Many Texas homeowners have had a hard time getting windstorm insurance coverage due to the location of their homes. This is especially true for residents off the Texas Coast, because there has been a possibility of a Category 4 hurricane striking the Gulf Coast. Because of the storm’s potential to cause billions of dollars in damage, many insurance companies do not offer windstorm and hurricane coverage to homeowners in this area.
As a result, an organization overseen by the Texas Department of Insurance but independently managed has acted as many homeowners’ last resort in obtaining insurance coverage. This organization – Texas Windstorm Insurance Association (TWIA) – is Texas’ primary coastal windstorm insurance provider.
However, TWIA may not be able to pay wind claims in Texas if a major hurricane causes serious damage. State Rep. John Smithee, chairman of the House Insurance Committee, wrote a letter to Texas Insurance Commissioner Eleanor Kitzman about what has occurred over the past 18 months that has led to TWIA’s financial concerns, including:
- Continuing litigation costs from Hurricane Ike
- Failure to increase rates
- Shortage of reinsurance
- Weak bond market making it difficult to sell bonds to finance association
This news is concerning for the homeowners in the 14 counties that have insurance coverage through TWIA, as the association may not be able to cover the losses from a Category 4 hurricane. Our Galveston insurance claim attorneys at the Voss Law Firm want homeowners to be aware of this potential problem and will inform you of any future updates.
If you have a home insurance claim in Texas that you need help on, please call the Voss Law Firm today at 888-614-7730 for a free, no-obligation consultation. Also, request a free copy of our book Disputes With Your Insurance Company – What All Consumers Need to Know.