Your property rights are under assault at the Texas Capitol. Insurance lobbyists and their allies at the self-styled “Texans for Lawsuit Reform” are pushing legislation that will mean insurance companies pay you as little as late as possible for claims.
House Bill 1774 and Senate Bill 10, better known as the “blue tarp bills,” strengthen the hand of insurance companies in property-claims disputes. The end result is homes, businesses, schools and churches will be blanketed in blue tarps after storms when they’re cheated out of their policy benefits.
Central Texans are no strangers to bad weather and know the stakes. Protection from nature’s fury is one of the main reasons we buy insurance, though we’ve been paying more for our policies while receiving less in coverage for many years now. We pay our hard-earned premiums each year in exchange for a promise that our insurance company will be there for us in our time of need. But too often, insurers abandon their customers, denying claims and wrongly asserting damage is minimal or pre-existing. They also underpay or delay compensation; the list of games played to pad the bottom line goes on and on.
Insurers of Texas homeowners have made over $4.5 billion in profits since 2012. The longer insurance companies can hold on to our money, the more profits they can reap through investments in the stock market. That’s why we have policyholder protections on the books in Texas. We all know that our system of bureaucratic regulation favors powerful insurers over Texas homeowners and businesses. Only the ability to enforce strong laws in court pries policy benefits back from insurance companies and ensures prompt payment.
The Blue Tarp Bills weaken policyholder protections. The legislation slashes the penalty insurers face for slow payment; forces most insurance disputes into our overburdened federal courts, where it takes twice as long to receive justice; and threatens access to justice for property owners who won’t be made whole if they guess incorrectly before suit about the amount the jury will award. The cost, delay and uncertainty the bills create only works to advantage the insurance company and disadvantage the property owner.
Without the ability to hold your insurance company accountable, you are at their mercy. Is it any wonder, then, that insurance companies and their allies are pushing an agenda at the Capitol to gut your rights? Imagine after the next storm hits, calling your insurance company to make your claim and being told “no.” This is the second storm of insurer abuse, and it’s bearing down on every Texan unless the blue tarp bills are stopped.
Official data shows insurers paid 10 percent fewer hail claims after massive storms and refused to reopen claims files in significant numbers until policyholders were forced to take their claims to court. These trends will only worsen if insurers face less accountability for cheating their customers. Giving insurance companies more power is a recipe for man-made disasters following natural disasters.
Texans don’t want this. A recent survey of active voters conducted by Hill Research Consultants, a nationally respected Republican public research organization, found overwhelming majorities of Texans want to increase or maintain policyholders’ legal rights. The support spanned the political spectrum with 83 percent of Democrats, 87 percent of Republicans, and 89 percent of self-identified tea party supporters holding this position.
Instead of undermining your ability to demand fair treatment, lawmakers should consider stronger legal remedies that impose stiff penalties on insurance companies caught cheating their customers. Though no system is perfect, of course, independent judges and juries do a better job than Austin bureaucrats when it comes to holding insurance companies accountable.
If you agree policyholders should be protected, now is the time to raise your voice in opposition to the blue tarp bills. Lawmakers are hearing from insurance lobbyists each and every day this session — but they were sent to Austin to work for you.
Wendell is the executive director of Texas Watch, a nonpartisan citizen advocacy group that has worked to protect policyholders since 1998.