Consider Filing Insurance Claims Early for Hurricane Harvey

Consider Filing Insurance Claims Early for Hurricane Harvey

As we recover from Hurricane Harvey’s aftermath, we want to extend our gratitude to our team for their constant efforts to serve our clients and members. To our members and clients, thank you for your patience during this trying time. We are doing everything we can to keep operations running smoothly. We are thankful that we are all safe and can focus on recovery. Part of that recovery for most Texans are insurance and insurance claims.

A New Texas Law Regarding Insurance Claims

The combination of the devastating effects of Hurricane Harvey and its floods and the deadline set by a new Texas Law regarding insurance claims is producing a number of questions, and quite frankly, much anxiety, over the effects of this new law on Hurricane damage claims.

We will try to clarify a few things, but by all means if you suspect you will actually have to sue your insurance company over a claim, you should consult with a lawyer before this new September 1, 2017 deadline. As a Plan Member, you can use your consultation benefits for this, but understand, that the Network Lawyers are available normal business hours between now and August 31, 2017, the date before the new law takes effect.

Below is a summary of the impact that House Bill 1774, which becomes law on Sept. 1, 2017, will have on insurance policyholders [for most insurance claims] and how they can avoid being impacted. You can view the text of the bill here and find more information here.

The new law will impact policyholders who file a lawsuit against their insurance company for failing to pay enough in claims or paying claims too slowly. It requires any plaintiff, or any plaintiffs' attorneys, to offer more detail when they give notice of intent to file a lawsuit. The new law then requires insurance companies, if they are found to have to pay damages in that lawsuit, to pay a lesser amount of interest on the damage award. The new law will reduce the amount of penalty interest they'll owe from 18% to about 10%.

To be able to take advantage of the higher interest in the current law before the new law takes effect, policy holders should file a written notice of their claim with their insurance carriers and adjusters before Friday, Sept. 1, 2017.

Will this apply to every insurance claim?

The confusion is over whether someone who knows they have a current claim for damage from Hurricane Harvey now, but cannot even get to a phone or computer to file the claim, must comply with the written notice before the September 1, 2017 deadline. The answer is yes, so far the law has not been changed by the legislature.

But remember practically, that most insurance claims never have this interest rate at all, because they never get to the lawsuit phase. Most insurance companies settle claims without ever getting to a lawsuit. So, this new law will only affect you if (1) your insurance company does not pay a claim and you are forced to sue; and (2) if you win and they are forced to pay a damage award. 

Since most of us will never know, when the claim arises, if the insurance company will pay or not, there is no way of knowing if this new law will affect us. Before you fret over missing the deadline, remember, that most likely, your claim will be settled and this will not apply to you. For those of you who want to be sure, file some written notice of the claim with your insurance company before the deadline. Our attorneys are available to help our Plan members in Texas.


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