The Texas Prompt Payment Act
If you are entitled to money from an insurance claim, then you should expect to receive the money that you won as soon as possible. In order to remove the possibility of tardy payments or underpayments that do not reflect the full amount that you deserve, the state of Texas has created the Prompt Payment Act of 2003, which is now written into the Texas Insurance Code. This code mandates that all insurers must be diligent to pay out claims within 60 days of receiving all requested items, forms, and statements. Insurers who fail in this responsibility may have to pay your insurance attorney's fees or may have to also cover the value of the claim and pay set penalties.
Every claim is different, but insurers are required to be consistent when it to comes to their job. If you have filed a claim and received an amount of compensation, then you deserve to have that money as soon as possible. If you do not receive your payment, then the insurer may need to pay penalty interest to you and also cover your attorney's fees. The Texas Insurance Law also states that if an insurer denies a claim and later an attorney is able to prove that that denial was invalid, then the insurer may be still held liable for a tardy payment.
Penalties for Late Payments
If you are the victim of a late insurance penalty, then you may be entitled to additional payments as a result. For example, any claims that are paid within 45 days after a deadline for payment are susceptible to either a $100,000 fine or 50% of the difference between the billed and contracted rate of the payment.
Those that do not pay a claim until 49-91 days after the headline may need to pay up to $200,000 or 100% of the difference between the billed and contracted rate. As well, claims that are paid between 91 and 270 days after the deadline of the payment can result in a $200,000 fine or 100% of the difference between the billed and contracted rate. In addition to tis the insurance company is required to pay 18% interest on the amount that was delayed from the date that the payment was due.
This can add up, and you may be able to receive a significant amount of extra finances as a result. Your claims should be paid within 45 days if it was submitted in anon-electronic format, and 30 days if it was submitted in an electronic format. Insurers who want to audit a claim are still required to pay it in full while the audit takes place. There are rare circumstances when an insurer can obtain an extension of deadlines, but these cases are not common.
If your case has been delayed in any way, our attorneys can help you take a stand.
Penalties for Underpayment
If you are underpaid in your insurance claim, and the insurer does not jump to fix the problem, then you will probably be able to take this situation to court. The Texas Prompt Pay Act also discusses this issue and determines that there are penalties for underpayment in the United States. Those who underpay within 45 days of the claim payment deadline will need to pay a $100,000 fine or 50% of the underpaid amount as a penalty. Those who don't correct the mistake until 46 to 91 days later will need to pay $200,000 or 100% of the unpaid amount depending on which is the lesser expense. As well, those who do not receive a correct payment within 91 to 270 days will need to pay either $200,000 or 100% of the claim amount and will also need to pay 18% of annual interest on that amount.
Hire a Houston Personal Injury Lawyer
If you are dealing with insurance claim issues regarding tardiness or underpayment, then you want an attorney on your side. You shouldn't worry about the costs of hiring attorney, as the expenses may be covered by the insurance company after they are found guilty of the offenses of underpayment or late payment. Insurance companies that delay or deny payments can certainly be held liable for their offenses, and will have to pay penalty interest and attorney's fees if the court deems it necessary. You will want to determine whether or not the Prompt Payment Act has weight in your case by discussing this with an attorney. If you filed a commercial property claim, fire claim, life insurance claim, business interruption claims, or another sort of claim regarding insurance then there is a possibility that you will need to litigate when you are wronged by an insurance company.