According to a recent article in the Houston Chronicle, the threat from hurricanes and tropical storms is being cited as one of the reasons for increased homeowner insurance rates in Texas. It was noted that in 2011-the most current data available-Texas had the third-highest premiums for HO-3 homeowners’ policies, following Florida at No. 1 and Louisiana at No. 2. A State Farm spokesperson was quoted as saying that, even though Texas has not been hit by a major hurricane in several years, Texas “is a catastrophe-prone state” and no part of the state is risk-free. Another insurance company spokesperson noted that rates are not established on past weather conditions but rather upon “projected losses based on long-term historical trends/actuarial data.”

It is irritating when your insurance rates go up. However, what may end up being more irritating in the aftermath of a hurricane is dealing with an insurance company and finding yourself facing a denied or undervalued claim. Unfortunately, as reported by Consumer Reports, insurers are becoming more miserly in paying out hurricane claims. This can lead to vigorous disagreements with your insurer.

An informal survey showed that Consumer Reports readers were compensated for 80 percent of their Hurricane Katrina losses but for only 71 percent of their Hurricane Sandy losses. In the aftermath of a storm, surveyed owners who had claims of $30,000 or more had the most hassles and disagreements with insurers. By contrast, less than 20 percent of insurance customers had major disagreements with insurers after storm damage if their claims fell below $30,000.

Risk Management magazine observes that too often insurance companies put their own interests ahead of their policyholders. To maximize their profits, insurance companies draft policy provisions with the goal of curtailing coverage, hike premiums unnecessarily and delay claims payments for losses. These tactics are working given that insurance companies are making hefty profits. Indeed, it is pointed out that in the aftermath of Hurricane Katrina, insurance companies made record profits.

TDI Tips

Before a hurricane threatens, you need to make sure that you have your insurance affairs in order. The Texas Department of Insurance suggests that, before a hurricane strikes, you should take the following precautions:

• Take an inventory of your furnishings and valuables and either put the list in a safe place or, better yet, email it to yourself.
• Take photographs or make video recordings of each room in your home and keep this documentation in a safe place. Also, take pictures of your home’s exterior.
• Store your insurance policies and cards in a safe place.

<li”>Before a hurricane threatens, be familiar with the terms of your policy and what it actually covers. Make sure it provides adequate coverage to pay the full replacement cost of your property.

• Find out how much coverage you have for “additional living expenses” in order to cover lodging, food and other expenses if you are forced to vacate your residence after suffering a covered loss.

Seek legal help

After a hurricane, the last thing anyone wants is an insurance company that is unjustifiably denying or undervaluing your claims. Unfortunately, disputes with an insurance company after a disaster strikes your home or business seem to be occurring more frequently. If you find yourself dealing with an intransigent insurance company, you should contact a Texas attorney who is experienced in handling disputes with insurance.