Texas Property Insurance Law Guide – San Antonio Homeowners

Estimated reading time: 12 min read

Introduction: Why San Antonio Homeowners Must Understand Texas Property Insurance Law

San Antonio sits at the intersection of Central Texas’s flash-flood alley and the state’s hail belt. From record-breaking hailstorms to sudden mold-causing water intrusions, Bexar County homeowners see more than their share of property insurance claims. Unfortunately, insurers do not always pay fairly or on time. Understanding your rights under Texas law is therefore essential if you receive a claim delay, underpayment, or outright denial.

This comprehensive guide—written with the homeowner in mind—explains exactly how Texas statutes, regulations, and court precedents protect you, the policyholder. We focus on common disputes, including mold damage, wind and hail losses, water damage, fire, and repair-scope battles. You will discover step-by-step strategies, statutory deadlines, and local resources specific to San Antonio, Texas. If you need further help, the Louis Law Group stands ready to provide a free case evaluation and policy review—call 833-657-4812.

1. Understanding Texas Property Insurance Law

1.1 The Texas Insurance Code Provisions Every Homeowner Should Know

• Chapter 542 – Prompt Payment of Claims Act (PPCA): Requires insurers to acknowledge, investigate, and pay or deny claims within strict time limits—usually 15 days to acknowledge, 15 business days to accept or reject after receiving required documents, and 5 business days to issue payment after acceptance.

• Chapter 541 – Unfair Settlement Practices: Prohibits insurers from misrepresenting coverage, failing to attempt prompt and fair settlements, or refusing to pay claims without reasonable investigation.

• Chapter 542A – Catastrophic Weather-Related Events: Governs lawsuits arising from wind or hail and includes advanced notice requirements but also prevents insurers from escaping responsibility by designating adjusters as sole defendants.

Violating Chapters 541 or 542 exposes insurers to 18% annual interest on delayed payments, attorneys’ fees, and, in some bad-faith cases, punitive damages.

1.2 Statute of Limitations for Texas Property Insurance Disputes

• Breach of contract: 4 years from the date of breach (Tex. Civ. Prac. & Rem. Code § 16.004) unless the policy contains a valid two-year contractual limitations period.

• Statutory bad-faith (Chap. 541): 2 years from the date the unfair practice occurred or was discovered.

• Prompt payment (Chap. 542): 2 years from the insurer’s statutory violation.

Missing these deadlines can extinguish your right to recover, so calendar them as soon as a dispute arises.

2. Common Property Insurance Disputes in Texas

2.1 Mold Damage: Hidden but Costly

San Antonio’s humid subtropical climate and notorious spring flooding make mold a frequent post-loss complication. Most Texas policies limit mold remediation coverage to a dollar sub-limit or exclude it entirely unless caused by a covered peril such as a sudden pipe burst. The insurer may:

• Deny coverage by alleging long-term seepage or maintenance neglect.

• Apply the mold sub-limit even when the policy requires removal to access covered water damage repairs.

• Ignore Texas Department of Insurance (TDI) bulletin guidance that mold caused by a covered water loss should be paid within policy limits.

Texas courts recognize that insurers cannot simply refuse legitimate mold remediation when it is necessary to return the property to pre-loss condition (Fiess v. State Farm Lloyds, 202 S.W.3d 744 (Tex. 2006)).

2.2 Wind and Hail Claims

San Antonio experienced the costliest hailstorm in Texas history on April 12, 2016. Hail claims often trigger disputes over roof replacement versus spot repairs, actual cash value holdbacks, and cosmetic-damage exclusions.

2.3 Water Damage and Plumbing Failures

Sudden leaks, slab leaks, and flash flooding can cause extensive interior and structural damage. Insurers may argue that the leak was “ongoing,” falling under the policy’s continuous seepage exclusion, or dispute mitigation costs such as drying equipment rental.

2.4 Fire and Smoke Damage

Dry, hot summers raise the risk of residential fires. Disagreements arise over code upgrade costs, smoke odor remediation, and personal property valuations.

2.5 Scope-of-Repair Battles

Even when coverage is conceded, policyholders frequently fight over the scope and pricing of repairs—especially under Replacement Cost Value (RCV) policies. Texas permits appraisal to resolve these valuation disputes, but insurers sometimes delay or refuse appraisal requests.

3. Texas Legal Protections & Regulations

3.1 Prompt Payment Deadlines

• Day 0: You provide written notice of loss.

• Within 15 days: Insurer must acknowledge claim and request documents.

• Within 15 business days after documents submitted: Insurer must approve or deny. (Under § 542.056, extended to 30 days in declared catastrophes.)

• Within 5 business days of approval: Insurer must issue payment.

Failure triggers 18% annual interest plus attorneys’ fees (Tex. Ins. Code § 542.060).

3.2 Appraisal Process

Most Texas policies allow either party to demand appraisal to determine the amount of loss. Recent Texas Supreme Court cases shape the process:

• State Farm Lloyds v. Johnson, 290 S.W.3d 886 (Tex. 2009) – Appraisers decide damage amount, not coverage.

• Barbara Techs. Corp. v. State Farm Lloyds, 589 S.W.3d 806 (Tex. 2019) – Payment after appraisal does not automatically defeat PPCA damages.

• Ortiz v. State Farm Lloyds, 589 S.W.3d 127 (Tex. 2019) – Insurer may still raise contract defenses, but appraisal award stands absent fraud or bias.

Insist on appraisal in writing if you dispute the insurer’s estimate. Once invoked, each side selects an appraiser; the two appraisers choose an umpire. The award requires two of the three signatures.

3.3 Bad Faith and Extra-Contractual Damages

Under Chapter 541 and the common-law duty of good faith, Texas policyholders can recover treble damages if an insurer knowingly engages in unfair practices. Examples include:

• Denying without reasonable investigation.

• Misrepresenting policy provisions.

• Failing to provide a reasonable basis for denial.

Sanctions can include punitive damages, mental-anguish damages, and attorneys’ fees.

3.4 Licensing and Regulatory Oversight

Adjusters, appraisers, and attorneys handling Texas claims must hold the appropriate state licenses. Complain about misconduct to the Texas Department of Insurance (TDI). TDI can fine insurers and order corrective action.

4. Steps to Take After a Property Insurance Dispute

4.1 Document Everything Immediately

• Photograph and video all visible damage—including mold-affected areas—before cleanup.

• Keep receipts for mitigation expenses (fans, dehumidifiers, temporary housing).

• Maintain a claim diary: dates, who you spoke with, and what was said.

4.2 Obtain Independent Estimates

Hire a reputable, licensed contractor or public adjuster in San Antonio to produce an Xactimate or similar detailed estimate. Independent valuations provide leverage during negotiations or appraisal.

4.3 Request a Certified Copy of Your Policy

Knowing your exact coverages, exclusions, deductibles, and mold sub-limits enables informed decisions. Texas insurers must provide a certified copy on request.

4.4 Comply with Post-Loss Duties

• Provide timely proof of loss (often 60 days from insurer’s request).

• Allow reasonable inspections.

• Protect the property from further damage, but do not make permanent repairs before the insurer approves.

4.5 File a Complaint with TDI

If the insurer drags its feet past PPCA deadlines or refuses valid claims, submit an online complaint with TDI. Include your policy number, claim number, timeline, and supporting documents. TDI investigations can motivate insurers to settle.

4.6 Explore Appraisal or Mediation

Invoke appraisal for valuation disputes. For smaller disagreements, the TDI Consumer Protection division offers voluntary mediation.

4.7 Preserve Legal Claims

Send the 60-day notice letter required by Texas Insurance Code § 541.154 before filing suit. The letter should outline the facts, statutory violations, and damages sought.

5. When to Seek Legal Help in Texas

While many routine claims resolve without litigation, hire an attorney when:

• The insurer denies coverage citing exclusions you suspect are inapplicable.

• Payment is significantly under market value even after you provide evidence.

• Deadlines under Chapters 541 or 542 have passed without reasonable action.

• You receive a demand for an Examination Under Oath (EUO) that feels adversarial.

• You are facing complex mold claims or code upgrade disputes.

Texas attorneys must be licensed by the State Bar of Texas and, for insurance-specific claims, should possess deep knowledge of the Insurance Code and appraisal case law. Louis Law Group’s Texas-licensed attorneys focus exclusively on representing policyholders, not insurers. We advance case costs, pursue prompt-payment interest, and charge no fees unless we recover. Call 833-657-4812 for a free evaluation.

6. Local Resources & Next Steps for San Antonio Homeowners

6.1 Government and Court Resources

Texas Department of Insurance Consumer Help Bexar County District Clerk – Filing Suit Supreme Court of Texas Opinions San Antonio Bar Association Lawyer Referral Service

6.2 Climate Risks Unique to San Antonio

Historic hail events, Gulf-fed tropical storms, and the Edwards Aquifer’s karst geology (which can worsen foundation shifts) all influence claim frequency and scope. Keep annual photographic inventories and schedule roof inspections each spring to minimize dispute-prone surprises.

6.3 Action Checklist Moving Forward

• Review your declarations page for mold, windstorm, and water sub-limits.

• Photograph exterior and interior conditions annually.

• Store digital copies of policies and receipts off-site.

• At first sign of damage, notify your insurer in writing and request a certified policy copy.

• If payment is delayed beyond statutory limits, consult counsel immediately.

6.4 Disclaimer

This guide is for informational purposes only and does not constitute legal advice. Reading it does not create an attorney-client relationship. Deadlines and laws may change; consult a licensed Texas attorney for advice regarding your specific situation.

Get Help Now

If your property insurance claim has been delayed, underpaid, or denied—especially for mold or storm damage—call Louis Law Group at 833-657-4812 for a free case evaluation and policy review. Our Texas insurance attorneys fight for San Antonio homeowners and do not get paid unless you do.