Texas Woman Makes Bad Faith Insurance Claim over Hurricane Damage

Kemah, TXA Texas woman whose waterfront home was destroyed in 2008 by Hurricane Ike may soon file a bad faith insurance claim. Her insurance provider denied her claims after a year-long appraisal process and $25,000 in fees.

span itemprop="image" itemscope itemtype="https://schema.org/ImageObject" style="display:block">Alison Putman appealed to state regulators, poured through estimates and contacted state legislators in an effort to retrieve some form of compensation from her insurer. Eventually the provider agreed to meet her in appraisal, an arbitration technique whereby three insurance appraisers find a compromise between the claimant's and insurer's representatives.

Nearly six months later, Putman's insurer issued a letter denying the appraisal due to a discrepancy as to what was actually damaged.

Flood insurers tend to argue against the appraisal process, as it allows them little control over the claims process. Instead, many insurers prefer to force policyholders to file a lawsuit - which is often not in the best interests of the claimant, suggests the Houston Chronicle.

"They seem to be setting it up to go to litigation," Putman tells the Chronicle. "Appraisal is supposed to be cost-efficient and effective, but it will be neither if I have to spend another $20,000 to go to court."