Time To Rein-In Home Insurance Premiums

We need to ask ourselves, “Why are we still paying the highest premiums in the nation?”

Three years ago with Gov. Rick Perry, then Texas Department of Insurance (TDI) Commissioner Jose Montemayor, and legislators “looking the other way,” lax insurance legislation permitted the industry to double the premiums paid by Texas homeowners.

At that time and during the previous several years, the insurance industry had been experiencing a “hard market” and was losing revenue; we were told it was due to excessive claims due to storms, winds, flooding, hail, and mold. It had called upon the state informally to help with correcting the market, but few listened to industry pleas.

As in many previous years of “hard markets,” the insurance industry elected to act on the problem without waiting any longer for government interaction on its behalf. Virtually overnight, it then “over-corrected” the market by doubling home insurance premiums.

In some instances, the industry decreased the coverage and still increased the premiums significantly.

The reaction of homeowners was disbelief and then anger. They contacted the offices of the governor, TDI, and various legislators. They were told publicly by Perry and Montemayor that by the next year, the insurance industry would refund up to 14 percent of the increased
premiums.

To date, that has never occurred.

So, now it