Solomon Ortiz, Jr.

May 23, 2009 

~Corpus Christi Legislators Press to Avoid Special Session on Windstorm Issue ~

AUSTIN-State Representatives Abel Herrero and Solomon Ortiz, Jr. voted today to begin debate on Senate Bill 14, this legislative session's Texas Windstorm Insurance Association (TWIA) legislation.

"Hurricane season begins June 1 and coastal homeowners cannot afford to wait any longer for sensible reforms to TWIA" Herrero said. "We need to take this up now to make sure there are protections for coastal communities."

Herrero and Ortiz voted for a motion to begin debate on the TWIA legislation today, but the motion was defeated by Republican legislators who are unwilling to debate TWIA now.

"I am disappointed Rep. Herrero and I were not given the opportunity today to fight for our constituents and offer amendments to further improve SB 14 further," Ortiz said. "It's time to move forward on this issue."

"Governor Perry has indicated he may call the legislature back for a special session to address TWIA," Ortiz added. "But by then, we will be well into a potentially devastating hurricane season and coastal legislators will have no leverage to broker a compromise that benefits coastal Texans. If it comes down to a special session, devastating bills like House Bill 911 will resurface and there will be no way to stop them. We'll be completely run over."

The Texas Windstorm Insurance Association (TWIA) was created by the Texas Legislature in 1971 to provide windstorm and hail coverage to those who are unable to obtain insurance from the voluntary insurance market. TWIA was created in response to market conditions along the coast after Corpus Christi was hit by Hurricane Celia in 1970, causing $500 million in losses. This session, Senate Bill 14 was voted out of the House Committee with support from coastal legislators.

"The State must provide protections to all policyholders by passing comprehensive insurance reform that is not discriminatory. A fair and affordable windstorm bill is an absolute necessity and the only acceptable option for our coastal communities and our state economy," Herrero added.

Some important changes in Senate Bill 14:

* Requires no increase in rates
* TWIA is authorized to issue bonds
* Requires a declination by at least one private insurer to qualify for coverage from TWIA; also requires a declination for renewal of a TWIA policy
* Alters the makeup of the TWIA board to include more Coastal residents
* Allows TWIA to use computer modeling in setting rates
* Allows TWIA to establish rating territories and vary their rates by no more than 5% among those territories
* If a major hurricane hits, coastal insurance rates would increase by no more than 2.9 % to pay for excess claims on TWIA

###