Texas is one of the most disaster-prone states in the United States. Vulnerable to hurricanes and flash floods, Texas is notorious for high frequencies of strong storms. It ranks alongside Florida as a top state for extreme weather.
When protection is not enough
As a homeowner in the Lone Star State, flood insurance could be one of your only protections from financial harm. Areas such as central Texas (aptly nicknamed flash flood alley) suffer billions of dollars in damage during unexpected disasters. Insurance is supposed to act as your lifeline during times of extreme necessity.
But what happens when that lifeline is fragile enough to snap? Insurance companies providing National Flood Insurance Program (NFIP) policies may decide to underpay your claim, or worse, unfairly deny you. When you are not getting your fair share, insurers should be upheld to the law.
Building your case
Before assessing whether you were underpaid by the insurer, you should know the legal definition of flood damage. The Federal Emergency Management Agency (FEMA) states that flood events are when:
- two or more acres of normally dry land inundated with water or mudflow
- more than one property affected by water or mudflow
FEMA clearly distinguishes general water damage from flood damage. When insurance companies look at your claim, they look at inconsistencies such as incomplete documentation, policy exclusions or delays.
Look over your documents and get repair estimates from contractors or other professionals. You will need to file a Proof of Loss and compile evidence.
Options to settle disputes
The government-backed NFIP has a 60-day limit to appeal from the date listed on your denial letter. Follow the FEMA Flood Claim Appeals process. If you are still not happy with the outcome, you may take one of two pathways for appeals.
- administrative appeal via FEMA’s Federal Insurance Directorate
- the appraisal process
Under NFIP guidelines, the two pathways are mutually exclusive. If you choose a path to appeal, you forfeit the right to use the other.
Should you decide not to go through the administrative process, you can file a federal lawsuit against the insurer. You have a strict one year window from the date of denial to file the suit. In every step of the resolution process, it is advisable to seek a legal advisor to navigate your insurance disputes.