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For more Texas-related P&C insurance information and news, visit the ICT website
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ICT's Weekly Legslative Roundup
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Senate Business & Commerce Committee Hears Bills of Interest
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The Senate Business & Commerce Committee met on March 4 and heard bills of interest to ICT:
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SB 455 by Sen. Mayes Middleton – Arbitration in Surplus Lines Insurance Contracts
SB 455 requires that arbitration in surplus lines insurance contracts be conducted in Texas, under Texas law, and that the contracts themselves be interpreted under Texas law. The bill is a refile of SB 796 from the last session, which was passed but ultimately vetoed. ICT registered against the bill. The bill was left pending in committee.
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SB 1006 by Sen. Mayes Middleton – Declination, Cancellation, or Nonrenewal of Policies
SB 1006 implements TDI’s biennial recommendation to require insurers to provide a written reason for policy declinations, cancellations, and nonrenewals. Jon Schnautz testified on behalf of ICT and expressed ICT’s commitment to continuing work on the bill to ensure it improves consumer understanding while keeping new requirements clear and practical. He emphasized that ICT does not intend to change the bill’s mandate for notices of policy cancellations and nonrenewals; however, there is room for further refinement regarding declinations. Current law allows policyholders to request explanations for nonrenewals and cancellations, as well as for applicants to seek explanations for policy denials. ICT supports maintaining this "upon request" process for denials. The bill was left pending. ICT has been following up with committee members who had questions or needed clarification.
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Tying Bill Up in Senate Business & Commerce on March 9; TDI Rule Hearing Set for March 10Â
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The Senate Business & Commerce Committee heard SB 213 by Sen. Royce West on Tuesday, March 11. SB 213 prohibits insurers from requiring consumers to bundle multiple personal lines of property or casualty insurance policies as a condition for purchasing coverage, classifying such practices as unfair competition or deceptive acts. ICT has been actively engaged with the senator’s office, discussing potential changes to the bill.
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Meanwhile, TDI will hold a rule hearing on its proposed tying rule on Monday, March 10. ICT plans to testify in opposition, arguing that TDI lacks clear authority to adopt the rule as a Chapter 541 violation. ICT submitted comments expressing the same concern to TDI regarding its informal draft rule.
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House Insurance Meets for Organizational Hearing
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On March 5, 2025, the House Insurance Committee held an organizational hearing and invited testimony from TDI, OPIC, and TWIA. Chairman Dean outlined the committee's top five priorities for the session, which include reducing insurance costs, identifying regulatory impacts on costs, combating waste and fraud, improving insurance delivery efficiency, and enhancing consumer protection through increased transparency. Insurance Commissioner Cassie Brown testified on TDI's regulatory scope and the insurance market, noting that while rates have moderated, they remain high. Committee members discussed discrepancies between statewide rate data and local experiences, with TDI committing to provide district-level information. The Committee also discussed roofing fraud, the cost of reinsurance, and TWIA's financial situation.
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House Trade, Workforce, and Economic Development Committee Holds Organizational Hearing
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The Trade, Workforce, and Economic Development Committee met on March 5 for an organizational hearing and heard invited testimony from DWC Commissioner Jeff Nelson. Commissioner Nelson testified that workers’ compensation rates have significantly improved, decreasing 81% since 2005 and 33% in the last five years, even as other P&C insurance rates have risen. He highlighted that the cost per $100 of payroll is now just 47 cents, compared to $2.32 in the past
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Members can access ICT's full hearing recaps and summaries in the Member InfoHub.
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Insurance fraud investigations recover millions for TexansÂ
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Texas insurance fraud investigators helped recover nearly $58 million in court-ordered restitution in 2024, targeting schemes that drive up costs for consumers. The Texas Department of Insurance’s (TDI) Fraud Unit investigated more than 350 cases, focusing on major fraud operations.
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Key Points:
- More than 20 TDI investigators worked statewide to identify and stop costly insurance fraud.
- Their efforts aim to protect consumers by preventing fraud-related premium increases.
- One case led to the conviction of Dallas doctors Desi and Deno Barroga for opioid overprescription and fraudulent billing.
- The doctors were sentenced to prison, ordered to pay $9 million in restitution, and lost their medical licenses.
READ MORE
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DWC to host quarterly stakeholder meeting
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The Division of Workers’ Compensation (DWC) will host a quarterly stakeholder meeting for insurance carriers and health care providers to discuss issues in the Texas workers’ compensation system. The meeting will be held via Zoom on Wednesday, March 26, from 2 to 3 p.m. Central time.
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The agenda and Zoom details are available on the Texas Department of Insurance website.
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DWC offering free webinar on dispute resolution
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DWC is offering a free webinar on Wednesday, March 19, at 2 p.m. Central time for the next on dispute resolution in the Texas workers’ compensation system.
Topics include:
- Common types of disputes in workers’ compensation.
- Steps in the dispute resolution process and tips for navigating it.
- Resources available for parties involved in a dispute.
This free course is approved for one hour of Texas Department of Insurance general education credit. Register here.
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Save the date for Thursday, March 13! Join Clark and Seth from RedZone as they explore the latest advancements in wildfire risk assessment. They’ll cover everything from new approaches to risk scoring, to strategies for managing accumulations during the quoting process. Plus, they'll discuss the critical role homeowners play in mitigation and how private insurance response programs are making an impact. This session is a great opportunity for insurers looking to refine their strategies and better support policyholder resilience. Don’t miss out—register now to secure your spot!
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CE: This event is approved for 1.0 continuing education hour by the Texas Department of Insurance. Course No.: 142565 Provider No.: 32832.
CLE: This event is approved for 1.0 continuing legal education hour by the Texas State Bar. Course No.: 174271809 Sponsor No.: 10457.
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The home insurance industry pushes back on a plan to require explanations for dropped policies
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The Insurance Council of Texas (ICT) is developing a response to clarify the industry's position on the proposed legislation, as the article misrepresents industry testimony. The insurance industry did not oppose requiring explanations for cancellations and nonrenewals but raised concerns about declinations, which are fundamentally different. The added requirement could create significant administrative burdens while offering limited benefits to consumers.
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Key Points:
- The article inaccurately portrays the industry's stance, which did not oppose increased transparency for cancellations and nonrenewals but expressed concerns about declinations.
- Declinations often result from underwriting guidelines or market conditions, making explanations unhelpful to consumers.
- The proposed mandate would require insurers to invest heavily in new reporting systems with unclear benefits.
- Texas lawmakers seek more data on insurance availability, but TDI already collects extensive market data and is reviewing its needs.
- The federal government’s climate impact report lacked Texas-specific data because TDI declined to request it.
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The Ripple Effect of High Tort Costs on Texas Insurance Rates
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Texas ranks 10th nationwide in tort lawsuit costs, with an average of $4,594 per household in 2022, placing significant financial pressure on businesses and insurers. The state's legal environment, known for large "nuclear verdicts," has led to increased settlements and higher insurance costs, contributing to market instability. Lawmakers have introduced HB939 and SB779 to address these challenges, aiming to limit noneconomic damages and refine public nuisance claims to reduce excessive litigation.
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Key Points:
- Texas's tort costs rank among the highest, affecting businesses and driving up consumer expenses.
- Large legal settlements, or "nuclear verdicts," pressure companies to settle cases, increasing overall litigation costs.
- High litigation rates have strained the insurance market, leading to higher premiums and reduced availability.
- HB939 proposes capping noneconomic damages in personal injury claims to curb rising lawsuit costs.
- SB779 seeks to refine public nuisance claim laws to prevent excessive or frivolous litigation.
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Multiple factors hinder
insurance protection gap collaboration, reveals poll
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In 2024, global economic losses from natural disasters reached $368 billion, marking the ninth consecutive year that losses exceeded $300 billion. Despite $145 billion in insured losses, a 60% protection gap remains, highlighting the urgent need for industry-wide collaboration. A recent poll found that conflicting priorities, data gaps, and regulatory hurdles are key barriers to narrowing this gap, with most respondents citing a combination of these factors as the biggest challenge.
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Key Points:
- Natural disasters caused $368 billion in economic losses in 2024, with only $145 billion covered by insurance, leaving a $223 billion protection gap.
- A poll found that 55% of respondents believe multiple factors—clashing priorities, data gaps, and regulations—hinder efforts to close the gap.
- Hurricane Helene was the year’s costliest disaster, causing $75 billion in damages and 243 fatalities in the U.S.
- Secondary perils like flooding and wildfires remain underinsured, with only 25% of California wildfire losses covered.
- Industry experts stress that regulatory flexibility and insurer collaboration are essential to expanding coverage and reducing the protection gap.
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More Americans taking the
risk of dropping home insurance
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Rising home insurance costs and policy nonrenewals are forcing more homeowners to drop coverage, a risky decision that leaves them financially vulnerable. A 2023 survey found 12% of homeowners lacked insurance, more than double the rate from 2019, with lower-income households and certain demographics disproportionately affected. Some homeowners, like Florida retiree Larry Bendik, see it as a calculated risk, but experts warn of severe consequences if disaster strikes.
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Key Points:
- Homeowners are dropping insurance due to skyrocketing premiums, with rates doubling in recent years.
- A 2023 survey found 12% of homeowners lacked coverage, up from 5% in 2019, with lower-income and minority households most affected.
- Major insurers have withdrawn from high-risk areas, leaving residents struggling to find affordable coverage.
- Experts warn uninsured homeowners face total financial responsibility for repairs or rebuilding after disasters.
- Consumers can explore cost-saving options like bundling policies, upgrading home safety measures, or seeking discounts for seniors and veterans.
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State Senate passes legislation to study credit score and other impacts on insurance coverage
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The state Senate passed a bill to examine how credit history and other factors impact insurance coverage, following concerns that current rating methods disproportionately affect certain consumers. Senate Bill 5589 directs the Office of the Insurance Commissioner to study these practices and propose alternative rating methods by fall 2026. While supporters argue that insurance rates should be based on relevant risk factors like driving history, opponents warn that past attempts to remove credit-based rating led to unintended premium hikes.
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Key Points:
- SB 5589 requires a state study on how credit scores and other factors influence insurance rates and eligibility.
- Consumer advocates argue that credit-based insurance pricing disproportionately affects lower-income individuals.
- The Insurance Commissioner previously attempted to ban credit-based pricing in 2022, but the effort was overturned in court.
- Opponents, including Senate Republicans, warn that eliminating credit factors could raise rates for other groups.
- The bill passed the Senate 29-20 and now moves to the House for further consideration.
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Check out all things ICT!
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The Insurance Council of Texas (ICT) is on the lookout for knowledgeable and engaging speakers for our 2025 events! We are looking for experts to discuss industry trends at our upcoming gatherings including:
- Quarterly ICT Webinar Series
- Workers' Comp Conference: September 15-16, 2025 in Austin, TX
- P&C Insurance Symposium: September 17-18, 2025 in Austin, TX
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We’re seeking speakers to cover critical industry trends, topics such as:
- Emerging topics and innovations
- Legal developments affecting insurance
- AI and technology: challenges and opportunities
- Resiliency strategies for businesses and communities
- Insights on the future of the insurance industry
If you have suggested topics, would like to request a speaker or would like to present at one of ICT's events, click here to let us know.
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