Houston Residential Homeowner First Party Insurance Claims

With first-party insurance the person insured, the first party, is paid by the insurer, the second party, after the occurrence of injury, property damage/loss, or accident. When a Houston resident files a claim for residential damage, injury, or loss of property with his or her homeowner’s insurance carrier, that person is making what is called a first-party insurance claim. Texas homeowner’s insurance policies offer the insured peace of mind that they will be protected in times of disaster.

Forty-five percent of insurance claim payments from the years 1999 through 2009 were made as the result of damages sustained in hurricanes and tropical storms. While Texas residents are more concerned about hurricanes because of their proximity to the Gulf of Mexico, tragedies like the catastrophic outbreak of tornados in Alabama in April of 2011, remind Texans of the need for preparing for anything Mother Nature can throw out there. An extremely important part of that preparation is the obtaining and maintaining of proper homeowner’s insurance coverage and dealing with a reputable insurer who will respond in a proper manner once a claim is filed. Always understand the details of your homeowner’s insurance coverage and be aware also that you have the right to what is owed to you.

In Texas, a first-party insurance claim is stated when the insured party is engaged in seeking damages/recovery for his or her own injury or loss. A third-party claim, on the other hand, is stated when the insured seeks insurance coverage for injuries/losses incurred by a third party. By purchasing homeowner’s coverage, homeowners are attempting to protect themselves and their property from damage caused by wind, fire, tornados, hurricanes, etc. Homeowner’s insurance policies cover such events as the following:

• Ice, sleet, or snow causing property damage
• Fire
• Discharge of water from air conditioning or heating systems
• Failure of household appliances which may cause the discharge of water or fires
• Water damage due to the activation of a fire protection sprinkler system
• Wind damage
• Damage from hail
• Damage from tornadoes or hurricanes
• Plumbing failures, etc. Homeowner’s policies, however, do not generally cover slow leaks or drips which may cause problems over a prolonged time period.

eowners are attempting to protect themselves and their property from damage caused by wind, fire, tornados, hurricanes, etc. Homeowner’s insurance policies cover such events as the following:

Section 541.060 (a) of the Texas Insurance Code identifies contractual claims brought in first-party situations referred to as bad faith claims which allege that settlement practices have been violated by insurance carriers.

With respect to a claim made by an insured individual or a beneficiary, Section 541.060 (a) of the Texas Insurance Code states that it is unfair or deceptive for an insurance company to engage in the following unfair settlement practices:

• Misrepresentation to a claimant of a policy provision contained in the coverage at issue
• Misrepresentation to a claimant of a key, material fact regarding the insured’s coverage
• Failing to make a good faith effort to effect a fair, prompt, and equitable settlement with the insured
• Failing to attempt in good faith to process a claim with respect to which the insurance company insurer’s liability is reasonably clear
• Attempting to influence the claimant to settle his or her claim under another part of the coverage, not the coverage pertaining to the actual event and resulting damage

Texas law states that the insurer can be held liable for dealing in bad faith if the company postpones or denies a claim that was clearly covered under the insurance policy. That fact should have been reasonably understood by the insurer. If the insurer’s conduct is extreme and injury-causing independent of the claim against the policy, the conduct of the insurer may be considered to be in bad faith. Insurance companies must not act in bad faith by failing to attempt to achieve a prompt, fair settlement of a claim when the company’s liability has become reasonably clear.

In regard to the use of experts in determining damage amounts, Texas courts have found that the reliance by an insurer on the report of an expert standing alone cannot shield the insurance carrier when evidence exists that the expert’s report was not prepared objectively or the carrier’s reliance on the report was unreasonable. Under the legal doctrine of bad faith, insurance companies have the obligation to act fairly toward those they insure and in good faith whether the policy specifically states so or not. The duty of acting in good faith is key to how under law insurance companies must treat their insured and conduct themselves.

• Immediately notify the insurance company with whom you hold a homeowner’s policy.
• Preserve as much of the damaged property as is reasonable.
• Take and date pictures of everything in and around your home which has sustained damage.
• Collect and save all evidence of purchases for products or labor such as receipts and invoices.
• Save all documents you can because insurance companies may attempt to show failure to provide documents they request is reason enough to deny a claim.
• Be aware of an insurer’s lack of adjusting the claim in a fast and efficient manner. The insurance company will assign an adjuster to oversee your claim. That adjuster is responsible for creating a record of the losses incurred in the weather event and assigns a dollar amount to the value of the home prior to the event as well as a dollar amount reflecting how much money will be needed for the policy holder to repair the home.
• Provide a proof of loss if requested to do so by the insurer. A proof of loss is a sworn statement concerning the origin of loss, time of loss, and cash value of damages sustained.

Insurance companies may offer to settle a claim for far less than the actual value of your loss. Homeowners do not have to tolerate mistreatment on the part of insurance companies. Homeowners, who have suffered loss, should seek the help of an experienced first-party insurance claims lawyer. Even if you have already filed a claim, it is not too late to seek outside help from an attorney who realizes insurance companies are not eager to pay damages and who can help homeowner’s insurance policy holders receive the full amount of damage compensation owed to them by their insurers.

If you are a homeowner who has experienced property damage and are having trouble getting your insurance company to pay the full value of your first-party claim, contact the Houston, Texas based Wyly Law Firm, P.C.

Call (713) 574-7034 or fill out our online contact form.

We at the Wyly Law Firm are committed to helping Texas homeowners obtain the full value of their first-party property loss claim.

These Hubs are provided for informational purposes only and should not be considered legal advice. Professional legal counsel should be sought for specific advice relevant to your circumstances.