You Only Get What You Pay For

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Posted on September 29, 2023 by Barry Zalma

Refusal to Buy Coverage Defeats Suit

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In Texas Windstorm Insurance Association v. Kevin Kelly and Tiffany Kelly, No. 09-22-00173-CV, Court of Appeals of Texas (September 21, 2023) the Texas Windstorm Insurance Association’s (TWIA) appealed from an order granting Plaintiffs’ summary judgment and denying TWIA’s summary judgment motion.


Section 2210.208 of the Texas Insurance Code requires an offer of Windstorm and Hail Insurance policies issued by TWIA to include coverage for wind-driven rain. Coverage may be made available through an endorsement that requires the insured to pay an additional premium to the carrier to compensate the carrier for insuring against the additional risk of covering the property against the casualty of being damaged by wind-driven rain.


The Kellys live in Port Arthur, Texas. In 2017, the Kellys purchased a windstorm and hail insurance policy from TWIA through their insurance agent to cover their residential property. The policy insures the property against direct loss resulting from the perils of Windstorm and Hail only. The policy specifically excluded the following loss to the covered property: “6. Rain. We do not cover loss or damage caused by or resulting from rain, whether driven by wind or not, unless direct force of wind or hail makes an opening in a roof or wall and rain enters through this opening and causes the damage.”

The Kellys’ home was damaged by Hurricane Harvey on or about August 29, 2017. On September 1, the Kellys’ filed a notice of claim with TWIA. The adjuster hired by TWIA made the following findings:

  1. the Kellys’ property sustained covered damage to the garage door tracks,
  2. damage to the roof was not caused by wind or hail, and
  3. water damage to the interior of the property did not result from a wind or hail created opening in the roof or walls, as required for coverage under the policy.

TWIA issued a Notice of Claim Acceptance in Part and Denial in Part, accepting coverage for damage to the tracks on the detached garage but denying coverage from rainwater intrusion.

TWIA filed an unsuccessful motion for summary judgment.

The dispute centered on whether the “must include coverage for” clause is satisfied by TWIA’s offering their insureds the opportunity to purchase a Department of Insurance approved endorsement, which extends the basic coverage in TWIA’s windstorm and hail policy to damages caused by wind-driven rain.

The trial court found that the TWIA policy issued to the Kellys improperly and ineffectively omits coverage for wind driven rain damage.


The Court of Appeal construes statutory language to determine and give effect to the Legislature’s intent. The Court must not interpret the statute in a manner that renders any part of the statute meaningless or superfluous.

TWIA argued that it complied with the Act by offering to cover losses caused by wind-driven rain through an endorsement to the basic windstorm and hail policy that it issued to the Kellys, an endorsement the Kellys did not obtain.

The Act imposes no non-compliance penalty on TWIA but instead allows it to comply with the statute by offering its insureds the opportunity to obtain an endorsement that covers damage caused by wind-driven rain by paying an additional premium approved by the commissioner when purchasing a windstorm and hail policy.

The Court of Appeals’ reading of the statute supports the policy that led to the enactment of the windstorm statute. Under well-established rules of statutory interpretation, an appellate court may not interpret one portion of a statute so as to render another portion of the statute meaningless.

Accordingly, the Court of Appeals concluded that TWIA complied with the requirements of the statute by offering the Kellys the opportunity to obtain coverage for damage caused by wind-driven rain through the purchase of an endorsement that, if purchased, would have provided coverage for losses caused by wind-driven rain.

The Court of Appeals reversed the trial court’s Order granting summary judgment in favor of the Kellys and reversed the trial court’s Order denying TWIA’s summary judgment.


Statutes requiring insurers to provide various types of insurance must be read in a manner to provide the desires of the Legislature and not provide less or more than that required by the statute. TWIA followed the statute by offering an endorsement providing wind driven rain coverage, which it offered to the Kellys’ only to have them refuse the coverage and then, when damaged by wind driven rain, attempted to cure their error by litigation misinterpreting the statute. They received the coverage they paid for and did not receive the additional coverage for which they refused to pay.

(c) 2023 Barry Zalma & ClaimSchool, Inc.

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Barry Zalma, Esq., CFE is a retired insurance coverage lawyer who blogs daily with digests of insurance cases and writes books and articles on insurance claims, insurance law, and insurance fraud.

Culver City, CA

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