When your insurance company issued your policy, you probably didn’t read the whole thing cover to cover. Many people never read the entirety of their homeowners’ insurance policy until they need to make a claim.
Fortunately, all insurers in the state must include an overview of the insured’s rights under the law along with every policy. Property damage attorney Bill Voss explains essential provisions of the Texas Insurance Bill of Rights, including each party’s responsibilities and what policyholders can do if their rights are violated.
Texas Homeowner Benefits Under the Insurance Bill of Rights
The first right you have as a homeowner is the right to accurate information upon request, both from the Texas Department of Insurance (TDI) and your insurance company. Texas law requires insurers to deal honestly with policyholders, prohibiting companies from making false, misleading, or deceptive statements about their insurance.
Under the Insurance Bill of Rights, you also have the right to:
Fair treatment
Insurance companies cannot deny you insurance based on your credit score alone. They cannot deny you insurance or raise your premiums after a prior appliance-related water or mold damage claim as long as the damage was repaired and certified.
Independent property inspection
If an inspector issues you an inspection certificate verifying that your property meets insurance requirements, insurers cannot deny coverage based on property conditions without performing another inspection.
Timely notification of premium increases
If your insurer plans to increase your premium by 10% or more, they must send a rate increase notification at least 30 days before your renewal date. In addition, insurers cannot increase the amount of automatic monthly payments from your bank without written notice at least 30 days before the effective date.
Notification of reduced coverage
Insurance companies cannot reduce coverage during the policy period (unless you requested the change) without notifying you at least 30 days before the policy renews.
Explanation of denial
Your insurer cannot deny coverage or cancel your policy without issuing a written notice including the specific risk factors, incidents, or circumstances that influenced the decision.
Limited cancellation
Your insurance company must mail a cancellation notice at least ten days before the cancellation date. If your dwelling policy has been in effect for 90 days or more, there are only four situations where insurers can cancel the policy: nonpayment of premiums, filing a fraudulent claim, sudden increase in hazards that affect your premium rate, or because continuing the policy would violate insurance laws.
Continued coverage
If your marital status changes, insurers must continue to provide approved coverage or create a new policy with similar coverage and the same expiration date. These policies cannot be dated in a way that reflects a coverage gap.
Timely receipt and response to claims
Within 15 calendar days of a claim submission, your insurance company must 1) acknowledge receipt of your claim and 2) request additional information needed to process your claim. After receiving the requested information, the insurer must approve or deny your claim in writing within 15 business days. If your claim is approved, your insurance company must issue payment within five business days of approval notification.
Prompt payment from lending agents
If an insurer sends your claim check to your lender or mortgage company, the lender must notify you within ten days of receiving the payment. Once you request that the funds be released, the lender has just ten days to either issue a full payment or tell you what requirements must be met to get the money released. If the lender fails to meet its obligations, it could be liable for the payment plus 10% interest per year.
Hire a lawyer
Policyholders have the right to seek an attorney’s advice if they are being mistreated or have been offered an unfair valuation by an insurance company.
Let Us Determine the Next Steps in Your Property Damage Claim
Our attorneys have been holding insurance companies accountable for years, negotiating fair settlements and filing bad faith lawsuits on behalf of our clients. To see how Voss Law Firm can help you, fill out our contact form or call us at 888-614-7730. You can also get more information on your claim by reading our free book, Tricks of the Trade: How Insurance Companies Deny, Delay, Confuse, and Refuse.
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