It is no secret that there are problems with the appraisal process. The ever-growing issues with appraisal include, but certainly are not limited to, exorbitant expenses pushed onto policyholders and insurance companies, gamesmanship, and the never-ending questions of:

  • When is appraisal appropriate
  • What can be addressed and assessed within appraisal, and
  • Whether a policyholder’s claims for bad faith, fraud, and violations of the Texas Insurance Code stand once appraisal is completed.
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In what sounds like a simple and obvious statement, an adjuster sent by the insurance company to perform an inspection and write an estimate of damages can be liable for violating the Texas Insurance Code. The Western District of Texas recently held that while an adjuster cannot be held liable as an insurer under the insurance code, the plaintiffs could have a valid claim against the insurance adjuster under Texas Insurance Code section 541.060.1
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TFPA’s mission is to efficiently provide essential residential property insurance products and services for eligible Texas policyholders when no one else will.”

Purpose and Operation

The Texas Fair Plan Association (TFPA) was created by the Texas Legislature to address growing concerns of obtaining residential property insurance coverage in underserved areas. TFPA was implemented in 2002 following a mold crisis. Due to an increase in mold damage claims and water damage claims—fewer policies were being written and renewed through the private market. Lack of available residential property insurance policies through the private market sparked a surge in the number of TFPA policies being written.
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After a claim is filed, the insurance company is certainly entitled to receive from a policyholder reasonable information that the insurance company requires to decide whether to accept or reject the claim. Unfortunately, as a way to delay the claim and discourage the policyholder, many insurance companies create daunting laundry lists of items from the policyholder they say they require before they can make a decision to accept or deny the claim.


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Yesterday’s post, Texas Insurance Lobbyists Support Bad Insurance Practices promised to show “how the insurance lobby uses ‘think tanks’ and the media – directly referencing yours truly – to manipulate our own elected representatives.” As a conservative supporter of people trying to help people rather than cheating insurance companies and believer that propagandists are a huge threat to America, I want to show you just one connection between the strategy of Texas insurer lobbyists and “for hire spin doctors” that are paid for by insurance companies to hurt policyholders.


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If organized criminals in Texas wanted to get off easier and pay less for their misdeeds, they would probably hire lobbyists to make up a propaganda campaign to change laws to go easier on crooks. This is similar to what the insurance industry and their trade groups plan to do in Texas this year – they want to lessen penalties and personal accountability for cheating, delaying, and wrongfully denying property insurance claims.


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This summer, a carrier asked a Houston federal court to declare that a fire was intentional, voiding the policy and removing carrier’s liability to the insured. The insured countered with a claim for breach of contract and sought sanctions for spoliation of evidence. The Court held that the carrier had a duty to preserve samples obtained by its investigator during its investigation and used its inherent power to sanction the carrier for pre-action destruction of evidence.1


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Several Texas news outlets discussed a report from the Texas Department of Insurance (TDI) which stated that homeowners insurance premiums in Texas have gone up 21 percent since 2009. Texas Insurance Commissioner Eleanor Kitzman presented figures to a Senate committee recently showing that the average premium on a homeowners policy in Texas last year was $1,412. The report found that the average loss on an insurance claim in Texas is among the highest in the country, which contributed to high premiums.


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