The Supreme Court of Texas perceives that a workers’ compensation carrier is no longer in an unequal bargaining position with its insureds’ employees. This comes as a surprise to injured workers, as well as the Office of Injured Employee Counsel, the ombudsmen who are largely tasked with representing the workers.
The OIEC said:
In essence, the only restraint on the carrier’s failure to deal fairly with claimants would be through the administrative procedures at TDI-DWC. Claimants cannot pursue an individual remedy for the carrier’s unreasonable delays, denials, or disputes.
Justice Cardozo famously held:
“(t)he risk reasonably to be perceived defines the duty to be obeyed.”
Palsgraf v. Long Island R. R., 248 N.Y. 339, 344, 162 N.E. 99, 100, 59 A.L.R. 1253.
Where did the risk go? In 1988 in Aranda the Supreme Court saw a risk:
An arbitrary decision by the carrier to refuse to pay a valid claim or to delay payment leaves the injured employee with no immediate recourse.
Aranda v. Ins. Co. of N. Am., 748 S.W.2d 210, 212 (Tex. 1988) overruled by Texas Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430 (Tex. 2012).
But now the Act itself is “comprehensive,” and the fines provided for misbehavior will ensure the adherence to the duty. Really?
This could be fixed quickly. The provisions of Chapter 541 of the Texas Insurance Code should apply to the adjustment of a w.c. insurance claim.