Orange resident sues Allstate over Rita claim

David Yates Apr. 2, 2008, 9:45am


Orange County resident Gerald Bailey Sr. is the latest Hurricane Rita victim to sue his insurance company for allegedly refusing to pay at least a portion of his policy damage claim.

Through attorney Steve Mostyn, who filed hundreds of insurance lawsuits last year, Bailey filed a breach of contract lawsuit against National Lloyds Insurance Co. and two of its claims adjusters. The suit was filed in the Orange County District Court on March 28.

According to the plaintiff's original petition, Bailey submitted a claim for damages following Rita. Lloyds and its assigned adjusters then "wrongfully" denied his claim, the plaintiff claims.

The suit says Bailey asked the insurance company to cover the cost of repairs to the property but Lloyds' "misrepresented" the policy to them and denied at least a portion of their claim, "even though the damage was caused by a covered occurrence."

"Defendant failed to explain to plaintiff the reasons for their offer of an inadequate settlement," the suit said, adding that Lloyds refused to conduct a reasonable investigation.

The suit faults Lloyds for breaching its contract and duty of good faith and fair dealing, and also alleges the insurance company committed several violations of the Texas Insurance Code.

Furthermore, the suit says the adjusters are also guilty of several Insurance Code violations and accuses all defendants of committing fraud.

The plaintiff is suing for the unpaid claim, actual and compensatory damages, economic hardship, plus exemplary damages and damages for mental anguish.

He is demanding a trial by jury.

The case has been assigned to the 260th Judicial District.

Case No. D080129-c

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