AUSTIN — Proposed rules that could put surcharges on certain coastal automobile and property insurance policies after a massive storm are set for a round of public hearings that start this month.
The Texas Department of Insurance conducted hearings on informal rules last year, and with minor technical changes, the rules are set to go to public hearings again.
“We feel an urgency to make sure rules are in place before storm season,” said Jerry Hagins, Texas Department of Insurance spokesman.
An emailed notice from the insurance department said hearings are planned for Corpus Christi, Austin and Beaumont, although official notice of the hearing in Beaumont has not yet gone out, according to the email.
Charlie Zahn, a Port Aransas attorney involved in working against the proposed rules, said people will need to comment after the proposed rules are officially published Feb. 14 even if they weighed in during the previous public comment period.
Texas legislators created the windstorm association in 1971 as a way to provide windstorm and hail coverage for those who can’t get it from the voluntary market. The association functions as an insurer of last resort for more than 267,000 residential and commercial property owners. About 90 percent of the properties are residential.
The windstorm insurance association covers a small portion of Harris County and 14 coastal counties, including Nueces County.
“I don’t agree with any of it,” said State Rep. Todd Hunter, R-Corpus Christi, of the proposed rules. “The Texas Department of Insurance needs to show support for the coast, and the rules do not do that again.”
The rules bring to life part of House Bill 3, a 2011 piece of legislation that became law to make reforms to the windstorm association. Lawmakers asked that the department delay implementation of part of the law in hopes that a new law would pass out of the Legislature, but that didn’t happen.
“If the Legislature wants to come back in 2015 and look at TWIA, which we think is a good idea, that’s fine, but we need to at least get what we can for some nail down predictability for the coming storm season,” said Beaman Floyd, executive director of the Texas Coalition for Affordable Insurance Solutions.
In the event of a catastrophic storm, the association first pays for claims out of its premiums.
From there, the windstorm association can issue bonds. The way the windstorm association pays back the bonds is through premiums, surcharges and assessments. Assessments are what the state charges insurance providers.
Community leaders in the Corpus Christi area have called for the windstorm board to consider approving about $400 million in assessments that the board hadn’t taken from insurers after the 2008 Hurricane Ike.
The surcharges apply to the insurance policies of those living in coastal areas.

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