(Header Image of Hurricane Harvey flooding via CNN)
Plenty of alarming news stories regarding Hurricane Harvey have been circulating through social media over the past few days, and a particular set of headlines involving insurance claims have Texas residents fearing their hardships will continue well after the storm has passed.
These headlines have been somewhat misleading, as many who have shared these articles on social media (likely without reading the full story) have inferred that the end of this month is the deadline to file any Harvey related insurance claims. This rumor is flat out false.
With September 1st being only 3 days away, many Texas residents displaced by Hurricane Harvey will not even be able to access their homes much less thoroughly assess their property damage in this short of a time window. It doesn’t make any sense for the state legislature to pass a law preventing literally millions of their constituents from overcoming catastrophic damage to their properties. So what changes are actually occurring next month?
The articles mentioned above (and resulting commentary hysterics) have been published in the wake of the Texas Senate passing HB 1774, which pending Governor Greg Abbott’s likely signature will become an effective law on September 1st. The law seeks to address the plethora of frivolous lawsuits stemming from fraudulent claims that have plagued insurance providers after large scale catastrophes. The specific new protocol from the law includes:
- Protection of individual insurance agents from personal lawsuits
- Reduction in likelihood of insurance companies paying plaintiff’s legal fees
- Reduction in the penalty rate that insurers must pay if payments are late
Furthermore, the vast majority of flood insurance policies purchased by homeowners are through FEMA’s National Flood Insurance Program (NFIP), which is not subject to state regulations in the first place. Nothing will change at the end of August for homeowners filing flood claims through NFIP.
Conversely, if your property sustained wind damage or your flood insurance is provided through a private company (common for business owners), there is still good reason to file your claim before September 1st. This is the actual argument being made by the circulating articles. Critics of the bill assert that these changes tip the balance of power in favor of the insurance companies, and that the late-payment fee reduction doesn’t even target the issue of fraudulent claims.
If you have the ability to assess every aspect of your property damage before Friday, fantastic. If not, we strongly recommend that you do not rush your claim. A thoroughly inspected and documented claim will do far more to help your case than a relative, ever so slight legal advantage. Here are some better ways to ensure that your insurance provider pays the full amount they truly owe you.
- Take photos of everything as soon as possible. It could go a long way in settling any disagreement between what you know happened and what the claims adjuster believes to have occurred when they arrive at your property days later.
- Differentiate between flood and wind damage. Your flood policy provider will try to weasel their way out of anything they can construe as wind damage, and vice versa for your wind policy provider.
- Find receipts or market values for your items. Disputes over how much your property is worth often arise during the claims process. Having receipts or credit card/bank statements proving the value of your destroyed contents can greatly abate this issue. In the likely scenario you don’t have this information handy, or for items that tend to depreciate in value overtime, providing evidence of the market value of your items can go a long way in ensuring you aren’t short changed.
Hopefully our clarification helps ease any additional, unnecessary worries for those of you already struggling through these extremely difficult circumstances. Our thoughts and prayers are with everyone impacted by this devastating storm. Tomorrow, we plan to post a master list of national and local organizations accepting donations and volunteers for all communities impacted by Hurricane Harvey. If you know of any great agencies in your neighborhood aiding the recovery effort, please share them in the comments!