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Howell v. Southern Farm Bureau Life Insurance Co.

Court: ED Tx  01/28/2025  In Matter of First Impression, Court Holds Prompt Payment Act Claims Sound in Tort for Purposes of Civil Practice and Remedies Code's Proportionate Fault Provision, But Denies Leave to Designate Responsible Third Party

A court of the Eastern District of Texas denied a life insurer's motion for leave to designate a responsible third party, holding that in a matter of first impression, claims under the Texas Prompt Payment of Claims Act within Tex. Ins. Code Chapter 542 sound in tort for purposes of the Texas Civil Practice and Remedies Code's proportionate fault provisions, but that the insurer's motion should be denied where the alleged responsible third party could not possibly have contributed to any delay in the claim process where he had died prior to the filing of the insurance claim which triggered the insurer's duty to timely handle the claim.

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