Texas Public Policy Does Not Preclude Insurance Coverage for Exemplary Damages Due to Employer's Gross Negligence Under Workers' Compensation and Employer's Liability Policy

Texas Public Policy Does Not Preclude Insurance Coverage for Exemplary Damages Due to Employer's Gross Negligence Under Workers' Compensation and Employer's Liability Policy

After analyzing the Texas Workers' Compensation and Employer's Liability Statutory scheme, the Supreme Court of Texas in Fairfield Ins. Co. v. Stephens Martin Paving, LP(currently unpublished) held that the state legislature had the authority to authorize the Texas Department of Insurance to create a policy that provides insurance coverage for exemplary damages in workers' compensation cases. In answering the certified questions poised by the United States Fifth Circuit, the Court ruled that public policy considerations do not void coverage in such policies for exemplary damages due to an employer's gross negligence. For more information regarding this case, contact Jeff Kingsley or Nikia O'Neal.