Attorneys across the state of Texas have taken to social media to warn homeowners who have been affected by Harvey to file claims before House Bill 1774 comes into effect Friday.
Houston insurance attorney, Steve Mostyn said his firm has received nearly 600 calls of people asking what they need to do before the law comes into play.
“Millions of homeowners are going to be affected by this, that’s the reason you need to file your claim before September 1 and get a better interest rate which would give them incentive to pay you faster,” Mostyn said.
Under current law, if a court finds that the insurance company takes too long to pay, they then have to pay 18 percent of interest, but as of September 1 the interest will be lowered to 10 percent. Mostyn said this law will also make it harder for homeowners to have attorney fees covered.
“It puts a lot of procedural hurdles in place in writing certain notice letters,” Mostyn said.
Lubbock Insurance Agent, Douglas Sanford with Sanford & Tatum Insurance said there is a huge misunderstanding about this law, and that it won’t affect flood claims or windstorm insurance but will in fact allow more out of state adjusters to enter the area and help move claims along quicker.
“This bill is aimed at making it a civil process, nobody needs to file a claim by September first, it has no affect on you, in fact some people don’t even know if they have a house left, safety needs to come first,”Sanford said.
Sanford said the purpose for the bill is to allow insurance companies the chance to properly settle claims that the property owner isn’t satisfied with, and give notice to the company.
“It gives the person a chance to say ‘I’m not satisfied, either pay or I’m going to sue,” Sanford said.
Sanford said in a multi-element storm like Harvey, these claims can get very complicated.
“If you don’t have flood insurance, but you have windstorm insurance, how much do they owe you? You get into those problems and it’s hard to work out because the homeowner wants the whole thing covered,” Sanford said.
Governor Abbott gave a statement saying he isn’t changing the the bill, and that it won’t affect the claims involved in Harvey, stating that every valid claim will be paid regardless of when it’s filed.
