While in Mississippi this week, working on a hurricane claim to three apartment complexes that fortunately resolved at mediation, I had the opportunity to discuss an important area of Mississippi insurance law with attorney Wynn Clark. Wynn shared with me an excellent summary 1 of what’s known in Mississippi as “Veasley damages,” and it’s worth unpacking why this unique doctrine matters for anyone handling claims in the Magnolia State.
Mississippi has long recognized that when an insurance company mishandles a claim, the harm to the policyholder often extends beyond the unpaid benefits. Unlike many states that restrict damages in breach of contract cases to direct economic losses or require punitive conduct to justify more, Mississippi carved out a middle ground—an intermediate tier of relief for what courts call tortious breach of contract.
This category comes from Universal Life Ins. Co. v. Veasley, 610 So. 2d 290 (Miss. 1992). In Veasley, the insurer negligently refused to pay a valid life insurance claim due to a clerical mistake. The Mississippi Supreme Court recognized that it was foreseeable that the insurer’s negligence would cause emotional distress, inconvenience, attorney’s fees, and other costs. Even though the conduct didn’t rise to the level required for punitive damages, the court held that the insurer could still be liable for these reasonably foreseeable consequences.
As later cases explained, Veasley damages fill the space “between simply receiving incidental costs of suit and getting punitive damages.” This doctrine was reaffirmed by the Fifth Circuit in Essinger v. Liberty Mutual Fire Insurance Company 2 and later clarified in cases like Broussard v. State Farm Fire & Casualty Company, 3 where courts held that even without a “reasonably arguable basis” for denial, an insurer’s negligent conduct could still give rise to compensatory relief beyond contract damages.
In practical terms, that means Mississippi recognizes a form of accountability in which an insurer’s misconduct isn’t egregious enough to warrant punishment but is still harmful enough to warrant compensation. This includes emotional distress, attorney’s fees, and other consequential damages tied to the insurer’s mishandling of the claim.
For policyholders and their attorneys, this doctrine is vital. It allows recovery in many real-world cases where an insurance company’s negligence, rather than outright malice, inflicts significant harm. As Wynn Clark and I discussed, understanding this framework can make all the difference in how a claim is evaluated, negotiated, and ultimately tried in Mississippi courts.
It’s also a reminder that Mississippi’s jurisprudence continues to reflect an appreciation for fairness and accountability in insurance relationships. Mississippi recognizes that the promise of insurance is about more than just dollars and cents. It’s about restoring peace of mind and dignity when disaster strikes.
Thought For The Day
“Justice cannot be for one side alone, but must be for both.”
— Eleanor Roosevelt
1 Clark Memo.
2 Essinger v. Liberty Mutual Fire Ins. Co., 534 F.3d 450 (5th Cir. 2008).
3 Broussard v. State Farm Fire and Cas. Co., 523 F. 3d 618 (5th Cir. 2008).