How long does an insurance company have to settle a claim in Texas?

A car accident can result in substantial damages, ranging from damage to your vehicle to personal injury to financial loss. Fortunately, you have insurance to cover the cost of your losses and to help ease the recovery process.

Insurers understand that car accident victims rely on speedy settlements to recover and move on with their lives. Most review and investigate claims and make decisions in timely fashions — often within a couple of days of receiving a claim. Not all do, however.

In some situations, insurers may require more time to investigate a claim before making a decision. In others, an adjuster may not receive the information he or she needs to make an accurate determination. In yet others, a company may purposefully delay some or all aspects of the claims process. Regardless of the reason, if you feel that your insurer is taking too long to process your claim and make a determination, it is imperative that you understand your rights under Texas law. A large part of understanding your rights entails knowing insurers’ responsibilities.

The Insurance Claim Timeline in Texas

Per Texas law, insurers have 35 days from the receipt of a claim to make a determination and settle it. Within that timeframe, they must meet three additional deadlines: A deadline by which it must acknowledge a claim, a deadline by which it must make a decision and a deadline by which it must issue a final payment.

Providing Notice of the Claim

Your insurer does not have a responsibility to you if it does not receive notice of your claim. Only you can begin the claims process, which you do by providing notice of your claim. Ideally, you will file a notice immediately after your car accident. However, if you delay filing a claim for whatever reason, know that you have two years from the date of the accident to submit a notice for compensation. Failure to file a notice of claim within that two-year period may result in the forfeiture of your rights to compensation.

When providing notice of your claim, there are additional steps you can take to speed up the determination and settlement process. First and foremost, you can work with an experienced personal injury attorney in Texas who understands everything from filing deadlines to what documentation you need to support your claim. You can also provide photo evidence, medical records, police reports and other relevant documentation.

Acknowledgment of Claim and the Investigation Process

Once you submit your claim, the proverbial ball is in the insurer’s hands. Upon receipt of a claim, the insurance company has 15 days total to do the following three things:

• Notify you that it acknowledges your claim and send you the necessary paperwork and instructions; paperwork should include proof-of-loss forms, which will serve as your sworn statement regarding the scope of your injuries and damages
• Begin the investigation process
• Request any additional information it needs to complete the investigation process

At the end of this 15-day period, the adjuster should have everything it needs to confidently approve or deny your claim.

The Determination Process

During the second 15-day period of the 35 days of the claims process, your insurer must approve or deny your claim and inform you of its decision. If, during this 15-day period your insurer continues to request irrelevant information or documentation, you may want to consult with an attorney if you have not already. Insurers often use this tactic or similar strategies to delay making decisions in the hopes that insureds will drop the issue. An experienced lawyer is familiar with these types of bad-faith tactics and can encourage the insurance company to make a final determination.

The Final Payout

If your insurance company approves your claim, it has five days from the date of approval to issue your payment or begin the process of sending your vehicle in for repairs. This five-day period brings the total time frame to 35 days.

Exceptions

Texas law does provide for an exception to the 35-day rule. If an insurer needs more time, it can request a 10-day extension. A governing board may grant this extension if the insurer can show good cause. If your insurer needs more time, it must notify you of the delay and provide you with a valid reason in writing. With a 10-day extension, your insurer has up to 45 days to review, investigate and settle your claim.

Penalties for Delaying Your Claim

Insurers face steep consequences for unnecessarily delaying insureds’ claims. If a carrier delays your claim for more than 60 days after it receives all the requested documentation, you may file a claim for insurance bad faith. If successful, you may recover the following damages:

• The full value of your claim
• 18% in annual interest
• Attorney costs and legal fees

If you suspect your insurer of committing bad faith, contact an attorney right away.

Factors That May Delay Your Claim

There are some situations in which your insurance company may not be able to process your claim completely within the 30- to 45-day timeframe. Factors that spur these situations may be completely out of your or the insurer’s control. Some such factors are as follows:

• Dispute Over Fault: If it is not immediately clear via photos, police reports or individual accounts who was at fault, your claim may take longer to settle. Neither parties’ insurance company will want to pay out a claim for which it may not be legally responsible.
• Ongoing Negotiations: If your damages are severe enough that you felt compelled to hire an attorney, you can count on your lawyer to push for the maximum amount of compensation on your behalf. Doing so, however, will likely require extensive and ongoing negotiations between your legal team and that of the opposing party. Said negotiations may drag on for months.
• Severe Injuries: If you sustain severe injuries in your accident, you may have to undergo extensive medical care before you reach the point of maximum medical improvement. Only once you reach the point of MMI — which basically means you are as good as you are going to get — should you consider settling. If you settle too soon, you may unwittingly settle for an amount that is far below the actual value of your case.

Delays can be frustrating. Fortunately, there are steps you can take to prevent them.

How an Experienced Personal Injury Lawyer Can Help Prevent Delays

Though you cannot control how quickly your insurance company processes your claim, you can take steps on your end to prevent delays and protect your rights. For instance, you can provide as much evidence as possible upfront, remain responsive and cooperative with the insurance company, and brush up on state laws. You can also contact an experienced personal injury attorney immediately after your accident. Though you may not end up needing legal help, an experienced lawyer can advise you of your rights and the insurer’s responsibilities and ensure that you do what you can on your end to protect your rights to compensation.

At Fielding Law, we do more than just protect your rights — we get results. We routinely recover six- to seven-figure verdicts for our clients and are excited at the opportunity to do the same for you. Whether you cannot get anywhere with a claim you already filed or you simply wish to be proactive in your pursuit for compensation, reach out to our team to see how we can help you. Schedule your free case evaluation online today.