Appraisal Determines the Amount of Loss and When Paid the Amount of Claim is Resolved

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Appraisal under an insurance policy determining the amount of the loss is. This appeal involves the Texas Prompt Payment of Claims Act (the TPPCA or the Act).

In Sanford Crayton v. Homeowners Of America Insurance Company, No. 02-20-00037-CV, Court of Appeals (December 23, 2020) Sanford Crayton violated the TPPCA by initially rejecting his claim but later paying an appraisal award on the claim after Crayton sued.

ZALMA OPINION

In a more than 50 page opinion the appellate court made clear that when an insurer denies a claim because its evaluation found the loss to be less than the insured’s deductible, it did not violate the statute or act wrongfully when it paid the claim in accordance with an appraisal award. Appraisal awards are subject to being made a judgment of the amount of loss and compel an insurer to pay on the judgment. By paying before it became a judgment Homeowners acted properly and deserved the favorable result after a long review of a Texas Supreme Court decision.