Frequently Asked Questions
1. What is the Texas Property and Casualty Insurance Guaranty Association?
The Texas Property and Casualty Insurance Guaranty Association is an association of all insurance companies that are licensed to sell property and casualty insurance in the State of Texas. The Texas Legislature created it in 1971 to provide limited protection to Texas policyholders and claimants in the event of an insurance insolvency.
2. How is TPCIGA different from an insurance company?
TPCIGA is not in the business of insurance. It does not write insurance policies or collect premiums. We are a non-profit, unincorporated association created by the Texas Legislature to act as a safety net for insurance consumers whose companies have become insolvent. Because the way we are funded has an indirect financial impact on all the taxpayers of Texas, there are statutory limitations on the kinds and amounts of claims we can pay.
3. When does TPCIGA become responsible for handling the claims of an insolvent insurance company?
Our responsibilities are triggered when a company is declared insolvent and the Commissioner of Insurance for the State of Texas issues an official order designating the company as an "impaired insurer."
4. I heard that my insurance company is going into receivership in another state. Will there be guaranty fund coverage for my claim in Texas?
If the Texas Commissioner of Insurance issues an order designating the company as an impaired insurer, TPCIGA's duty to pay covered claims will be triggered. The company must have been licensed to write insurance in Texas in order to be subject to guaranty fund protection.
5. Will someone from TPCIGA contact me about my claim?
TPCIGA will endeavor to contact each person who had an open claim on file with the impaired insurer. As soon as possible after we receive the claim files from the company's receiver (referred to as a "liquidator" in some states), we will mail out letters detailing your rights under the Guaranty Act and letting you know who will be handling your claim. If you do not hear from us within a month from the date the company was designated impaired, feel free to call us. However, please bear in mind that we will be unable to give you specific information about your claim or to make any payments until we have received your claim file from the receiver.
6. Am I still entitled to the same benefits under my policy?
In some situations you may not be able to recover all of your policy benefits from TPCIGA. Because the guaranty association is designed to be a safety net and not a complete replacement for insurance coverage, the Guaranty Act contains a number of limitations on the kinds and amounts of claims that TPCIGA can pay. For example, with the exception of claims for workers' compensation benefits, there is a limit, or cap, on the amount of benefits payable for an individual claim. If your insurer became impaired after September 1, 1997, the per-claim limit is $300,000 or the limits of the policy, whichever is less. In addition, a person seeking payment of a claim from TPCIGA must first exhaust any rights he or she may have under any other insurance policy, and TPCIGA is entitled to a credit for those amounts recovered under another policy. If you have a claim for policy benefits in excess of that payable by TPCIGA, you may present that claim to the receiver or the liquidator of the impaired insurer. Such claims will be payable only to the extent that there are sufficient company assets remaining to pay them.
7. Are there any limits to the workers' compensation benefits that TPCIGA can pay?
TPCIGA is authorized to pay the full amount of a covered claim arising out of a workers' compensation claim under a workers' compensation policy. There is no cap on those benefits.
8. Will there be an interruption in my workers' compensation benefits?
TPCIGA makes every effort to ensure that the payment of weekly workers' compensation benefits continues without interruption. However, our efforts are subject to the availability of claim files and necessary information from the insolvent company, and it is possible that there may be an interruption in your weekly benefits. In addition, our review of the file may result in a change in the amount or availability of benefits, in accordance with the Texas Workers’ Compensation Act.
9. May I continue to see the doctor treating me for my workers' compensation claim?
Yes. You should advise the doctor to contact TPCIGA for authorization and billing information.
10. How will workers' compensation medical bills be processed?
Click here for more information
11. I had already filed my claim with my insurance company; do I have to file it again with TPCIGA?
So long as your claim appears in the company's records, TPCIGA will have notice of your claim and there is no need to file it again. However, if your insurer was designated impaired more than a month ago and you have not yet heard from TPCIGA, you should contact us to be sure we have a record of your claim.
12. Is there a deadline to file a claim?
It depends on the type of claim. Claims for statutory workers' compensation benefits do not have a deadline to file the claim with the Guaranty Association. However, the claim must have been timely filed in accordance with the procedures of the applicable workers' compensation act. For all other types of claims, the deadline is eighteen months after the date that the receivership court enters an order of liquidation, or the date set by the receivership court, whichever is later. If you had already filed a claim with the insurer prior to receivership, TPCIGA considers your claim to have been filed prior to the deadline.
13. What do I do if I receive notice of a new claim against me or if I am served with a lawsuit?
If you had insurance coverage for the claim or lawsuit with a carrier that is now impaired, you should immediately contact TPCIGA and send a copy of the claim and/or lawsuit to our office.
14. Will TPCIGA take over the defense on my pending lawsuit?
If the lawsuit is within coverage of the applicable policy, TPCIGA will continue to defend the insured to the extent of coverage under the policy and the Guaranty Act.
15. Will the same attorney represent me in the lawsuit filed against me?
TPCIGA may choose to retain the same attorney, or we may decide to have the case referred to a different attorney.
16. My lawsuit is scheduled for trial soon. What will happen?
The law provides for an automatic stay of all proceedings pending in a court in Texas for six months from the date of impairment. If additional time is needed, the receivership court may extend the period of the stay.
17. Where does the Guaranty Association get its funding?
The Texas Property and Casualty Insurance Guaranty Association is authorized to make assessments against all licensed Texas property and casualty insurance companies. Membership in the Association is a condition for doing business in the state of Texas. The Association also gets funding from distribution of assets of the insolvent receiverships. A third source is earnings on the Association's investments.
18. What is the maximum assessment that can be levied against each insurance company?
The maximum assessment for each calendar year cannot exceed 2% of the total net direct written premium for the line of business being assessed. However, in the other lines business, in the event of a natural disaster or other catastrophic event, the Association may apply to the Governor of the State of Texas for an additional amount not to exceed 2% of the insurer's net direct written premium for the preceding calendar year.
19. How do I contact the Texas Property and Casualty Insurance Guaranty Association?
The Texas Property and Casualty Insurance Guaranty Association is located in Austin, Texas. Email or view or Contact Page.
TPCIGA
9120 Burnet Road
Austin, TX 78758
Phone: (512) 345-9335
Toll Free: (800) 856-0298
Fax: (512) 345-9341