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Why delays in homeowner’s claims can become expensive

On Behalf of | Jun 4, 2024 | Property Damage Insurance Claims |

Homeowner’s insurance may be the only financial protection covering someone’s residence after a major storm. Ideally, the policies that people purchase can help them repair their homes after significant storm damage occurs. However, companies often have many claims to handle at once after big storms arise, causing delays in processing.

Policy rules and Texas state insurance statutes require a relatively quick response to claims related to storm damage. Unfortunately, many homeowners find themselves stuck in insurance claim limbo while waiting for repairs. An insurance company may give them the runaround about approving a claim or paying a claim after approving it. Significant delays in claim processing and resolution can lead to secondary expenses for a policyholder.

Why do insurance delays sometimes cause economic strain?

The possibility of secondary damage

If a storm has already damaged the roof of a home, additional damage could be a concern without prompt repairs. Mold growth, damage to the electrical system and irreparable damage to home furnishings are all concerns when an insurance company doesn’t promptly settle a claim related to a building damage. Houses that appear unoccupied might face criminal activity committed by opportunistic individuals. The longer it takes to resolve a homeowner’s insurance claim, the greater the likelihood of secondary damage and losses during the claims process.

The need for alternate accommodations

Many homeowner’s insurance policies provide at least partial coverage for alternate housing during a claim. Still, policies often limit how much they pay for housing or how long those benefits last. People could end up paying out of pocket for alternate living spaces required temporarily until their homes are safe to occupy again. The longer the claim drags on, the more likely people are to accrue substantial expenses related to the need for alternate housing and property storage.

Bad faith insurance practices don’t just involve denying valid claims. It is also bad faith to unreasonably delay the payout on a valid claim brought by a policyholder. Homeowners who can recognize bad faith practices are in a better position to hold insurance companies accountable after making a sizable homeowner’s insurance claim. Having assistance while communicating or negotiating with an insurance company may decrease the likelihood of unfair delays and other misconduct.