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If You Have a Claim
If you have a claim, the company must start investigating your claim within 15 days after receiving written notice. However, the company may ask you for
more information. Once you send the information, the company has 15 business days to accept or reject your claim. If the company agrees to pay, it must do so within five business days. If the company rejects
your claim, it must say why in writing.
Exceptions:
- A company that needs more time can take 45 days to make a decision if it sends you a notice explaining the delay.
- A company that suspects arson has 30 days after receiving the required paperwork to either accept or reject a claim.
- TDI can give companies an extra 15 days after a major natural disaster.
- Surplus lines carriers have 20 days to pay your claim after agreeing to do so.
- A company that takes too long to pay is liable for your reasonable attorney fees plus damages equal to 18 percent of your claim if you sue and win.
In an insurance claim lawsuit, the insurance company has the burden of proving it was not obligated to pay. If you are financing your home, your insurance company may require your lender to sign or approve
your claim check. When this happens, the lender must act within 14 business days after receiving the request. Failure to act within this time period could result in a $500 civil penalty. Complaints about
lenders failing to process claim payments should be directed to the Texas Attorney General's Office at
To make the claim process run smoothly and to protect your rights, follow these steps:
- Know your coverage. Your policy's dollar limits and benefits appear on your policy's Declarations page. If you need help, ask your agent or company
representative.
- If you have a loss, notify your agent or insurance company immediately. Report losses involving theft or crime to the police.
- Make a list of your damaged property. If possible, photograph or videotape the damage before making any repairs.
- Make only temporary repairs to protect your house and belongings. The insurance company may deny your claim if you make permanent repairs before it
inspects the damage. If you are not sure whether a repair is considered permanent, contact the insurance company before beginning repairs. The cost of these repairs and for storing personal belongings is
covered by your policy. It is important to make only temporary repairs.
- Keep receipts. For personal property claims, you must provide evidence that you bought the replacement items. If you bought materials for temporary
repairs, receipts will help you get reimbursed quickly.
- Try to be there when the insurance company's adjuster inspects your home. You may have your own contractor or builder represent you. In times of
major disasters, it might not be possible to meet with the adjuster.
- If you have to move because of a disaster, make sure your address is visible. Leave a sign with your temporary address, phone number, and the name
of your insurance company.
- If you use a public adjuster, make sure you know the fee. Public adjusters help consumers with their homeowners claims. They generally charge a
percentage of your claim settlement. In most cases, you probably don't need a public adjuster.
- Proof of loss. Within 15 days after you report your loss, the company may request a signed, notarized proof-of-loss form. In most cases, the
company will ask you to estimate the replacement cost of the household items you lost and the cost of repairing your home. Contractors, catalogs, and retailers are good sources of current price information.
- Include sales tax in your cost estimates.
- Ask whether you should use exact costs, or if you can round numbers to the nearest dollar.
- Don't forget to include small items such as kitchen utensils or clothing accessories.
- The company will use the form to decide the value of your claim, so make your list as complete and as detailed as possible. Include photos and
receipts. Be sure to keep copies for your records.
Final estimate. The adjuster will prepare an estimate of the cost to repair or replace your home and any personal belongings. The insurance company's offer
is based on this estimate.
Disputes. If you disagree with the adjuster's estimate, tell the company why. The company may have overlooked something and may make adjustments. If you
still disagree, you can use a process called appraisal.
The appraisal process governs only disputes over the amount to be paid. It is not for settling disputes about coverage or the cause of a loss.
You and the company each hire an appraiser. The two appraisers then choose a third one as umpire. Your appraiser and the company's appraiser make their own
estimates of your loss. If they differ, the umpire makes the final decision, which is binding on both you and the company. You are responsible for the expenses of your appraiser and for half of the umpire's
expenses.
Payment. Once the company agrees to pay all or part of your claim, it must do so within five business days. If you don't get your check within five days,
contact your agent or company. If you believe that the company is delaying payment intentionally, contact TDI for help.
Note: Most companies pay homeowners claims with two checks. The first, issued after the adjuster reviews your loss, is for the estimated cost of repairs,
minus depreciation and your deductible. The company issues the second check for the balance of your claim after receiving the contractor's bill for the finished job, as long as the repairs or replacements are
completed within 365 days of the date of loss. You may submit a written request for an additional 180 days extension.
Getting Help from TDI:
Companies are subject to penalties if they fail to settle claims promptly and fairly.
If you believe an insurance company has treated you unfairly, you should file a complaint with the Texas Department of Insurance.
Before you contact TDI, contact your company. Most companies operating in Texas are required to have a toll-free telephone line to provide customer
assistance. The number should be listed in your policy.
reprinted from website of Texas Department of Insurance.
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