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Late Claim Payment Interest Calculator

Insurer paid your claim late? Estimate the interest some state laws add to a late claim payment, and the total to ask for.

Short answer

Many states make insurers pay interest when they pay a claim after the legal deadline. Texas adds 18% a year plus reasonable attorney's fees (Tex. Ins. Code § 542.060) and Michigan 12% a year; elsewhere the rate depends on the state's statute. Interest runs from the date payment was due to the date it was paid.

Many states charge interest or penalties on late claim payments at different rates. Your state insurance department or the statute named on our state page will say which.
The statutory deadline; our claim deadline lookup can work it out.
Not legal, financial, or insurance advice. This tool gives a general, educational estimate only. Insurance laws, deadlines, and formulas vary by state, by policy, and by insurer, and they change over time. Verify anything important with your insurance policy, your state department of insurance, or a licensed attorney before relying on it. Late-payment interest depends on the claim type, who is claiming and the exact statute; insurers often dispute when the clock started. This is an estimate of simple interest, not a legal calculation.

The two rules built in

  • Texas: an insurer that misses a prompt-payment deadline owes the claim plus interest at 18% a year as damages, and reasonable attorney's fees (Tex. Ins. Code § 542.060). This applies to claims by the policyholder or a beneficiary under the policy. Weather-related property claims under Chapter 542A use a lower rate.
  • Michigan: benefits not paid on time bear simple interest at 12% a year from 60 days after the insurer received satisfactory proof of loss (MCL § 500.2006). A third-party claimant gets it only when liability is not reasonably in dispute and a court finds the refusal was in bad faith.

How to ask for it

Write to the adjuster, cite the statute, give the date payment was due and the interest you calculated, and ask for it to be paid with the claim. If the insurer refuses, include it in a complaint to your state department of insurance.

Already settled a claim? Share the first offer and what you finally got, anonymously, in 30 seconds. It helps us build the Lowball Index, which we publish once enough claims are in.

Worked example

Your Texas insurer agreed to pay $8,500 and the payment was due on March 1, 2026, but it arrived on May 15, 2026: 75 days late.

Interest at 18% a year: $8,500 × 18% × 75/365 = $314.38, on top of the claim and reasonable attorney's fees.

What to do next

Frequently asked questions

Does every state charge interest on late insurance payments?

Many do, but the rate, the start date and who can claim it differ a lot. Some states use a fixed rate, some tie it to the court judgment rate, and some only allow it after a lawsuit. Check your state statute before you claim a number.

Is late-payment interest taxable?

Interest paid on a claim is generally treated as interest income for tax purposes, unlike the claim payment itself. Ask a tax professional if the amount is significant.