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Condo Insurance Claims in Texas

Condo Claims in Texas follow this general process:

  1. Submit a claim to your condo insurance provider. In the claim, you will provide details of damages to the properties contained in the condominium and evidence of the properties value.

  2. The insurer sends out an insurance claims adjuster to assess your claims and losses, and to make sure that they are indeed covered by your condo policy.

  3. After the assessment, the condo insurance provider decides to approve, decline, or modify the value to be paid out for your claims.

How Do I File a Claim for Condo Insurance?

To file a claim for condo insurance in Texas, contact your insurer, or better yet, an insurance agent who sold you the policy. A property insurance agent can make the claim process run more smoothly and with less stress to the insured. The agent typically:

  • Reviews the policy to tell the insured if their damage is covered (while the final determination is made by the insurer and the assigned insurance adjuster)

  • Assists the insured in communicating with the insurance company’s claim department by making calls and sending emails, and

  • Files claim paperwork on behalf of the insured.

If you purchased the coverage online, without a personal agent, contact your insurer to file a claim with a staff insurance adjuster. In general, filing a claim involves compiling a list of damaged structures, personal properties, and the corresponding values. Afterward, you will submit this list to your condo insurance provider, who will assess your claims and accept, reject or modify your demands.

How Long Do I Have to File a Condo Insurance Claim in Texas?

Your condo insurance policy document should contain how long you have to file a condo insurance claim in Texas. However, the Texas Department of Insurance (TDI) advises policyholders to file claims immediately after the occurrence of a covered peril.

What Happens After I File a Claim with my Condo Insurance Company in Texas?

Once you file a condo insurance claim in Texas, your condo insurance provider must acknowledge receiving your request within 15 days. After receiving your request, the insurer has 35 days to settle your claim. During this period, a claims adjuster will assess your claims and recommend a decision to your insurance provider. Contact a licensed property insurance agent if you have questions regarding the condo insurance claims process.

How Do Condo Insurance Companies Pay Out Claims in Texas?

Once your insurance adjuster assesses your claims and your insurance provider agrees to make payments, the payout will likely be made via check. However, if you have an active mortgage, your condo insurance provider will pay the claims directly to the mortgage lender. Afterward, you can work with the mortgage provider to release the funds to the repair or service company fixing or replacing properties in your condominium.

Can a Condo Insurance Company Refuse to Pay a Claim?

Yes, a condo insurance company can refuse to pay a claim if they suspect fraud. However, such suspicions will be investigated by an independent investigator who will confirm or strike out your provider’s suspicions. If there are no suspicions of fraud, condo insurance companies are obligated by the policy agreement to pay your claims. In Texas, it is common for insurance providers to consult with you during the claims assessment period to determine a mutually suitable amount to pay as claims.

Why Do Condo Insurance Companies Deny Insurance Claims?

Your condo insurance provider can deny claims if they suspect you of fraud or other forms of foul play. Also, if the damage to your condominium or personal property is not covered by your insurance policy, your insurance provider will deny your insurance claims. Furthermore, if you stopped paying your condo insurance premiums, your insurance provider can deny your claims.

How Much Does Condo Insurance Pay Out?

The amount your condo insurance will payout depends on several factors. The most important of these factors is the valuation of your condo and properties by your condominium insurer. In Texas, your condo can be valued in one of the following ways:

  • Fair market valuation: Insurers can sometimes price your condo according to the average sales prices of condominiums in your area.

  • Appraised valuation: This valuation is designated by a property appraiser. These appraisals are done during a condo sale, financing, or refinancing.

  • Taxes assessed valuation: This valuation is obtained from your condo's stated value during your property tax filing. The value is usually lower than the fair market valuation of your condo.

  • Rebuild valuation: This valuation is derived by determining how much it would cost to build your condo in the same neighborhood from scratch. It is the best valuation to go by.

The agreed value of your condo determines the amount your condo insurance will pay out as a claim. For example, if your insurance policy is based on the rebuild value of your condominium, that is the amount your condo insurance provider will payout. For your properties, the amount the condo insurance will pay depends on the determined value of your properties. Personal property valuation is determined in one of two ways:

  • Replacement value
  • Actual cash value

The Replacement value is considered the amount it would cost to replace the personal properties when you claim. In contrast, the actual cash value is the value of your properties minus depreciation. If your condo insurance policy covers losses of properties based on the replacement value, that is how much your condo insurance will pay.

What if my Insurance isn’t Paying Enough for my Claim?

Since insurance claims in Texas are usually paid by checks, your signature on the check issued by your condo insurance provider will signify that you consent to the amount stated in the claim. If you do not agree to the amount offered by your insurance provider, you can decline to sign the check and reach out to them and register your displeasure. You can also request the services of a private claims adjuster, who can reassess your claims and make a new recommendation to your insurance provider. If you use a private adjuster to negotiate for you, you will need to pay a percentage of the final claim as a fee for the service, which usually results in the net payout lower than you would get without them. Usually, once you can provide concrete evidence of the value of the repairs on your condo and property, your insurance provider will pay the amount stated in your proof.

How Long Can a Condo Insurance Company Investigate a Claim in Texas?

Condo Insurance companies in Texas are allowed a maximum of 15 days to investigate your claims. If they do not decline or attempt to modify your claims in that period, they are obligated to send you a check.

How Can I Check the Status of my Condo Insurance Claim?

To check the status of your condo insurance claim, you can do two things:

  • Check with your property insurance agent who is helping you with filing the claim. As your representative, they can do the follow up with the insurer, notifying you when something is required on your end.

  • Reach out to the claims department of the insurer to confirm the status of your claims. Some insurers provide customers with a dedicated phone line, website, or mobile app for checking the status of filed insurance claims.

Do I Need to Tell Condo Insurance Company if I am Staying in a Hotel Due to Renovations at my Condominium?

Most condo insurance policies in Texas provide coverage if you need to stay at a hotel or other temporary location during the renovation to your condominium after a covered peril. This is known as loss of use coverage. It is best to inform your condo insurance provider of such a development since they will also be responsible for your living expenses for that period. You can also contact your property insurance agent who will in turn inform your insurer about your predicament.

When not to File a Condo Insurance Claim?

Generally, you may not want to file a condo insurance claim in Texas under the following circumstances:

  1. If your condo and properties' repair value or replacement value is almost the same value as your deductible. Insurance premiums typically increase after claims, and it might be better to pay for repairs out-of-pocket if the repair or replacement costs are negligible to avoid raising your premiums.

  2. If you have had several condo insurance claims in the last three years, filing a claim might not be worth it. Since condo insurance providers consider persons who file claims frequently as high-risk individuals, the cost of your premiums will increase. Depending on an insurer, the type of a claim filed, and the final payout, you can expect your Texas Condo insurance to increase an average of 5% to 20% per claim.

  3. If your claim is related to a simple maintenance issue, it might not be worth filing with your insurer.

  4. If the claim you wish to file is not covered by your insurance policy, you cannot file such a claim. For example, if your condo insurance does not cater for the repair of walls destroyed by mold, you should not file a claim to repair such walls.

Discuss your claim-related questions with your insurer, a knowledgeable and licensed residential property insurance agent, or an attorney practicing in insurance law.