Q:

An insurance company wrongfully delayed paying my claim. Is there a penalty?

A:

Yes, if there is an unreasonable delay in paying a claim, an insurance company can be held liable for attorney fees, 18% interest and other damages. 

Q:

Are insurance policies generally characterized as separate or community in Texas?

A:

Texas follows “inception of title” when classifying life insurance proceeds. This means that ownership of the policy is established by the source of funds for the first premium. If that premium was paid prior to the marriage or with separate property, then the policy may be considered separate property. This is a highly technical area of law, and matters are case-specific. Please contact us if you would like to discuss a matter further.

Q:

How will I know if an insurance company has accepted or rejected my claim?

A:

An insurance company generally has fifteen days to accept or reject a claim, or ask for more information. If there is a reasonable suspicion of arson, then the time extends to 30 days. If a claim is rejected, the insurance company is obliged to tell the claimant the reasons why.

Q:

I am shopping for an auto insurance policy. What do the coverages mean, and which ones should I purchase?

A:

In dealing with personal automobile and commercial auto policies, many people need a quick primer on what the individual coverages actually mean. Here is a VERY brief overview of standard policy options, and what they mean. Please note that your policy will be much more detailed. YOU NEED TO READ YOUR POLICY AS IT MAY VARY.

1. Bodily Injury Liability – If covered, then the insurance will pay for losses if you are at fault in an accident and are legally responsible for others’ injuries. It does not cover your own injuries. This may include passengers in your car, drivers and passengers of the other car(s) and pedestrians involved in an accident. The policy is usually listed as per person / per accident. This means that any individual in the accident can collect up to the per person amount, but if there are several people in a common accident, they are capped by the per accident amount. Also, beware that there may be a family member limit on the policy which is lower than the per person amount. This coverage is mandatory. Presently minimum limits on this policy is $25,000 for purchased vehicles, and $100,000 for leased vehicles. If this is a commercial vehicle, then you MUST notify the insurance company that the vehicle is for commercial purposes.

2. Property Damage Liability – This means that the insurance company should pay for losses if you are at fault in an accident and are legally responsible for damage to another’s property. This is mandatory in Texas.

3. Uninsured/Underinsured Motorist Bodily Injury (UM/UIM BI)- If you are not at fault in an accident, and the other driver has no insurance (or not enough) then this coverage should provide for medical expenses for you and your passengers. Although this coverage is optional, it should not be avoided. Given the cost of the insurance versus the expense if you are in an accident with an underinsured motorist, it is strongly recommended.

4. Personal Injury Protection (PIP) – This should pay for expenses resulting from an auto accident for you or your passengers, regardless of fault. Eligible expenses generally include medical, funeral, disability and lost wages to the extent that they can be documented. This coverage is optional, but is strongly recommended.

5. Uninsured/Underinsured Motorists Property Damage (UM/UIM PD) – If you are not at fault in an accident this coverage should protect your vehicle if your vehicle is damage by a driver who does not have any and in some case not enough insurance. 

6. Medical Payments Coverage (MPC) – This optional coverage should pay for medical, dental and funeral expenses for you or your passengers, regardless of who is at fault. It is similar to PIP, but does not cover lost wages.

7. Comprehensive (comp) – This coverage should cover repair to your vehicle from damage caused by covered risks such as theft, vandalism and hail. This is typically required for financed and leased vehicles but not for purchased and paid for vehicles. If your car has any significant value, it may be a smart purchase.

8. Collision – This covers repair of your vehicle from damage caused in an accident, regardless of fault. It is typically required in financed purchases. If your car has any significant value, it may be a smart purchase.

9. Rental Reimbursement – This coverage helps pay for the cost of a rental car while your vehicle is being repaired as a result of a covered loss. This coverage is optional, but strongly recommended, especially if you use your car to get to/from/during work.

10. Towing – This coverage should pay to have your vehicle towed if it is disabled. This coverage may be duplicative of an auto club policy or a vehicle warranty.

11. Gap – This coverage applies if your vehicle is a total loss, and you owe more than your vehicle is worse. Although this is optional, it should be considered a mandatory purchase for any financed vehicle in which there is a possibility that you may owe more than the . Put simply, if you owe more than your car is worth, and it is totaled, you still have to pay the difference unless you have this coverage.

Q:

I want to apply for Medicaid, but I have too many assets. What can I do?

A:

Depending on the size of your estate, a Medicaid compliant estate plan can reduce your estate’s countable assets for Medicaid purposes. This may allow you to qualify for Medicaid after a certain date.

Q:

I was in an accident, but not at fault. My insurance paid the claim. What about my deductible?

A:

The insurer may go after a third party for your deductible, or authorize the insured to go after himself or herself.

Q:

My insurance company wrongfully denied my claim. What can I do?

A:

An insurance policy is a contract between you and your insurance company. If you make a claim under your policy, Texas law requires that your insurance company acts “reasonably” and in “good faith” when determining whether or not to pay benefits under a policy. If an insurance company fails to act reasonably, it has violated Texas law and you may be entitled to damages.

Q:

My spouse is in a nursing home. I still live in our house. Can my spouse still qualify for Medicaid?

A:

Possibly, depending on how the house is titled. There is also an issue with Medicaid Estate Recovery Program (MERP) going after the value of the house after the second spouse’s death. A proper Medicaid compliant plan can address this.

Q:

The insurance company stated that they have accepted and will pay my claim. How much time do they have?

A:

Generally speaking, an insurance company has five business days to pay an accepted claim. If the insurance company requires paperwork from a party, then the five days begins on receipt of the paperwork.

Q:

The life insurance company has already paid the proceeds of the life insurance policy to the listed beneficiary. I am the surviving spouse and I wasn’t listed as a beneficiary. Is there anything I can do?

A:

Possibly. If the life insurance company paid proceeds while ignoring the rights of the spouse, then the insurance company may be liable to the surviving spouse

Q:

Under Medcaid, what is a “medical necessity”?

A:

Medically Necessary (or Medical Necessities) per the Act are:

• Reasonably necessary to prevent illness or medical conditions, or provide early screening, interventions, and/or treatments for conditions that cause suffering or pain, cause physical deformity or limitations in function, threaten to cause or worsen a handicap, cause illness or infirmity of a recipient, or endanger life;

• Provided at appropriate locations and at the appropriate levels of care for the treatment of clients’ conditions;

• Consistent with health-care practice guidelines and standards that are issued by professionally-recognized health-care organizations or governmental agencies;

• Consistent with the diagnoses of the conditions; and

• No more intrusive or restrictive than necessary to provide a proper balance of safety, effectiveness, and efficiency.

Q:

What is a Medicaid countable asset?

A:

Countable assets (for purposes of Medicaid computations) are assets in which the Medicaid subscriber/applicant has (1) ownership, (2) has the legal authority to liquefy the asset, and (3) is not otherwise prohibited from using the asset for his/her own support.

Q:

What is an ADL?

A:

In insurance and Medicaid/Medicare lingo, ADL is often used as an acronym for Activities of Daily Living. Activities of Daily Living are considered essential to daily personal duties of self maintenance. These duties including personal hygiene, getting dressed, using the restroom, and eating. Normally, these activities are placed on a checkbox style grid, and an applicable insurance policy will pay on an amount based upon the number of ADLs that a subscriber can or cannot perform on a daily basis.

Q:

What is the difference between Medicare and Medicaid?

A:

Both are federal programs that help pay for medical needs.

However, Medicare, which is applied for at the Social Security Office, is for: People 65 and over, people of any age who have kidney failure or long term kidney disease and/or people who are permanently disabled and cannot work. There is no income requirements for Medicare.

Medicaid is for low income individuals including: pregnant women, children under the age of 19, people 65 and over, the blind, disabled and/or who need nursing home care. There are strict financial and income guidelines that have to be adhered to in order to qualify for Medicaid assistance.

Q:

What is the law in Texas regarding a common law spouse and life insurance?

A:

A common law marriage in Texas, if proven, carries the same validity as a ceremonial marriage. Accordingly, if there is a proven common law marriage, then the Texas rules regarding life insurance beneficiaries would apply.

Q:

What is the monthly allowable income for Medicaid eligibility in Texas?

A:

As of 2009, the monthly income eligibility for Medicaid in Texas is calculated by multiplying the SSI for an individual (presently $674) times 3. Therefore, the income allowance in Texas is $2022.