Texas Insurance Commissioner Eleanor Kitzman is hearing an earful from the coastal community as she listens to residents’ concerns in the Corpus Christi area.
Coastal occupants are complaining about the cost of windstorm insurance policies provided by the Texas Windstorm Insurance Association , better known as TWIA. Mark Gugevich, who spoke at a recent town hall meeting, believes that requiring the 14 coastal counties (and parts of Harris County) to shoulder the burden of their own coverage is “blatantly wrong.”
State Rep. Craig Eiland, D-Galveston, is even urging coastal residents to pressure corporations with interests in the region – especially oil concerns like ExxonMobil, BP and Valero – to lobby state lawmakers to keep coastal rates low, ahead of the next legislative session that begins Jan. 8, 2013.
Others fear a fight with TWIA over the categorization of the destruction from a hurricane, whether it is labeled wind or flood damage. TWIA covers all damage to property caused by wind, but citizens must separately insure against a flood surge. This situation, they find, is not acceptable.
The obvious remedy to such complaints is to demonstrate the subsidized nature of the TWIA rates. When compared with the rates other areas of the state pay for private insurance for wind and hail damage, TWIA’s rates are much more reasonable. In fact, in order to be eligible for TWIA, applicants must provide evidence of they were declines by at least one insurer currently writing wind and hail coverage in the Tier 1 coastal counties, a requirement that also applies every three years for renewals. Additionally, all Texans must pay for flood insurance in addition to a standard homeowners policy. No region of the state is exempt from personalizing their policy to fit the particular risks of their area.
Thus, the arguments that those on the coast are paying more than they should just do not hold water when compared with the risk-based rates paid by the rest of the state.