August 20, 2010
The Texas Windstorm Insurance Association has filed for 5 percent increases in both its residential and commercial rates, effective Jan. 1, 2011.
The state's insurer of last resort provides wind and hail coverage in the 14 coastal counties and parts of Harris County. TWIA provides wind and hall coverage when insurance companies exclude it from their homeowners and other property policies sold to coastal residents.
In accordance with the Texas Insurance Code, TWIA is required to make an annual rate filing with the state Department of Insurance no later than August 15 of each year. Actuarial data indicates that rate increases of 27 percent for residential and 36 percent for commercial are needed. However, the group's board of directors voted to file for the 5 percent increase.
Jerry Hagins, spokesman for the state Department of Insurance said it is premature to say whether the insurance commissioner will disapprove the rate request. Yet the commissioner's approval is not needed.
By law, any rate increases greater than 5 percent must be approved by the commissioner within 60 days. However, for rate filings of 5 percent or less, the commissioner does not have to approve the rate. The commissioner does have 30 days from the rate filing to disapprove of it. And if the commissioner does not disapprove of the rate increase, it will automatically take effect, Hagins explained.
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