News Summary
GD Group Inc. has filed a lawsuit against Berkshire Hathaway Direct Insurance Company, alleging mishandling of their property insurance. The lawsuit arises from a water damage incident at GD Group’s Seguin property. They claim inadequate investigation and wrongful policy rescission, leading to significant financial losses. As GD Group seeks to recover damages, the implications of this case could reshape commercial property insurance practices in Texas.
Texas – GD Group Inc., a Texas-based corporation, has initiated a lawsuit against Berkshire Hathaway Direct Insurance Company in federal court located in San Antonio. The lawsuit, filed on September 25, 2025, alleges that Berkshire Hathaway unlawfully rescinded GD Group’s commercial property insurance policy following a substantial water damage incident caused by a sprinkler system failure in August 2024.
The sprinkler system at GD Group’s property in Seguin ruptured on August 8, 2024, resulting in extensive water damage. Following the incident, GD Group filed a claim with Berkshire Hathaway, which acknowledged the claim and assigned it to adjuster Raj Shipwal for further investigation. Shipwal collaborated with David Yoon from Engle Martin during this investigative process. However, despite confirming the existence of significant water damage, the insurer reportedly failed to make a coverage determination. On October 29, 2024, GD Group was informed that their claim was still under investigation.
Compounding GD Group’s difficulties, Berkshire Hathaway issued a notification on February 3, 2024, stating that their insurance policy had been rescinded due to alleged “material misrepresentation during the policy application process.” Following this policy rescission, the firm received a refund for their premiums. However, GD Group expressed confusion regarding this action, citing assurances from their insurance agent that the policy application was correctly completed.
Numerous attempts by GD Group’s insurance agent to resolve the policy cancellation with Berkshire Hathaway were unsuccessful, as the insurer reportedly refused to engage on the matter. Meanwhile, GD Group’s property suffered additional damage, resulting in financial hardships including loss of income due to property closures. To further assess the situation, GD Group enlisted the services of Mutual Group Inc., which estimated repair costs at $1,210,175.43, alongside calculating business income loss at $474,012.96 and loss of contents at $2,608,422.25.
This information was presented to Berkshire Hathaway alongside a pre-suit notice and demand on May 30, 2025. However, the response from Berkshire Hathaway’s attorney, Christopher Burke, on June 25, 2025, claimed that the policy was rescinded due to GD Group filing three business claims over three years, which were allegedly misrepresented during the application process.
The lawsuit accuses Berkshire Hathaway of several offenses, including bad faith, breach of contract, and deceptive insurance practices. GD Group asserts that the insurer conducted an inadequate investigation and failed to provide timely explanations for the denial of their claim, thereby violating Texas insurance law. As a result, GD Group is seeking a range of damages, including actual damages, policy proceeds, statutory damages, treble damages, accrued interest, and attorney fees.
As it stands, GD Group’s claim remains unpaid, and the company continues to experience ongoing harm, as they have been named as a defendant in a related lawsuit concerning unaddressed repairs linked to the original water damage claim. The ongoing lawsuit has potential implications for the landscape of insurance practices, particularly concerning how insurers handle rescissions and the investigation of claims within the commercial property sector.
It is crucial to note that all claims and allegations outlined in the lawsuit are currently at the complaint stage, with no judicial decisions rendered as of yet. The outcome of this litigation may set precedents for future interactions between insurers and policyholders in similar situations.
Deeper Dive: News & Info About This Topic
- Insurance Business
- ValuePenguin
- U.S. News: Homeowners Insurance in Texas
- Fox26 Houston
- Houston Chronicle
- Wikipedia: Insurance Law
- Google Search: Insurance Claims Denials
- Google Scholar: Insurance Coverage Rescind
- Encyclopedia Britannica: Insurance
- Google News: Insurance Disputes
Author: STAFF HERE COLLEGE WRITER
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