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How Long Does it Take for an Insurance Company to Settle a Claim?

May 16, 2022Personal Injury

Waiting for an insurance company to settle your claim can be stressful. In Texas, insurance companies are allowed 35 business days to make a decision to settle or deny a claim after it is filed. Additionally, state law stipulates how long an insurance company has before they must respond to a claim.

Timeline for Insurance Claims in Texas

Best-case scenario, the insurance company will settle your claim and send the payment within 35 business days. However, the insurer is required to acknowledge your claim within 15 business days of receiving it. Instructions and paperwork, such as proof-of-loss forms, must also be included. Their investigation will then begin, and after receiving your proof-of-loss documents, the insurer may request other relevant information if necessary.

Once they have received everything they need, the insurer typically has 15 days to notify you whether they accept or reject the claim. The insurance company can use the last five business days to make the final payment if the claim is approved. If the claim is denied, the insurer must give you a reason.

Factors That Can Delay the Settlement Process

Various factors can potentially delay the amount of time it takes for an insurance company to settle your claim. For example:

Incomplete Information
If the insurance company doesn’t receive all the information they need with your proof-of-loss forms, they may have to ask for additional documentation.

In some cases, the insurer can extend their time to investigate to 45 days, but there must be a sufficient reason for doing so. For instance, if the adjuster has a large caseload or the size of your claim is extensive and requires a lengthier investigation.

Severe Injuries and Losses
If your injuries are severe, it can take several months or longer for you to recover or reach maximum medical improvement (MMI). An attorney will typically advise you to wait until that point before accepting or negotiating a settlement. The reason is that if you are still receiving treatment and generating medical bills, the total value of your claim cannot be known. Additionally, the insurance company will complete a more extensive investigation to validate your losses and look for ways to reduce their liability.

Pre-existing Injuries
You can still recover compensation if you had a pre-existing injury or condition that was aggravated or made worse because of the accident. However, the insurance company may raise suspicions about reimbursing medical care if you were already receiving it. As a result, you will have to provide medical evidence that the collision furthered your injury.

The Policyholder’s Limits
If the at-fault party’s policy limits are substantial and your losses are extensive, the insurance company will take extra time to thoroughly review your claim to minimize their payout.

Unfortunately, there is no way to shorten the 35 business days an insurance company has to settle a claim by law. However, some things can speed up the claims process, such as cooperating with the insurer and providing any requested information quickly. It is also important to know that Texas’s prompt payment law does not apply if another driver’s insurance is paying your claim, but they must act in good faith and attempt to settle it quickly and fairly. For more information on the insurance claim process, contact our Houston personal injury lawyers today.