I recently received a request to write about the claims handling guidelines in Texas. In the great state of Texas, the handling of insurance claims are governed by both the Administrative Code and Insurance Code.
Generally, and insurance carrier may not engage in any unfair settlement practices.1 An insurance carrier in Texas must acknowledge a claim not later than 15 days after receipt of the claim (30 days for surplus lines carriers).2 The carrier must begin its investigation of the claim within 15 days (30 days for surplus lines carriers).3 They must request all items they need from the insured and provide forms for a proof of loss along with instructions for completing the same within 15 days of their receipt of notice of the claim.4 The carrier must notify the insured of acceptance or rejection of the claim within 15 days of receiving all requested information from the claimant.5 If they accept or reject the claim within that time frame, they must advise why additional information is needed within those 15 days.6 Thereafter, they must advise as to the acceptance or rejection no later than 45 days after advising that more time was needed.7
The carrier must pay the agreed upon portion of any claim within 5 days of informing the insured the claim will be paid, or within 5 days of any condition precedent to payment being met (20 days for surplus lines carriers).8
Again, please let me know if you have questions or requests to move a state up on the list in our 50-state tour. Finally, there are so many great songs written about Texas, it was hard picking one, but this has to be one of the best.
1 28 Tx. Admin. Code §21.203.
2 Tex. Ins. Code Ann. §542.055(a)(1).
3 Tex. Ins. Code Ann. §542.055(a)(2).
4 Tex. Ins. Code Ann. §542.055(a)(3).
5 Tex. Ins. Code Ann. §542.056(a).
6 Tex. Ins. Code Ann. §542.056(d).
7 Tex. Ins. Code Ann. §542.056(d).
8 Tex. Ins. Code Ann. §542.057.