Relating to the operation of the Texas Windstorm Insurance Association and the renaming of the Texas Windstorm Insurance Association as the Texas Coastal Insurance Association.
The proposed amendments to the Insurance Code introduce new provisions regarding assessments, payment methodologies, and the structure of the association's governance. Notably, the bill establishes mechanisms for the issuance of public securities to cover losses during catastrophic events, with assessments on member insurers capped at $500 million per catastrophe year. This allows the association to respond to significant claims following major weather events, ensuring policyholder protections while maintaining fiscal responsibility for the association's obligations.
House Bill 2245 proposes the renaming of the Texas Windstorm Insurance Association to the Texas Coastal Insurance Association and outlines changes to its operational framework. The bill primarily aims to ensure the provision of adequate windstorm and hail insurance in Texas's coastal areas, crucial for the economic welfare and development of those regions. The bill establishes the association as a backstop insurer, ensuring coverage for individuals unable to obtain insurance through traditional markets, thereby promoting insurer competition and stability in the sector.
The key points of contention surrounding HB 2245 involve concerns about the sufficiency of insurance coverage, the financial implications of the insurance assessments, and the operational transparency of the association. Critics argue that without rigorous oversight, the renaming and restructuring could lead to inefficiencies or reduced accountability for the Texas Coastal Insurance Association. Additionally, stakeholders from the insurance industry may debate the appropriateness of the assessment limits and their long-term implications on coastal homeowners’ premiums and access to coverage.