Texas Property Insurance Law Guide for Arlington Mold Damage

Estimated reading time: 11 min read

Introduction: Why Arlington, Texas Homeowners Must Know Their Rights

From spring hailstorms roaring down the I-30 corridor to summer cloudbursts that leave attics soaked, property insurance claims are a fact of life for homeowners in Arlington, Texas. Mold damage often follows these weather events and is one of the most hotly contested issues between policyholders and insurers. Understanding how Texas property insurance law applies in Arlington can be the difference between a covered repair and a costly out-of-pocket loss. Common disputes include:

• Delayed claim investigations and payments

• Underpayment of repair estimates, especially for hidden mold remediation

• Full denials based on alleged policy exclusions or wear-and-tear arguments

This comprehensive guide—written with a focus on protecting Texas policyholders—breaks down the statutes, deadlines, and practical steps that Arlington homeowners should follow when a claim goes sideways. Whether you are battling black mold behind drywall or arguing over hail-damaged shingles, the information below is designed to help you level the playing field against powerful insurance companies.

Understanding Texas Property Insurance Law

Key Statutes Every Arlington Homeowner Should Know

Texas Insurance Code, Chapter 542 – Prompt Payment of Claims Act (PPCA) • Insurer must acknowledge a claim within 15 business days after notice. • After receiving all requested items, insurer must accept or deny the claim within 15 business days (extendable to 45 days with written notice). • Payment must issue within 5 business days after acceptance. Failure can trigger 18% annual interest plus attorney’s fees. Texas Insurance Code, Chapter 541 – Unfair Settlement Practices Allows treble (triple) damages when an insurer knowingly commits bad-faith or deceptive practices such as misrepresenting policy terms or undervaluing losses. Texas Deceptive Trade Practices Act (DTPA) Provides additional consumer protections and potential treble damages for deceptive insurance conduct. Statutes of Limitation • Breach of contract: 4 years under Texas law, but most homeowner policies shorten this to as little as 2 years and 1 day from the date of loss—check your policy language carefully. • Common-law bad faith and statutory claims: generally 2 years.

How Mold Damage Fits into Texas Law

Mold claims raise unique challenges. Many Texas homeowner policies exclude or cap mold coverage, but the exclusions are strictly construed against the insurer. Under Fiess v. State Farm Lloyds, 202 S.W.3d 744 (Tex. 2006), the Texas Supreme Court ruled that an insurer could exclude mold unrelated to a covered water loss. However, if the mold results from a covered peril—like a storm-caused roof leak—the resulting mold remediation may still be covered even if the mold itself is excluded. Knowing this distinction—and documenting causation—can dramatically boost your negotiating leverage.

For official explanations of Texas insurance laws, visit the Texas Department of Insurance (TDI).

Common Property Insurance Disputes in Texas

Survey data from TDI complaint files show that the most frequent homeowner disputes in Texas include the following:

• Wind and hail damage—particularly contentious in Tarrant County, which logged thousands of severe hail claims after the 2022 storms.

• Water and mold damage—humid North Texas summers magnify mold growth, complicating remediation costs.

• Hurricane and tropical storm losses—while Arlington sits inland, remnants of Gulf storms still spawn torrential rains and tornadic winds.

• Fire and smoke damage—wildfires in dry summers, kitchen fires, and faulty wiring incidents.

• Scope of repair disagreements—insurers often prefer “patch” repairs; policyholders demand full replacement per building codes.

Because many adjusters are not local, they may underestimate the cost of labor and materials in the thriving Dallas-Fort Worth (DFW) metroplex. The result: lower estimates, slower payments, and frustration for homeowners.

Texas Legal Protections & Regulations

Statutory Deadlines and Penalties

• Notice of claim to insurer: Ideally within the policy’s “prompt notice” requirement—often 30 days but not always specified.

• Insurer acknowledgment: 15 business days (TIC §542.055).

• Request for additional information: Must be made within the same 15-day window.

• Decision to pay or deny: 15 business days after receiving all information (up to 45 with notice).

• Payment after acceptance: 5 business days.

Appraisal Clause – A Quick Path to Settlement?

Most Texas policies contain an appraisal clause allowing either party to demand appraisal when dispute centers on the amount of loss. Each side hires an appraiser, and the appraisers select an umpire. The majority decision is binding on value but not on coverage. Key Texas cases include:

• State Farm Lloyds v. Johnson, 290 S.W.3d 886 (Tex. 2009) – Court held that appraisal is appropriate where the dispute is value, not cause.

• Barbara Technologies Corp. v. State Farm Lloyds, 589 S.W.3d 806 (Tex. 2019) – Even after appraisal, policyholders can still pursue bad-faith damages if the insurer delayed payment.

Deadline to invoke appraisal: Policies vary, but many require written demand within 60 days of a disagreement. Missing the window can waive the right.

Bad Faith & Extracontractual Damages

Texas recognizes both statutory and common-law bad faith. A carrier acts in bad faith if it unreasonably denies or delays payment when liability is reasonably clear. Chapter 541 and DTPA remedies include:

• Economic damages (unpaid benefits)

• Additional damages up to three times economic damages for “knowing” violations

• Attorney’s fees and court costs

The Prompt Payment of Claims Act adds 18% interest on any amount not timely paid. Combined, these penalties create significant leverage for policyholders—if you know how to assert them.

Steps to Take After a Property Insurance Dispute

1. Document Everything Immediately

• Take time-stamped photos and videos of all damage, including source of water intrusion that led to mold.

• Keep samples of damaged materials (e.g., drywall, carpet) if practical.

• Maintain a written log noting dates of every conversation with adjusters, contractors, and inspectors.

2. Mitigate Further Damage

Texas policies require “reasonable steps” to protect property from further harm. Hire a reputable water-remediation company to dry affected areas within 48 hours if safe. Failure to mitigate may give the insurer ammunition to reduce payment.

3. Obtain Independent Estimates

A second (or third) opinion from licensed contractors or public adjusters can expose undervalued line items. For mold, insist on a certified mold assessment and protocol compliant with Texas Mold Assessment and Remediation Rules (TMARR).

4. Review Your Policy in Detail

Look for:

• Water damage and mold sub-limits

• Exclusions for “continuous or repeated seepage” (disputed terms)

• Appraisal and limitation-of-action clauses

If anything is unclear, consult an experienced Arlington insurance attorney.

5. File a Written Complaint with TDI

Policyholders who believe an insurer violated the law can file an online complaint with the Texas Department of Insurance Consumer Help Division. TDI will forward the complaint to the insurer and require a written response, often nudging stalled claims forward.

6. Consider Invoking Appraisal

When the only dispute is dollar amount, timely appraisal can avoid full-blown litigation. Submit a written demand citing the policy paragraph and name your chosen appraiser.

7. Preserve Evidence and Deadlines for Suit

Calendar the statute of limitations—typically 2 years from final denial or 2 years and 1 day from date of loss, depending on the policy. Mail a certified-mail TIC §542A pre-suit notice at least 61 days before filing suit, identifying each statutory violation and your damages.

When to Seek Legal Help in Texas

If you encounter any of the following, consult counsel immediately:

• The insurer denies mold remediation claiming “pre-existing” damage without adequate investigation.

• Payment is delayed beyond PPCA deadlines.

• An adjuster or engineer report seems biased or factually incorrect.

• The insurer refuses to disclose its estimate or depreciation calculations.

• You receive a reservation of rights letter or complex policy language you do not understand.

Louis Law Group’s attorneys are licensed by the State Bar of Texas and have extensive experience forcing insurers to honor their obligations. We handle cases on contingency—no fee unless we recover for you. Our team marshals independent adjusters, certified industrial hygienists for mold testing, and expert contractors to build the strongest claim possible.

Local Resources & Next Steps

Government and Court Contacts

Texas Department of Insurance – Consumer helpline: 800-252-3439 Texas Judicial Branch – Dockets, forms, and court rules Tarrant County District Clerk – File lawsuits arising in Arlington

• Legal Aid of NorthWest Texas – 888-529-5277 (income-qualified assistance)

Practical Checklist for Arlington Homeowners

• Notify your insurer in writing immediately after discovering damage.

• Photograph and video every affected area before cleanup.

• Keep receipts for mitigation and living expenses.

• Request a certified copy of your complete policy.

• Track every deadline on a calendar—15, 45, and 5 business days matter.

• Seek a second estimate if the adjuster’s numbers look low.

• If the claim stalls beyond 30–45 days, issue a polite but firm written demand citing Texas Insurance Code §542.

• Contact a qualified attorney if the insurer still drags its feet.

Ready to Fight Back?

If your property insurance claim has been delayed, underpaid, or denied—including stubborn mold damage disputes—call Louis Law Group at 833-657-4812 for a free case evaluation and comprehensive policy review today. Our Arlington-focused team is ready to make your insurer keep its promises.

Disclaimer: This guide is for informational purposes only and does not constitute legal advice. Every claim is fact-specific, and you should consult a licensed Texas attorney regarding your particular situation. Reading this material or contacting Louis Law Group does not create an attorney-client relationship.