Texas House Bill HB3629

Texas 2019 - 86th Regular

Caption

Relating to premium rates for policies issued by the Texas Windstorm Insurance Association.

Impact

By limiting rate increases, the bill seeks to provide financial relief and predictability for homeowners and businesses relying on windstorm insurance. This is especially critical in areas frequently affected by hurricanes and other severe weather events. The legislation is intended to protect policyholders from abrupt and significant hikes in insurance costs that could occur as a direct response to disaster declarations. Additionally, the bill restricts TWIA from collecting premiums on claims that are unresolved until those claims have been officially paid or denied, further providing financial security to policyholders.

Summary

House Bill 3629 focuses on regulating premium rates for policies issued by the Texas Windstorm Insurance Association (TWIA). It introduces several amendments to the Texas Insurance Code aimed at controlling the rates that can be charged for these insurance policies, particularly in the aftermath of natural disasters. The bill specifically prohibits TWIA from increasing rates more than 101 percent of the previous year's rates, ensuring that policyholders are not excessively burdened during times of economic hardship following a disaster declaration.

Contention

While the bill is designed to offer stability and support to those in vulnerable coastal regions, there may be contention surrounding its potential impact on the financial viability of the TWIA itself. Critics argue that overly restrictive rate regulation can diminish the association's ability to effectively manage risk and maintain solvency, particularly in the aftermath of major disasters when claims tend to surge. Supporters contend that the consumer protections offered by HB3629 are crucial for safeguarding homeowners during times of crisis.