SENATE APPROVES WINDSTORM INSURANCE REFORM
(AUSTIN) — The Senate passed a bill Wednesday intended to improve the state's coastal windstorm insurance agency, clarifying the claims process and increasing transparency at the agency. The Texas Windstorm Insurance Association was intended to be the insurer of last resort for coastal residents, but as private insurers pulled out of the market following massive damage claims from hurricanes, the association has become virtually the only insurer along the Texas Coast. After House and Senate members couldn't come to an agreement during the regular session, Governor Perry added the issue to the special session. The bill passed by the Senate is nearly identical to the measure passed unanimously by the Senate during the regular session.
The only major change from the version passed during the regular session is the removal of a provision that would have assessed an 18 percent penalty against TWIA for delay in damage reimbursement. As in the version passed in May, the bill would increase transparency, requiring the agency follow the Open Meetings Act. It creates a timeline for the claims process, giving policy holders a year to file a claim and permits claimants to sue for double damages under certain scenarios. The bill also intends to fix solvency issues at the agency, authorizing TWIA to purchase pre-event bonds and requiring officials to submit a plan on how to pay for damage claims exceeding $2.5 billion if the agency does not purchase reinsurance.
Bill author Senator John Carona of Dallas pledged to protect the Senate version of the bill if it heads to a conference committee. Though the Senate passed its bill in the regular session unanimously, disagreements with the House led to the issue dying before the end of the session on May 30. At the time, Perry promised lawmakers they would be dealing with this issue over the summer if they couldn't reach agreement. If a compromise bill doesn't go to the Governor's desk before the first special session ends on June 28, Perry could call another one to deal with this issue before the hurricane season gets into full swing.
The Senate will reconvene Friday, April 24 at 1:30 p.m.