Hurricane Ike and Windstorm Insurance Print E-mail
Written by Administrator   
Tuesday, 23 September 2008
The tragic aftermath of Hurricane Ike has devastated many of our coastal communities in Texas. Touring the disaster area with Governor Perry this week, I saw first hand the damage wrought by this massive storm. Those experiences brought home the human dimension to this terrible catastrophe. Nadine and I join with many Texans whose prayers go out to those who have died, been injured, or seen their homes and property swept away by this storm.

When the roads reopen and the cleanup begins in earnest, we will start to see the true scale of Hurricane Ike, and what its ramifications will be for Texas. Those ramifications will not be limited to coastal communities. This is a crisis that will affect all Texans, not just those living on the Gulf of Mexico.
The reason is windstorm insurance. Unlike traditional insurance, where the risk and costs are primarily borne by the private market, very few insurers are willing to insure homes against windstorms. The State of Texas, recognizing this problem, stepped in years ago, creating the Texas Windstorm Insurance Association (TWIA), an insurer of last resort for our coastal communities. This provides protection to many coastal Texans, and must continue to be there for our citizens to rebuild their shattered communities.

But unfortunately, TWIA is in crisis, and finding a solution is long overdue. Following Hurricane Rita in 2005, TWIA – a state-supported insurer – was in bad financial shape. Many experts predicted that a major storm could wipe the insurer out. Responding to these warnings, I made TWIA a priority in the 2007 legislative session, ordering an interim study and then supporting legislation to solidify the imperiled public insurer. Unfortunately, meaningful reform of TWIA failed to pass in the legislature.

Now, the big storm that everyone feared has hit us, and the cost of reforming TWIA is likely going to be even greater than before.  Nonetheless, I remain committed to bringing windstorm insurance reform to the forefront of the legislative agenda in 2009. It will not be easy. Citizens from various regions of Texas have different priorities for what sort of TWIA they would like to see. Working with legislators from across the state, we must find a compromise solution that moves Texas forward and heals the broken cities of our coastal region while avoiding a general revenue crisis.

 The work will be difficult, but it is a responsibility we owe to all Texans, whether they live on the coast or not. A healthy insurance climate is something all Texans need and expect.
Last Updated ( Tuesday, 23 September 2008 )
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