Task Force Takes Aim at Windstorm Insurance Challenges

CORPUS CHRISTI — The Coastal Windstorm Task Force on Wednesday held its first open forum, uniting policymakers, business developers, insurance agents and others along the coast in an effort to educate the public about windstorm insurance and discuss potential legislative solutions to rising premiums and the Texas Windstorm Insurance Association’s financial challenges.

Created in July by state Rep. Todd Hunter, R-Corpus Christi, the task force includes members from all 14 Texas coastal counties and aims to propose legislation to reform or replace the Texas Windstorm Insurance Association, which provides wind insurance to coastal residents when private insurers are not available.

Hunter said he hopes the Legislature will look hard at the future proposal that the task force creates and consider adopting some of its suggestions — including alternatives to litigation in cases of unpaid claims and adding in-state insurance adjusters to assess hurricane damage.

“We’re under attack,” Hunter said at Wednesday’s forum, which was held in partnership with the Corpus Christi Chamber of Commerce. “There is a belief in this state that if you live by the coast you’re going to be discriminated against.”

Task force chairman Charles Zahn, a Port Aransas lawyer, said that TWIA served policyholders well before Hurricane Ike struck in 2008, but the agency had difficulty handling policyholders’ claims after the catastrophic storm. Since then, insurance rate hikes for coastal residents discourage potential home and business owners from moving to the coast, harming the economy, he said.

TWIA's board of directors approved a 5 percent rate hike this year. Under the direction of Insurance Commissioner Eleanor Kitzman, TWIA also hired an actuarial firm to conduct an analysis on how to potentially adjust premium rates territorially depending on the level of risk of damage to the area.

Members of the task force reject plans that include territorial rate hikes, said Ingleside Mayor Pete Perkins. Instead, a primary suggestion is to create a statewide catastrophe insurance plan.

“This is a Texas coast issue and a Texas issue,” Zahn said. He accused Kitzman of trying to divide the state between coastal and noncoastal citizens.

“While I may have a view that the rates that TWIA charges are inadequate, it really has nothing to do with the current financing problem,” Kitzman said in an interview with The Texas Tribune. Because the TWIA rates are so “inadequate for the risk that they are assuming,” Kitzman said it exacerbates the problem of private insurers not wanting to do business along the coast. The solution must come from lawmakers, she added, but didn’t say specifically what she thinks the Legislature should do.

Coastal residents have to pay for specialized insurance while areas affected by other types of disasters like fires and tornadoes do not, said Foster Edwards, president of the Corpus Christi Chamber of Commerce. This functions as discrimination against people who live near the coast, he said.

The task force will continue to meet with legislators and others around the state to gather ideas and will probably host additional forums before the end of the year in advance of the legislative session, which starts in January.

Becca Aaronson contributed to this report.