State Farm Lloyds, Inc. v. Polasek

OPINION

PEEPLES, Justice.

In this arson and bad faith case State Farm appeals a judgment against it for actual and exemplary damages. In 1990 a fire destroyed the Polaseks’ video rental business, which State Farm insured. State Farm denied the Polaseks’ insurance claim on the ground that the fire was caused by arson. The Polaseks filed suit, and ultimately a jury found that the Polaseks had not committed arson and that State Farm acted in bad faith because it did not have a reasonable basis for denying the claim. The jury found damages of $40,000 for property loss and $200,000 for mental…