Homeowners Policies

Grand Prairie Insurance Lawyers and those in Dallas, Fort Worth, Grapevine, Carrollton, Farmers Branch, Benbrook, and other places over the DFW area should always be aware of the tactics and procedures insurance companies are using that relate to the policies sold to consumers. The Austin American Statesman published an article that provides some important information. Here is what it says.
Texas Attorney General Greg Abbott is locked in a fight with the state’s largest insurer over the company’s decision not to renew 11,000 residential and commercial property insurance policies along the Gulf coast.
Abbott’s office requested documents last month from State Farm to make sure the insurer lawfully terminated the contracts, Tom Kelley, a spokesman for Abbott, said in an email.
State Farm responded late last week by filing a lawsuit to prevent the attorney general’s office from getting the information it requested.
“Given the number of Texans that are affected, we want to ensure that State Farm complies with the law,” Abbott said in a statement. “If State Farm has not done anything wrong, it’s certainly curious that they would go to court just to avoid the state’s subpoenas.”
Kelley said the attorney general’s review would seek to find out if the company made deceptive representations to its policyholders about its intentions to drop coverage.
Patti Kelly, a spokeswoman for State Farm, said the company filed suit “in an effort to protect our legal rights.”
Kelly said she couldn’t comment in depth because of ongoing litigation, but she said she believes State Farm, which writes more than 1.76 million residential and commercial property insurance policies in Texas, acted in compliance with the law.
Deeia Beck, head of the Austin-based Office of Public Insurance Counsel, which acts as an advocate for customers, said her agency has not seen any indication that State Farm violated the law.
“It’s very likely to be within the guidelines,” Beck said.
Jerry Hagins, a spokesman for the Texas Department of Insurance, said that his department has found nothing to indicate noncompliance on State Farm’s part but that the agency will continue to monitor the situation.
Alex Winslow, executive director of the advocacy group Texas Watch, said he wants to know more about State Farm’s decision not to renew the coastal policies.
“State Farm should not be allowed to just tuck tail and run without any explanation. So, a full investigation is warranted,” Winslow said in a statement.
“The public deserves to know just what State Farm is up to and what the company’s decisions mean for families and small businesses, including the company’s network of insurance agents.”
Winslow joined Beck and others to say that the denial of renewals would force people to rely on the Fair Access to Insurance Requirements, or FAIR, Plan, the residential property insurance option of last resort that is operated by a quasi-governmental entity to address residential property insurance availability problems in underserved areas.
“I guarantee you we’ll see a spike in the FAIR Plan,” Beck said, adding that the plan offers much less coverage than State Farm could write.
State Rep. John Smithee, a Republican from Amarillo and chairman of the House’s insurance committee, said scores of new FAIR Plan and windstorm policies could be problematic.
The quasi-governmental Texas Windstorm Insurance Association, which is still fielding lawsuits stemming from Hurricane Ike in 2008, could be in an especially precarious position if former State Farm customers with policies that covered wind damage seek coverage from the Texas Windstorm Insurance Association, Smithee said.
“We’re not really equipped to have them right now,” Smithee said.
The above article would at first glance, appear to be concerns of only homeowners along the Gulf Coast area of Texas. But the practices complained of affect homeowners all over the State of Texas.