Dewhurst to Lawmakers: How About Shutting Down Texas Windstorm Insurer?

September 11, 2014

  • September 11, 2014 at 12:16 pm
    txmouthbreatherboogereatertx says:
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    How ’bout just shuttin’ down Texico.

    • September 11, 2014 at 3:31 pm
      Agent says:
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      How about just shutting your mouth boogerbrain?

    • September 11, 2014 at 4:26 pm
      Libby says:
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      Damn! You beat me to it!

      • September 11, 2014 at 4:32 pm
        Agent says:
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        I am glad you finally agree on Boogerbrain Libby.

        • September 12, 2014 at 12:04 pm
          Libby says:
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          You really are dense. He beat me to “How about just shuttin’ down Texico.”

          • September 19, 2014 at 7:06 pm
            bob says:
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            Dense would be missing that Agent was mocking you.

            You mock him in similar fashion so I am surprised you missed it.

  • September 11, 2014 at 1:54 pm
    KentU says:
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    I write through the TWIA but, wish there were more and better alternatives. There will be if the state shuts down the TWIA. I suggest that the first step be for the TWIA to offer only depreciated value coverage and only on the structure itself. This will prompt a considerable segment of consumers to seek better coverage and in turn will give the market place a reason to offer alternative coverage. The TWIA rates have not been actuarially sound for years – too low.

    • September 11, 2014 at 3:34 pm
      Agent says:
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      Kent, Do you think insureds in Tier 1 & 2 will be better served by the private market who avoid that area like the plague? I wonder what the rates would be for windstorm. How about the deductibles going to 5% or more for Wind & Hail?

      • September 11, 2014 at 4:27 pm
        Libby says:
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        Wait! Now you’re FOR government sponsored insurance programs? WTF?

        • September 11, 2014 at 4:31 pm
          Agent says:
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          Actually, I am for preserving the private market place and to have affordable premiums for customers. Unlike the small Pennsylvania area, we do have a lot of coastline and a lot of people living down there. There is no need to see double the premium on carriers policies. I also see a bunch of carriers not offering coverage in the area. Where are insureds going to go for coverage?

          • September 12, 2014 at 12:06 pm
            Libby says:
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            I don’t know. But I see you are OK with taking government handouts as long as they benefit you. But not so much if they benefit other people. How typically republican of you.

          • September 12, 2014 at 5:02 pm
            Agent says:
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            Libby, please explain how paying a premium for coverage is a government hand out. You either pay a private carrier for coverage or NFIP for Flood Coverage. By the way, Social Security is not a government entitlement. Working people pay into it all their working lives and the Trust Fund was set up to begin paying upon retirement. Unfortunately for us, LBJ robbed the Trust Fund and put it in the General Fund to pay for his Social Programs like the War on Poverty and look what we have now.

          • September 15, 2014 at 8:38 am
            Ron says:
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            Agent,

            The article makes several references to how a major storm could impact TX taxpayers. Why? Because the TWIA is not charging enough premium. This means that TX is subsidizing the premiums for the coverage which equals a handout. It is amazing how you can make any other subsidized government program into an evil entitlement, but not if it benefits TX.

          • September 15, 2014 at 2:24 pm
            txmouthbreatherboogereatertx says:
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            Being that Texico doesn’t have a colony tax, the Federal Government will be stuck with this bill. Double your premiums or keep moving South!

          • September 16, 2014 at 9:49 am
            Agent says:
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            Hey Ron, have you been on vacation since you haven’t commented on any articles in some time? Major storms always impact taxpayers and insureds. Have you forgotten all about Katrina and all the problems with FEMA and them handing out $2,000 checks to anyone on the street in Louisiana as a start? Then, the government was paying for temporary housing in Houston and several other places which is still going on to this day. How about Sandy? The President said he would cut the red tape for NJ and NY and claims are still going on with that. The federal taxpayers are subsidizing any storm that comes along anywhere it happens. Find me a couple hundred insurance companies willing to put their “assets” on the line to insure coastal property for wind and we may have a solution.

          • September 16, 2014 at 1:24 pm
            Ron says:
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            Agent,

            Once again, you missed my point.

            You said, “Libby, please explain how paying a premium for coverage is a government hand out.” I took the liberty of explaining to you how paying a premium that is not sufficient for the risk from a government insurance program is a hand out.

            Now do you understand?

            Are you happy that the government has been subsidizing all of these people? Maybe if government sponsored insurance programs charged the approiate premium for the risk, unaffected taxpayers would not need to subsidize those in harm’s way. Do you agree?

          • September 19, 2014 at 7:11 pm
            bob says:
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            Ron,

            Why do you specifically only insist on commenting and debating with Agent and conservatives who meet the image of conservatives having no reply to your comments?

            Agent won’t ever be good at stating his points, and then you constantly say that he proves all conservatives cannot do so.

            I clearly can, and in our arguments you typically side step the argument trying to make it down to both parties being the same by bringing up either Reagan as a Keynesian when it comes to spending (I disproved this in about 5 different ways. By comparing what he tried to pass, comparing tactics of democrats who said they wouldn’t lower taxes without raising spending just like they did in 2012, I did it by his proposals that democrats called extreme spending cuts and gutted the system, etc etc.) or Bush W when it comes to recessions.

            Choose the right people to debate with and don’t label the rest based on Agent.

            Before you comment and state I do the same with Libby and Liberals:

            I don’t. It is rare for me to say: All liberals don’t know politics.

            In fact, I don’t think I have ever said it.

  • September 11, 2014 at 3:42 pm
    JoeE says:
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    The vacuum that will be created by TWIA leaving the state will only cause TDI to mandate all carriers in TX take their fare share of insured’s now insured by them and offer wind and hail in the Gulf – stirring up the home insurance market again. JoeE

    • September 11, 2014 at 5:11 pm
      Agent says:
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      I think you are right JoeE. The way I understand it, carriers currently have to pay a fee based on their total writings to TWIA to fund it. I am not sure any of these carriers want a total exposure obligation if another hurricane comes through. Reinsurance is bound to be expensive and that will drive up the cost of policies a great deal.

      • September 11, 2014 at 6:21 pm
        KentU says:
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        In the event that TWIA runs out of funds they levy each insurance carrier according to its share of the home market in Texas. Example: State Farm paid about $1B and Farmers $600M for their portion of Hurricane Ike when the TWIA ran out of funds. The carriers are then allowed to get back some or all of their part over a five year period for not having to pay excise taxes. Reforms to TWIA this past year have greatly improved the reinsurance portion in that they can issue more bonds to have money available before they levy the carriers. Even TWIA is looking at 5% deductibles because the current funding is actuarially unsound. Every insurance carrier passes along their expense of reinsuring the TWIA to their policyholder not matter where in the state of Texas they live – that not fair but, that is how it is. The TWIA needs to begin giving consumers a reason to get insurance in the open market.

        The BEST solution is for flood policies (NFIP / FEMA) to start including windstorm in its policies that insure coastal risks. There has ALWAYS been problem after hurricanes in determining the cause of loss: wind or water??? Put both causes of loss in one policy and that problem is solved. FEMA is probably the only government department that can solve this problem. The TWIA has been better than nothing but, a more comprehensive program insurance wind & water is needed.

        Better building codes! The state of Texas missed an opportunity when Bolivar Peninsula / Crystal Beach got wiped away by Hurricane Ike. Only the best built structures survived. If anyone wants a beach house then, they should be able to afford to build one that will withstand the punishment or be able to afford the insurance in the open market. I, the tax payer should not be expected to subsidize the cost of their insurance through TWIA.

        • September 12, 2014 at 11:47 am
          Agent says:
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          Good summary KentU. I am glad I am not in that area of the state to deal with those issues. It is hard enough in other parts of the state to deal with unending rate increases, deductible increases etc.

          I agree that Flood policies should be expanded and it is sometimes hard to tell whether wind driven rain or rising waters caused the damage. State Farm had all kinds of trouble with claims under Katrina, got sued by policyholders in Louisiana and Mississippi and it took years to settle. That was not their finest hour for sure.

    • September 16, 2014 at 4:38 pm
      Agent says:
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      Once again Ron, you missed my point. TWIA rates may have been inadequate to pay for an Ike hurricane, but you know what, if private carriers had all that exposure, they could not have collected enough premium to handle the loss either. How about Katrina? Was that adequately funded from an insurance standpoint? State Farm took a bath on that since they didn’t even have their property re-insured. Was Sandy adequately funded by anyone including FEMA Flood? It seems to me you are picking on Texas when the problem is nationwide with rate adequacy. Remember the Mississippi floods a few years back? Was that adequate to handle the damage?

      • September 17, 2014 at 7:36 am
        Ron says:
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        Agent,

        I agree with you. The government get out of the property insurance business and just allow private carriers to charge the appropriate premium for the risk. If some people cannot afford the premium, then they can move, work harder to get a promotion, get a second job, etc. You know, personal responsibility. Just stop relying on the government.

        The point Libby and I were making is that the TWIA is a government handout to those unable to pay an adequate premium for the risk. Example: Adequate premium is $1,000. TWIA premium is $750. This equates to a $250 government handout. Get it?

        • September 17, 2014 at 5:16 pm
          Agent says:
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          As usual, you didn’t answer my question about Katrina and Sandy. How did you like all those government handouts up there Ron? You seem to think Texas is the only problem state with insurance rates. Do you think FEMA has made a real effort to settle claims up there? I wonder why they are still having issues.

          • September 17, 2014 at 9:32 pm
            Ron says:
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            Agent,

            I did answer your question. What part of, “The government get out of the property insurance business and just allow private carriers to charge the appropriate premium for the risk. If some people cannot afford the premium, then they can move, work harder to get a promotion, get a second job, etc. You know, personal responsibility. Just stop relying on the government.” do you not understand?

            Neither Katrina nor Sandy occurred anywhere near me. Do you even realize that Long Island is more than 400 miles from where I live? When is the last time you heard of Western New York receiving anything from FEMA or any other handout?

  • September 11, 2014 at 5:23 pm
    JAMES LETTE says:
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    WHAT ARE TRYING TO DO BREAK THE BANKS AND BANKRUPTY THE INSURED’S, PLEASE FIND A MARKET FIRST

    • September 11, 2014 at 5:40 pm
      Agent says:
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      Good luck on finding a market who is willing to write business in Tier 1 or 2. They have a funny way of wanting to protect their reserves and staying in business for the long haul.

      • September 23, 2014 at 2:40 pm
        insurance is fun! says:
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        There are always carriers willing to write any coverage at the correct price…..like maybe 25 times the current subsidized rate.

  • September 15, 2014 at 5:55 pm
    Jan Laman says:
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    I am an agent in Tier 1, Galveston County. It has been my opinion all along that TWIA rates are too low, not rated based on risk but by politics. Those of us who choose to live on the Gulf Coast must realize that our insurance premiums are going to be high based on the high risk of hurricanes and tropical storms. We have to realize that any insurance company doing business in this area has to be able to charge premiums based on risk or they won’t be able to do business here at all. If TWIA were a “real” insurance company, subject to the rules of the Texas Department of Insurance, they would not be allowed to do business in Texas at all. If standard companies were allowed to charge premium based on actual risk, they may be willing to take up the slack here and we can close TWIA for good. We can all complain about insurance rates but we have to remember that we enjoy low housing costs, no state payroll taxes, low vehicle registration costs etc. It all comes out in the wash.

    • September 16, 2014 at 9:42 am
      Agent says:
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      Jan, I see your point. The trick to see how many carriers are willing to write business there at whatever the rate. My guess is that many will limit their exposure to keep from getting wiped out if a hurricane comes in and everything would have to be heavily re-insured. The insurance company actuaries will be very busy trying to figure out rate adequacy to try to make a buck down there.

    • September 16, 2014 at 6:12 pm
      KentU says:
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      Jan, you and I are on the same page – I agree with everything you just said. TWIA has a goal to make their rates actuarially sound and of my policies with them are seeing needed rate increases. We are seeing the same thing with their flood policies. When TWIA rates start getting close to being actuarially sound I truly believe that you will see the private insurance market get reinsured to complete. Until then there isn’t any reason for the private market to spend the necessary resources to even develop a market in tiers 1 and 2. I am serious about much tougher building codes. A number of my customers on Crystal Beach have chosen not to rebuild but, rather to sell to a developer that plans to build condos that will withstand the punishment of a major hurricane.



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