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Hurricane Harvey First Party Property Claims Checklist (Texas)

August 25, 2017

By Thomas H. Cook, Jr. and Jason Reeves
To view this article in PDF format, please click here.

With the Arrival of Hurricane Harvey, Insurers Should Keep in Mind the Following Texas Insurance Code Claim-Handling Guidelines

  • Acknowledge claim in writing and commence investigation within 15 days. § 542.055
  • Request all necessary items from insured and provide instructions and blank proof of loss forms for insured to complete. § 542.055
  • A reservation of rights should be issued as appropriate.
  • Accept claim, reject claim, or state in writing additional time is needed, explaining why more time is needed to conduct an investigation within 15 days. § 542.056
  • If additional time to investigate claim is requested, accept or reject claim within 45 days after the notice requesting additional time is provided. § 542.056(d)
  • Make payment within 5 business days after acceptance of claim. § 542.057(a)
  • The claim-handling deadlines above can be extended by 15 days in the event of a weather-related catastrophe or major natural disaster as defined by the insurance commissioner. § 542.059(b)
  • Failure to comply with any of the deadlines set forth above can subject an insurer to statutory penalties of 18% per year on the amount of the claim, plus reasonable attorney’s fees even if there is a good faith basis for not paying the claim. § 542.060 (effective through August 31, 2017, amended by H.B. 1774)

Some Additional Issues to Consider:

  • Civil Authority – Mandatory evacuations have already been issued in several Texas counties.
  • Service Interruption – Power and telephone/cell service may be disrupted.
  • Sue and Labor – Businesses may shut down operations in advance.
  • Adjuster licensing – Texas requires all adjusters and public adjusters to be licensed in the State of Texas. There is a provision for emergency licensing of adjusters in the event of a catastrophe.
  • Flood hazard zone areas—Areas identified on the Flood Insurance Rate Map can change so be aware of applicable policy limits by hazard zone.
  • Flood and Wind sublimits

For updates please see our CAT law blog:

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