A Stowers demand is a tool commonly used by personal injury lawyers in Texas to settle personal injury claims. It can help accident victims settle for maximum fair compensation.

The Stowers Duty: Defined

The Stowers duty was first recognized in 1929 in the case of Stowers Furniture Co. v. American Indemnity, and since has broadened and narrowed the duties it imposes. The Stowers duty is the duty an insurer is obligated to perform in order to exercise reasonable care in handling claims against its insured. This duty was enacted to ensure that insurers exercise due care in evaluating settlement demands that are within the policy limits of the insured.

History of the Stowers Furniture Company Truck v Car Accident & Lawsuit

In 1929 a driver for Stowers Furniture Co. hit a car while delivering furniture to Houston, Texas which seriously injured the driver of that car. A suit was brought against Stowers furniture and before the trial date the injured party made a demand for $4,000, which was within Stowers $5,000.00 policy limit, to settle for her damages (known as a Stowers demand). American Indemnity rejected the demand saying they wouldn’t pay more than $2,500.00 while knowing that the judgment was likely to exceed Stowers policy limit. The case was tried and the injured party was owed $14,107.15.

Stowers Furniture Co. then brought an action suit against its insurer, American Indemnity, saying the insurance company didn’t use due care when evaluating the case because it refused to accept the demand that was in policy limits. Since the amount exceeded Stowers $5,000.00 policy limit, the furniture company would be liable for anything above that amount. The jury sided with Stowers saying that American Indemnity did not act as a prudent insurer and was held responsible for the verdict of $14,107.15.

The policy stated that American Indemnity had the right to take complete control of the suit against Stowers and that Stowers was prohibited from making any settlement. By holding that right, the insurance company takes on the responsibility of being the insured’s agent, and it should act with care and diligence just as an ordinary person would I managing his business.

Summary of Stowers Duty Implications for Personal Injury Law and Accident Cases

Prior to the Stowers duty, insurance companies didn’t put themselves in their insured’s shoes because they knew that if they win they only lose defense costs, and if they lost they only lose the amount that the insured’s policy covers, leaving the insured to pay the rest. The Stowers duty puts burden on the insurance agencies reminding them to act with care because they could be liable for whole settlement if they act negligently on behalf of their insured.


A Stowers Demand is an effective tool personal injury lawyers can use to:

  1. Settle a case.
  2. Protecting the injured from accepting unfair settlement.
  3. Puts pressure on the insurance company to settle for policy limit.

What to watch out for in a Stowers demand:

  • A Stowers demand will be made within policy limits.
  • Liability is reasonably clear.
  • The demand must be “unconditional.”
  • The demand must be a “full release.”
  • A reasonable insurer would accept the offer.

You may be left with a few questions from that list and what it really means.

First, the demand must be within the policy limits. It’s well known among personal injury lawyers that insurance adjusters often will not disclose the policy limits of the insured. To ensure their client doesn’t receive less than they deserve, a personal injury attorney will make a demand for maximum policy limits.

What is “unconditional?” In this context, the “unconditional” offer will be made by the plaintiff to settle with the defendant. If accepted, all potential liens and all liability of the defendant will be released. That is, the plaintiff can not sue the party for any other claims.

What is a “full release?” The demand must not be conditioned upon anything and must be an offer to fully release the at fault party.

The value of the demand must be reasonable given the injuries sustained by the victim.

Stowers Demand in Austin Car Accident Cases

If you have been injured, talk with your attorney about your case. Experienced legal counsel at McMinn Law Firm know when a Stowers Demand should be made in a personal injury case.

Jason McMinn and Justin McMinn are experienced car accident lawyers that will help you get back on your feet after a crash. Knowing your case is in good hands can give you peace of mind. Read our tips about choosing the best personal injury lawyer for your car accident case here.

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