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Office of Public Insurance Counsel -

The Texas Windstorm Insurance Association (TWIA) provides the majority of wind damage coverage in designated areas along the Texas coast.  The insurance claim process for TWIA is unique and unlike the claim process for other insurers. 

 

You can find helpful information regarding the claim process on the Texas Department of Insurance’s (TDI) Coastal Outreach and Assistance Services Team (COAST) Resource page: http://www.tdi.texas.gov/consumer/coast/index.html and TWIA’s own website: https://www.twia.org/wp-content/uploads/2017/03/Claims-Dispute-Resolution.png.

 

TWIA Claims

 

Below are some key points relating to TWIA claims:       

 

  • Flood damage.  The TWIA policy DOES NOT cover damage caused by a flood.

 

  • House Bill 1774 that became effective September 1, 2017.  The changes in House Bill 1774 do not apply to claims or lawsuits with TWIA.

 

  • Claim filing deadline.  You have one year from the date your property was damaged or destroyed to file a TWIA claim.

 

  • If you dispute the amount of your claim TWIA accepts.  If TWIA agrees to pay your claim, either partially or fully, you must work with TWIA to resolve your dispute or request the appraisal process to dispute the amount. If you don’t request the appraisal process to dispute the amount, TWIA’s decision is final after 75 days.

 

  • If you plan to file a lawsuit because your claim was partially or fully denied.  If you dispute TWIA’s decision to partially or fully deny coverage for your claim and you intend to file a lawsuit, you must notify TWIA of your intent to file a lawsuit within two years of receiving TWIA’s decision to deny coverage.  If you miss the two year deadline, you waive your right to contest TWIA’s denial of coverage.

 

  • Prior to filing a lawsuit.  TWIA may require you to submit your dispute to alternative dispute resolution (ADR) prior to you filing a lawsuit.  Mediation is the primary form of dispute resolution utilized by TWIA.

 

TDI and OPIC have information to assist consumers with Hurricane Harvey-related issues, including how to file a claim, at http://www.tdi.texas.gov/consumer/storms/helpafterharvey.html and www.opic.texas.gov. It is important to review you insurance policy and inspect your property thoroughly in order to maximize your insurance recovery.

 

 

The information below is intended to provide some basic information for anyone with insurance questions related to the recent flooding and storm damage experienced in Texas.

Homeowners Coverage

 

·       Wind, including a tornado:  A typical homeowners policy covers damage caused by wind, including tornadoes.
·       Hail:  A typical homeowners policy covers damage caused by hail.

 

WIND and HAIL NOTE:  If your home is located in one of Texas' 14 coastal counties, or parts of southeastern Harris County, your homeowners policy MAY NOT cover damage caused by wind and hail. If your home is located in the above area, your wind and hail coverage may be written through the Texas Windstorm Insurance Association (TWIA.) If so, for additional information contact TWIA at 1-800-788-8247 or visit its website at www.twia.org.

 

·       Flood:  A typical homeowners policy DOES NOT cover damage caused by a flood.

 

FLOOD NOTE:  To protect your home from damage caused by flood, you will need to purchase a separate flood policy from the National Flood Insurance Program (NFIP) administered by FEMA.  Flood policies typically have a 30-day waiting period before you will have coverage.  This link has a summary of coverage, https://www.floodsmart.gov/floodsmart/pdfs/Summary_of_Coverage_English.pdf  

 

For additional information, contact NFIP at 1-888-FLOOD 29 (356-6329) or visit its website at www.floodsmart.gov.

 

Auto Coverage

 

If you purchased comprehensive (commonly referred to as “other than collision”), your personal auto policy may cover damage to your auto caused by flood, hail, or wind (including a tornado).  Comprehensive coverage typically pays for damage to your auto caused by events other than a collision, including theft, fire, flood, hail, and wind.  Comprehensive coverage also pays for a loss to your auto from contact with birds or animals or breakage of glass. 

 

Auto Note:  If you only purchased auto liability insurance and did not purchase comprehensive coverage for damage to your auto, your personal auto policy will not pay for damage to your auto caused by events such as flood, hail, or wind.  Auto liability insurance pays for injuries to other people or property of others that you, or a covered person, cause in an auto accident. 

 

Do You Need to File a Claim or Have Coverage Questions?

 

If you have damage that may be covered under your insurance policy or questions about your coverage, contact your agent or company as soon as practical.  

 

·       Be sure to keep a record of all contacts you have with your agent or company.  
·       Be prepared to answer questions about the extent and severity of the damage. 

 

Are You Temporarily Out of Your Home Due to Damage Covered by Your Homeowners Insurance Policy? 

 

If so, ask your agent about coverage that may be available to you for your additional living expenses (ALE).  Homeowners insurance policies pay for your additional living expenses if you are unable to live in your home because of a covered loss.  You will need to provide documentation regarding your expenses.

 

Flood Note:  Flood policies DO NOT cover your additional living expenses if you are unable to live in your home due to a covered flood loss.

 

IMPORTANT: If you are making repairs prior to settling your insurance claim,  only make repairs necessary to protect your home and property from further damage, such as covering broken windows and holes to keep rain out. 

 

•       Don't make permanent repairs until instructed by your insurance company. 
•       Save all repair receipts. 

 

Tips That May Assist You With Your Claim

 

•       If you are temporarily out of your home, make sure your insurer knows where they can reach you.
•       Inspect your property and cars for damage.
•       Inventory your damage.
•       Photograph or video the damage.
•       Don’t throw away damaged property until your insurance adjuster has seen it.
•       Get your insurance company’s approval before you make any permanent repairs.

 

Try to be present when the insurance adjuster inspects the damage. Be sure your address is visible. If you moved out of your house temporarily, leave a note or a plywood sign with your temporary address, phone number, and name of your insurance company.

 

For additional information, contact the Office of Public Insurance Counsel at 512-322-4143.

 

You may be able to save a significant amount of money on your auto insurance if you simply shop.  Companies charge a wide range of premiums and The State of Texas has developed some easy to use resources to help you shop for auto insurance. 

 

Companies base auto insurance premiums on multiple factors including credit history, driving record, where you live, how you use the vehicle, and the coverage limits you select.  The coverage limits are the maximum amount the company will pay for injuries and property damage resulting from an accident.  A policy with coverage limits of 50/100/50 will pay up to $50,000 for a single person’s injuries, up to $100,000 for injuries to multiple people, and up to $50,000 in property damage for a single accident.  You can find sample auto insurance premiums at www.helpinsure.com.  For example, sample premiums for a policy with 50/100/50 limits for a person living in Travis County with good credit, no violations, and using the car to go to and from work can range from $143 to $844. 

 

Of course the insurance coverage provided for these amounts can also vary significantly.  Comparing policies will help you identify policies that meet your insurance needs.  You can compare different companies’ policies and find explanations of key insurance provisions and terms by using the policy comparison tool at www.opic.texas.gov.  Some ways policies differ can include:

 

  • Does the policy cover any person using the auto or only those named in the policy?
  • Does the policy cover autos you purchase after the policy begins?
  • Does the policy cover autos owned or regularly used by a family member?

 

After reviewing sample premiums and comparing policies, you should research the companies you are considering.  Check the Texas Department of Insurance (TDI) website at www.tdi.texas.gov to verify the company is licensed, view its financial information, and to see the number of complaints TDI has received on the company.  You can also contact TDI at 1-800-252-3439 for this information.

Finally, you should contact an insurance agent, or the company directly, to get actual premium quotes and discuss the policies you are considering.  Company contact information may be found at www.helpinsure.com or TDI’s Company Lookup on its website.  Questions you should ask include:  

 

  • Who is and is not covered under the policy?
  • What autos are and are not covered under the policy?
  • What types of usage of your auto are not covered under the policy?
  • What are the coverage limitations for additional equipment or components?
  • What discounts or credits do you offer?

 

Hopefully these tools will help you save some money and find insurance that meets your needs.  Insurance is a complicated subject that most people do not want to talk about.  We do.  Please contact the Office of Public Insurance Counsel with any insurance questions you may have by visiting www.opic.texas.gov or calling 512-322-4143.

 

 

Monday, 14 October 2013 14:06

Shopping for Homeowners Insurance

Is Your Homeowners Premium Quote or Renewal Premium too High?

 

You may be able to save a significant amount of money on your homeowners insurance if you simply shop.

 

The State of Texas has developed some easy to use resources to help you shop for homeowners insurance. Companies charge a wide range of premiums for homeowners insurance in Texas.  You can find sample homeowners insurance premiums for your zip code at www.helpinsure.com.  For example, sample premiums for a person with good credit, no claims, and a frame home in Tarrant County can range from $1,132 to $3,120.  Of course the insurance coverage provided for these amounts can also vary significantly.  That is why you should compare the coverage provided by the policies you are considering.

 

You can compare different companies’ policies and find explanations of key insurance provisions and terms at www.opic.state.tx.us.

 

Some ways policies differ can include: 

 

  • Does the policy provide named peril or all risk coverage?
  • Does the policy provide actual cash value or replacement cost coverage?
  • What type of water damage coverage does the policy provide?

 

Comparing policies will help you identify policies that meet your insurance needs.  After reviewing sample premiums and comparing policies, you should do some research about the companies you are considering.  Check the Texas Department of Insurance (TDI) website at www.tdi.texas.gov  to verify the company is licensed, view its financial information, and to see the number of complaints TDI has received on the company.  You can also contact TDI at 1-800-252-3439 for this information.

 

Finally, you should contact an insurance agent, or the company directly, to get actual premium quotes and discuss the policies you are considering.  Company contact information may be found at www.helpinsure.com or TDI’s Company Lookup on its website. Questions you should ask include: 

 

  • What types of property are not covered or have limited coverage?
  • What types of losses does the policy cover and what type of losses are not covered?
  • What discounts or credits do you offer?
  • What is the dollar amount of each deductible? 
  • What type of loss does each deductible apply to and how is each deductible applied?

 

Hopefully these tools will help you save some money and find insurance that meets your needs.  Insurance is a complicated subject that most people do not want to talk about.  We do.  Please contact the Office of Public Insurance Counsel with any insurance questions you may have.  You can contact us at www.opic.state.tx.us or at 512-322-4143.

 

Friday, 06 April 2012 09:00

Purchasing Insurance to Protect Your Car

 

In addition to buying state mandated liability insurance, many consumers decide to purchase physical damage insurance to protect their own vehicles. Physical damage insurance covers your car for a wide variety of hazards, regardless of who is at fault or whether your car is moving or parked. Insurance companies offer two separate types of physical damage coverage: collision and comprehensive. These coverages are purchased separately and each pays for specific causes of damage to your vehicle.

 

Collision coverage pays to repair or replace your car if it collides with another vehicle, regardless of who is at fault. It also pays when your car is involved in a single car accident, such as spinning out on ice, flipping your car, colliding with another object, or hitting a pothole. Collision coverage is usually offered with a deductible that you must pay toward your car’s repair or replacement. For example, if your repair cost is $4500 and your deductible is $500, your insurance company will pay $4000 towards the repair. Premium costs are lower when the amount of the deductible is higher, but make sure you are comfortable with the prospect of paying a large deductible out-of-pocket if you make a collision claim.

 

Comprehensive coverage is sometimes referred to as “Comp” or “OTC” (Other Than Collision). This coverage pays for damage to your vehicle that is a direct result of weather, animals, natural disasters, and other causes listed in the policy. Deductibles for comprehensive coverage range from $250 to $1000. Following are some of the hazards that are covered under comprehensive insurance:

 

  • Damage from hitting a deer or other animal
  • Damage from a tree limb falling on your car
  • Vandalism or malicious mischief
  • Windstorm, hail, water, or flooding
  • Earthquake
  • Tornado
  • Fire
  • Theft, including cost for renting a vehicle while your claim is resolved, as per the policy language
  • Missiles and other falling objects (not military missiles, which are excluded as an act of war)
  • Explosion
  • Cracked windshield from a rock or flying debris.

 

Coverage for specific causes of loss varies from policy to policy. Insurance companies also have their own sets of exclusions, policy restrictions, and time parameters. Review your current policy and any prospective policy to make sure you are purchasing the type of coverage that is right for you.

 

What is a Deductible?

 

A deductible is the portion of a covered loss you must pay before your insurance company pays for any of the loss. Typically, your insurance company will simply subtract the deductible from the total amount of your claim, rather than requiring you to pay the deductible up front.

Types of Deductibles

 

Your policy may have different deductibles based on the reason for your claim. A typical Texas homeowners policy will have two deductibles:

 

  • Clause 1 deductible - applies to claims involving covered windstorm damage; and
  • Clause 2 deductible - applies to claims involving all other types of covered damage.

 

Some insurance policies may also include a “named storm” or “tropical cyclone” deductible. This deductible applies when a hurricane or named storm damages your home. Your regular Clause 1 deductible will apply in the event that damage occurs from a thunderstorm or tornado unrelated to a hurricane or named storm. Named storm deductibles are usually much higher than other policy deductibles. This means you are responsible for a larger portion of any loss involving damage from a hurricane or named storm.

 

Not all policies contain named storm deductibles. It is important to understand what deductibles apply to your policy. Ask your agent or other company representative if you are unsure if your policy contains a named storm deductible. 

Calculating the Deductible

 

Insurance companies can calculate deductibles as either a fixed dollar amount or a percentage of your home’s insured value. A dollar deductible provides an easy way to anticipate the amount you are responsible for in the event of a covered loss. For example, if you have a $500 deductible, you are responsible for $500 of the loss and the company pays for the rest of your loss, up to the policy limits. Percentage deductibles are calculated as a percentage of your home’s insured value and not a percentage of the claim amount. For example, if your home is insured for $100,000 with a 1% deductible, you would be responsible for $1,000 of any loss. A 2% deductible on that same policy means you’re responsible for $2,000 of any loss.

 

Unlike the amount of a dollar deductible, which remains constant, the amount of a percentage deductible increases every time the insured value of your home increases. For example, with a 1% deductible, if your home’s insured value increased from $100,000 to $110, 000 upon renewal, you would be responsible for $1,100 of a loss, instead of the $1,000 you were responsible for during the prior policy term.

Choosing a Deductible

 

You may be able to choose the amount of your deductible. This is important because the amount of your deductible can have a direct impact on how much your insurance costs. Choosing a higher deductible means your insurance company bears less of the risk for damage to your home, and this can translate into lower premiums for you. The disadvantage to choosing a higher deductible is that you are responsible for a larger portion of any loss. On the other hand, if you choose a smaller deductible, you’re responsible for a smaller portion of any loss, but your premiums will likely increase. Don’t be afraid to ask your agent or company representative to explain what deductible options are available to you, and how each option will impact your coverage and the price of your insurance.

 

 

 

It is becoming more common for Texas property owners to be subject to a homeowners association (“HOA”).   While HOAs have long been associated with condominium ownership, more single-family subdivisions now have them. HOAs have definite benefits for property owners. They allow owners to jointly cover common expenses and add amenities for the common use of the HOA members at a much lower cost than if each member purchased the amenity or covered the expense individually.

 

While the benefits of HOAs are evident, one of the risks isn’t: the loss assessment risk. Within the HOA agreement, the HOA very likely has the right to levy a “loss assessment” against all HOA members as a result of a covered loss that is not fully covered by the HOA’s insurance and funds on hand.

 

As an example, say an accident occurs at the HOA-owned swimming pool and a judgment is entered against the HOA for $1,500,000. Assume the HOA’s liability coverage is $1,000,000 and there are no HOA operating funds available to pay the loss. Further assume there are ten members in the HOA.  How will the remaining $500,000 be paid to satisfy the judgment? The HOA will assess each member $50,000 (their share of the loss).  Loss assessment coverage would pay the assessment up to the policy limit.  Therefore, if your loss assessment coverage limit is $50,000, the coverage would pay the assessment and the HOA member would not owe any additional funds.

 

When considering this coverage, be aware that it has limitations. Most loss assessment coverage is triggered only when the loss would have been covered by the HOA policy’s terms and conditions but there were insufficient policy limits. The loss assessment coverage will not provide any benefit if the loss is not covered or is excluded under the HOA’s policy, the HOA policy provided only defense costs but no indemnity coverage, or if the HOA’s policy has lapsed.

 

What should the prudent HOA member do?  First, make sure you understand the risk exposure you have as a member of the HOA.   To do this, talk with your HOA board, review your HOA documents, and determine the amount and status of the HOA’s insurance coverage.  If changes should be made, suggest them to the HOA board.  Second, if you perceive that you still have some risk of a loss assessment, talk with an insurance professional about the appropriate amount of loss assessment coverage you should have.   Remember, this coverage is very inexpensive and can protect you from a large financial loss when you perhaps could least afford it. 

 

Do you have questions? We would love to help. Please send me an email (dnardecchia@opic.texas.gov) or give me a call (512-322-4143).

 

 

Texas financial responsibility laws require all drivers to have liability coverage, but not all auto liability insurance policies are equal. Language, coverages, and exclusions vary from policy to policy. Be sure you know exactly who and what is covered under any insurance policy you consider purchasing.

 

The Texas Personal Automobile Policy (TPAP) was once the standard policy form used by insurance companies in Texas and is still preferred by many insurers. Today insurers may sell other auto policies that vary from the TPAP, but still fulfill the basic legal requirements for liability coverage. Some companies have added language to policies that enhance protections and offer broader coverage than the TPAP. In contrast, companies also offer policies that limit or reduce coverage.

 

Since the language, coverages, and exclusions contained in auto insurance policies differ, it is always important to read your policy thoroughly and make sure you are aware of any circumstances where your coverage may be less than you need or desire. Some policies may restrict coverage to certain drivers or vehicles or lack coverage that exists in the TPAP.

 

Below are examples of how policy coverage may be limited.

 

  • Some insurers sell policies that only cover certain drivers or specific vehicles that are identified on the policy. These policies oftenexclude coverage for any family or household member who is not listed by name on the application or policy declarations page.

 

  • Companies may attach a Named Driver Policy Endorsement to your private passenger automobile insurance policy. This endorsement excludes coverage for any family and household member who is not specifically identified on the endorsement.

 

  • A Named Driver Exclusion Endorsement excludes coverage for a person specifically named in the endorsement. Some companies are not eager to attach this endorsement to a policy, but all insurers must offer the Named Driver Exclusion to a policyholder who is in danger of being cancelled due to the actions of another insured on the policy.

 

Use OPIC’s Auto Policy Comparison tool to obtain more detailed information on coverage protections and limitations offered by insurance companies in Texas. The comparison tool allows you to evaluate as many as five different policy forms at one time. With side-by-side comparisons of how coverages and exclusions vary among companies, it is much easier to determine which policy is right for you.

 

Friday, 24 February 2012 11:46

Companies Writing the Standard HO-B Policy

 

Are you looking for a company that writes the standard HO-B homeowners policy?

 

The following companies on our comparison tool presently write the HO-B:

 

  • AMEX Assurance Company

  • Apex Lloyds Insurance Company

  • Armed Forces Insurance Exchange

  • ASI Lloyds (newly constructed homes only)

  • Chubb Lloyds Insurance Company

  • Dallas National Insurance Company

  • Delta Lloyds Insurance Company of Houston

  • Federal Insurance Company

  • Imperial Fire and Casualty Insurance Company

  • Middle States Insurance Company, Inc.

  • National Specialty Insurance Company

  • Republic Underwriters Insurance Company

  • Southern Insurance Company

  • Stonington Lloyds Insurance Company

  • Trinity Universal Insurance Company

  • Unitrin Safeguard Insurance Company

  • Universal Insurance Company of North America,

  • U.S. Lloyds Insurance Company

 

Do you have questions?

 

Please contact us at 877-611-6742 or by email: dnardecchia@opic.texas.gov