Replies to This Discussion

Permalink Reply by sesport on August 3, 2009 at 18:01

bump

I've been waiting to hear some discussion on this issue, especially perhaps some "sidetrack" about higher insurance costs associated with the above stated.
:0)

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Permalink Reply by Dion Warr, CPL on August 4, 2009 at 2:44

Mac:

Not that I'm wishing to hijack your topic, but observations indicate that this is more of a problem with lenders with existing mortgages on properties within the HS area, many of which (having financial problems of their own) have become quite green (or maybe just want more 'green') with envy and want to inject themselves into the role of receiving (at least) portions of bonus, rents, and royalty from an oil, gas and mineral lease when an account for valuation of minerals was never considered to be part of the basis of their lending same on the properties so mortgaged.

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Permalink Reply by P.G. on August 4, 2009 at 2:50

I believe with Home Owner's insurance, it's the liability and improvements that are insured, not the land!
As for the car, they consider the salvage value towards a replacement. I suppose if your house burned down, wouldn't that be like them making claim to the rubble?
And aren't mineral rights just that? "Rights" to get the minerals if any exist and not the actual minerals? What are minerals worth if they haven't been reduced to possession?

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Permalink Reply by intrepid on August 4, 2009 at 11:28

In Texas, an insurance co. would have no right to your lot. They have enough trouble trying to figure out how they can pay as little as possible on your claim, let alone trying to figure out how to take your lot and profit from your minerals. But, I wouldn't put it past some of them to try, now that you've given them the idea. :>

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Permalink Reply by sesport on August 4, 2009 at 12:27

I think there is some misunderstanding, but the query is a mixed one. Look at Mac's last statement.

Mineral owners will have another asset, some large and some not so large. Should someone sustain an injury on MO's insured property and property insurance company pays up to the limit, is there the potential for mineral revenues to be factored in and/or seized for payment beyond the insurance limit? Also, to increase one's limit, wouldn't that mean insurance premiums would increase?

I don't necessarily think, though, that this is a "gotcha" because coverage limits are spelled out in policies.

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Permalink Reply by Mac Davis on August 4, 2009 at 12:38

It's a gotcha in the sense that maybe you need a higher coverage limit.

There might also be some additional risk to getting sued because you might get sued by someone working on pipelines, seismography, drilling, etc. on your property. Or even something bizarre like because you sold mineral rights or were force pooled, you're partially liable for an injury on the drilling rig that isn't even on your land. Yes, it's BS, but it could cost you money to defend yourself. That assumes that your insurance company would defend you against such a lawsuit.

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Permalink Reply by sesport on August 4, 2009 at 13:44

As to your first scenario (employee of companies injuried on home/landowners' property) I'm going to GUESS that it would depend on the circumstances of the injury. An injury that occurs performing the duties of the job MAY fall under the responsibility of the employer. An injury sustained by company's employee while, say, walking across property and tripping in a hole MAY be the liability of the home/landowner.

The "Or even something bizarre..." part, I'm not sure & would have to look into it further to GUESS what risk may be involved for home/landowner.

And, as you say, IANAL or insurance agent. :0)

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Permalink Reply by Mac Davis on August 5, 2009 at 1:18

I'm not trying to argue there are land mines out there in terms of insurance, I'm just poking around to try and see if they are out there.

So far, I'm getting

1) Yet another thing you should get into your lease.

2) Lawsuits looking for people or insurance companies willing to settle rather than fight. (It's Lawsuit Lottery!!!!)

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Permalink Reply by Mac Davis on August 5, 2009 at 1:35

And to be clear, one of the reasons to have a reasonably high level of coverage is to give the insurance company an incentive to actually defend against a frivolous lawsuit rather than just paying out their coverage limit and leaving you to defend the lawsuit.

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Permalink Reply by Mac Davis on August 5, 2009 at 2:27

Interesting. Do you mean the insurance company can't just say, "Mr. Plaintiff, here's the amount of Mr. Defendant's coverage limit," and the insurance company is done, but you're still on the hook?

However, can't they can hire cheapo Joe Lawyer, just out of law school, not give him any resources to fight the suit and know they won't have to pay out more than the amount of your coverage limit when Joe Lawyer loses the case?

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Permalink Reply by intrepid on August 6, 2009 at 4:55

In Texas the insurance co. still has a duty of good faith and fair dealing to their policy holder and that old standard the Stowers case is still the basis for a lot of litigation today when insurance companies are as blantant as you describe in hanging their policy holder's out to dry.

Permalink Reply by intrepid on August 5, 2009 at 3:28

Sesport, it would be the same as if you had any other potentially substantial asset. If the damages awarded by a jury and sstained on appeal were in excess of your insurance coverage, or not covered by insurance, they could potentially be attached. But a homestead is subject to some protection even if you have to go into bankrupty to do it.

There are suits over mineral and property interests all the time of course but those are very different basis that someone trying to bring a predatory suit for personal negligence targeting mineral rights as the ultimate prize.

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