A recent unanimous decision by the Supreme Court of Texas held that Elephant Insurance owed no duty to provide post-accident safety guidance to protect its insured and undertook no duty.
AUSTIN, Texas, June 16, 2022 /PRNewswire-PRWeb/ -- Thompson Coe Appellate partner Michael Eady and San Antonio Appellate lawyer Nissa Dunn successfully represented Elephant Insurance Co. in a longstanding wrongful-death case that ultimately determined whether an insurer owes a duty to give post-accident advice to its insured on how to be safe at an accident scene. See Elephant Insurance Company, LLC v. Lorraine Kenyon, Individually and as Executrix of the Estate of Theodore Kenyon, No. 20-0366 (Tex. 2022).
According to court documents, the case began when an Elephant Insurance policyholder was involved in a one-car accident on a rain-soaked road in San Antonio. The policyholder called Elephant's Virginia-based first notice of loss representative from the scene. During their short conversation, the policyholder asked if they needed to take pictures and the Virginia-based representative affirmed. Moments later, another driver lost control of their car sliding into and killing the policyholder's husband who had traveled to the scene to assist his wife. The policyholder filed a wrongful death action against the other driver and Elephant Insurance.
After an automobile accident, taking pictures of damage to your car, any other cars or property involved, and the road conditions is common practice and recommended on the Texas Department of Insurance website. However, this case looked at whether the existing Texas common law duty of good faith and dealing encompassed a duty on the part of the insurer to provide post-accident safety guidance or whether Elephant Insurance voluntarily assumed such a duty either during that call or under its policy, according to the Texas Supreme Court opinion.
Elephant Insurance maintained that no such duty—in essence, a duty to protect—existed between insurers and policyholders under these facts. The trial court agreed, as did the Fourth Court of Appeals three-Justice panel in a split decision. However, on rehearing, the Fourth Court of Appeals sitting en banc reversed, reaching the opposite conclusion in all regards. Elephant Insurance petitioned the Texas Supreme Court to review the Court of Appeal's decision. The Texas Supreme Court accepted the petition, heard oral argument, and reversed.
After first rejecting any duty to protect or provide post-accident guidance as part of an insurer's existing common law duty of good faith and fair dealing, the Court further rejected the argument that Elephant nonetheless assumed such a duty as stated in the opinion. Lastly, the Texas Supreme Court balanced the factors for "determining the existence, scope, and elements of legal duties," agreeing with the trial court and the court of appeals' panel that the insurer bore no such duty, as stated in the opinion.
"In addition to its significance for Elephant Insurance, the Texas Supreme Court's opinion clarifies that there is no duty for post-accident safety guidance, at least not under these facts," said Michael Eady.
Dallas partner Roger Higgins and Austin senior attorney Elizabeth Brabb also assisted in the case.
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