Property Insurance Claim Denial Guide – New Braunfels, TX

Introduction: Property Insurance Risks in New Braunfels

Nestled between the Comal and Guadalupe Rivers, New Braunfels, Texas is known for its historic downtown, thriving tourism industry, and rapidly expanding residential neighborhoods. Unfortunately, Central Texas weather patterns also make local homes vulnerable to sudden windstorms, large hail, and flash flooding. The National Weather Service has documented multiple hail events in Comal County over the past decade, with stones greater than two inches in diameter capable of shredding asphalt shingles and damaging metal roofs. When extreme weather strikes, New Braunfels homeowners naturally look to their property insurance policies for financial protection.

What happens when the insurance company refuses to pay, delays payment, or offers far less than the cost of repairs? A denial—or even a partial denial—can leave families scrambling to cover expenses out-of-pocket. This guide provides New Braunfels policyholders with a clear, statute-based roadmap for responding to a property insurance claim denial. Every statement is sourced from authoritative Texas law, Texas Department of Insurance (TDI) materials, or published Texas court opinions, giving you the confidence to protect your rights.

Understanding Your Rights in Texas

The Insurance Policy Is a Contract

Texas courts consistently hold that an insurance policy is a contract between the insurer and the insured. In Farmers Group, Inc. v. Geter, 620 S.W.3d 702 (Tex. 2021), the Texas Supreme Court reiterated that both parties must comply with the policy’s plain language. If your insurer denies a claim without a valid contractual basis, the company may be in breach of contract.

Good-Faith and Fair Dealing

Texas law imposes an implied duty of good faith and fair dealing on insurers. The seminal case Arnold v. National County Mutual Fire Insurance Co., 725 S.W.2d 165 (Tex. 1987), recognizes a cause of action when an insurer unreasonably denies or delays benefits. You do not have to prove the insurer acted with malice; only that liability was reasonably clear, yet the claim was denied.

Prompt Payment Rights (Texas Insurance Code Chapter 542)

Texas Insurance Code Chapter 542—often called the Prompt Payment of Claims Act—requires insurers to:

• Acknowledge receipt of a claim within 15 calendar days (Tex. Ins. Code § 542.055).

• Accept or reject the claim within 15 business days after receiving all requested items (Tex. Ins. Code § 542.056).

• Pay accepted claims within five business days of notifying the policyholder (Tex. Ins. Code § 542.057).

If the carrier violates these deadlines, it may owe the policyholder the amount of the claim, reasonable attorney’s fees, and interest of 18% per year on the amount wrongfully delayed.

Protection From Unfair Settlement Practices (Texas Insurance Code Chapter 541)

Chapter 541 prohibits insurers from misrepresenting policy terms, failing to attempt a prompt and fair settlement, or refusing to pay a claim without conducting a reasonable investigation. A successful Chapter 541 action can result in actual damages, attorney’s fees, and, if the insurer acted knowingly, up to three times actual damages.

Statute of Limitations

Texas generally applies a four-year statute of limitations for breach-of-contract claims and a two-year statute of limitations for Chapter 541 and common-law bad-faith claims (Tex. Civ. Prac. & Rem. Code § 16.003). However, policies may contain contractual limitations shortening the period—often to two years from the date of loss. Courts will enforce a reasonable contractual limitations period, so calendar every deadline immediately.

Common Reasons Property Insurance Companies Deny Claims in Texas

Below are frequent denial rationales observed in Texas claim files, each followed by the legal considerations for challenging the decision.

Wear and Tear or Age-Related Deterioration Most homeowner policies exclude damage due to gradual deterioration. However, insurers sometimes over-apply the exclusion when a sudden peril—such as hail—accelerates pre-existing wear. Texas courts require the carrier to segregate covered damage from excluded damage (Lennar Corp. v. Markel American Ins. Co., 413 S.W.3d 750 (Tex. 2013)). Late Notice of Claim Policies require "prompt" or "immediate" notice. Under Texas law, late notice defeats coverage only if the insurer proves it was prejudiced (PAJ, Inc. v. Hanover Insurance Co., 243 S.W.3d 630 (Tex. 2008)). Always ask the insurer to identify specific prejudice resulting from any alleged delay. Excluded Peril—Flood vs. Surface Water Standard homeowner policies usually exclude flood damage. Yet Texas courts distinguish flood (overflow of inland waters) from rain-induced interior damage caused by roof openings. If wind damages shingles allowing rainwater inside, the ensuing water damage may be covered under the wind portion of the policy. Misrepresentation on Application Under Tex. Ins. Code § 705.004, an insurer may only avoid the policy for a misrepresentation made with intent to deceive or that materially affects the risk. Innocent mistakes rarely meet this high bar. Improper Repairs or Lack of Maintenance Carriers may argue that existing code violations or poor maintenance caused the loss. Request documentation, photographs, and engineering reports the insurer relied on. Chapter 542A now requires carriers to disclose these reports within 30 days of a written request.

Texas Legal Protections & Regulations

Texas Insurance Code § 542A (Weather-Related Claims)

Enacted in 2017, § 542A applies to claims "for damage caused wholly or partly by forces of nature" such as hail or wind. Key provisions include:

• Pre-Suit Notice – Policyholders must send a 60-day notice letter specifying the amount owed and the acts giving rise to the claim. Failure to provide notice can impact attorney’s fee recovery.

• Inspection Option – Insurers may request a re-inspection within 30 days of receiving notice.

• Attorney’s Fee Limitation – Fees may be reduced if the claimant’s demand is excessive relative to the judgment obtained.

Appraisal Clause Under Texas Law

Most Texas homeowner policies include an appraisal provision allowing either party to request an impartial determination of the amount of loss. State Farm Lloyds v. Johnson, 290 S.W.3d 886 (Tex. 2009) confirms that appraisal resolves only the amount of loss, not coverage. Invoking appraisal can break a valuation deadlock without immediate litigation.

TDI Consumer Complaint Process

The Texas Department of Insurance offers a free administrative avenue to resolve disputes. Homeowners may file an online or paper complaint. Once received, TDI contacts the insurer and requests a detailed, written response within 15 days. While TDI cannot force payment, its regulatory oversight often prompts carriers to reevaluate claim handling.

File a complaint with TDI here: Texas Department of Insurance Complaint Portal.

Texas Administrative Code Rules on Unfair Practices

Title 28, Texas Administrative Code § 21.203 defines unfair claim settlement practices, mirroring Chapter 541. Repeated violations can lead to administrative penalties up to $25,000 per violation (Tex. Ins. Code § 84.022).

Steps to Take After a Denial in Texas

Review the Denial Letter Thoroughly Insurers must provide a written denial explaining the reasons (Tex. Ins. Code § 542.056(c)). Compare each cited policy provision with the facts of your loss. Request the Claim File Under Tex. Ins. Code § 542A.003, you may request all adjuster reports, photos, and estimates relied on in denying the claim. Put the request in writing and keep a dated copy. Document the Damage Independently Obtain contractor estimates, engineering opinions, and high-resolution photographs. The more objective evidence you have, the stronger your position during negotiations or litigation. Send a Written Dispute or Supplemental Claim Address each denial reason, enclose additional evidence, and reiterate your demand for payment. Under Chapter 542, this resets certain prompt-payment deadlines. Consider Appraisal If the dispute centers on price, not coverage, appraisal can be faster and less costly than a lawsuit. Under most policies, each party picks an appraiser, and the two appraisers select an umpire. File a Complaint With TDI If negotiations stall, lodge a complaint using the TDI portal linked above. Provide the claim number, policy number, denial letter, and correspondence timeline. Consult a Public Adjuster or Attorney Public adjusters licensed by TDI can evaluate the loss and negotiate with the carrier for a fee capped at 10% of the claim (28 TAC § 19.708). If legal issues arise, consult a Texas-licensed attorney.

When to Seek Legal Help in Texas

Texas insurance litigation can be technical and deadline-driven. Speak with a lawyer promptly if:

• The denial involves complex coverage questions, such as anti-concurrent causation clauses.

• The insurer alleges fraud or intentional misrepresentation.

• Your home suffered catastrophic damage exceeding $30,000.

• Prompt-payment penalties or extra-contractual damages may be available.

Only attorneys admitted to the State Bar of Texas may provide legal advice on Texas insurance disputes. You can verify a lawyer’s license at the State Bar website.

Local Resources & Next Steps for New Braunfels Homeowners

City and County Agencies

• City of New Braunfels Building Inspections Division – Ensures repairs meet current International Residential Code standards. Obtaining permits and inspection reports can support your claim.

• Comal County Office of Emergency Management – Provides disaster-related updates and resource referrals after major storms.

Consumer Assistance

Texas Department of Insurance – Consumer Protection State Bar of Texas Lawyer Referral Service

Recent Weather Trends in New Braunfels

NOAA’s Storm Events Database shows multiple hail incidents measuring 1.75" or greater in Comal County since 2018. These data points reinforce the importance of maintaining updated roof inspections and keeping receipts—evidence that becomes vital after a denial.

Legal Disclaimer: This guide is for informational purposes only and does not constitute legal advice. Every claim is fact-specific. Consult a licensed Texas attorney regarding your particular situation.

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