Texas House Bill HB3962

Texas 2019 - 86th Regular

Caption

Relating to rate filings by the Texas Windstorm Insurance Association.

Impact

The implications of this bill are significant for the regulation of windstorm insurance in Texas. By easing the requirements for rate approval, the bill aims to enhance the efficiency of the TWIA, particularly in reacting to changes in the market or risk environment. The changes stipulate that the association can implement rate increases within set limits without waiting for regulatory approval, potentially leading to faster responses to financial pressures and ensuring better availability of coverage in storm-prone areas.

Summary

House Bill 3962 focuses on modifying the rate filing process for the Texas Windstorm Insurance Association (TWIA). The bill intends to streamline the approval process for rate changes, allowing the TWIA to use a filed rate without prior approval from the insurance commissioner under specific conditions. These conditions include timely filing of the rate and limits on how much it can exceed the existing rates, thereby facilitating quicker adjustments to insurance rates when necessary.

Contention

However, this bill has generated discussions regarding the balance between regulatory oversight and the need for operational flexibility. Critics may argue that loosening the constraints on rate increases could lead to higher insurance costs for consumers, particularly in vulnerable areas. Furthermore, the absence of prior commissioner review may heighten concerns related to consumer protection, as there would be less oversight on rate increments and their justification, which might affect low-income communities disproportionately.