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Taylor v. Root Insurance Co.

Court: WD Tx  08/22/2023  Auto Insurer Not Required to Pay Sales Tax Under Total Loss Settlement

A court of the Western District of Texas adopted a magistrate's recommendation to dismiss a class action complaint for breach of contract and violations of the Texas Prompt Payment of Claims Act that alleged an insurer failed to pay applicable sales tax for total loss settlements, holding that although the policy unambiguously states the insurer owes "applicable sales tax" in addition to actual cash value, the Texas Administrate Code specifies that the applicable sales tax is $0.00 when an insurer takes title to a vehicle under a total loss settlement.

auto policy, class action, sales tax, total loss settlement, actual cash value, 34 Tex. Admin. Code Sec. 3.62

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