Insurance proceeds for destroyed beach house delayed by rival claims

GALVESTON - American Modern Lloyds Insurance Co. is embroiled in a dispute over Hurricane Ike-related claims with three East Texas residents.

The insurer filed suit against Orange resident Melvin Cook and Lumberton locals Stephen and Debora Dzenowski on Jan. 13 in Galveston County District Court, stating the respondents may expose it to "multiple liability" because of their alleged "rival claims."

The suit shows American Modern provides property damage coverage with a total limit of $43,000 to a Crystal Beach house which was completely destroyed by Hurricane Ike in 2008.

According to the original petition, American Modern "has indicated its willingness to pay the proceeds of the policy, but conflicting claims have arisen from the plaintiffs."

"The defendant is unable to determine which, if any, of the defendants are entitled to the policy proceeds," the suit says.

"There is an issue between the named insureds regarding insurable interest and ownership of the insured property."

American Modern insists it claims "no interest in the proceeds of the policy, which the plaintiff has at all times been willing to pay to the person or persons entitled to payment."

It is represented by Kane, Russell, Coleman & Logan PC.

The case has been assigned to Galveston County 122nd District Court Judge John Ellisor.

Case No. 12-cv-0043