To Plead & Prove a Tort of Bad Faith Claim There Must Be Evidence

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Refusal to Pay the Amount the Insured Deems Appropriate Is Nothing More than a Good Faith Coverage Dispute.

In Vernon Humphries and Rebecca Humphries v. State Farm Lloyds, Civil Action No. 3:20-CV-01163-X, United States District Court, N.D. Texas, Dallas Division (March 9, 2022) State Farm Lloyd’s (State Farm) successfully moved the USDC for partial summary judgment on Vernon and Rebecca Humphries’ suit for breach of the duty of good faith and fair dealing and related statutory claims.

Unsatisfied, the Humphries filed suit against State Farm in Texas state court in April, 2020, and State Farm removed the case to Federal Court. Since filing suit, the Humphries changed the amount they claim is necessary for repairs five times based on different estimates by their expert, Duane Smith, settling on $247,138.71, more than double their original claim. 

Here the Humphries present no investigative standards against which State Farm’s investigation can be judged deficient, much less purposefully so. In sum, the Humphries failed to point to any evidence suggesting that State Farm’s refusal to pay the Humphries the amount they deem appropriate reflects anything more than a good faith coverage dispute. The Court granted State Farm’s motion for partial summary judgment. The breach of contract action will proceed.

ZALMA OPINION

It takes more than an upset insured to bring a case for bad faith.  This case teaches that to prove a bad faith claim it is necessary to present expert testimony that the insurer failed to act within the custom and practice of the industry or acted wrongfully and in bad faith. 

(c) 2022 Barry Zalma & ClaimSchool, Inc.

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. 

He has created a library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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