In Richardson East Baptist Church v. Philadelphia Indemnity Insurance Company, a Texas appellate court considered a church’s claims for breach of the duty of good faith and fair dealing, breach of contract, conspiracy, and violations of the Texas Insurance Code. The case arose because the church owned several buildings, all of which were insured by Philadelphia Indemnity.
In 2013, the church notified its insurer that a hailstorm had damaged the roofs of two buildings. It submitted a roofer’s estimate of $32,713.13 to replace the roofs. The insurer assigned an independent adjusting company to investigate. The company assigned an adjustor, who inspected the property and told the insurer his findings. He’d concluded that the hail damage necessitated the replacement of certain slopes and spot repairs. His estimate was that the repairs totaled $10,441.55, minus the $2,500 deductible.
The pastor disagreed with the estimate, claiming that an expert had found more damage. The insurer told the adjustor to hire an engineer to evaluate the damage, and the engineer found only limited hail damage to one slope—even less than what the adjustor had found. Nonetheless, the insurer offered to pay the church based on the adjustor’s initial estimate. The pastor still disagreed and told the adjustor he would take the option for the appraisal provision in the policy.