April 21--ARANSAS PASS -- Mary Ann Heiman opened her bait shop on the causeway that crosses Redfish Bay to Port Aransas in 2011. From the outside, 1950 Hwy 361 was nothing fancy.

"The building was just an old metal building that had sat here since the 1980s," she said. "It was basically held together with nails and glue and love and duct tape." The real value of Offshore Adventures was the equipment inside, the tanks and freezers Heiman needed to hold the crabs, shrimp, mud minnows and mullet that anglers bought in their pursuit of the Texas coast's rich lode of redfish, trout and drum.

A resident of the area on and off since her 1950s childhood there, Heiman knew the wild weather that occasionally swept in from the Gulf and the havoc it could leave behind. Last July she purchased a policy from the Texas Windstorm Insurance Association to cover $60,000 of business personal property inside 1590 Hwy. 361 from high wind damage. It cost $679.

Heiman's timing couldn't have been better. Hurricane Harvey barreled into Port Aransas a month later, on the evening of August 25, packing 130 mph winds and driving rain.

When Heiman was allowed back into the area a few days later, her bait shop had disappeared, the splintered debris of her livelihood hurled inland by the Category 4 winds. A group of wooden pylons roughly representing the outline of the shop poked out of the sand like a mouthful of broken teeth.

It was only after the adjuster for the windstorm insurance association went to the site and agreed the record winds had destroyed her bait shop that it was discovered Heiman's insurance agent had accidentally transposed two of the numbers in Offshore Adventures' street address. In letters and phone calls, he asked the windstorm association to correct the typo so Heiman could collect her due and rebuild the business.

The association refused. Heiman's policy for 1590 Hwy 361 did not cover 1950 Hwy 361, representatives explained. Her claim for the money she needed to restart her bait shop was stamped "denied."

Agency rebuilt after Ike

The last time a major hurricane pounded Texas, the windstorm association also sustained serious damage. Like many coastal property owners, the organization has spent years rebuilding.

State legislators created the association, known as TWIA, in 1971 as a public-private partnership to provide wind and hail insurance for coastal communities whose residents were unable to purchase protection from private companies because of the costly weather-related risks. Most years TWIA gets a few thousand claims. But when major storms strike the association is thrust into the center of recovery efforts.

That last happened in 2008, when Hurricane Ike crashed into the Galveston area on Sept. 13 with 110 mph winds. By the time it dissipated inland, Ike had caused nearly $30 billion in property damage.

As ravaged coastal communities struggled to recover, the windstorm insurance association became the target of numerous complaints -- it was too slow to respond, inconsistent in its evaluations of policyholders' damage claims and criticized for low-balling its customers as they struggled to rebuild. Hundreds of policyholders sued. The association eventually paid out a half-billion dollars in legal claims.

In 2011, following additional allegations of fraud, the Texas Department of Insurance placed it under the state's direct supervision. TWIA "is in a condition that makes its continuation in business hazardous to the public or to its policyholders," then-Texas Insurance Commissioner Mike Geeslin declared.

The Legislature also overhauled the agency. New laws shored up its shaky finances and more clearly outlined how the association was to interact with policyholders.

Some of the biggest changes lawmakers made were designed to restrict lawsuits against the association, many of which had revolved around how much hurricane-related property damage was attributable to wind and so covered by TWIA, and how much was the result of water, an issue covered by flood insurance policies.

Legislators capped awards from TWIA lawsuits at two times damages, compared to three times for most other insurance lawsuits, according to TWIA attorney David Walling.

They also installed a mandatory dispute-resolution system outside the courts. Under it, if a property owner disagrees with TWIA's assessment of how much damage his or her property sustained in a storm, each side hires an appraiser to review the numbers. If a dispute still remains, an umpire is asked to weigh in. The association and property owner split the costs.

'I've refused all TWIA cases'

In many ways, the reforms have worked as intended. TWIA was released from state supervision in 2016.

According to the association's latest figures, the number of complaints it has received as a percentage of Harvey claims is only a fifth of the percentage it fielded for Ike. Fewer than 1,500 policyholders have invoked the appraisal dispute-resolution process, and TWIA has been sued only 50 times over its Harvey-related coverage (300 others have filed a notice of their intent to sue).

TWIA has cited such figures as indicators of generally satisfied customers. But the feeling isn't universal.

Because of the upfront expense -- appraisers can cost upwards of $1,000 -- and the lowered damage limits, attorneys say they are reluctant to take on even potentially winnable legal battles against TWIA on behalf of aggrieved property owners. "People are calling every day," said Lawrence Tylka, a Galveston-area attorney who handled Ike claims. "But I've refused all TWIA cases" from Harvey.

"The changes in the law make it almost impossible for attorneys to help clients," added Gregg Cox, an attorney for the Houston-based Mostyn Law Firm, which won some of the largest Ike settlements against the windstorm association. "They created the appearance of a fair system. But the system is rigged in favor of the insurance companies."

Anna Stafford, a TWIA spokeswoman, said that if a policyholder disagrees with an initial appraisal the agency will perform another inspection at no cost. "The vast majority of the [Harvey] appraisal requests received are being resolved through this process at no additional expense to the policyholder," she said.

But Rep. Todd Hunter, who represents the Corpus Christi area and coastal communities north to Port Aransas, said in recent weeks a number of his constituents have asked him to host town hall meetings on TWIA so that they can air their concerns.

One of the biggest complaints he's heard, he added, has been the appraisal system. Homeowners have told him that, with their properties destroyed and their lives upended, they did not have the time or money to contest a claim.

"These people are going weeks and months without getting anything fixed," he said. "Theoretically, appraisal sounds great. Practically, it doesn't work."

Although Hunter said the new laws generally had improved TWIA after Ike, he added that based on the post-Harvey concerns he's heard, he intends to propose tweaks to the dispute system during the next legislative session, which will begin early next year.

"I've heard from enough people that the appraisal process absolutely needs to be looked at," he said. "It shouldn't be a process of low-balling. It shouldn't be a process of delay. It shouldn't be a process that's complicated."

'Some pretty good fish stories'

TWIA said it has received slightly over 75,000 Hurricane Harvey claims, which it expects to cost about $1.45 billion. Just over half have been closed with property owners accepting either full or partial payments of their claims. The Texas Department of Insurance said it has received about 160 complaints from policyholders about TWIA and resolved most, resulting in the association paying out an additional $4.6 million.

About 15,000 claims were closed without payment because the appraised value of the damage fell below the policy's deductible. Still, an additional 12,000, or 17 percent of all claims, have been denied, primarily because the association determined the property owner wasn't covered by a valid policy.

As Mary Ann Heiman discovered, however, the definition of a valid policy isn't always obvious.

There was never any doubt that whatever work Heiman did, it would involve salt water and fish. A boat captain before she opened her first bait shop outside of Port Aransas, she has always been drawn to the sport.

"I've cleaned fish, ran charters, sold bait," she said. "When the sun comes out in the morning, you see some of the most beautiful sunrises in the world." Not to mention, "You get to hear some pretty good fish stories."

Her insurance agent, Ray Fessenden said he has navigated windstorm claims for his coastal customers for more than two decades. The vast majority -- including those from Hurricane Harvey -- have been well-handled by TWIA, he said.

"I've had many, many, many claims," he said. "This is the only one we've had a problem with."

He said he first noticed that Heiman didn't have wind damage protection on her bait shop while reviewing her policy last summer. Documents show that TWIA received Fessenden's application for coverage of $60,000 on her business property at 1590 Hwy. 361, with a 2 percent deductible, on July 31.

The association's underwriter, Laura McHale, reviewed it three days later. Documents show she used Google Maps to confirm the property's address.

The program didn't recognize the street location Fessenden had provided, directing her instead to a nearby address. Despite the discrepancy, McHale said "Nothing seemed out of the ordinary ... so she approved the application and issued a policy," according to court documents.

Fessenden readily admits he wrote the Offshore Adventures address in error, transposing the middle two numbers. But he said the fact there was no recognizable property at that location should have been caught by TWIA and relayed to him so he could correct it.

"It isn't even on the water," he pointed out. "It's kind of hard to have a bait shop not on the water."

Heiman said she saw her bait shop for the last time the day before Harvey hit. She waited out the hurricane in the VFW hall in nearby Ingleside. When she returned, "it was devastating," she recalled. "My place was totally gone."

Records show TWIA send a field adjuster out to examine the remains of her business a week later. When the woman couldn't find the address listed on the policy she called Heiman, who rerouted her to the correct location.

"Suggest paying policy limits as there is no property left," the adjuster's Sept. 5 report concluded.

"A couple of days later they said, 'We'll write the check,'" Heiman said. "I thought, 'Wonderful! I can build back and be back up in time for spring break,'" a traditionally busy period.

Judge: TWIA as much to blame

Fessenden, meanwhile, contacted TWIA to tidy up what he considered a minor typo. "In error when we processed this policy," he wrote in a Sept. 12 email to TWIA, "the address was transposed. We entered 1590 and it should be 1950. Please correct as this has Harvey claim pending payment."

A week later the association responded, saying it had confirmed the bait shop's true location in local appraisal records. But it added that it could not correct the address because that would amount to backdating Heiman's policy so she could collect payment.

Heiman received her official denial on Oct. 5. TWIA explained that her windstorm protection policy covered property only within 100 feet of the listed address. Because the bait shop, at 1950 Hwy 361, was more than 100 feet from 1590 Hwy 361, the association explained, her claim was invalid.

She appealed to the State Office of Administrative Hearings. Three weeks ago, Administrative Law Judge Michael O'Malley concluded the windstorm association should make good on Heiman's policy.

"TWIA is as much to blame for insuring a property with an incorrect address as the insurance agency," the judge wrote. He added its underwriter could easily have caught the typo by looking up Offshore Adventures on tax records or even the company's website. He also noted that TWIA had corrected minor data entry errors in the past to approve claims.

The state insurance commissioner must approve the judge's recommendations before it becomes final, a process which could take at least two months, longer if TWIA appeals. In the meantime, Heiman said she has struggled to make ends meet.

She's had to come up with attorney fees to fight the windstorm agency. A federal Small Business Loan finally arrived two weeks ago, she said, but the original estimates to replace her property have nearly doubled since her last price check, in September, when she thought her insurance would pay for the damage.

Eight months after Harvey's landfall, she said she's ready to be back on the water: "I just want to have my bait shop back."

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