Houston, Texas Property Insurance Claim Guide

Introduction for Houston Homeowners

Few experiences are more stressful for Houston homeowners than discovering hurricane-torn shingles, a slab leak after last week’s tropical downpour, or a roof punctured by hail from a spring thunderstorm—only to receive a claim denial letter from your insurer. The Greater Houston metro area sits barely 50 miles from the Gulf of Mexico and averages more than 50 inches of rain each year, placing local properties at heightened risk of wind, flood, mold, and water damage. According to loss data reported to the Texas Department of Insurance (TDI), Harris County consistently leads the state in the number of homeowners’ claims filed after named storms. Yet policyholders frequently learn that insurers have questioned causation, invoked exclusions, or demanded burdensome proof of loss. This comprehensive guide explains how the Texas Insurance Code, state regulations, and Houston-specific hazards intersect when a property insurance claim is denied. By understanding your rights and following the steps outlined here, you can level the playing field and protect the investment you call home.

Understanding Your Property Insurance Rights in Texas

Key Rights Under Texas Law

The Texas Legislature has enacted robust consumer protections designed to ensure that policyholders are treated fairly. Although insurers hold significant leverage, you have enforceable rights, including:

• Prompt Notice and Payment – Under Texas Insurance Code Chapter 542 ("Prompt Payment of Claims Act"), an insurer must acknowledge a claim within 15 calendar days, begin its investigation, and—once it receives all requested information—accept or deny the claim within another 15 business days (extendable to 45 for a catastrophic event).

• Freedom from Unfair Practices – Chapter 541 of the Texas Insurance Code prohibits insurers from misrepresenting policy terms, failing to attempt a prompt and fair settlement, or delaying payment without reasonable basis.

• Right to Access Your Policy and File History – Texas Insurance Code §542.158 entitles you to copies of your claims file, adjuster notes, and photographs upon written request.

• Contractual Limitation Period – Most first-party property actions must be filed within four years (breach of contract) and within two years for statutory bad-faith claims, per Tex. Civ. Prac. & Rem. Code §16.004 and §16.003 respectively.

Typical Coverages Relevant to Houston Homes

Standard Texas Homeowners (HO-3) and Dwelling policies usually include:

• Coverage A – Dwelling: structural repairs to roofs, walls, HVAC, etc.

• Coverage B – Other Structures: fences, detached garages, sheds.

• Coverage C – Personal Property: contents inside the home.

• Coverage D – Loss of Use: additional living expenses (ALE) when the residence is uninhabitable.

Optional endorsements frequently purchased by Houston residents include windstorm coverage through the Texas Windstorm Insurance Association (TWIA) and mold remediation riders. Each coverage part carries its own deductibles, exclusions, and conditions. Familiarity with these provisions is critical when disputing a denial.

Common Reasons Property Insurance Companies Deny Claims in Texas

Texas insurers rely on several well-worn arguments to deny or limit payment:

• Late Notice: Alleging the policyholder failed to provide "prompt" notice required by the policy.

• Wear and Tear/Pre-Existing Damage: Categorizing roof deterioration as age-related rather than storm-caused, despite severe wind events common in Houston.

• Flood vs. Wind Disputes: After hurricanes like Harvey, insurers may claim that rising water—not covered by standard policies—caused the damage, while the homeowner asserts wind or wind-driven rain triggered the loss.

• Failure to Mitigate: Insurers often argue policyholders did not take reasonable steps (e.g., tarping the roof) to prevent further damage as required by policy conditions.

• Partial Denial via Causation Allocation: Paying only a fraction by attributing some damage to excluded causes such as foundation movement or earth settlement.

• Policy Exclusions: Mold, cosmetic roof damage, or certain plumbing leaks may be excluded unless an endorsement applies.

Understanding the specific rationale cited in your denial letter allows you to gather targeted evidence to rebut the insurer’s position.

Texas Legal Protections & Insurance Regulations

Texas Insurance Code Chapter 542 – Prompt Payment of Claims

Chapter 542 imposes strict timelines and penalties:

• 15 days to acknowledge receipt of claim.

• 15 additional business days to accept or reject after receiving all requested items.

• Statutory interest penalty of 18% per annum plus attorney’s fees if the insurer violates the statute. (See Texas Insurance Code §542.060).

The statute applies to most residential property claims, including fire, wind, and theft. It does not apply to flood policies under the NFIP.

Texas Insurance Code Chapter 541 – Unfair Settlement Practices

Chapter 541 mirrors many provisions of the national Unfair Claims Settlement Practices Act. Examples of prohibited conduct include:

• Misrepresenting a material fact relating to coverage.

• Failing to settle when liability has become reasonably clear.

• Refusing to pay claims without conducting a reasonable investigation.

A successful Chapter 541 claim can yield actual damages, treble damages for knowing violations, and attorney’s fees.

Statute of Limitations in Texas

• Breach of Insurance Contract: 4 years (Tex. Civ. Prac. & Rem. Code §16.004).

• Statutory Bad Faith (Ch. 541): 2 years (Tex. Ins. Code §541.162).

• Prompt Payment (Ch. 542): 2 years.

Some policies shorten the contractual limitations period; such provisions are generally enforceable if the period is reasonable and conspicuous.

Texas Department of Insurance Complaint Process

If informal efforts fail, you may file a complaint with TDI:

Complete the online form at TDI Complaint Portal.

• Attach the denial letter, correspondence, photos, and your policy.

• TDI contacts the insurer, which must respond within 15 days.

• TDI will issue a written finding. Although not binding, insurers often reconsider when regulators inquire.

The process is free and typically resolved within 40–60 days.

Steps to Take After a Property Insurance Claim Denial in Texas

• Review the Denial Letter Carefully Note every policy provision or exclusion cited. Denials must be in writing under Chapter 542. Make a checklist of the insurer’s stated reasons.

• Request Your Claim File Under Texas Insurance Code §542.158, send a written demand for the entire file, including adjuster reports, engineer opinions, and photographs. This evidence often reveals gaps in the insurer’s investigation.

• Gather Independent Evidence Hire a licensed public adjuster or qualified contractor experienced with Houston building codes (e.g., International Residential Code as amended by the City of Houston) to prepare an estimate. Obtain weather reports from the National Weather Service to confirm wind speeds or hail size on the date of loss.

• Submit a Written Reconsideration Demand Attach your independent estimate, photographs, and expert reports. Cite Chapters 541 and 542, and set a deadline (e.g., 10 business days) for the insurer to respond.

File a Complaint with TDI If the insurer refuses to reevaluate, escalate through the TDI complaint process. Include your demand letter and supporting materials.

• Consult a Texas Attorney Experienced counsel can send a pre-suit demand under Tex. Ins. Code §542A.003 (applicable to "forces of nature" claims) and preserve your right to attorney’s fees.

When to Seek Legal Help in Texas

Although many claims can be resolved directly with the insurer, certain red flags warrant immediate legal intervention:

• The insurer hires an engineer who concludes storm damage is "cosmetic only," despite interior leaks.

• You receive a reservation of rights letter alleging misrepresentation.

• The claim involves complex causation disputes: wind vs. flood, wind-driven rain vs. seepage, or pre-existing conditions.

• The insurer delays payment beyond statutory deadlines or provides shifting explanations.

A Texas attorney can preserve evidence, engage experts familiar with Harris County jury pools, and file suit in state district court. Local counsel must be in good standing with the State Bar of Texas under the Texas Disciplinary Rules of Professional Conduct.

Local Resources & Next Steps for Houston Residents

• City of Houston Permitting Center – Verify whether repairs require permits under local building codes.

• Harris County Flood Control District – Access floodplain maps to support wind vs. flood causation arguments.

Texas Windstorm Insurance Association (TWIA) – If your property is in a designated catastrophe area, TWIA may provide supplemental wind coverage. See TWIA Claims Information. Public Adjusters – Licensed by TDI under Tex. Ins. Code Ch. 4102. Verify license status on the TDI Agent Lookup.

Persistent advocacy, thorough documentation, and knowledge of Texas insurance law can turn an initial denial into a full and fair recovery.

Legal Disclaimer: This article is provided for informational purposes only and does not constitute legal advice. Laws may change, and the facts of every case are unique. Consult a licensed Texas attorney regarding your specific situation.

If your property insurance claim was denied, call Louis Law Group at 833-657-4812 for a free case evaluation and policy review.