TX Claims Adjuster key terms

A financial stake in the person or property being insured, so that the insured would suffer real economic loss from a covered event. In property coverage it must exist at the time of loss.

The principle that insurance should return an insured to approximately the financial position held before a loss, no better and no worse. It is why policies limit recovery to the value of the loss.

The mutual duty of insurer and applicant to deal honestly and to disclose facts that would affect the underwriting decision. Concealment or material misrepresentation can let the insurer rescind the policy.

A policy drafted by the insurer and offered to the insured with little or no room to negotiate terms. Because the insured lacks bargaining power, ambiguous policy language is usually construed against the insurer.

The insurer's right, after paying a claim, to stand in the insured's place and seek recovery from the party responsible for the loss. It helps prevent an insured from collecting twice.

The actual cause of a loss, such as fire, lightning, windstorm, theft, or collision. Policies either list the perils they cover or insure against all risks except those excluded.

A condition that increases the chance a peril will cause a loss or makes a loss more severe. Examples include a worn roof, oily rags in a garage, or an unattended wood stove.

The dominant, efficient cause that sets in motion an unbroken sequence of events leading to a loss. It decides coverage when more than one cause contributes to the damage.

Waiver is the voluntary giving up of a known right, such as the right to deny a claim. Estoppel stops a party from asserting a right after another party reasonably relied on its earlier conduct.

The state agency that regulates insurers and licenses agents and adjusters in Texas. It adopts rules, reviews policy forms and rates, and handles consumer complaints about claim handling.

The collection of Texas statutes governing insurance, including licensing, policy forms, claim deadlines, and prohibited practices. Adjusters should know the chapters that control claim handling.

Chapter 542 of the Texas Insurance Code. It sets deadlines for acknowledging, investigating, and paying claims and allows interest, penalties, and attorney fees when payment is delayed without reasonable cause.

Conduct defined by Texas law as improper claim handling, such as misrepresenting policy terms, unreasonable delay, failing to investigate, or offering far less than a claim is worth. Violations can lead to regulatory action and lawsuits.

A state-created insurer of last resort that provides windstorm and hail coverage to coastal Texas properties unable to buy it in the voluntary market. It follows its own claim procedures and deadlines.

A credential issued by the Texas Department of Insurance that authorizes a person to investigate and settle claims. Texas offers all-lines and limited licenses, and adjusting without one can violate state law.

A statutory body that pays certain claims of policyholders of insolvent member insurers, within limits and subject to exclusions. It is not a state agency and does not cover every line of insurance.

A Texas statute governing first-party weather-related property claims, including hail and windstorm losses. It requires pre-suit notice to the insurer and limits attorney fee recovery in related litigation.

The value of damaged property at the time of loss, often figured as replacement cost minus depreciation. The policy's own definition controls, so adjusters must read the form rather than assume a method.

The amount needed to repair or replace damaged property with new material of comparable kind and quality, with no deduction for depreciation. Many policies require carrying insurance close to full replacement value.

The part of a covered loss the insured must absorb before the insurer pays anything. It may be a flat dollar amount or a percentage of the dwelling limit, as with windstorm and hail.

A package policy combining dwelling, other structures, personal property, loss of use, and personal liability coverages in one contract. Forms differ in which perils are insured and how losses are valued.

Coverage that pays the increase in living costs, such as temporary rent and meals, when a covered loss makes the home unfit to occupy. Payments are usually limited by time or dollar amount.

A coverage approach that insures against all risks of direct physical loss except those the policy specifically excludes. The insured does not have to identify a named peril in order to recover.

A property provision requiring the insured to carry limits equal to a stated percentage of the property's value. If the limit falls short, the claim payment is reduced in proportion to the shortfall.

Coverage for damage from rising water, surface water, and similar flooding, usually written through the National Flood Insurance Program or a private carrier. Standard property policies exclude flood, so a separate policy is needed.

Coverage that pays amounts an insured is legally obligated to pay for injury or damage to others and usually provides a defense. It responds to claims within the policy's terms, limits, and exclusions.

Failure to use the care a reasonable person would use in similar circumstances. A liability claim generally requires a duty, a breach of that duty, causation, and actual damages.

A liability policy that covers injury or damage occurring during the policy period, no matter when the claim is later reported. It is often contrasted with claims-made coverage.

Physical harm, sickness, or disease suffered by a person, including death that results from it. Policies define the term, and it is the trigger for most liability coverage.

The Texas fault rule under which a claimant more than 50 percent responsible recovers nothing, and any award is reduced by the claimant's share of fault. It affects how liability claims are evaluated and settled.

Auto coverage that pays an insured's damages when the at-fault driver has no insurance or too little to cover the loss. Texas requires insurers to offer it, though the insured may reject it in writing.

Texas auto coverage that pays medical bills, lost income, and similar expenses for the insured and passengers regardless of who caused the crash. Insurers must offer it, and it can be rejected in writing.

A written notice telling the insured that the insurer will investigate or defend while it questions whether coverage applies. It protects the insurer's ability to deny coverage later.

An insurer's unreasonable handling of a claim, such as denying without a reasonable basis, failing to investigate, or delaying payment improperly. Texas law allows some extra-contractual remedies for it.

A formal, usually sworn statement from the insured describing the loss, the property damaged, and the amount claimed. Policies set a deadline, and failure to file can affect the claim.

A policy process for settling disputes over the amount of a loss. Each side selects a competent appraiser, and the appraisers or an umpire set the amount; coverage questions are not decided.

A policy condition letting the insurer question the insured under oath about a claim, with a transcript kept. Refusing to submit to the examination can bar recovery under the policy.

Damaged property the insurer may take after paying a total or partial loss and then sell to recover some of the cost. Policies give the insurer this right, and its value can affect the settlement.

The maximum amount an adjuster may pay on a claim without approval from a supervisor or committee. Exceeding it requires referral, and it is a basic control in claims operations.

A team that investigates suspected fraudulent or exaggerated claims and refers cases to regulators or prosecutors. Adjusters must recognize fraud indicators and route suspicions through company procedures.

The insured's report to the insurer that a loss has occurred. Policies require prompt notice, and Texas law sets deadlines for the insurer to acknowledge the claim and begin investigating.