Hunton Insurance Recovery Blog

On February 13, 2020, a Texas federal court granted summary judgment in favor of coverage, finding the policyholder provided sufficient notice to its insurer of a potential claim for damages caused by allegedly contaminated proppant used at a well site in west Texas.  See Evanston Insurance Company v. OPF Enterprises, LLC, Civil Action No. 4:17-CV-2048 (S.D.T.X. Feb. 13, 2020) (Dkt. No. 51) .  The Court found that the policyholder’s notice of a potential claim was effective when provided to the insurer’s agent, even though it was not provided directly to the insurer itself.

Following a six-day trial, a Texas jury found that Great American Insurance Company breached its policy with a hydraulic fracturing company and engaged in unfair settlement practices when it refused to pay for loss the company sustained in a well accident. The decision highlights the need to vigorously pursue coverage using all information available and the benefits of leveraging state statutory protections governing unfair claims settlement practices to ensure that insurers handle claims in a prompt, fair, and reasonable manner.