There’s a ‘rumor’ going around that citizens need to file their insurance claims for Harvey before 09/01/2017 due to the Hailstorm bill that recently passed the Senate. This is NOT true.
What's The Nitty Gritty on the Hailstorm Bill?
First and foremost the DOL (date of loss) is the determining factor for a claim pay out -- NOT the report date of the loss. Regardless of when the loss is reported to the carrier or to the agent, the 'rules' that determine payout are based on the DOL.
Second important point is that the codes being changed/added are specific to filing a lawsuit. So if you're not filing a lawsuit then it's business as usual.
Per the weather reports for those of us in the Houston area, I don't think anyone's going to have a DOL on/after 09/01 unless it's something not related to this storm (i.e. they decide to see if their car can swim through the high water to get back to their house).
And, unfortunately, if you’ve not actually had the loss then you’re going to have to wait until the loss occurs, otherwise you’re committing fraud and your insurance policy will become null and void, so don't do that!
What does the Hailstorm Bill (Texas HB 1774) Mean for Me?
There only 2 'downsides' for consumers. The first being, the percent penalty the insurance carrier would have to pay the insured for not paying in 'timely and fully' is reduced from 18% per year to 5 percentage points above Texas’ pre-judgment interest rate, which is currently 5%. (Note: For claims to which Chapter 542A does not apply, however, the statutory penalty interest rate would still be 18%.)
The only time this interest rate would come into play is in the event an insured sues the carrier/agent. From a consumer standpoint, if your suit is valid (i.e. the carrier truly should have been sued) then this shouldn't really affect you much. However, those that are looking for a reason to sue and win extra money from a carrier will find this law was designed to keep that from happening.
The second is limitation on recoverable attorney's fees. At first blush (thinking from a consumer/insured standpoint) this made me mad, however when you read the verbiage this provision is (again) designed to prevent frivolous suits from being filed. This provision will simply make an attorney think twice before trying to sue an insurance company without first doing their due diligence (which they should do to begin with) to ensure you, the insured, actually have a valid suit!
I've linked some additional resources that go over the other points, which again are related to some time frames for correspondences and inspections. I've also included the bill's direct link on the Texas Legislation site in case you're really bored and want to try and read through it.
What if my Insurance Company Says I'm Not Covered?
Homeowners (all-inclusive) and Windstorm (separate) do NOT cover flood - they never have. Sadly, a LOT of consumers don't realize they have always been in a Flood Zone. Even if you’re in the Preferred Zone X, you’re still in a Flood Zone. It’s never been a matter of ‘if’ your home would flood, but a matter of ‘when and how bad.’
You first need to determine the type of loss you have. Is it windstorm or flood?
Flood is defined by the NFIP (National Flood Insurance Program) as: A flood is a general and temporary condition where two or more acres of normally dry land or two or more properties are inundated by water or mudflow. And more importantly: Anywhere it rains it can flood.
If you have water in your house from anything other than the above then you have a Windstorm loss and need to file on your Homeowners (if it includes wind/hail) or your Windstorm policy.
You'll also have to meet your deductible - this is the amount of money that is your responsibility to cover before the insurance policy would start paying out. Sometimes losses are just not large enough to meet that deductible. I have a lot of clients that have chosen a 5% deductible to save on their premium (the higher the ded the lower the premium). So if you have a $200,000 dwelling coverage on your policy and a 5% deductible, your deductible would be $10,000 and any damage under that amount would be solely your responsibility.
For filing a claim on a flooded car, if you have comprehensive (aka 'other than collision) coverage then a flooded auto would be covered for ACV (actual cash value) after you meet your comp deductible (usually $100, $500 or $1000)
As an agent I feel like a broken record about Flood Insurance, but I’d rather harp at my clients to get Flood Insurance than to never let them know they should really get the protection.
I Flooded, but I Don't Have Flood Insurance, What Do I Do?
If you have a flood loss and you don't have a flood insurance policy, unfortunately your only option is going to be to apply for Federal Disaster Relief.
You can start that process by registering on the website DisasterAssistance.gov. If you do not have internet access call (800) 621-FEMA (1-800-621-3362).
If you’ve had damage from high winds (i.e. leaking roof, windows blown out, etc) then you should file a claim on your Homeowners or Windstorm policy.
If you do have both a Flood loss and a Windstorm loss, and you have a Flood Insurance Policy then you will need to file TWO claims – one with your Flood carrier and one with your Windstorm carrier.
How Do I File a Flood Insurance Claim?
You'll need to contact your agent or the carrier directly to file the FNOL (First Notice of Loss). You'll need the DOL (date of loss), at minimum your name and address or your policy number if you have it and what was damaged. You'll provide all of that information when you call in and the claims department will provide you with a Claim Number - remember to write this down (quick tip: have them text it to you or text it to yourself for quick reference later). Also make sure you get the claims department's direct phone number.
For more information on how to file a claim Click Here. There are only a few of my major windstorm/flood carriers listed. If you don't see your carrier, simply Google their name followed by 'file a claim' and you should be able to find the correct entity to contact.
Can I get a Flood Insurance Policy Now?
Yes, absolutely. You can get a flood insurance policy at any time throughout the year. There are some provisions (like a waiting period) that you'll need to know about. As an agent operating in the Gulf Coast for over 14 years I know more about Flood Insurance and Flood Zones than I ever wanted to! Just give me a call/email/text and I'll get you set up. Email me, P: 832-779-8430 or Message me on Facebook
See this post for How Much Does Flood Insurance Cost? and How Much Flood Insurance Do I Need?
If I can help in any other way please don't hesitate to call/email and share this with your friends and family!
Blessings to you & yours,
The bill in its current state
Synoposis of the bill's changes