How long does a Texas insurer have to pay a car accident claim?

Q: How long does a Texas insurer have to pay a car accident claim?

The Texas Insurance Code says that if an insurer notifies a claimant that it will pay a claim or part of a claim, it must pay not later than 5 business days after the notice is made, except as otherwise provided, and for the prompt payment subchapter a claim is a first-party claim made by an insured, policyholder or named beneficiary that must be paid by the insurer directly to that person. It also says an insurer that delays payment beyond the period set by other statutes, or for more than 60 days if none is set, after receiving all items it reasonably requested must pay damages and other items.

Texas insurer payment: 5 business days after notice

How long does a Texas insurer have to pay a claim?

The Texas Insurance Code sets payment deadlines for an insurer. It says that if an insurer notifies a claimant that it will pay a claim or part of a claim, the insurer must pay not later than 5 business days¹ after the date notice is made, except as otherwise provided. It says that when payment is conditioned on an act by the claimant, the insurer must pay not later than 5 business days¹ after the act is performed. The first rule reads:

Except as otherwise provided by this section, if an insurer notifies a claimant under Section 542.056 that the insurer will pay a claim or part of a claim, the insurer shall pay the claim not later than the fifth business day after the date notice is made.
Texas Legislature (Texas Constitution and Statutes)¹

What happens in Texas if an insurer delays payment?

The Texas Insurance Code says an insurer that delays payment for more than the period set by other statutes, or for more than 60 days² if none is set, after receiving all items it reasonably requested must pay damages and other items under a later section.² That later section says an insurer liable for a claim that does not comply with the subchapter owes, in addition to the claim, interest at 18 percent a year³ as damages plus reasonable attorney’s fees. The same section sets a different rate for actions to which another chapter of the code applies.³

What are the Texas insurer payment deadlines?

Situation	Deadline in the statute
The insurer has notified the claimant that it will pay	Not later than 5 business days¹ after the notice is made, except as otherwise provided
Payment depends on an act by the claimant	Not later than 5 business days¹ after the act is performed
After receiving all items it reasonably requested, the insurer delays payment beyond the period set by other statutes, or 60 days² if none is set	The insurer must pay damages and other items

Which claims do these Texas payment rules cover?

For this part of the Texas Insurance Code, a claim is a first-party claim made by an insured, policyholder or named beneficiary that must be paid by the insurer directly to that person.⁴

What the sources do not state

The sources used here do not state a payment deadline that runs from the date of the crash.

Next step

The statute is published on the Texas Legislature page for the Insurance Code prompt payment chapter. The filing lookup tool is where to look up filing details for a situation.