January 31, 2003

TCAIS Director Beaman Floyd testifies, as Senate insurance reform hearings begin

With a message to lawmakers that the coalition's insurance companies are not afraid to be regulated, Beaman Floyd, director of the Texas Coalition for Affordable Insurance Solutions, testified Thursday before a hearing of the Texas Senate's Business and Commerce Committee. The committee is discussing insurance reform legislation now since the issue has been officially declared an emergency item by Governor Perry.

Floyd told the committee that Senate Bill 14 was a "good starting point" in the development of meaningful insurance reform for Texas. SB 14, filed by Senator Mike Jackson (R-La Porte) would require all homeowners and auto insurance companies in Texas to file rates with the state's Insurance Commissioner for review before they begin using them.

"What we want is a style of regulation that allows for both strong consumer protections and the ability of companies to compete with each other for both prices and products. We think that's the best way of ensuring folks both good rates and availability in the marketplace," Floyd told the panel.

Progress has already been made…

The TCAIS director also pointed out that Texas has made some progress toward a healthier, more competitive insurance market in the past year but that more changes are needed. He emphasized that effective an effective regulatory system should allow consumers to choose the type of insurance policy that best suits their needs and budget. Click here to see the progress made in the past year.

Senator Troy Fraser (R-Horseshoe Bay), chairman of the Senate Business and Commerce Committee, echoed this idea, pointing out that many of the current problems in Texas' insurance market are due to the state’s strict regulation of policy forms. "In other states there has been more flexibility in the types of products sold and the price they would be charging. Texas has not been as flexible," Fraser said.

Chairman Fraser said that providing Texas consumers with more affordable options would be a vital part of improving the insurance market in Texas. "In the long term it will be a key component in rates coming down and will give consumers choice about what kind of product they want to buy."

In other action, the committee approved Senate Bill 310, which requires insurers writing homeowners insurance in Texas to file rates, estimated rates over the next six months and other supporting data with the commissioner of insurance so that he may prepare a summary report to the legislature. SB 310 now goes to the full Senate for additional action.

Insurance reform:
Don’t just get mad, get it right.

Texas Coalition for Affordable Insurance Solutions
www.TCAIS.org

TCAIS is a proactive alliance of insurance providers and trade organizations committed to working with legislators, regulators, consumers and others to find public policy solutions that will improve insurance availability and affordability in Texas.