When an insured is covered under multiple insurance policies, it is sometimes unclear which policy should respond, and in which order. The uncertainty can result in the insured being left in limbo despite sufficient insurance to cover the loss. To avoid this problem, Texas courts generally encourage insurers to protect the insured first, and then fight about coverage later in an insurance subrogation action. See Hardware Dealers Mut. Fire Ins. Co. v. Farmers Ins. Exch., 444 S.W.2d 583 (Tex. 1969). The process is commonly referred to as “pay and chase” litigation – the insurer pays the loss, and then chases the other parties who should have paid.
Pruessner & Colley has been at the forefront of Texas insurance subrogation law in recent years, both in pursuing and defending against such claims. Two of our recent cases resulted in significant decisions that clarified an insurer’s subrogation rights under Texas law:
- Amerisure Ins. Co. v. Navigators Ins. Co., 611 F.3d 299 (5th Cir. 2010) (limiting Supreme Court of Texas’ Mid-Continent decision, and finding that insurer could subrogate against non-paying insurer)
- Colony Ins. Co. v. Peachtree Constr., Ltd., 647 F.3d 248 (5th Cir. 2011) (same)
Relying on our wealth of experience in this area of the law, we advise clients regarding whether a “pay and chase” strategy should be employed for a particular claim, how to preserve their subrogation rights, and assist in recouping sums that are paid. Similarly, the Firm defends clients against subrogation actions brought by other insurers.