TWIA SEEKS 13% RATE HIKE

At a recent public hearing held by the Texas Department of Insurance (TDI) on windstorm coverage rates, the Texas Windstorm Insurance Association (TWIA) requested a 13.6 percent rate increase for hail/windstorm insurance premiums for commercial buildings. TWIA, the insurer of last resort in the state for such coverage, cited costs, including predicted losses from mold claims, in advocating a rate increase. According to the San Antonio Express-News, however, the state Office of Public Insurance Counsel (OPIC), a consumer advocacy agency, dismissed TWIA’s claims, noting that the insurance association’s 15-county coastal region had experienced relatively few catastrophic storms over the past 30 years. While the OPIC argued in favor of reducing rates by 27.2 percent, it asked for the maximum allowed 15 percent reduction. A representative from the Southwestern Insurance Information Service (SIIS), the official spokesgroup for TWIA, said a rate hike is needed because of an increase in the cost of reinsurance for protecting property along the Texas gulf coast. SIIS also cited an increase in wind and hail claims handled by TWIA and anticipated losses from future mold damage claims as justification for an increase. OPIC director Rod Bordelon rejected the TWIA’s mold clams as being speculative and said that any increases due to mold claims should be considered after TDI finishes gathering facts on mold issues and analyzes the data. TDI Commissioner Jose Montemayor said he would study the differing recommendations but set no timetable for a decision.

Topics Texas Pricing Trends