Courts have held that extracontractual liability (meaning in essence liability beyond the usual contract damages) can exist in first-party insurance cases even when an appraisal was timely paid, for example, but the claim itself was not timely paid. The Texas Supreme Court announced that holding when it addressed the question of liability under the Texas Prompt Payment of Claims Act in the case of Barbara Technologies Corp. v. State Farm Lloyds, 589 S.W. 3d 806, 816-19 (Tex. 2019).
The question of bad faith and how it depends on the presence or absence of fault is the subject of § 9:5, in 2 Dennis J. Wall, Litigation and Prevention of Insurer Bad Faith (3d Edition Thomson Reuters West and 2020 Supplements).
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