Texas’ insurer of last resort in coastal areas has denied allegations that a culture of racism has existed within the organization.
Responding to claims by a Houston-based trial lawyer that employees of the Texas Windstorm Insurance Association often used racist language in emails to disparage Hispanics, Arabs and African-American, TWIA countered that the organization “has firm policies against discriminatory, racist, or offensive behavior or communications of any kind by, from, or toward any policyholders, employees or anyone else who does business with TWIA.”
The allegations by lawyer J. Steven Mostyn, who is representing the Brownsville Independent School District in a case over unpaid claims stemming from Hurricane Dolly in 2008, were reported in the Austin American Statesman on Dec. 10. The article also appears on the website of the Mostyn Law Firm.
According to that report, the offensive emails were found among nearly a million other documents examined during the discovery process in the Brownsville School District’s case against TWIA.
In a message posted on its website, TWIA said the association’s “management and legal counsel will address these allegations appropriately and in the appropriate forum. We reject and deplore the content of the emails provided to the media by opposing counsel in ongoing litigation.”
TWIA remains under the oversight of the Texas Department of Insurance. The association said that should TDI launch an investigation into the allegations it would cooperate fully.
Responding to an emailed request for comment from Insurance Journal, TDI spokesman Ben Gonzalez said the agency’s “practice is to refrain from commenting on any pending litigation.”
Gonzalez acknowledged the department had received a complaint on Dec. 10, “alleging claims of discrimination by an attorney who is currently involved in active litigation against TWIA. TDI will follow its normal procedures in reviewing these allegations.”
Gonzalez added that TDI “has led the charge nationally against race-based insurance practices. When the agency receives any complaint alleging discrimination under the insurance code we will investigate it.”
Mostyn has been in battles with TWIA before.
He was the lead plaintiff lawyer in hundreds of cases brought against the coastal property insurer following Hurricanes Ike and Dolly in 2008. His law firm has collected tens of millions of dollars in legal fees stemming from those lawsuits.
The Ike claims brought by Mostyn and the associated legal fees raised the ire of then-state Rep. Larry Taylor, an independent agent from Friendswood who was co-chairman of the Joint Windstorm Insurance Legislative Oversight Board, a member of the House Insurance Committee and the the Select Committee on Emergency Preparedness, and the State Representative for House District 24 in Galveston County.
Taylor, now a state senator, has been an outspoken critic of settlements made by TWIA over Ike claims and publicly sparred with Mostyn over access to information on TWIA settlements.
In September 2010, Taylor filed an open records request to find out the details of a $189 million settlement between TWIA and a group of homeowners over slab claims — cases in which the only thing left of the houses following Hurricane Ike were the slabs they were built on.
Mostyn fought the request, asserting the settlement information was confidential and suggesting that Taylor was over-stepping his authority as a state representative in requesting information about a confidential settlement.
Taylor ultimately was successful in obtaining the information.