Dealing with auto insurers can present difficulties. Insurers have a financial incentive to pay as little as possible for your claim. Conversely, you need a fair payout to cover your financial losses and the reduction in your quality of life. Insurers will often delay your claim and use other tactics designed to get you to accept an undervalued settlement or drop your case altogether.
However, insurers cannot delay forever. The insurance policy and Texas law set out an insurer’s obligations. If the insurance company fails to satisfy them, it may face sanctions and a bad-faith insurance lawsuit from the claimant.
Timelines Set by Texas Law
Texas uses fault-based liability insurance. After a car accident, injured victims file insurance claims with the at-fault driver’s insurance company.
The claim includes a description of the accident and documents proving the losses incurred as a result of the crash.
Filing the Claim
A claim usually starts with an online filing, and the insurer has 15 days to perform the following acts:
- Acknowledge receipt of the claim
- Start the claim investigation
- Request proof-of-loss documents
Proof-of-loss documents include anything that pertains to the insurer’s liability to you.
For example, you might include the following information:
- An accident report explaining how the accident happened
- Medical records describing your injuries
- Financial documents, such as medical bills and wage reports, showing your losses
In many cases, you will include these documents with the claim to accelerate the process. If the insurer needs more information, the claims adjuster assigned to your case will send a request.
Insurer’s Response
Once the adjuster has everything needed to investigate your claim, the insurer has 15 business days to accept or deny it. However, this step comes with two important limitations that allow the insurer to delay a decision.
First, the adjuster must have “final proof of loss” for the period to start. If the adjuster requests additional information, they delay triggering the time and can sit on the claim until you respond. If you take a week to respond, the insurer’s deadline gets pushed back a week.
Second, the adjuster can take an additional 45 days to investigate your claim by sending a notice before the deadline. This notice gives the reasons for the delay.
Based on these rules, Texas law gives insurers roughly one to three months to accept or deny your claim.
Additional Time to Resolve a Claim
Your wait is not over when you receive the notice of acceptance or denial. If the insurer accepts the claim, it will offer a settlement. In most cases, the initial offer will undervalue your claim. This negotiation tactic leaves the insurer room to increase the offer if you reject it. It also allows the insurer to settle cases inexpensively with claimants who do not realize they can ask for more.
If you and your lawyer reject the offer, you can negotiate for a higher payout. For example, suppose that you had $15,000 in medical bills and the insurer offered $15,000. You can negotiate for additional money to cover your lost earnings, pain, and suffering. Unfortunately, negotiations take time, and Texas law sets no time limit on the insurer at this stage.
Good Faith Standard for Negotiations
The law imposes a duty of good faith. Insurers must attempt in good faith to promptly settle your case. Thus, any bad faith delays are prohibited. Bad faith is an amorphous concept, but it likely includes any delays deliberately introduced for any reason other than resolving the claim. For example, an adjuster cannot sit on a claim to annoy or anger you.
Even with this duty of good faith, negotiations could take weeks or even months, depending on the dispute. For example, suppose the insurer is only willing to pay for your knee injury and not your back injury because it claims your back pain is a preexisting condition. You may need additional tests and medical opinion letters to explain how the crash caused the back injury.
Settling a Car Accident Lawsuit
If the adjuster denies your claim, you have a few options. First, you and your lawyer can respond to the denial with evidence or legal arguments. The timeline for responding to a claim denial will appear in the document denying the claim.
Second, you could file a lawsuit. You could still settle your case if you go to court. Only about 4% of personal injury lawsuits go to trial. However, again, there is no time limit for settling a lawsuit. In some cases, the parties settle cases on the eve of trial.
Contact Us to Discuss Settling Your Case
Even in the best-case scenario, your case could take a few months to settle. Contact us online or call (817) 839-3143 for a free consultation with Parker Law Firm Injury Lawyers to discuss your case and the time it could take to settle it. We’ll fight to get you the compensation you deserve.
