When property damage occurs, a business can suffer significant detriments to its day-to-day operations. As property owners scramble to ensure their clients and customers remain properly taken care of and any significant items or documents are intact, they could run into trouble if time lapses between the incident and when they file a damage claim with their insurer. Knowing just how long business owners have to file a property damage claim with their insurance carrier can help ensure they receive the funds they are entitled to for repairs.

Filing a Property Damage Claim in Texas

No matter how property damage occurs, business owners must file a claim or call their insurance provider within timeframes dictated both by the terms of their policy and by state and even federal law. Policyholders are held to various deadlines throughout the claims process because insurance companies are governed by regulations that dictate the time frame an insurer must acknowledge, investigate, and resolve a claim. 

Unfortunately, however, ascertaining the exact amount of time a policyholder must file a claim can still be ambiguous, so it is crucial to file a property damage claim as soon as possible. Time frames vary by state and may vary based on the type of loss that occurs. In Texas, for instance, policyholders must give reasonable notice of a claim to their insurer within a period of one to two years, usually from the date of loss. While policyholders must refer to the specifics of the policy itself, the main requirements for filing a claim include:

Notifying the Insurance Provider of a Loss

Policyholders must give reasonable notice of a claim to their insurer; however, what counts as a reasonable amount of time can be a little vague when it comes to the policy itself. This is important to note, as reporting a loss outside of the timeframe outlined in the policy can preclude that claim from being investigated. Typically in Texas, most commercial property policies allow up to two years after the date of loss for a claim to be filed. While certain circumstances allow for a delay in filing a claim to be forgiven, the policyholder should file it as soon as the damage is discovered.

Submitting Documentation and the Investigation Process

Once a claim is properly submitted, the insurance provider then has 15 days to acknowledge receipt, to begin investigating the claim, and to request any additional necessary documentation from the policyholder. Once all the items are received by the insurer, the carrier has an additional 15 business days to notify the policyholder if the claim is accepted or rejected. In the event the claim is rejected, the insurer must provide valid reasoning for the denial. If an insurer is unable to accept or reject a claim within 15 days, it must notify the policyholder and provide reasoning as to why it needs more time. 

Under the Texas Prompt Payment of Claims Act (TPPCA), all insurers must pay claims within 60 days of receiving all requested documentation, forms, and statements from the policyholder. If the insurer fails to pay the claim within 60 days, the insured is entitled to payment of the claim, statutory damages of up to 18 percent interest per year, and attorney’s fees.

When to Obtain Legal Counsel for a Property Damage Claim

While the property damage claims process has many deadlines in place to make it run smoothly, this does not always happen. Insurance providers often attempt to utilize bad faith tactics to delay the process by refusing to pay legitimate claims or refusing to investigate and process them within the period mandated by the TPPCA. 

Insurance companies use bad faith tactics as a means to make further financial gains because paying out valid claims costs them money. While a policy lays out terms and conditions regarding when the insurer will pay a claim, carriers will use tactics like delaying the claims process, underpaying the full amount owed to the policyholder, or denying the claim entirely. This is because the insurance industry has two major expense categories: payment of claims and operating expenses. The percentage of money paid out in claims as a percentage of premiums is referred to as the “loss ratio,” while the percentage of premium income paid toward expenses is the “expense ratio.” When a greater sum is taken in on premiums than is paid out in claims and expenses, an insurance company generates underwriting income. The lower these combined ratios are, the greater the net underwriting income.

 When these bad faith tactics are utilized, it can be incredibly frustrating for the policyholder, especially when they have adhered to all the deadlines to properly file a property damage claim and have it investigated. In these situations, it’s best to seek out and retain knowledgeable legal counsel that can help policyholders receive the compensation they need to fully recover after the damage has occurred.

Bad Faith Insurance Attorneys

The insurance recovery lawyers at Raizner Law have extensive experience working with clients who have been underpaid, paid late, or wrongfully denied by their insurance companies. To discuss your situation with our team of trusted attorneys, contact us today to discuss your claim.

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