These bills graphically display what happens when the self-interest of agents is placed ahead of the public interest of policyholders.
Without policyholders there would be no agents.
The proponents of this legislation can cite no evidence of frivilous lawsuits being filed against agents. In fact, the only lawsuit evidence of late has been the meritorious cases that have resulted in brokers agreeing to over ONE BILLION DOLLARS in settlements in the last 60 days to compensate their policyholder victims.
What is wrong with this picture?
Agents are making more money than ever because of the skyrocketing premiums being paid by Texas policyholders–and yet the proponents of these bills seek unprecented protection from their customers that no other business or industry enjoys.
The past two months have proven that policyholder protections against fraud and deception found in the Texas Insurance Code are good. These protections that have been in the Code for the past 33 years should not be sacrificed for the special interests of a few agents who fear their customers.
Perhaps a current reading of CANON #1 of the CPCU CODE OF ETHICS is in order.
Are you one of the Lawyers who spearheaded the law back in 1973? Do Lawyers enjoy the protection Insurance Agents seek in this legislation?
Just curious.
Thanks,
Milo
In 1973, as Chief of the Antitrust & Consumer Protection Division of the Texas Office of Attorney General,I was one of several lawyers who worked with the insurance industry and consumer groups to fashion the protections against insurance fraud that are currently found in Chapter 541 of the Insurance Code. (formerly known as Article 21.21)
These provisions apply to lawyers the same as agents when lawyers engage in conduct that violates the Insurance Code. See Perez v. Kirk & Carrigan, 822 SW2d 261 (Tex. App. Corpus Christi 1992).
Likewise, the provisions which these bills propose to weaken, protect honest agents from unscrupulous companies and agents who would engage in unfair and/or deceptive practices in the business of insurance–including unfair methods of competition. See Crown Life Ins. Co. v. Casteel, 22 SW3d 378, (Tex. Sup. 2000).
Honest agents have no need to fear their customers. It is the dishonest agent that causes problems, not only for policyholders, but for the honest agents as well.
In my opinion, by weakening existing law, these bills (unintentionally I’m sure) would only serve to protect the dishonest at the expense of the honest.
The answer to your question is yes, lawyers do already enjoy this protection. It’s easy to see why Mr. Longley is against this legislation, attorneys stand to gain the most when the plaintiff (the insured) wins the lawsuit. Not only the attorney’s fees but settlements can be huge!! It’s easy to be an advocate of the side of the preverbial “pot of gold” being the insureds. I am sure Mr. Longley has been doing quite well as a prosecuting attorney on cases related to E&O.
Lawyers do not enjoy this protection. See Perez v. Kirk & Carrigan cited previously.
I am against this legislation because I am against insurance fraud. Honest agents are against insurance fraud and I stand with them.
I agree that the recent settlements have been huge. Over ONE BILLION DOLLARS in the past 60 days agreed to by brokers who victimized their customers by bid-rigging and price fixing. I think that is good–don’t you?
I agree, with you on those settlements being good. That is not the type of dishonesty I nor the article is speaking of.
I am an honest agent, and I am against insurance fraud as well. However, agencies are sued by insureds in numerous lawsuits on the grounds of Errors & Omissions for many things including “amnesia” of the insured over coverages they declined but somehow claim they had. Also, the need for a plaintiff to include insurance agencies in lawsuits so that their case gets taken to a court by trial jury rather than by judge when suing that agency’s insureds. There are many more examples…
In reflection, a bill that allows some protection would be great, as long as the crooks are not escaping the long arm of the law. There can be a happy medium there.
The legislation as proposed and as amended in committee does not discriminate between “types of fraud”. The $100,000 and $500,000 exemptions would have allowed the culprits in the recent broker scandals to get completely off the Insurance Code hook if either of these bills were to pass.
Statutory indemnity is the answer for the honest agent who gets sued for something that the company did. It’s in the DTPA and could easily be placed in the Insurance Code without disturbing any policyholder or agent remedies.
Of course, comparative responsibility is already available to the agent who is sued for simple negligence at common law based upon his own conduct.
Settlements are sometimes driven by the decision of the E & O carrier over which the agent, by contract, has no control. But a judgment is something altogether different. In 36 years of trial practice, I have yet to see a Texas jury award damages against a defendant (agent or lawyer) that was not first found liable for some act of commission or omission that had been fully explored by the evidence introduced and admitted in a court of law.
My point here is that it is very important in fashioning legislation to not reward wrongdoers at the expense of the innocent victim.
We’re not there yet with regard to HB 2155 or SB 236.
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These bills graphically display what happens when the self-interest of agents is placed ahead of the public interest of policyholders.
Without policyholders there would be no agents.
The proponents of this legislation can cite no evidence of frivilous lawsuits being filed against agents. In fact, the only lawsuit evidence of late has been the meritorious cases that have resulted in brokers agreeing to over ONE BILLION DOLLARS in settlements in the last 60 days to compensate their policyholder victims.
What is wrong with this picture?
Agents are making more money than ever because of the skyrocketing premiums being paid by Texas policyholders–and yet the proponents of these bills seek unprecented protection from their customers that no other business or industry enjoys.
The past two months have proven that policyholder protections against fraud and deception found in the Texas Insurance Code are good. These protections that have been in the Code for the past 33 years should not be sacrificed for the special interests of a few agents who fear their customers.
Perhaps a current reading of CANON #1 of the CPCU CODE OF ETHICS is in order.
Are you one of the Lawyers who spearheaded the law back in 1973? Do Lawyers enjoy the protection Insurance Agents seek in this legislation?
Just curious.
Thanks,
Milo
In response to Milo:
In 1973, as Chief of the Antitrust & Consumer Protection Division of the Texas Office of Attorney General,I was one of several lawyers who worked with the insurance industry and consumer groups to fashion the protections against insurance fraud that are currently found in Chapter 541 of the Insurance Code. (formerly known as Article 21.21)
These provisions apply to lawyers the same as agents when lawyers engage in conduct that violates the Insurance Code. See Perez v. Kirk & Carrigan, 822 SW2d 261 (Tex. App. Corpus Christi 1992).
Likewise, the provisions which these bills propose to weaken, protect honest agents from unscrupulous companies and agents who would engage in unfair and/or deceptive practices in the business of insurance–including unfair methods of competition. See Crown Life Ins. Co. v. Casteel, 22 SW3d 378, (Tex. Sup. 2000).
Honest agents have no need to fear their customers. It is the dishonest agent that causes problems, not only for policyholders, but for the honest agents as well.
In my opinion, by weakening existing law, these bills (unintentionally I’m sure) would only serve to protect the dishonest at the expense of the honest.
The answer to your question is yes, lawyers do already enjoy this protection. It’s easy to see why Mr. Longley is against this legislation, attorneys stand to gain the most when the plaintiff (the insured) wins the lawsuit. Not only the attorney’s fees but settlements can be huge!! It’s easy to be an advocate of the side of the preverbial “pot of gold” being the insureds. I am sure Mr. Longley has been doing quite well as a prosecuting attorney on cases related to E&O.
Lawyers do not enjoy this protection. See Perez v. Kirk & Carrigan cited previously.
I am against this legislation because I am against insurance fraud. Honest agents are against insurance fraud and I stand with them.
I agree that the recent settlements have been huge. Over ONE BILLION DOLLARS in the past 60 days agreed to by brokers who victimized their customers by bid-rigging and price fixing. I think that is good–don’t you?
I agree, with you on those settlements being good. That is not the type of dishonesty I nor the article is speaking of.
I am an honest agent, and I am against insurance fraud as well. However, agencies are sued by insureds in numerous lawsuits on the grounds of Errors & Omissions for many things including “amnesia” of the insured over coverages they declined but somehow claim they had. Also, the need for a plaintiff to include insurance agencies in lawsuits so that their case gets taken to a court by trial jury rather than by judge when suing that agency’s insureds. There are many more examples…
In reflection, a bill that allows some protection would be great, as long as the crooks are not escaping the long arm of the law. There can be a happy medium there.
Accountability is the key.
The legislation as proposed and as amended in committee does not discriminate between “types of fraud”. The $100,000 and $500,000 exemptions would have allowed the culprits in the recent broker scandals to get completely off the Insurance Code hook if either of these bills were to pass.
Statutory indemnity is the answer for the honest agent who gets sued for something that the company did. It’s in the DTPA and could easily be placed in the Insurance Code without disturbing any policyholder or agent remedies.
Of course, comparative responsibility is already available to the agent who is sued for simple negligence at common law based upon his own conduct.
Settlements are sometimes driven by the decision of the E & O carrier over which the agent, by contract, has no control. But a judgment is something altogether different. In 36 years of trial practice, I have yet to see a Texas jury award damages against a defendant (agent or lawyer) that was not first found liable for some act of commission or omission that had been fully explored by the evidence introduced and admitted in a court of law.
My point here is that it is very important in fashioning legislation to not reward wrongdoers at the expense of the innocent victim.
We’re not there yet with regard to HB 2155 or SB 236.