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Insurance Companies Respond to Texas Wildfire Claims

Insurance agents have set up temporary work stations inside vans and tents in order to respond to damage claims resulting from the unprecedented wildfires which scorched several parts of Central Texas last week. It has been reported that a spokesman for Farmer Insurance has stated that he has received many claims of total losses. The spokesman says that the priority of insurance agents should first be to help customers find a place to live, food, and clothing. Once after the customers basic needs are taken care of should they begin the claims process.

Sources say that Farmers, State Farm and Allstate have declared the Central Texas fires a catastrophe. Accordingly, the insurance companies say they will be sending specialized claims workers and equipment to help catalyze the claims process. According to a spokesman for the Insurance Council of Texas, the total amount insured property loss due to wildfires for 2011 is expected to be the worst in the history of Texas. Reportedly, the previous record was set in 2009 when wildfires caused of $100 million in insured property damage statewide. Further, sources say that many authorities are worried that the continuing dry conditions of the state will cause the wildfires to continue.

Further, some insurance agents are reporting that many of their customers still do not know the extent of the damages because they have not been able to return home. Further, sources say State Farm policy holders in Central Texas have filed 210 claims and that number has continued to grow. Representatives of the insurance industry say that urban wildfires are different from typical disasters because the wildfires are often ongoing and do not happen in a single instance.

Insurance agents who are responding to the fires also say that many people filing claims are working on hearsay and assumptions and do not know the exact status of the property. Sources say this problem is propounded by the fact that many policyholders have not been allowed to return home due to dangerous conditions. Representatives of the insurance are encouraging people who have been evacuated to make contact with their insurance agent, regardless of whether their home was injured. Once an insurance company has received a claim, it has 15 days to say whether it has accepted or rejected the claim. Most policies allow for an appraisal process to settle claim disputes. However, insurance companies in recent Texas catastrophes such as Hurricane Ike resulted in 1000’s of lawsuits due to allegations of bad faith and insurance code violations.