Full opinion text
SUBSTITUTE OPINION ON REHEARING KEM THOMPSON FROST, Justice. The court issued a unanimous opinion in this case on August 26, 2008. Appellant Texas Mutual Insurance Company moved for rehearing. After receiving a response from appellee P. Lance Morris, the court grants the motion for rehearing in part, withdraws the earlier opinion, vacates the earlier judgment, and issues this substitute opinion and new judgment in their place. I. Introduction A workers’ compensation carrier appeals from a final judgment in favor of a workers’ compensation claimant. In six issues, the carrier contends that (1) the evidence is legally insufficient to sustain the jury’s finding that the carrier engaged in unfair or deceptive acts or practices in violation of the Texas Insurance Code, (2) the evidence is legally insufficient to sustain the jury’s finding that the carrier did so knowingly, (3) the evidence is legally insufficient to support the award of damages for loss of credit reputation, (4) the evidence is legally insufficient to support the award of mental-anguish damages, (5) the trial court erred in submitting broad-form liability questions containing both valid and invalid theories of liability, and (6) the judgment cannot be sustained on the alternative claim of breach of the duty of good faith and fair dealing because no such claim is recognized in the context of a workers’ compensation claim. In a cross-appeal, the claimant requests that this court modify the trial court’s judgment to increase the award of additional damages for the carrier’s knowing violation of the Texas Insurance Code. We conclude that the evidence is legally sufficient to support the jury’s findings that the carrier engaged in unfair or deceptive acts or practices in violation of the Texas Insurance Code and that it did so knowingly. We also conclude that legally sufficient evidence suppoife the award of mental-anguish damages, and that no Cas-teel problem requires reversal. However, we conclude that no evidence supports the award for loss of credit reputation. We further conclude that the claimant’s cross-appeal lacks merit. We therefore modify the judgment to delete that portion awarding the claimant damages for loss of credit reputation and to reduce the additional damages accordingly. Further, because we are reducing the actual damages awarded to the claimant, we also reverse the portion of the judgment awarding attorney’s fees, and remand this case for retrial of that issue and for the recalculation of pre-judgment and post-judgment interest. We affirm the remainder of the judgment. II. Factual and Procedural Background Appellee/cross-appellant P. Lance Morris brought this suit against appellant/cross-appellee Texas Mutual Insurance Company, alleging that the company acted in bad faith and violated the Texas Insurance Code because it failed to properly investigate Morris’s claim for workers’ compensation benefits, and that it delayed paying workers’ compensation benefits due him. Morris alleged that, on June 12, 2000, while working for the Justin Volunteer Fire Department he received an on-the-job injury to his spine (the “2000 Injury”). Then, in March 2003, Morris required emergency treatment for his back injury. According to Morris, Texas Mutual initially promised to pay for surgery on his back, but only days after the surgery, the company reneged on this promise. Morris alleged that the requested treatment for his injury was reasonable and necessary, but Texas Mutual delayed and denied payment for the previously pre-authorized medical treatment, with significant adverse consequences to him. Morris also alleged that the Texas Workers’ Compensation Commission (hereinafter the “Commission”) adjudicated that Texas Mutual wrongfully denied his claim for benefits. Morris claimed that Texas Mutual violated the Texas Insurance Code, breached its common-law duty of good faith and fair dealing, and violated the Deceptive Trade Practices Act (“DTPA”). Texas Mutual answered the suit and later amended its answer to add a counterclaim for fraud. In the counterclaim, Texas Mutual alleged that Morris strained or sprained his back in 1998; two years before the 2000 Injury, and that he falsely represented to the Commission that he did not have a pre-existing back injury. Texas Mutual claimed that Morris knew this representation was false when he made it, and that Texas Mutual relied upon it and was injured by having to pay for benefits that would not have been due if the extent of Morris’s back problems had been, disclosed fully. In the March 2006 trial, the jury returned a 10-2 verdict in Morris’s favor on his claims for common-law bad faith and statutory violations. The jury awarded Morris $50,000 for past mental anguish; $25,000 for past damage to his credit reputation; $50,000 for future damage to his credit reputation; and $120,000 for attorney’s fees. The jury also awarded Morris $500,000 in additional damages because it found that Texas Mutual knowingly violated the Texas Insurance Code. The jury declined to find that Texas Mutual acted with malice or that Moms defrauded Texas Mutual. On May 18, 2006, the trial court signed a final judgment for Morris, awarding the amounts found by the jury, except for the $500,000 in additional damages, which the trial court reduced to $250,000. On appeal, Texas Mutual raises six issues, and Morris raises one issue in his cross-appeal. III. Issues PResented by the Carrier In its first four issues, Texas Mutual contends the evidence is legally insufficient to support: • the jury’s finding that Texas Mutual engaged in unfair or deceptive acts or practices in violation of the Texas Insurance Code, • the jury’s finding that Texas Mutual violated the Texas Insurance Code knowingly, and • the jury’s damage awards for mental anguish and lost credit reputation. In its fifth issue, Texas Mutual contends that the trial court erroneously instructed the jury on both valid and invalid theories of liability. In its sixth issue, Texas Mutual contends that no cognizable claim exists for breach of the duty of good faith and fair dealing against a workers’ compensation carrier, or alternatively, any such claim should be abolished. A. Legal Sufficiency of Evidence Supporting Jury’s Finding that the Carrier Engaged in Unfair or Deceptive Acts or Practices in Violation of the Texas Insurance Code In its first issue, Texas Mutual contends that no evidence supports the jury’s finding that Texas Mutual engaged in unfair or deceptive acts or practices in violation of the Texas Insurance Code because no evidence shows that it misrepresented the policy or failed to explain the basis for the dispute, and no evidence shows that it knew or should have known that coverage was reasonably clear. Texas Mutual also contends that the evidence conclusively shows that it had a reasonable basis to dispute Morris’s claim. When reviewing the legal sufficiency of the evidence, we consider the evidence in the light most favorable to the challenged finding and indulge every reasonable inference that would support it. City of Keller v. Wilson, 168 S.W.3d 802, 823 (Tex.2005). We must credit favorable evidence if reasonable jurors could and disregard contrary evidence unless reasonable jurors could not. See id. at 827. We must determine whether the evidence at trial would enable reasonable and fair-minded people to find the facts at issue. See id. We cannot substitute our judgment for that of the jury, so long as the evidence falls within the zone of reasonable disagreement. See id. at 822. The jury is the only judge of witness credibility and the weight to give to testimony. See id. at 819. 1. Jury’s Liability Finding Regarding the Texas Insurance Code The judgment against Texas Mutual is predicated on the jury’s affirmative answer to Question 2. In that question, the jury was asked whether Texas Mutual engaged in any one or more of eight unfair or deceptive acts or practices under Texas Insurance Code sections 541.060 and 541.061. In propounding that question the court instructed the jury to consider the following ways in which an insurer could engage in an unfair or deceptive act: Making any misrepresentation of an insurance policy by: a. making an untrue statement of fact; or b. failing to state a material fact that is necessary to make other statements made not misleading, considering the circumstances under which the statements were made; or c. making any statement in such manner as to mislead a reasonably prudent person to a false conclusion of a material fact; or d. failing to disclose any matter required by law to be disclosed; or Engaging in any of the following unfair settlement practices with respect to a claim by an insured or beneficiary: a. misrepresenting to a claimant a material fact or policy provision relating to coverage at issue; or b. failing to attempt in good faith to effectuate a prompt, fair, and, equitable settlement of a claim ivith, respect to which the insurer’s liability has become reasonably clear; or c. failing to provide promptly to a policyholder a reasonable explanation of the basis in the policy, in relation to the facts or applicable law, for the insurer’s denial of a claim or for the offer of a compromise settlement of a claim; or d. refusing to pay a claim without conducting a reasonable investigation with respect to the claim. On appeal, Texas Mutual contends that no evidence supports any of the acts listed. As a preliminary matter, we first address the proper legal standard against which to measure the legal sufficiency of the evidence. Texas Mutual argues that, under Texas law, (1) proof that a workers’ compensation carrier refused to pay a claim without conducting a reasonable investigation is not sufficient to support liability against the carrier for violating the Insurance Code, and (2) the claimant also must prove a failure by the carrier to attempt in good faith to effectuate a prompt, fair, and equitable settlement of a claim with respect to which the carrier’s liability has become reasonably clear. For ease of reference, we refer to the first element as “no reasonable investigation” and the second element as “reasonably clear liability.” Morris, on the other hand, asserts that liability may be affirmed based only upon legally sufficient evidence that Texas Mutual failed to conduct a reasonable investigation. For the purposes of our analysis, we presume, without deciding, that Texas Mutual’s characterization of Texas law is correct. Nonetheless, Question 2 did not charge the jury on this law; rather, it allowed the jury to find an Insurance Code violation based only on a finding of no reasonable investigation. No party objected to Question 2’s failure to charge the jury on what Texas Mutual argues on appeal is the correct legal standard, and no party requested that the jury be charged under this legal standard. Therefore, this court reviews the sufficiency of the evidence under the charge submitted to the jury (allowing liability to be based on a finding of either no reasonable investigation or reasonably clear liability), even if the charge did not correctly state Texas law. See Osterberg v. Peca, 12 S.W.3d 31, 55 (Tex.2000) (holding that court could not review the sufficiency of the evidence based on a particular legal standard because that standard was not submitted to the jury and no party objected to the charge on this ground or requested that the jury be charged using this standard); Hirschfeld Steel Co. v. Kellogg Brown & Root, Inc., 201 S.W.3d 272, 283-86 (Tex.App.-Houston [14th Dist.] 2006, no. pet.) (reviewing sufficiency of evidence based on unobjected-to jury instruction and rejecting various arguments based on different legal standards). Accordingly, if there is legally sufficient evidence of either no reasonable investigation or reasonably clear liability, there is legally sufficient evidence to support the jury’s answer to Question 2. 2. Evidence of “No Reasonable Investigation” and “Reasonably Clear Liability.” Texas Mutual asserts that the evidence is legally insufficient to support either a finding of “no reasonable investigation” or a finding of “reasonably clear liability.” Texas Mutual contends that its records showed that Morris had a minor injury that resolved in 2000 and a new, and more severe, injury in 2003, caused by an unrelated incident. Therefore, Texas Mutual asserts, the evidence conclusively shows that the company had a reasonable basis to deny or delay paying Morris’s workers’ compensation claim based on the 2000 Injury. Texas Mutual claims that it had a reasonable basis to question whether the back strain Morris sustained in connection with the 2000 Injury was a cause of his need for back surgery in April 2003. According to Texas Mutual, its records showed that Morris suffered only a minor injury for which he received one month of chiropractic treatment; he returned to work without restrictions after missing only one shift. In addition, Texas Mutual claims, the medical records available from Morris’s surgeon in April 2003 reflected that Morris’s injury requiring surgery occurred when he slipped or fell off a fire truck, not while lifting a patient out of a ditch as occurred on June 12, 2000. Thus, because Texas Mutual’s records indicated a minor injury while lifting a patient out of a ditch, that had fully resolved in 2000, and a “new and more severe injury in 2003 eause[d] by a different incident,” Texas Mutual believed it had grounds to dispute whether Morris’s surgery was connected with the 2000 Injury. The question before this court is whether legally sufficient evidence exists to show “no reasonable investigation” or to show “reasonably clear liability.” The following evidence presented to the jury supports a finding as to both items. The 2000 Injury and the Surgery On June 12, 2000, while working for the Justin Volunteer Fire Department, Morris hurt his back when he lifted a victim of a motor-vehicle accident out of a ditch. The fire department reported the injury to its workers’ compensation carrier, Texas Mutual, which accepted the claim. Morris visited a chiropractor, Dr. Waldrop, the day he was injured. Dr. Waldrop’s initial medical report to the Commission noted that Morris was injured when he “lifted a patient and felt sharp shooting pain in the lumbar portion of his spine.” The doctor’s clinical assessment indicated that Morris had “palpable muscle spasms at the L-4L-5 level of his spine.” Morris received several chiropractic treatments from Dr. Waldrop over the next two weeks. After that, Morris had periodic appointments with Dr. Waldrop over the next two-and-a-half years. Morris missed only a brief period of work as a result of the 2000 Injury. In February 2003, Morris married and moved from Justin to Sugar Land. After the move, Morris began seeing another chiropractor, Dr. King. At some point, Morris began experiencing increasing pain in his back, and on March 23, 2003, Morris went to the emergency room at Methodist Hospital in Sugar Land. The hospital referred Morris to a neurosurgeon, Dr. Charles Neblett, who diagnosed Morris with a herniated disc. Dr. Neblett requested preauthorization from Texas Mutual to perform an “L4-5 L5-S1 lumbar laminectomy.” Texas Mutual granted the request for pre-authorization on April 1, 2003. Surgery was performed the next day. The Initial Inadequate Investigation On April 3, 2003, Texas Mutual transferred Morris’s file to a new adjuster, Joy Rodgers. Four days later Rodgers took her first documented action on the file. On that day, April 7, 2003, Rodgers reviewed the file and called Bill Mitchell, the fire chief of the Justin Volunteer Fire Department, to find out about Morris’s 2000 Injury. According to Rodgers’s claim diary, Mitchell told her that Morris returned “at full duty without any problems.” On that same day, April 7, Rodgers prepared and filed a “Notice of Refused or Disputed Claim,” giving notice that Texas Mutual disputed the claim. By deposition, Rodgers testified that she knew she had a duty to investigate the claim, which included a procedure known as a “three-point contact.” As its name suggests, a “three-point contact” entails contacting three sources of information: (1) the injured worker, (2) the employer, and (3) the medical provider. Rodgers admitted that she did not complete the three-point contact before disputing the claim. Before Rodgers communicated Texas Mutual’s denial of the claim, neither she nor anyone else spoke to Morris’s surgeon, Dr. Neblett, even though the documentation submitted for preauthorization by Dr. Neblett indicated that the need for surgery arose from the 2000 Injury. Nor did Rodgers talk to any other treating doctor. Rosalind Thompson, a Texas Mutual claims supervisor, acknowledged that before Texas Mutual denied the claim it did not ask a doctor whether the 2000 Injury was a producing cause of Morris’s surgery, even though Texas Mutual knew the names of the two doctors who had treated Morris from the time of the 2000 Injury to days before his surgery. And, although Rodgers, in her claims diary, noted that she called the surgeon, Dr. Neblett, she did not speak with the doctor but instead spoke to administrative personnel in his office to let them know that Texas Mutual was disputing the claim. Morris’s expert testified that Dr. Neblett was the best person for Rodgers to speak with in conducting an investigation because he saw and physically examined Morris. Notably, Rodgers did not even speak with Morris before denying his claim. Initially, Mitchell- — the only person with whom Rodgers did speak — did not recall speaking to Rodgers, and Mitchell testified that he would not have told her Morris returned at full duty with no problems. Rodgers apparently did not inquire into any of the details of Morris’s injury. At best, the evidence shows that she made only a cursory inquiry with Mitchell into Morris’s status when he returned to duty. One fact that seemed to play heavily in Rodgers’s decision to dispute coverage was that the description Morris gave for how he injured himself in 2000 differed from the cause reflected in Texas Mutual’s records. Even with this variation, the date Morris gave for his injury — June 12, 2000 — was correct. Before disputing the claim, Rodgers failed to ask Morris about this discrepancy. Although a field investigator was assigned to speak with Morris and apparently did speak with him a week or so after the surgery, the investigator apparently did not ask Morris about the discrepancy and did not ask him for medical records. Frank Weedon, Morris’s insurance expert, testified that Rodgers’s investigation of the claim was not reasonable because she failed to conduct a “three point contact.” Weedon explained that Rodgers did not speak to either Morris or his treating doctors, and, at most, had only a brief discussion with Mitchell before filing the dispute on April 7, 2003, the same day she first reviewed the file. Although Rodgers testified that she felt she did not need to speak with a doctor to learn more about Morris’s physical condition before she disputed the claim, she knew about the three-point-contact principle and agreed that use of this method would have been the proper way to conduct an investigation. Reasonable jurors could have chosen not to believe Rodgers’s claim that she did not need to speak with- a doctor in this particular .case. Other Actions by the Carrier Regarding the Claim Texas Mutual continued to dispute coverage for the next several months. Texas Mutual asserted it did not receive an authorization from Morris to obtain medical records; however, Morris faxed an authorization form to Texas Mutual no later than mid-April 2003. The form was signed by his wife because he was back in the hospital at the time. Texas Mutual stated that it would not have been able to obtain any records with this form because Morris himself did not sign it, but it also appears that Texas Mutual did not attempt to obtain any records with the form. In addition, Morris said that no one at Texas Mutual ever asked him for another authorization and never requested his medical records. Eventually, Morris retained attorneys to represent him in the dispute with Texas Mutual. On August 29, 2003, Morris’s attorneys faxed to Texas Mutual some of Morris’s medical records, including a page of treatment notes from Dr. Waldrop, the chiropractor Morris saw after the 2000 Injury. Documented in this page of treatment notes was Dr. Waldrop’s treatment of Morris between November 2001 and January 2003. Morris’s attorneys specifically sent this page because Texas Mutual said it had no record of treatments for Morris between 2001 and 2003. The notes indicate, among other things, that Morris had “L5/S1 n. root disc radiculopathy.” The Texas Mutual employee who was responsible for organizing the medical records testified that the company failed to forward this important page because the document was wrongly coded. She explained that this page was behind another page that was an approval for a new physician, Dr. King, who saw Morris from February to April, just before the surgery. Seeing the approval letter, she coded the documents following it as relating to the approval letter, apparently without checking to ensure that this coding determination was accurate. Another Texas Mutual employee testified that no other medical documents were wrongly coded. In November 2003, Morris and Texas Mutual participated in a benefit-review conference at the Commission’s offices, but the dispute was not resolved at that time. Texas Mutual requested that Morris submit to a medical examination by a doctor of its choice, and Morris agreed. Texas Mutual chose Dr. Stephen DeYoung. On January 7, 2004, Texas Mutual sent Dr. DeYoung a letter asking him to determine, among other things, whether the lumbar herniations that were surgically treated in April 2003, were causally related to the “lumbar strain” of the 2000 Injury. Texas Mutual represented that it had attached “all of the medical records currently available” to it for Dr. DeYoung’s review. However, Texas Mutual did not forward any medical records from Dr. Waldrop, stating that it had “no documentation of medical treatment from the DOI, to 02/19/03” — even though Texas Mutual had received the page of treatment notes from 2001-2003. In its summary of Morris’s medical condition, Texas Mutual also pointed out that Dr. King’s medical records reflected that the “mechanism of injury” was different than that reported by the employer. The first report of injury, on June 12, 2000, indicated that Morris strained his back after carrying a patient out of a ditch, while Dr. King reported that he “fell off the fire truck after slipping off tread steps.” No one from Texas Mutual ever asked Morris about this discrepancy. Examination by Carrier’s Chosen Doctor On January 22, 2004, Dr. DeYoung examined Morris, who provided both an oral and written medical history. Morris told Dr. DeYoung that he was injured on June 12, 2000, when carrying a patient on a backboard out of a ditch to an ambulance, and that he had been receiving chiropractic treatment from Dr. Waldrop until he moved to Sugar Land and began seeing Dr. King in 2003. Morris did not tell Dr. DeYoung about an earlier injury he sustained in 1998, for which he received chiropractic treatments from Dr. Waldrop. At trial, Morris explained that he recovered fully from that incident and did not consider it an injury, and, for that reason, he did not tell Dr. DeYoung about it. Morris also explained that he did not fall off a truck; he began to fall and caught himself. The act of catching himself caused the injury. Dr. DeYoung wrote to Texas Mutual explaining that, given the lack of medical records, he could not determine whether Morris aggravated and accelerated his pre-existing lumbar disc degeneration and spondylosis, which ultimately led to a herniation, or whether the herniation was secondary to a disease of life. Therefore, Dr. DeYoung opined that (1) if Morris had no history of lower back difficulty prior to the 2000 Injury, and (2) if the medical records support ongoing difficulty with the lower back from the date of the 2000 Injury until Morris sustained the herniations in April 2003, he would give Morris “the benefit of the doubt and causally relate the disc her-niations to the lumbar strain of June 2000 as a result of aggravation and acceleration of the pre-existing lumbar disc degeneration and spondylosis.” Even though it had medical records from the very years Dr. DeYoung mentioned, and even though it had no records of an earlier injury, Texas Mutual continued to dispute the claim. Texas Mutual advised Morris that he would have to schedule a second benefit-review conference to resolve the dispute. The Commission’s Benefit Revieiv Officer’s Ruling that Claimant’s Herniated, Disc ivas Related to the 2000 Tivju-ny A second benefit-review conference was held in June 2004, more than a year after the surgery. Again, the parties were unable to reach an agreement, at least in part because Texas Mutual claimed it still had no medical records reflecting continuing chiropractic treatments by Dr. Wal-drop for the 2000 Injury. According to documentation from the Commission, Texas Mutual’s position was that Dr. DeY-oung’s ability to determine causation was hampered because the records were not available; Morris countered that he had provided the records to Texas Mutual several times and had no control over whether Texas Mutual forwarded them to Dr. DeYoung. The benefit-review officer noted the gap in the medical records, but still recommended the payment of benefits to Morris. The review officer found the following: A review of the initial medical records from Dr. Waldrop noted the claimant’s symptoms, which are consistent with the cwvrent diagnoses at H.-L5 and at L5-Sl. There are medical records from other doctors in the file supporting a causal connection between the findings on the diagnostic studies performed in 2003 and the original injury. (emphasis added). In reaching her conclusion, the benefit-review officer also found significant the reference to radiculopathy in Dr. Waldrop’s notes of November 21, 2001. Texas Mutual declined to accept this recommendation, and a benefit contested-case hearing was scheduled for July 2004. The Contested Case Hearing On July 1, 2004, in preparation for the contested-case hearing, Texas Mutual forwarded to Dr. DeYoung medical records showing Morris’s “initial treatment” with Dr. Waldrop, and asked him to review the records and determine whether the April 2003 herniations were the result of a preexisting condition or the 2000 Injury. Once again, Texas Mutual did not include the page of Dr. Waldrop’s records showing that Morris had a number of chiropractic treatments between 2001 and 2003. In response, Dr. DeYoung reported that the records were “limited” and “did not provide any detail with respect to his history and examination.” He also noted that the records showed that Morris “was last treated by Dr. Waldrop in January 2001.” This time, Dr. DeYoung opined that if Morris did not receive any medical treatment for his lower back between January 2001 and February 2003 (when Morris saw Dr. King), he would attribute Morris’s condition “more to a disease of life than the work related injury.” At the contested-case hearing, the Commission received sworn testimony and evidence, and ultimately determined that “[t]he herniations in [Morris’s] lumbar spine at levels L4-5 and L5-S1 were caused and/or aggravated by, and naturally resulted from, his June 12, 2000 injury.” Consistent with the benefit-review officer’s recommendation, the Commission noted that the medical evidence showed that Morris was complaining of an L5-S1 radi-culopathy in November 2001, when he was receiving treatment from Dr. Waldrop. The Commission’s decision reflected that it was based largely upon Morris’s testimony that he had no prior history of back problems, and that he had required continuous treatment since the 2000 Injury — testimony that satisfied the conditions under which Dr. DeYoung would find causation. The Commission ordered Texas Mutual to pay medical benefits to Morris. Texas Mutual did not appeal this decision. Camer’s Actions Following Discovery of the 1998 Back Strain After Morris filed suit against Texas Mutual and discovery ensued, Texas Mutual learned that Morris strained or sprained his back in 1998, when he slipped on or fell from the running board of a fire truck two years before the 2000 Injury. At that time, Morris missed two weeks of work and underwent numerous chiropractic treatments. Texas Mutual counterclaimed for fraud, alleging that Morris fraudulently testified before the Commission that he had no back injuries before the 2000 Injury. When Dr. DeYoung — the doctor who in his first opinion had given Morris the benefit of the doubt in determining that the 2000 Injury was causally related to the 2003 herniated disc — was later deposed, he was asked whether the medical information concerning Morris’s 1998 back injury and the treatments by Dr. Waldrop after the 2000 Injury changed his earlier opinion. Dr. DeYoung testified that, based on this information, he would conclude that the 2000 Injury was not causally related to the herniated disc requiring surgery in April 2003. However, on cross-examination, Dr. DeYoung admitted that Dr. Wal-drop’s omitted treatment notes did reflect “periodic” treatments between 2000 and 2003, the specific time frame Dr. DeYoung had indicated to Texas Mutual was most important to his evaluation. He also acknowledged that Morris’s medical records reflected that Monis had between 25 and 30 treatments between June 2000 and March 2003, contrary to Texas Mutual’s representation that it had no documentation of treatment in that time frame. Dr. DeYoung also admitted that, while Morris had received chiropractic treatments before the 2000 Injury, he had not received treatment from a medical doctor, and he was able to return to work after the 1998 incident. Texas Mutual also contends that Dr. DeYoung was not misled about Morris’s treatment with Dr. Waldrop because Morris gave him an oral medical history that included Dr. Waldrop’s treatment of him between the time of the 2000 Injury and January 1, 2003. However, Dr. DeYoung testified that if an insurance company wrongly told him it did not have documentation of treatment when the company did have it, he would be “concerned that I was being a little misled if I didn’t have all of the correct information.” He also testified that he was most interested in records from that time frame because “it would be probably the most important time period for making an accurate assessment of [Morris’s] medical problem” and he relied on Texas Mutual to give him all the medical records it had. Additionally, Morris’s expert testified that Texas Mutual could refuse the claim only if another event was the sole cause of the herniated disc. Thus, according to Morris’s expert, even if the 2000 Injury were a “one percent” cause of the herniated disc because it aggravated an earlier condition, it would be compensable and causally related. Texas Mutual’s own expert agreed that Texas Mutual could use the 1998 injury as a justification for not paying for the surgery only if the 1998 injury was the sole cause of the herniated disc. But, Dr. DeYoung did not testify that the 1998 injury was the sole cause of the herniated disc; in fact, no doctor at trial testified that the 1998 injury was the sole cause of the herniated disc. And, as Dr. DeYoung acknowledged, the nature of Morris’s injury in 2000 was one that may aggravate a pre-existing back problem and lead to a disc herniation. Thus, the jury had before it proof that the claims adjuster (Rodgers) denied or disputed the claim the first day she looked at the file and that, in deciding to deny or dispute coverage, she ignored accepted methods of investigating a claim. One of the adjuster’s proffered reasons for disputing coverage was that the description of the original injury did not match the injury shown on file, but the adjuster never asked Morris about this discrepancy. The jury had proof that Morris’s attorneys provided Texas Mutual the relevant medical records, and that Morris signed a release so that Texas Mutual could obtain any other relevant records, but Texas Mutual failed to forward a crucial page from these records to its medical expert and failed to do so on more than one occasion. Texas Mutual’s representatives said that the company did not forward the page of medical notes because the document was wrongly coded, but no other page of medical notes was wrongly coded. Further, although Texas Mutual contended that either an undisclosed earlier injury or a new injury in 2003 caused Morris’s herniated disc, Texas Mutual offered no evidence that it had any reason to believe that any new or pre-existing injury was the sole cause of Morris’s herniation that would have precluded coverage. Finally, the jury heal’d Dr. DeYoung admit that a back injury initially reported as a back strain may lead to a disc herniation requiring a lumbar laminectomy. Thus, the jury could have concluded that Texas Mutual’s assertions were merely a pretext to justify its refusal to pay for Morris’s surgery. Medical History Regarding Treatment After the 2000 Injury Texas Mutual claims that nothing in its file reflected that Morris was treated after the 2000 Injury and that Rodgers confirmed this by speaking with Mitchell, who, according to Rodgers, said that Morris returned to full duty without any problems. Texas Mutual also claims that further investigation of the incident did not reveal much more. According to Texas Mutual, “[although [Texas Mutual] requested that Morris provide medical records, few of those records were provided.” The record, however, contains conflicting evidence. First, Mitchell testified he could not remember speaking with Rodgers, and that he would not have told her that Morris returned to full duty. Second, Morris’s lawyers sent medical records to Texas Mutual — including the page of treatment notes from Dr. Waldrop — showing a number of visits by Morris between 2001 and 2003. Once he was shown the records, even Dr. DeYoung agreed that Morris received 25 to 30 treatments between the time of the 2000 Injury and April of 2003, during the time frame Dr. DeYoung considered critical to his evaluation. At trial, Texas Mutual admitted that it had in its possession this key page of medical treatment notes and that it never gave the notes to Dr. DeYoung — even though Dr. Young had stated how significant this material would be to his assessment of a connection between the 2000 Injury and the 2003 surgery. Though Texas Mutual said it overlooked the page because it was wrongly coded, this was the only page of medical notes that was wrongly coded; the remainder of the medical records made it to Dr. DeYoung. As a result of the coding error, Dr. Waldrop’s notes from 2001-2003 repeatedly failed to make it to Dr. DeYoung. A jury could have found it too coincidental that, out of all the medical records, the only one wrongly coded was the critical page showing a causal link between the 2000 Injury and the 2003 surgery. In a related argument, Texas Mutual contends that Morris hampered its investigation by providing it with a release form signed by Morris’s wife rather than by Morris. Texas Mutual contends that a form signed by anyone other than Morris would not have entitled Texas Mutual to obtain Morris’s records. However, Texas Mutual also had an authorization signed by Morris. Before the second benefit-review conference, at Texas Mutual’s request, Morris personally signed an authorization for Texas Mutual to obtain his records from Dr. Waldrop. In addition, Texas Mutual points to no evidence that Dr. Wal-drop’s office refused to provide medical records based on either authorization, and Morris testified that Texas Mutual never told him it could not use the authorization form signed by Morris’s wife. Morris also testified that Texas Mutual never asked for the records. Therefore, whether the authorization signed by Morris’s wife would have enabled Texas Mutual to obtain Morris’s medical records is irrelevant, because the evidence does not show that Texas Mutual ever sought to obtain any records with it and was refused, and the evidence affirmatively shows that Morris himself gave Texas Mutual an authorization he had signed to enable the company to obtain medical records from Dr. Wal-drop’s files. The 1998 Injury as Possibly Precluding a Finding of “Reasonably Clear Liability" We next consider two arguments Texas Mutual urges: (1) that liability never became reasonably clear because of the undisclosed 1998 back strain or sprain, and (2) that if Morris had disclosed the 1998 injury before the contested-case hearing, Dr. DeYoung would have concluded that Morris’s back surgery in April 2003, was not related to the 2000 Injury, and the Commission likely would have concluded that Morris was not entitled to benefits. First, Texas Mutual does not dispute that Morris suffered a compensable injury on June 12, 2000; its dispute is over the extent of the injury, i.e., whether the 2000 Injury was a producing cause of the herniation requiring surgery. In effect, Texas Mutual suggests that its liability for Morris’s surgery has never become “reasonably clear” because of Morris’s allegedly undisclosed back strain or sprain in 1998. Under the law governing workers’ compensation carriers, the term “injury” includes the aggravation of a pre-exist-ing condition. See Tex. Lab.Code Ann. § 401.011(26) (Vernon 2006); City of Pasadena v. Olvera, 95 S.W.3d 494, 497 (Tex.App.-Houston [1st Dist.] 2002, no pet.). To defeat coverage, a pre-existing condition or bodily infirmity must be the sole cause of the present disability or incapacity. See Texas Employers’ Ins. Ass’n v. Page, 553 S.W.2d 98, 100 (Tex.1977); Transcontinental Ins. Co. v. Crump, 274 S.W.3d 86, 100 (Tex.App.-Houston [14th Dist.] 2008, pet. filed). As noted above, Dr. DeYoung never opined that Morris’s back injury in 1998 was the sole cause of his herÁiation. In addition, both a Texas Mutual claims supervisor and Texas Mutual’s expert, Wayne Davidson, acknowledged that Texas Mutual is obligated to pay for aggravation of a pre-existing injury. Thus, even presuming that any prior back strain Morris may have suffered in 1998 was still affecting him in 2003, the jury reasonably could have concluded that Morris’s compensable back injury in 2000 aggravated a pre-existing condition and that the earlier injury would not have provided a reasonable basis for denying Texas Mutual’s obligation to pay for the required medical treatment. Second, we consider Texas Mutual’s claim that Morris’s alleged duplicity in not revealing the 1998 injury “stacked the deck in his favor” so that both Dr. DeY-oung and the Commission held in his favor when they otherwise would not have done so. This argument prompts four responses: (1) The jury had before it all the evidence concerning Morris’s failure to tell Texas Mutual and his doctors about the 1998 injury and Morris’s explanation for why he did not think to tell anyone about it. Morris explained that he did not fall off the truck, but caught himself as he was about to fall, and that the act of stopping the fall injured him. Morris testified that he did not think to tell Dr. DeYoung about it because he fully recovered. The jury was asked if Morris committed fraud by not revealing the injury and the jury said he did not commit fraud. (2) Dr. DeYoung testified via deposition and both parties had the opportunity to ask him what impact the revelation of the 1998 injury had on his diagnosis. Neither party directly asked him the question. (3) As to the Commission’s decision and whether it would stand if the Commission had known the truth about the 1998 injury, to ask us to engage in “what ifs” regarding the Commission’s decision at the contested hearing is to ask us to speculate. That we will not do. (4) Even if Dr. DeYoung and the Commission had known about the 1998 injury, the jury heard testimony that Texas Mutual could avoid liability only if the 1998 injury were the sole cause of the herniated disc and resulting surgery. No one testified that the 1998 injury was the sole cause of the herniated disc, and Texas Mutual presented no evidence that it reasonably believed this injury to be the sole cause of Morris’s disc herniation. The Alleged New Injury in 2003 and the Claimant’s Inaccurate Description of His 2000 Injury as Possible Cause for Reversal Texas Mutual also contends that it reasonably disputed coverage because it believed Morris’s surgery was a result of a “new and more severe injury in 2003,” and not the 2000 Injury. However, Texas Mutual never offered any evidence of a new injury, or any evidence that another injury necessitated the surgery. Dr. DeYoung testified by deposition that lumbar lami-nectomies are performed for herniated discs, not back strains, and, based on the medical records, Morris did not have a herniated disc before March of 2003. But on cross-examination in that deposition, Dr. DeYoung also stated that a back strain could lead to a herniated disc. In general, Dr. DeYoung was equivocal concerning the cause of Morris’s herniation, stating that it was “really not clear” from the records, but nevertheless he would relate it to “some activity around the onset of his lower' — of his severe lower back and leg pain and numbness and tingling” that developed shortly before the surgery. Dr. DeYoung, however, apparently did not take into account the reference in Dr. Wal-drop’s treatment notes to radiculopathy, because Dr. DeYoung testified that Morris’s records did not contain any description of radicular symptoms related to the 2000 Injury. Texas Mutual also points to Morris’s inaccurate description of the events surrounding the 2000 Injury as one reason it believed a different injury caused the need for surgery. Although Morris described a different incident to treating doctors in 2003 — slipping on or falling from a fire truck — the date Morris consistently gave for the incident (June 12, 2000) was the same as that of the undisputedly compen-sable injury. But, as previously noted, no one from Texas Mutual ever asked Morris about the discrepancy. The jury could have concluded that Morris was merely confused about which incident happened in 2000 or unintentionally attributed his pain in 2003 to slipping or falling off a fire truck instead of lifting a patient out of a ditch on a backboard, or the jury may not have considered the discrepancy significant enough to raise a question about coverage. Likewise, the jury may have viewed Texas Mutual’s failure to ask about the discrepancy as one additional indication that Texas Mutual did not reasonably investigate the claim. Carrier’s Expert Testimony Finally, citing the testimony of Dr. DeYoung and Wayne Davidson, Texas Mutual’s workers’ compensation expert, Texas Mutual contends that the evidence “only shows a bona fide dispute, not clear liability.” However, the mere fact that a carrier offers expert testimony to support its position at trial does not insulate the carrier from liability. See State Farm Lloyds v. Nicolau, 951 S.W.2d 444, 448 (Tex.1997). Dr. DeYoung admitted that Texas Mutual did not give him medical records about Morris’s treatment between 2001 and 2003 — the very time frame that Dr. DeY-oung had told Texas Mutual was important to his evaluation — and the jury was entitled to conclude that Dr. DeYoung’s initial opinions were based on inadequate information. See id. Moreover, although Dr. DeYoung ultimately concluded that Morris’s lumbar herniation requiring surgery was not causally related to the 2000 Injury, the jury was presented with other evidence it reasonably could have considered when determining the weight to give Dr. DeYoung’s opinion. First, the jury could have determined that Dr. DeYoung’s opinion was undermined by his testimony that the records relating to Morris’s injury did not contain a description of radicular symptoms, when Dr. Waldrop’s treatment records actually reflected that Morris suffered from an “L5/SI n. root disc radiculopathy” after the 2000 Injury, and this notation in the records was a factor that the Commission considered in finding in Morris’s favor. Second, Dr. DeYoung’s testimony that a new and independent injury caused Morris’s herniation was at best speculative. No new incident was ever identified, and Dr. DeYoung admitted that it was “really not clear in the medical records what caused it,” but he nevertheless opined that he would relate Morris’s herniated disc to “some activity” occurring about two days before March 28, 2003. The jury also could have considered Dr. DeYoung’s acknowledgment that the mechanism of injury Morris originally reported in connection with the 2000 Injury, initially reported as a back strain, ultimately could lead to a disc herniation. Given the evidence before it, the jury was entitled to discount Dr. DeY-oung’s subsequent opinion that Morris’s lumbar herniations were not causally related to the lumbar strain suffered in connection with the 2000 Injury. Likewise, the jury was entitled to reject Davidson’s testimony on the ultimate issue of whether Texas Mutual violated the Texas Insurance Code and to base its decision on other evidence. As Morris points out, other evidence in the record would enable a reasonable jury to find no reasonable investigation by Texas Mutual and reasonably clear liability for Texas Mutual on Morris’s claim. The Carrier’s Claim that the Adjuster Would Not Have Learned Any Useful Information Even if She Had Spoken with the Claimant’s Surgeon Texas Mutual also claims that the evidence does not support liability for failure to conduct a reasonable investigation because Dr. Neblett could not have given Rodgers information showing that Texas Mutual’s liability was reasonably clear. Texas Mutual explains that Dr. Neblett “never examined or treated Morris before April 2003, and there is no evidence that Dr. Neblett could have offered any additional information to show a causal relationship existed.” We disagree. First, Morris’s workers’ compensation expert, who was experienced in handling claims like Morris’s, testified that Dr. Neb-lett was the best person for Rodgers to call. He explained that Dr. Neblett was the only doctor who had examined Morris to ascertain the exact problem with his back. Rodgers would have spoken with Dr. Neblett after the surgery. At that point, Dr. Neblett knew the state of Morris’s spine better than anyone else, even Dr. Waldrop. Having that information alone would have been useful to the investigation. In addition, even without this testimony, we know that Dr. Neblett spoke with Morris and obtained some medical history, because, for example, he listed the date of the 2000 Injury as the date of initial injury in his letter to Texas Mutual. Second, even if Dr. Neblett could not have given Rodgers any information, Morris had significant knowledge concerning the injury and the medical care he received, and Rodgers never once spoke to him. Had she done so, Morris could have told her about the chiropractic visits, and he could have explained the discrepancy in what was listed as the cause of the 2000 Injury. In short, on the day that Rodgers first picked up Morris’s file, she decided to dispute liability before speaking with the two people who could have enlightened her the most — Dr. Neblett and Morris. We are not persuaded by Texas Mutual’s argument. In summary, on this issue as to whether the evidence supports a finding of “no reasonable investigation” or “reasonably clear liability,” the jury had before it proof that • Medical and non-medical personnel at Texas Mutual initially authorized the surgery; • Texas Mutual’s adjuster (Rodgers) disputed coverage the same day she first reviewed the file, ignored accepted methods of investigating a claim, may or may not have spoken briefly with Morris’s former employer, never spoke with the two people who would know the most about the initial injury and/or the current state of Morris’s spine, and did not speak with any other treating physician before deciding to dispute the claim; • Texas Mutual complained that it had trouble getting Morris’s medical records, yet Morris’s attorneys faxed his records to Texas Mutual on more than one occasion, Morris’s wife signed a release for Morris’s medical records as early as mid-April, and Morris himself signed a release for his medical records; • Twice Texas Mutual sent medical records to its medical expert (Dr. DeY-oung) claiming that those were all the records when, in fact, one key page detailing multiple visits to Dr. Wal-drop was left out of the file; • The page left out of the records sent to Dr. DeYoung showed that Morris saw Dr. Waldrop between the 2000 Injury and the 2003 surgery; • Dr. DeYoung informed Texas Mutual that he would give Morris the benefit of the doubt if Morris’s records supported ongoing trouble with his back and if he had no back trouble prior to 2000. Texas Mutual either did not know its files well enough to know that it had a page of treatment notes from Dr. Waldrop showing visits between 2001 and 2003, or it chose not to give the sheet to Dr. DeYoung. Either way, the jury reasonably could have concluded that Texas Mutual acted unreasonably. Reasonable jurors could have concluded from this evidence that Texas Mutual failed to reasonably investigate the claim and that, after failing to attempt in good faith to settle the claim when its liability had become reasonably clear, Texas Mutual intentionally undertook a pretextual investigation designed to support its denial of the claim. We hold that, under the applicable standard of review, the evidence is legally sufficient to support a finding that (1) Texas Mutual refused to pay Morris’s claim without conducting a reasonable investigation with respect to the claim; and (2) Texas Mutual failed to attempt in good faith to effectuate a prompt, fair, and equitable settlement of Morris’s claim when its liability had become reasonably clear. Even if the evidence were legally insufficient to support only one of these two findings, Texas Mutual’s legal-sufficiency challenge regarding the jury’s answer to Question 2 would fail based on the legally sufficient evidence as to the other finding. Accordingly, we overrule Texas Mutual’s first issue. B. Legal Sufficiency of Evidence Supporting the Jury’s Finding that the Carrier Knowingly Violated the Texas Insurance Code In its second issue, Texas Mutual contends that no evidence supports the finding that the company knowingly violated the Texas Insurance Code because “all of the competent evidence shows that Texas Mutual and its representatives believed the claim was not valid because the evidence available to Texas Mutual showed that the back strain Morris sustained in 2000 was unrelated to the herniated disc he was diagnosed with in 2003.” According to Texas Mutual, the only evidence Morris offered to show Texas Mutual acted knowingly was the testimony of its liability expert, which was conclusory, not competent, and thus no evidence. In Question 3, the trial court asked the jury whether Texas Mutual knowingly engaged in the conduct described in Question 2, discussed above. Consistent with section 541.002, the trial court instructed the jury that: “Knowingly” means actual awareness of the falsity, unfairness, or deception of the act or practice described in Question 2. Actual awareness may be inferred where objective manifestations indicate that a person acted with actual awareness. See Tex. Ins.Code Ann. § 541.002(1) (Vernon 2009) (defining “knowingly”). Based on the jury’s affirmative finding, it awarded Morris $50,000 in damages for mental anguish and $500,000 in additional damages, both of which are recoverable only if the Texas Insurance Code violation was committed knowingly. See Minn. Life Ins. Co. v. Vasquez, 192 S.W.3d 774, 777 (Tex.2006). The trial court later reduced the award of additional damages to $250,000. As the Supreme Court of Texas explained in Vasquez, claimants are not entitled to extra-contractual damages because the insurer was negligent; instead, these extra damages are reserved for cases in which an insurer knew its actions were false, deceptive, or unfair. Id. at 775. Claims for extra-contractual damages should not be a routine addition to every breach-of-policy case. Id. For this reason, appellate courts are required to conduct an exacting review of damages that punish rather than compensate. Id. The following facts, viewed as a whole, are sufficient to support a finding by reasonable jurors that Texas Mutual was not merely negligent, but that it knowingly failed to effectuate a prompt, fair, and equitable settlement of a claim with respect to which its liability had become reasonably clear, and refused to pay a claim without conducting a reasonable investigation with respect to the claim. The evidence supports a conclusion by reasonable jurors that persons at Texas Mutual were actually aware of the unfairness of their actions. Rodgers was Texas Mutual’s adjuster on Morris’s claim and the one who filed the TWCC-21 disputing his claim. Before she was assigned the claim, it had been handled by another adjuster and was not in dispute. Rogers was assigned the claim the day after Morris’s surgery, and the first day she took any documented action, she filed the dispute. As discussed above, Rodgers admitted that she did not complete the three-point contact before disputing the claim, because she did not contact either Dr. Neblett or Morris. Morris’s expert, Frank Weedon, testified that Dr. Neblett, as the treating surgeon, was “in the best position” to answer questions regarding whether Morris’s surgery was related to the 2000 Injury. Yet, no one ever contacted Dr. Neblett about Morris’s surgery. Rodgers also testified that she had no idea how much time she spent investigating Morris’s claim, she did not know if she had all the information she needed before she filed the dispute, and she did not remember if she had any medical information relating to the claim when she filed the TWCC-21 notice that the claim was disputed. She also testified that she had no idea how Morris was supposed to secure medical treatment for his back after Texas Mutual disputed his claim. In addition, Rodgers filed the TWCC-21 after Texas Mutual had preauthorized the surgery based on Dr. Neblett’s request, when Texas Mutual’s position — -after a doctor and another Texas Mutual employee had examined the file — was that the claim was not in dispute. Weedon testified that Rodgers, as a licensed insurance adjuster, “knew the rule[s],” and had a duty to act reasonably, to fairly resolve the claim, and to investigate it. Weedon opined that Rodgers knew she was mishandling the claim, or, as he stated it, “running a red light,” when she denied the claim without reasonably investigating after Texas Mutual had preauthorized Morris’s surgery. Weedon further testified that Rodgers’s actions were false, deceptive, and unfair. He also testified that, once Texas Mutual preauthorized the procedure as reasonable and necessary to treat the condition, and there was no dispute concerning compensability or the extent of the injury, to later dispute the claim was an unconscionable act and an unfair claims practice that was “thoroughly prohibited.” Texas Mutual contends that Wee-don’s testimony was not competent evidence of a knowing violation because it was eonclusory. See Coastal Transp. Co. v. Crown Cent. Petroleum Corp., 136 S.W.3d 227, 232 (Tex.2004) (stating that eonclusory or speculative opinion testimony is incompetent evidence and cannot support a judgment). However, Weedon explained that the underlying basis for his opinion was his own experience in going through the training to be a licensed insurance adjuster, a position he held for eight year’s. Further, Rodgers confirmed that she was a licensed adjuster and that she knew the rules for conducting a reasonable investigation. In fact, no one at Texas Mutual ever spoke with Dr. Waldrop, or Dr. King, or Dr. Neblett, the three medical providers who would be in a position to testify about Morris’s pre-surgery condition. Texas Mutual personnel testified that they did not need to speak with a doctor to dispute the claim. Weedon’s testimony, when coupled with Texas Mutual’s complete failure to speak with any of Morris’s doctors, is some evidence supporting the jury’s finding that Texas Mutual knowingly violated the Texas Insurance Code. Additionally, as discussed in greater detail above, Texas Mutual falsely represented to Dr. DeYoung that it had received no documentation of Morris’s medical treatment from the date of the 2000 Injury to February 19, 2003, when, in fact, it had received Dr. Waldrop’s treatment notes from that time period. Without medical records from the relevant time period, Dr. DeYoung gave Morris “the benefit of the doubt” and conditionally attributed Morris’s disc herniation to “the lumbar strain of June 2000.” Thereafter, Texas Mutual represented that it was forwarding medical records of Morris’s treatment with Dr. Waldrop, but it failed to forward the page of Dr. Waldrop’s treatment notes reflecting treatments between 2001 and 2003— the specific time frame that had been the subject of Dr. DeYoung’s inquiry. This failure caused Dr. DeYoung to rely on incomplete information when he issued a later opinion supporting Texas Mutual’s dispute of Morris’s claim. Concerning Texas Mutual’s failure to provide Dr. Wal-drop’s treatment notes, Dr. DeYoung testified: Q: Would it, in your opinion, be fraud for an insurance company to withhold an important piece of medical evidence from a doctor providing an important evaluation? A: I mean, I — obviously if they knowingly, you know, left something out, I would obviously consider that— consider that wrong. Dr. DeYoung also acknowledged that the treatment notes Texas Mutual withheld from him were from the time period he considered “the most important time period for making an accurate assessment of [Morris’s] medical condition.” Although a Texas Mutual employee testified that this page of notes was incorrectly coded, another Texas Mutual employee admitted that no other medical records were wrongly coded. Members of the jury were able to see these witnesses and decide for themselves whether they believed the reason for the failure to provide the document. In addition, although Texas Mutual claims that it refused to pay because it thought that a new or an older, different injury caused the herniated disc, Morris’s expert, Weedon, stated that a licensed adjuster would know that a new or older, different injury would displace the 2000 Injury as a producing cause of the injury only if the injury was the sole cause of the herniated disc. In fact, Weedon testified that the 2000 Injury still would be a producing cause if it only aggravated an earlier injury by as little as one percent. In the period leading up to and including the contested-case hearing before the Commission, Texas Mutual had no evidence of an earlier injury. Weedon also testified that Texas Mutual’s delays in (i) obtaining Morris’s full medical records (approximately fourteen months), (ii) scheduling a physical examination by a doctor of its choice (eight months), and (iii) scheduling the contested-case hearing were unreasonable and that Texas Mutual employees would know these delays were unreasonable and unfair, especially since Morris’s operation already was concluded and medical costs already had been incurred when Texas Mutual first disputed the claim. Finally, a