Insurance companies and their lobbies paying a lot for change in the law

While Texas insurance companies are making money hand over fist, they are also claiming a litigation crisis is taking place that has forced them to alter and exclude certain coverages from their policies and increase premiums to policy holders. Meanwhile, insurance advocates are pressuring state lawmakers to change litigations laws that would adversely affect the policyholders they should be working for instead of against.

In Spring 2015, Senate Bill 1628 was introduced by Sen. Larry Taylor, a politician and owner of Truman Taylor Insurance Agency, that was touted it would rein in property insurance litigation. One aspect of the bill, had it passed, would have benefitted professionals by granting insurance adjusters and agents immunity from being held liable with litigation – essentially protecting himself from future lawsuits.

Insurance companies and agents are still fighting the so-called litigation crisis and in March 2016, at the request of the Senate Business and Commerce Committee – which Sen. Taylor is a member of – and House Insurance Committee, the Texas Department of Insurance requested information from insurance companies relating to hailstorm claims litigation. On October 5, 2016, TDI presented its preliminary findings to the Texas Senate Business and Commerce Committee. On December 1, 2016, the House Insurance Committee also was presented with the information. What the committees plan on doing with that information is still up for debate with the next legislative session which began January 10, 2017.

What is certain, however, is that members of the Texas Senate and Business Commerce Committee and the House Insurance Committee have been the recipient of nearly $4 million in campaign contributions from insurance companies and the political action committee Texans for Lawsuit Reform (TLR) – which looks to buckle down on hailstorm litigation as one of their main focuses, according to information available from the National Institute on Money in Politics.

Of Sen. Taylor’s $4.6 million in campaign contributions, almost $1.4 million, or 30 percent, has come from agencies and committees that have issues with the litigation crisis. Other members of the committees that were seeking information relating to hailstorm damage litigation that have received significant campaign contributions include: John Frullo, Chair of the Senate committee; Kenneth Sheets, Senate committee member; and Kelly Hancock, Chair of the House committee. Of all the campaign contributions these candidates received, 11 percent of Sen. Frullo’s, 19 percent of Sen. Sheets’, and 17 percent of Rep. Hancock’s came from insurance sources and the TLR.

Out of all the contributions the TLR has made to candidates running for office, Sen. Taylor has received the second highest amount of campaign contributions. Combined, these four lawmakers account of 73 percent of campaign contributions made by the TLR and 55 percent of insurance contributions to Senate and House committee members – which combined is comprised of 18 members.

While increased litigation has taken place in recent years, as Bryan Blevins stated during the October hearing, “Well, if claims aren’t getting paid, then people are going to be unhappy about that. You’re going to see more lawsuits.”

The logical conclusion is that there is no litigation crisis. It is merely a cause and effect situation that has been brought about because of big insurance companies trying to get over on the people that have paid their premiums for years by not holding up their end of the bargain.

While that may seem logical, the TLR and insurance campaign committees have paid significantly to key members of the committees, who are now acting in favor of insurance companies by bringing forth bills that would limit homeowners abilities to get their homes repaired.