insurer shall notify a claimant in writing of the acceptance or rejection of a claim not later than the 15th business day after the date the insurer receives all items, statements, and forms required by the insurer to secure final proof of loss.
(b) If an insurer has a reasonable basis to believe that a loss resulted from arson, the insurer shall notify the claimant in writing of the acceptance or rejection of the claim not later than the 30th day after the date the insurer receives all items, statements, and forms required by the insurer.
(c) If the insurer rejects the claim, the notice required by Subsection (a) or (b) must state the reasons for the rejection.
(d) If the insurer is unable to accept or reject the claim within the period specified by Subsection (a) or (b), the insurer, within that same period, shall notify the claimant of the reasons that the insurer needs additional time. The insurer shall accept or reject the claim not later than the 45th day after the date the insurer notifies a claimant under this subsection.
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What is a fiduciary duty?
Posted by David Leon in Business law, Estate planning and probate, Insurance Law, Litigation and judgments on 28/06/2009
A fiduciary duty is the highest standard of care one can owe to another. The fiduciary relationship is one of trust and confidence. The person or institution who owes the fiduciary duty must put the person’s interests above his or her own interests. Common examples of fiduciary duty include power of attorney holders, executors in wills, and trustees of trusts.
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What is ERISA?
Posted by David Leon in Insurance Law on 08/03/2009
ERISA is a federal law that stands for the “Employment Retirement Income Security Act” of 1974. This law is designed to protect retirement, pension and 401(k) plans.
ERISA requires employer plans to provide subscribers with specific information (such as disclosures about plan benefits and how the plan is funded). This law also assigns fiduciary responsibilities for those who manage and control plan assets.
Finally, the Act requires such plans to establish a grievance and appeals process for subscribers/employees and gives employees the right to sue for denials and breaches of fiduciary duty by plan administrators.
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What is EMTALA? What is patient dumping?
Posted by David Leon in Insurance Law, Personal injury, auto accident, slip and fall law on 08/03/2009
Patient dumping is when a hospital emergency room refuses to treat or diagnose an emergency situation on an individual due to their inability to pay (real or perceived.)
EMTALA is a federal law, 42 USC 1395 dd. It stands for the Emergency Medical Treatment and Active Labor Act, but is more commonly referred to as the “anti dumping act.”
This act states:
In the case of a hospital that has a hospital emergency department, if any individual (whether or not eligible for benefits under this subchapter) comes to the emergency department and a request is made on the individual’s behalf for examination or treatment for a medical condition, the hospital must provide for an appropriate medical screening examination within the capability of the hospital’s emergency department, including ancillary services routinely available to the emergency department, to determine whether or not an emergency medical condition [...]exists.
In general, this statute is designed to prevent certain hospital emergency rooms from refusing treatment to individuals based on their ability to pay. The statute provides for civil penalties if a hospital fails to comply with the statute.
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What is business insurance planning?
Posted by David Leon in Business law, Estate planning and probate, Insurance Law on 06/03/2009
Business insurance planning includes insurance against the loss of a key person who is vital to the survival of a business. This type of policy can be used to inject cash into a business in order to survive while you replace the lost person. It can also cover buy/sell agreements, allowing the surviving member of the business to buy out the deceased member’s interest. Other types of insurance planning include wholly owned or captive insurance companies, umbrella insurance policy planning and commercial liability. Contact Us for more information.
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How do I know if the life insurance policy is community property or separate property?
Posted by David Leon in Estate planning and probate, Insurance Law on 01/03/2009
If the initial premium was paid out of community funds, the life insurance policy may be a community asset. This means that one half of the policy “belongs” to the surviving spouse. If a third person is named beneficiary of a community owned life insurance policy, and the surviving spouse did not sign a waiver, then the surviving spouse may challenge the beneficiary designation. If naming the other person is found to be a fraud on the surviving spouse, the spouse may be awarded a share of the death benefits and the named beneficiary will be entitled to receive the remainder. If you have an insurance issue that you would like to discuss, please contact us.
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“My insurance company wrongfully denied my claim”
Posted by David Leon in Insurance Law, Litigation and judgments on 15/02/2009
An insurance policy is a contract between you and your insurance company. If you make a claim under your policy, Texas law requires that your insurance company acts “reasonably” and in “good faith” when determining whether or not to pay benefits under a policy. If an insurance company fails to act reasonably, it has violated Texas law and you may be entitled to damages.
An insurance company owes a fiduciary duty to its insureds. This means that the insurance company may not put its own interest above that of an Insured. Texas law requires that insurance companies act fairly when dealing with their insured.
Not all denials are done in bad faith, however. If an insurance company has a good reason to deny a claim, then it has acted in good faith. Some examples are: the insured failed to cooperate with insurance company, a policy lapsed, a loss is not covered by the policy or there is fraud. In cases such as these, an insurance company can deny a claim.
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The life insurance company has already paid the proceeds of the life insurance policy to the listed beneficiary. I am the surviving spouse and I wasn’t listed as a beneficiary. Is there anything I can do?
Posted by David Leon in Insurance Law on 15/02/2009
Possibly. If the life insurance company paid proceeds while ignoring the rights of the spouse, then the insurance company may be liable to the surviving spouse
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I was a common law spouse when my spouse purchased a life insurance policy. I wasn’t listed as a beneficiary. Is there anything I can do?
Posted by David Leon in Estate planning and probate, Family Law, Insurance Law on 15/02/2009
Possibly. If you meet the statutory requirements for being a common law marriage at the time the policy was purchased, and community funds were used to purchase the policy, then the policy may be considered community property. The surviving spouse would be considered a one-half owner. These tend to be fact specific matters. Please contact us if you would like to discuss this further.
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Are insurance policies generally characterized as separate or community in Texas?
Posted by David Leon in Estate planning and probate, Family Law, Insurance Law on 15/02/2009
Texas follows “inception of title” when classifying life insurance proceeds. This means that ownership of the policy is established by the source of funds for the first premium. If that premium was paid prior to the marriage or with separate property, then the policy may be considered separate property. This is a highly technical area of law, and matters are case-specific. Please contact us if you would like to discuss a matter further.
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My husband / wife died and designated someone else as the beneficiary of the life insurance policy? What can I do?
Posted by David Leon in Estate planning and probate, Family Law, Insurance Law, Litigation and judgments on 15/02/2009
In Texas, a life insurance policy that is purchased after a person is married, and community funds were used to pay for it, then the surviving spouse may have an ownership interest in the policy. However, a spouse way waive rights to the policy by signing a waiver. If your spouse had designated another as the beneficiary of a life insurance policy without your consent, or if you have questions, please contact us at 214-696-0021
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Does Texas law recognize a “common law” or informal marriage?
Posted by David Leon in Estate planning and probate, Family Law, Insurance Law on 15/02/2009
Yes. Texas law recognizes informal marriages. This issue most often after the death of one spouse, where the surviving spouse is attempting to prosecute a claim or where a surviving spouse is seeking a death related benefit from the deceased spouse.
The elements of a common law marriage are that a couple (1) agreed to be married, (2) lived together as husband and wife, (3) represented to others that they were husband and wife, (4) were more than 18 years old and (5) neither party was already married.
If a person is attempting to prove the existence of an informal marriage, then that person should do so within two years of the date the marriage ended (by either abandonment or death), as the burden of proof will shift.
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I am shopping for an auto insurance policy. What do the coverages mean, and which ones should I purchase?
Posted by David Leon in Insurance Law, Personal injury, auto accident, slip and fall law on 28/01/2009
In dealing with personal automobile and commercial auto policies, many people need a quick primer on what the individual coverages actually mean. Here is a VERY brief overview of standard policy options, and what they mean. Please note that your policy will be much more detailed. YOU NEED TO READ YOUR POLICY AS IT MAY VARY.
1. Bodily Injury Liability – If covered, then the insurance will pay for losses if you are at fault in an accident and are legally responsible for others’ injuries. It does not cover your own injuries. This may include passengers in your car, drivers and passengers of the other car(s) and pedestrians involved in an accident. The policy is usually listed as per person / per accident. This means that any individual in the accident can collect up to the per person amount, but if there are several people in a common accident, they are capped by the per accident amount. Also, beware that there may be a family member limit on the policy which is lower than the per person amount. This coverage is mandatory. Presently minimum limits on this policy is $25,000 for purchased vehicles, and $100,000 for leased vehicles. If this is a commercial vehicle, then you MUST notify the insurance company that the vehicle is for commercial purposes.
2. Property Damage Liability – This means that the insurance company should pay for losses if you are at fault in an accident and are legally responsible for damage to another’s property. This is mandatory in Texas.
3. Uninsured/Underinsured Motorist Bodily Injury (UM/UIM BI)- If you are not at fault in an accident, and the other driver has no insurance (or not enough) then this coverage should provide for medical expenses for you and your passengers. Although this coverage is optional, it should not be avoided. Given the cost of the insurance versus the expense if you are in an accident with an underinsured motorist, it is strongly recommended.
4. Personal Injury Protection (PIP) – This should pay for expenses resulting from an auto accident for you or your passengers, regardless of fault. Eligible expenses generally include medical, funeral, disability and lost wages to the extent that they can be documented. This coverage is optional, but is strongly recommended.
5. Uninsured/Underinsured Motorists Property Damage (UM/UIM PD) – If you are not at fault in an accident this coverage should protect your vehicle if your vehicle is damage by a driver who does not have any and in some case not enough insurance.
6. Medical Payments Coverage (MPC) – This optional coverage should pay for medical, dental and funeral expenses for you or your passengers, regardless of who is at fault. It is similar to PIP, but does not cover lost wages.
7. Comprehensive (comp) – This coverage should cover repair to your vehicle from damage caused by covered risks such as theft, vandalism and hail. This is typically required for financed and leased vehicles but not for purchased and paid for vehicles. If your car has any significant value, it may be a smart purchase.
8. Collision – This covers repair of your vehicle from damage caused in an accident, regardless of fault. It is typically required in financed purchases. If your car has any significant value, it may be a smart purchase.
9. Rental Reimbursement – This coverage helps pay for the cost of a rental car while your vehicle is being repaired as a result of a covered loss. This coverage is optional, but strongly recommended, especially if you use your car to get to/from/during work.
10. Towing – This coverage should pay to have your vehicle towed if it is disabled. This coverage may be duplicative of an auto club policy or a vehicle warranty.
11. Gap – This coverage applies if your vehicle is a total loss, and you owe more than your vehicle is worse. Although this is optional, it should be considered a mandatory purchase for any financed vehicle in which there is a possibility that you may owe more than the . Put simply, if you owe more than your car is worth, and it is totaled, you still have to pay the difference unless you have this coverage.
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