Senate Bill Will Make Insurance Harder to Find for Texans
April 3, 2003

New insurance study shows that regulation of the insurance marketplace must seek to complement rather than distort the laws of supply and demand.

Senate Bill 14, passed by the Senate Wednesday will make it increasingly difficult for Texans to find insurance. This legislation would be a step backwards for Texas by discouraging competition, limiting consumer choice and inevitably raising prices.

The Texas Coalition for Affordable Insurance Solutions (TCAIS) continues urging lawmakers to pass legislation that will bring more insurance companies to Texas, providing homeowners more choices at more competitive prices.

Insurance companies are not afraid to be regulated. Yet, new studies are finding that government price controls and arbitrary regulation, such as what’s found in SB 14, will not lower insurance rates for Texans in the long term. Competition is far more effective in regulating the market than any government mandate.

For Texans to truly benefit, the insurance market needs certainty and predictability...not ambiguous regulations that can be moved by the politics of the day.

While we appreciate the long hours spent developing the bill and the Senate’s rejection of several amendments that would have further stifled competition, we still believe that the rating structure in SB 14 will not create a competitive and predictable insurance market - something that will attract more insurance companies to Texas.

TCAIS believes legislators should give Texans the full benefits of a healthy, competitive insurance market with regulation that focuses on consumer protections designed to make sure insurance companies are financially healthy and treat their policyholders fairly. House Bill 3346, by Representatives Arlene Wohlgemuth (R-Burleson) and Larry Taylor (R-Friendswood), contains several positive elements that could move insurance reform in the right direction by creating an environment that encourages more companies to enter the Texas market and compete for customers.