In the aftermath of Hurricane Harvey, affected policyholders must now turn to surveying the damage and determining how to move forward with their insurers. As the storm’s impact becomes more clear, Law360 looked at five questions that may prove to be sticking points between policyholders and insurers in the coming months.
One of those questions is how long an insurer has to investigate a damaged property once the insurer is in receipt of a presuit demand from a policyholder. According to Texas House Bill (H.B.) 1774, which went into effect less than a week after Harvey made landfall, the insurer may request an opportunity to evaluate a property “in a reasonable manner and at a reasonable time,” then the insurer also can seek a court order that gives them a period of at least 15 days after the requested inspection has been completed when the policyholder is barred from filing suit over the claim. The law also allows a court to automatically abate a policyholder’s suit if the insurer isn’t provided with a “reasonable opportunity” to investigate damage, according to Law360.
But some lawyers say this and other language in H.B. 1774 is overly ambiguous and may lead to disputes.
“Particularly in the corporate context, this could be an area of dispute,” said Pillsbury Insurance Recovery & Advisory counsel Tamara Bruno, who is based in Houston. “What does a ‘reasonable opportunity’ to inspect or evaluate a property mean, and when is that ‘completed’?”
Read more about issues that may lead to insurance disputes in Harvey’s aftermath on Law360 (subscription required).