AUSTIN – To leading lawmakers and even some insurance industry experts, State Farm hasn’t exactly been like a good neighbor in recent dealings with state regulators.

The state’s largest property insurer shows no sign of compromising on its marathon legal battle over the state’s ruling that it overcharged homeowners hundreds of millions of dollars.

The insurer – which had an improved bottom line in 2009, according to figures released Monday by the state – has yet to pay a penny to policyholders.

After filing twice in eight months to increase rates, company officials gave a cold shoulder last month to state Insurance Commissioner Mike Geeslin, who suggested State Farm needed to give its customers a break.

And on Thursday, State Farm will take Geeslin and the Texas Department of Insurance to court in an effort to keep the agency from publicizing documents related to the rate spikes, which represent a statewide increase of 13 percent.

Meeting obligations

Company representatives insist that State Farm is just protecting its financial interests and those of its 1.2 million Texas customers with homeowner policies. State Farm also insures about 3 million drivers in Texas.

“Quite frankly, we do this on a regular basis because we have to react whenever necessary to remain in a financial position that allows us to meet our obligations” to policyholders, said Kevin Davis, a spokesman for State Farm in Texas.

Consumer advocates and some lawmakers, who will consider new insurance regulations next year, contend that State Farm has no incentive to abandon its tough-minded tactics as long as the law allows insurers to implement rate increases without the state’s consent.

“I don’t think any insurance company should be allowed to get to the point where they are too big and powerful to be regulated,” said Alex Winslow of Texas Watch, a consumer group active in insurance issues. He accused State Farm of “taking advantage of the marketplace.”

Public Insurance Counsel Deeia Beck, whose state agency represents consumers, said that while State Farm has “a legal right to do what they’re doing, I don’t think it has been a good path to choose” – particularly for its customers.

She noted that the company has used similar tactics in Louisiana and in Florida, where State Farm declared last year that it was going to pull out of the state. It reversed course only after state regulators agreed to let the company raise homeowner rates nearly 15 percent and drop about 125,000 policies.

Dispute over ‘03 order

State Farm’s longest-running dispute with Texas is litigation over a 2003 state order for the company to slash its rates 12 percent and issue refunds for excessive charges.

The state’s public insurance counsel said last year that the company owed nearly $1 billion in overcharges and penalty interest. Geeslin offered to settle the case for $310 million in refunds, but State Farm held firm that it owed nothing. The case is back in court again.

“State Farm’s rates are, and always have been, competitive and reflect the risks of the Texas market,” Davis said.

Among the risks, the company argues, are unpredictable weather. Davis also noted that the company has paid billions in claims in recent years and ranks high in customer-service ratings compiled by the state.

Davis rejected the assertion that State Farm constantly battles with the Insurance Department, noting that the company and department staffers frequently cooperate on a variety of regulatory issues.

But some lawmakers are growing impatient, particularly after the company announced the back-to-back rate hikes.

“Most families in North Texas haven’t seen their incomes go up by double digits this year, yet these big insurance companies think it’s OK to increase their premiums by double-digit increases,” said Rep. Chris Turner, D-Burleson. “With Texans already paying the second-highest homeowners insurance rates in the nation, this is unacceptable.”

Several other House members have made similar comments about State Farm in recent weeks.

Sen. Glenn Hegar, who as chairman of the Sunset Advisory Commission will lead a review of insurance regulations soon, voiced unhappiness with State Farm’s decision to try to block publication of certain documents related to the company’s two rate hikes. The agency has already posted most of the rate filings on its Web site – the first time it has done so for any insurer.

“Texans have an absolute right to full transparency and disclosure when an insurance company is attempting to increase rates on its customers,” said Hegar, R-Katy. “I will not allow [insurers] to hide behind the curtain of confidentiality when their actions impact ratepayers and Texas consumers.”

State Farm contends that the documents contain proprietary information that could harm its business interests if competitors see it. The company says no other state allows the release of such information.

Talk of prior approval

One industry insider with close ties to many legislators said he was “amazed at how belligerent State Farm has been in dealing with the Insurance Department.” He also voiced concern that the disagreements could lead to legislation next year that would put a tighter grip on insurance company premiums.

Most talked-about among lawmakers is a switch to a system that would require home and auto insurers to get prior approval from the state before implementing a rate increase. Under the current file-and-use law, companies are allowed to immediately impose higher rates once they have notified the insurance department.

Timing questioned

The commissioner can object and order refunds – plus penalty interest – if the new rates are deemed excessive.

When State Farm notified Geeslin of its most recent increase, the commissioner said the timing was “not in the best interests of Texas consumers” and asked company officials to voluntarily withdraw the rate plan. State Farm refused and said it will implement the changes next month.

“State Farm is the poster child for what is wrong with the system, and the commissioner has given them too much latitude,” said Winslow of Texas Watch.

Davis countered that a prior-approval requirement would be a mistake because the current system fosters competition among companies – and better prices.

“Competition is the most effective regulator of rates,” he said, also pointing out that the commissioner has the ability to regulate rates under the current system.

Background: Texas vs. the insurance giant

State Farm’s battles with the state:

May 2003: The Legislature approves an insurance overhaul to combat record increases in homeowner rates caused by massive claims for mold and water damage.

September 2003: Ordered by the Texas Department of Insurance to reduce its “excessive” rates 12 percent, State Farm files suit to block the order, arguing that its rates are fair.

December 2004: Lt. Gov. David Dewhurst, citing a record $600 million in profits by State Farm over a 15-month period, calls on the company to quit stalling and cut its rates.

July 2006: Insurance Commissioner Mike Geeslin rejects a bid by State Farm to increase rates 23 percent in Dallas County and 11 percent statewide. Geeslin also requires prior approval for future hikes.

May 2008: A state appeals court overturns Geeslin’s prior-approval order and sends the case back to Geeslin for hearings to determine whether the company has overcharged its customers.

April 2009: The commissioner begins hearings in the State Farm case. The Texas Department of Insurance and the Office of Public Insurance Counsel contend the company owes hundreds of millions of dollars in refunds while State Farm says it owes nothing.

November 2009: Geeslin orders State Farm to refund $310 million to its Texas customers for overcharges dating to 2003. The amount is far less than the $1 billion that the state’s public insurance counsel says is owed.

November 2009: State Farm rejects Geeslin’s order and says it will take the long-running case back to state court. A spokesman for the company compares the order to the financial stress that State Farm faced with its massive Hurricane Ike losses in 2008.

SOURCE: Dallas Morning News research

State Reps. Kent, Miklos and Turner respond to recent rate hikes by Texas’ largest insurance provider

AUSTIN – Today State Representatives Carol Kent, Robert Miklos and Chris Turner renewed their call for comprehensive insurance reform in light of last week’s announcement that State Farm, Texas’ largest homeowners insurance provider, will raise rates by 4.5% in May, just seven months after an 8.8% rate hike. This comes on the tail of recent rate increases by both Allstate and Farmers Insurance.

“Most families in North Texas haven’t seen their incomes go up by double digits this year, yet these big insurance companies think it’s ok to increase their premiums by double-digit percentages,” said Representative Chris Turner (HD 96-Burleson). “With Texans already paying the second highest homeowners insurance rates in the nation, this is unacceptable.”

In November, Allstate announced a 9.8% jump in their homeowner’s insurance rates. In January, Farmers Insurance, the third largest insurance company in the state, proposed raising rates 10% statewide and 11% for North Texas area customers. According to the Dallas Morning News, after Texas Insurance Commissioner Mike Geeslin called the hikes, “excessive and discriminatory,” Farmers agreed to only increase their rates by 4.5%. However, the company will be allowed to charge the excessive rate through March 2011 and keep the premiums they have already overcharged.

Currently, insurance companies are required to notify the Texas Department of Insurance (TDI) of rate increases, but TDI has no authority to block these rate hikes.

“The insurance commissioner should have the power to stop outrageous rate increases,” said State Representative Robert Miklos (HD 101 – Mesquite). “By increasing their rates by double digits in less than a year, State Farm is sending a message that it is ok to for insurance companies to line their pockets at the expense of consumers.”

In an attempt to combat overnight rate hikes by insurance companies, legislation has been filed in the past to create a “prior approval” system, which would give TDI the power to approve or deny these rate increases and give the agency true oversight over this industry. Many of the filed measures would have allowed for increased public input when insurance companies ask to raise their rates.

“During the next Legislative Session, when TDI is up for sunset review, we need some common sense oversight to protect homeowners.” said State Representative Carol Kent (HD 102 – Dallas). “There are far too many North Texas families struggling to make ends meet in this economy, and raising their insurance rates over and over again will just make that struggle even harder.”

In late May, the Legislative Sunset Advisory Commission, comprised of six member of the Texas Senate and six member of the Texas House, will begin to review TDI. Once the review process is complete, the advisory committee will present its recommendations to the 82nd Legislature.

State Representatives Carol Kent and Robert Miklos represent Dallas County districts. Representative Chris Turner represents southern Tarrant County.

Chris wrote and worked to pass the legislation that will require residential electric providers give at least 30 days notice that a fixed rate contract is scheduled to expire, allowing the customer time to shop around and select a new contract.  Chris heard from numerous constituents of instances when their contract expired, often with no notice, rates would skyrocket to the highest price available, doubling electric bills as a result.

Working to Make Insurance Companies Accountable

During the 81st Legislative Session, Chris wrote and filed numerous measures aimed at making insurance companies accountable for the high premiums they charge consumers. Currently, Texans pay the highest rates for homeowners insurance in the nation and they coverage they receive does not reflect the amount they pay. Unfortunately, special interests killed all insurance reform this session, but Chris is determined to help deliver real reform for Texas families.

Consumer Organization Lauds Turner for Commitment to Strong Homeowners Insurance Reforms

AUSTIN – The nonprofit citizens’ organization Texas Watch has named Rep. Chris Turner (Burleson) its House Freshman of the Year for his dedication to strong consumer protections designed to benefit Texas homeowners, families, and small business owners during the 81st Legislative Session.

“Rep. Chris Turner is a tireless advocate for the interests of Texas families, consumers, and workers. During his first term in the Texas House, Rep. Turner showed that he is not afraid to stand up for the needs of homeowners and small businesses,” said Alex Winslow, Texas Watch’s Executive Director. “The people of Tarrant County and all of Texas are better off because Chris Turner is fighting on their behalf.”

Texas Watch is a citizens’ organization with 10,000 activist members that advocate for issues from homeowner rights and insurance reform to worker safety and access to the civil justice system.

“We have a long way to go before Texas policyholders, consumers, patients, and small business owners are on a level playing field with the insurance and corporate special interests, but with Chris Turner’s help we are well on our way,” said Winslow. “We are proud to name him our House Freshman of the Year and look forward to working with him in the future to make meaningful insurance reform a reality for Texas families.”

During this year’s legislative session, Texas Watch had a complete agenda of consumer reforms, including:

• HOMEOWNERS INSURANCE REFORM. Texas Watch fought for comprehensive homeowners insurance reforms that were designed to improve the value of individual insurance policies by reining in costs while improving coverage and claims handling.
• ABOLISHING THE TRCC. Along with a coalition of dedicated homeowners and consumer organizations, Texas Watch helped to bring an end to the Texas Residential Construction Commission. The agency served as a blockade for homeowners to hold builders accountable for shoddy construction.
• RESTORE LOST LEGAL RIGHTS. Over the last 20+ years, Texans have seen their rights stripped by insurance lobbyists and powerful special interests. Texas Watch fought to restore the rights of workers and policyholders so that they are able to exercise the accountability protections guaranteed by our Constitution

.

Texas Watch currently has 10,000 grassroots activist members across the state. It is considered to be one of the most influential consumer voices in Texas. To learn more about Texas Watch, go to www.TexasWatch.org. To join the TexasWatch online network, go to www.Facebook.com/TexasWatch or www.Twitter.com/TexasWatch.

• Because of his work on issues affecting veterans and their families, Turner was named the bi-partisan Legislative Veteran’s Caucus “Freshman of the Year.”
• Given the “Leadership Award” by the Texas Veterans Commission.
• Turner authored H.B. 1299 which will create one scratch off lottery ticket to provide an estimated $8 million annually for critical and emergency aid to Texas veterans through the Fund for Veterans Assistance. The bill passed the House and was ultimately amended to a Texas Veterans Commission bill.
• Turner authored H.B. 1636 which ensures that all state employees who are called to active military duty are able to continue to accrue their vacation and sick time and do not lose these benefits because they were deployed. The bill was the House companion to Senator John Carona’s S.B. 833, which Turner sponsored.
• Turner authored and passed H.B. 3951 requires state colleges and universities ensure a professional in their financial aid office is familiar with and trained on the major educational benefits available to veterans.
• Turner authored H.B. 3952 extending the Hazelwood Act to the spouses of Texas military members who are killed in the line of duty or left completely disabled. Turner amended the measure to S.B. 93.
• Turner added an amendment to H.B. 1935 which establishes the Jobs and Education for Texans Grant Program. The amendment will ensure that those organizations that have programs benefiting veterans will be given priority in the grants awarding process.

Fighting for Consumers and Small Business

• For his efforts on behalf of consumers, Turner was named “Freshman of the Year” by the non-partisan pro-consumer organization, Texas Watch.
• Turner authored H.B. 995 which passed the House Committee on State Affairs unanimously (15-0) and was later amended onto another House Bill. The legislation will require retail electric providers to give their customers at least 30 days written notice that their fixed price electric contract is expiring.
• For his efforts on behalf of consumers, Turner was named “Freshman of the Year” by the non-partisan pro-consumer organization, Texas Watch.
• Turner filed several pieces of legislation protecting homeowners from unfair practices by the insurance industry.

Improving Our Public Schools & Helping Texas Universities  Excel

• Turner co-authored H.B. 3646, which will provide an additional $1.9 billion in school funding and increase the equity among school districts.
• Turner co-authored H.B. 51, the “Tier One” bill, which opens the door for “emerging research universities,” such as the University of Texas at Arlington, to become a “Top Tier” research university.

Shielding Our Families from Sexual Predators

• Turner authored H.B. 2396 will require sex offenders who claim to be homeless to register with their local law enforcement agency every 2 weeks. The bill was combined with an identical piece of legislation during the committee process and was signed into law by Governor Perry.
• Turner authored and passed out of the House legislation requiring computer technicians to report the discovery of child pornography to law enforcement.  This measure had strong support from law enforcement, but unfortunately the bill died in the Senate.

Supporting Texas Businesses and Cutting Taxes

• H.B. 1637 made improvements to the shared work unemployment compensation program, making it possible for many of our large manufacturers and other employers who operate on swing shifts to take advantage of this state program. Turner passed this bill on the first day the House considered legislation.
• Turner co-authored H.B. 4765 which will exempt small businesses with less than $1 million of revenue from paying Texas franchise taxes.
• Turner co-authored H.B. 831 which would exempt Chambers of Commerce from paying ad valorem taxes on property they owned and used for their primary functions.

During the past 140 days, I worked hard to pass significant measures to aid Texas veterans, protect consumers and enhance economic development in House District 96.

On the last day of session, I was honored to receive the bi-partisan Veteran’s Legislative Caucus’ “Freshman of the Year” award for my work on issues affecting Texas veterans and their families.

My work on behalf of those who served our nation so bravely is what I am most proud of this session. Senator Leticia Van de Putte and I passed legislation that will establish a dedicated lottery scratch-off game to benefit the Permanent Fund for Veterans Assistance, a top legislative priority for leading veterans’ organizations. Services that will be made possible with this bill include PTSD counseling, transportation assistance to VA health care facilities and job placement assistance. I authored and passed legislation that will ensure our veterans and their family members are able to take full advantage of the educational benefits which they have earned, by guaranteeing that there is a trained veteran’s aid specialist on every Texas public college and university. I also worked with Senator John Carona to pass legislation to allow state employees who take a leave of absence for military service to continue to accrue vacation and sick leave.

Senator Wendy Davis and I worked together to pass a major consumer protection measure, requiring utility companies to give notification to customers that their fixed rate contract is expiring. Over the past year and a half, I heard from many in Southern Tarrant County who had low fixed rate contracts and received no notification when their low rate contract expired, which resulted in bills doubling or tripling as a result. Now utility companies will have to provide written notification at least 30 days in advance and put the contract end date on every bill.

My top priority during the 81st Legislative Session was to stay in touch with and work hard for the constituents of House District 96. Prior to the beginning of session, I met with city and local leaders to discuss issues affecting them and how I could help. That’s why I filed and passed a bill which creates the Kennedale TownCenter Development District. Aimed to improve and diversify the economic base in Kennedale, the city and the Kennedale Economic Development Corporation will create a mixed use development that will house retail, professional offices and restaurants. Governor Perry has already signed this measure, which will ultimately help reduce pressure on local property taxes.

I am proud of our success in what was my very first session in Austin, but I am mindful that none of these things would have been accomplished without the support and encouragement of the people of District 96. It is a truly humbling experience to represent you in the Texas Legislature. I appreciate the help and support you all have given, for which I will always be grateful.

AUSTIN- State Representative Chris Turner ended his first legislative session with the passage of several significant measures aimed to aid Texas veterans, protect consumers and enhance economic development in House District 96.

AIDING TEXAS VETERANS AND THEIR FAMILIES

Turner passed several key measures to aid Texas veterans and their families:

Turner filed and passed legislation that will generate up to $14 million over the next two years to pay for critical services for Texas veterans. This measure, which establishes a dedicated lottery scratch-off game to benefit the Permanent Fund for Veterans Assistance, was a top legislative priority for leading veterans’ organizations. Services that will be made possible with this bill include PTSD counseling, transportation assistance to VA health care facilities and job placement assistance.

Turner also passed legislation that will help ensure that our veterans and their family members are able to take full advantage of the educational benefits which they have earned by guaranteeing that there is a trained veteran’s aid specialist at every public Texas college and university.

Turner successfully passed legislation to allow state employees who take a leave of absence for military service to continue to accrue vacation and sick leave.

Finally, Turner’s measure to expand the Hazelwood college financial aid program to the spouses of service members who are killed or completely disabled as a result of their service is on its way to the Governor’s desk.

“With over 1.7 million veterans in Texas, I was honored to fight for our veterans to ensure that they receive the benefits they have earned and deserve,” said Turner. “With thousands of Texans fighting wars in Afghanistan and Iraq, we must do all we can to make sure that they will receive the help they need when they return home.”

As a result of Turner’s effective work on veterans’ issues, the bipartisan Veterans’ Caucus named Turner its “Freshman of the Year.” “I am humbled to have received this tremendous honor from my colleagues, and I intend to keep fighting for Texas veterans and their families,” Turner said.

CONSUMER PROTECTION

Another of Turner’s key accomplishments this session was authoring legislation requiring electric utility companies to provide their customers with written notice that their contract is close to expiring, giving consumers time to shop around and find a reasonable electric rate. Turner passed his bill out of the House State Affairs Committee, but it was one of hundreds that was never scheduled for a vote on the House floor.

The legislation was ultimately passed as an amendment that Senator Wendy Davis added to another bill, and it will go a long way toward preventing huge, unexpected rate hikes on Texas families.

“For the past year, I have heard story after story of families’ residential utility bills doubling overnight as a result of a contract ending unexpectedly,” said Turner. “Texasfamilies don’t need or deserve huge rate hikes, especially in tough economic times. The utility companies need to be upfront with their customers and let them know when their rates may go up and by how much.”

HELPING DISTRICT 96

Turner’s top priority during the 81st Legislative Session was to stay in touch and work hard for the constituents he represents. Prior to the beginning of session, Turner met with city and local leaders to discuss issues affecting them and how he could help.

As a result of one such meeting, Turner filed and passed HB 1300, which creates the Kennedale TownCenter. Aimed to improve and diversify the economic base in Kennedale, the city and the Kennedale Economic Development Corporation, will create a mixed use development that will house retail, professional offices and restaurants.

“The TownCenter will provide much needed economic development and business revenue to the city and reduce the tax burden on homeowners,” said Turner. “My top priority has been and always will be to serve and be responsive to our district, and I remain honored and humbled to represent the families of southern Tarrant County in the Texas Legislature.”

STATE REPRESENTATIVE CHRIS TURNER’S LEGISLATIVE HIGHLIGHTS

• H.B. 1299 was amended to a Texas Veterans Commission bill, which passed on the last day of session. It will create one scratch off lottery ticket to provide and estimated $8 million annually for critical and emergency aid to our veterans through the Fund for Veterans Assistance
• H.B. 995 passed the House Committee on State Affairs unanimously (15-0) and was later amended onto another House Bill. The legislation will require retail electric providers to give their customers at least 30 days written notice that their fixed price electric contract is expiring.
• H.B. 1300 will create the Kennedale TownCenter Development District. The district will create a mixed-use commercial facility and will help lessen the tax burden on Kennedale homeowners.
• H.B. 2396 will require sex offenders who claim to be homeless to register with their local law enforcement agency every 2 weeks. The bill was combined with an identical piece of legislation during the committee process, which is now headed to Governor Perry.
• H.B. 1636 ensures that all state employees who are called to active military duty are able to continue to accrue their vacation and sick time and do not lose these benefits because they were deployed. The bill was the House companion to State Senator John Carona’s SB 833, which Turner sponsored in the House and has been sent to Governor Perry.
• H.B. 1637 adjusted the definition of the 40-hour work week as it pertains to the shared work unemployment compensation program making it possible for many of our large manufacturers and other employers who operate on swing shifts to take advantage of this state program. Turner passed this bill on the first day the House considered legislation. The measure has been signed by Governor Perry.
• H.B. 3951 requires state colleges and universities ensure a professional in their financial aid office is familiar with and trained on the major educational benefits available to veterans — particularly the GI Bill and the Hazelwood Act. The bill passed the House and Senate and has been sent to Governor Perry.
• H.B. 3952 extends the Hazelwood Act to the spouses of Texas military members who are killed in the line of duty or left completely disabled. Turner amended the measure to SB 93 and will be soon sent to Governor Perry for signing.
• Turner added an amendment to H.B. 1935 which establishes the Jobs and Education for Texans Grant Program. The amendment will ensure that those organizations that have programs benefiting veterans will be given priority in the grants awarding process.
• Turner authored and passed out of the House legislation requiring computer technicians to report the discovery of child pornography to law enforcement. This measure had strong support from law enforcement, but unfortunately the bill died in the Senate.

AUSTIN – The Utility Transparency for Texas Families Act, House Bill 995, authored by Rep. Chris Turner, passed unanimously out of the House Committee on State Affairs on Tuesday.  The bill requires residential retail electric providers to give customers with fixed priced contracts or “fixed price products” a minimum of two written notifications that their contract is expiring.

“For the past year, I have heard story after story of one and two-year fixed price contracts expiring, and residential utility bills doubling and tripling as a result,” said Turner. “Texas families don’t deserve unexpected rate hikes, especially in these challenging economic times. The utility companies need to be upfront with their customers and let them know when their rates may go up and by how much.”

Arlington resident Adrena Stephney traveled to Austin to testify in support of House Bill 995. “In mid-2007, we signed a year contract to lock in an energy rate of .125 (per kilowatt hour), in August 2008, we were blindsided with a significantly higher bill. It was then that we realized our rate had gone from .125 to .199,” said Mrs. Stephney. “I believe all service providers should notify and inform their customers of any changes that affect them. There are far too many urgent matters that require our immediate attention, the least of our concern should be an unexpected rate change resulting in higher utility bills.”

The bill also requires residential retail electric providers to inform customers about the Public Utility Commission of Texas website — www.powertochoose.org — which gives consumers the tools to compare providers and utility prices.

“People need to be informed of their options and know that they have the right to choose a new electric provider once their contract is up, or to select a new contract with the same provider,” continued Turner. Turner noted that some utility companies already voluntarily inform customers  when contracts are about to expire. “This is a good business practice that some companies are already engaging in.  For those that do not, the Utility Transparency for Texas Families Act will require utility companies who want to do business in Texas to be up front with their customers whose contracts are about to expire,” he concluded.

The bill received wide bipartisan support and is joint authored by Reps. Dwayne Bohac, Charlie Geren, Jose Menendez and Sylvester Turner.

Six years since a crisis in homeowners insurance compelled legislators to make sweeping reforms, many Texans have less coverage but still pay some of the highest premiums in the country.”

— Dallas Morning News, 2/15/2009

Austin –  This week, State Rep. Chris Turner filed three bills — House Bills 1528, 2784 and 2785 — to protect Texas consumers from unfair practices by insurance companies in Texas.

According to a nationwide survey recently released by the National Association of Insurance Commissioners (http://www.naic.org/), Texans pay the highest insurance rates in the nation. In fact, they pay roughly 1.75 times the national average for their homeowners insurance. Although Texans are paying high premiums, they are not always receiving the coverage that they need.

“Studies have shown that Texas homeowners pay more and get less when it comes to insurance policies,” said Turner. “It’s time we put Texas families first for a change and stop unfair homeowner insurance practices.”

House Bill 1528: Currently, insurance companies are under no obligation to pay a customer the replacement value of an item that has been lost or destroyed. Often times they pay only the “actual value” of the lost item, which may have depreciated over time. When passed, this legislation will require insurance companies to pay their customers the amount it would cost to replace an item.

House Bill 2784: Texas has a history of insurance companies making threats to leave the state or move from certain areas of the state, only to “return” once their demands have been met.  This bill would forbid an insurer who leaves the state from writing automobile or residential insurance policies for a five year period. “If insurance companies want to threaten to pull out of Texas as a negotiating tactic, then this bill says we are ready to call their bluff,” Turner said.

House Bill 2785: This bill prohibits customer inquiries regarding coverage to be used as a factor when determining insurance policy rates. Currently, when inquires are made regarding insurance coverage, i.e. asking if a broken window would be covered, it could affect the risk assessment on a home and ultimately the rate a customer must pay, even though no claim was made. House Bill 2785 would end this unfair practice.

“With the Texas Department of Insurance up for Sunset review this year, it’s time that the Legislature put an end to unfair insurance practices,” continued Turner. “We need to send insurance companies a strong message that if you want to do business in Texas, you have an obligation to treat Texas consumers fairly.”

The text of the bills may be found here: http://www.legis.state.tx.us/billlookup/billnumber.aspx

AUSTIN – Today State Representative Chris Turner (HD96) filed House Bill 995, the Utility Transparency for Texas Families Act. When passed, the law will require residential retail electric providers to give customers with fixed priced contracts a minimum of 60 days notice that their contract is expiring. The bill would also require providers notify customers what the rate change will be once their contract expires. House Bill 995 is the first bill Turner has filed.

“For the past year, I have heard story after story of one and two-year fixed price contracts expiring, and residential utility bills doubling and tripling as a result,” said Turner. “Texas families don’t deserve unexpected rate hikes, especially in these challenging economic times. The utility companies need to be upfront with their customers and let them know when their rates may go up and by how much.”

The bill also requires residential retail electric providers to inform customers with expiring contracts about the Public Utility Commission of Texas website — www.powertochoose.org — which gives consumers the tools to compare providers and utility prices.

“People need to be informed of their options and know that they have the right to choose a new electric provider once their contract is up, or to select a new contract with the same provider,” continued Turner. Turner noted that some utility companies already voluntarily inform customers when contracts are about to expire. “This is a good business practice that some companies are already engaging in. For those that do not, the Utility Transparency for Texas Families Act will require utility companies who want to do business in Texas to be up front with their customers whose contracts are about to expire,” he concluded.

A native Texan, Turner represents House District 96, which is a rapidly-growing and diverse area which encompasses much of Tarrant County south of Interstate 20, including large portions of Arlington and Fort Worth. The district also includes Crowley, Kennedale, Rendon and portions of Mansfield and Burleson. Major employers in the area include the University of Texas at Arlington, Lockheed Martin, Bell Helicopter and National Semiconductor.