By J. Lyn Carl, GalleryWatch.com
Austin, TX – Announcing "principles" they believe must be part of legislation affecting homeowner's insurance rates in Texas, Lt. Gov. David Dewhurst and several Republican and Democratic members of the Senate today held a press conference to espouse those principles and their bipartisan efforts to address this key issue of the current legislative session.
Dewhurst said the legislation likely will result not in a file and use system, but a prior approval system.
"One of the most important issues that is facing the legislature is homeowner's insurance," said Dewhurst. He noted he has spent the last three weeks calling in different members of the Senate, some key committee chairs and vice chairs, and "bringing them together to see if we could come up with a consensus on homeowner's insurance that will drive homeowners insurance rates down."
Legislation being considered would likely result in rate rollbacks in homeowner's insurance in the 12-15 percent range, said Sen. Troy Fraser (R-Horseshoe Bay).
Fraser, who chairs the Senate Business and Commerce committee to which most of the insurance bills have been referred, called the issue "difficult" and thus one that is difficult on which to garner bipartisan support. "We're all in agreement," he said, "that all companies will fall under state regulation and will be subject to the rating system" found in Sen. Mike Jackson's SB 14.
Preliminary figures, said Fraser, "give a snapshot of where we are today." He said a lot of things being done in other parts of the bill will "cause those losses to go down."
Regarding rate regulation, Sen. Jackson noted, "If rates are disapproved, the (insurance) commissioner must give information to companies as to why they were disapproved and what needs to be done to be approved. He said appeals will be made to the commissioner and if not decided there they will go to the State Office of Administrative Hearings (SOAH).
Sen. Leticia Van de Putte (D-San Antonio) credited the public for its input in the insurance issue both during the legislative session and the interim. "This has been a process that has been inclusive of the public," she said.
Van de Putte said a bill that comes out of the Senate must strongly prohibit unfair and discriminatory use of credit scoring or credit information in determining rates. She cited discrimination against people who operate more on a cash basis and seniors who have paid off much of their assets and don't use credit cards. "We want to make sure they're protected," she said. "The disclosure of credit scoring models is an important and necessary component of this bill. We will have sunshine."
She said legislation being considered "puts some strong teeth into the commissioner" so that he can promulgate rules prohibiting unfair or discriminatory practices.
Dewhurst said the group of senators surrounding him had spent long hours working on this issue and on legislation and said it is "an example of the Senate coming together in a bipartisan way."
He said the group is talking about "principles" relative to insurance legislation and noted there is "a lot to do yet in committees."