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ICT's Weekly Legslative Roundup
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Upcoming Committee Hearings
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Several committee hearings this week will cover issues of interest:
- The Senate Business & Commerce Committee met Tuesday, March 4, to consider several bills relevant to ICT. SB 1006 (Middleton) would require insurers to provide specific reasons for declinations, nonrenewals, and cancellations. The bill stems from the Texas Department of Insurance’s (TDI) biennial recommendation to the Legislature.
- The House Insurance Committee will meet Wednesday, March 5, for an organizational meeting. The committee will hear from TDI, the Office of Public Insurance Counsel (OPIC), and the Texas Windstorm Insurance Association (TWIA).
- The House Trade, Workforce, and Economic Development Committee will meet Wednesday, March 5, for an organizational meeting.
- The Division of Workers’ Compensation (DWC) will testify before the committee.
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ICT has been actively engaging with legislative offices, including meeting with the new chairs and members of House committees that oversee property and casualty issues. Additionally, ICT participated in a stakeholder discussion on appraisal and continues to engage in conversations on priority bills of interest. For additional information, you can log into the ICT Member InfoHub
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TWIA Board of Directors Sets 2025 PML
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On Feb. 25, the TWIA Board of Directors voted unanimously (5-0) to establish $6.227 billion as TWIA's 1:100 probable maximum loss (PML) for the 2025 storm season. The board adopted a blended approach using catastrophe modeling with long-term assumptions, allocating 50% to Aon’s Impact Forecasting (IF), 25% to Moody’s RMS, and 25% to CoreLogic’s RQE, resulting in a base PML of $5.415 billion. The board also voted to include 15% in loss adjustment expenses (LAE), bringing the total PML to $6.227 billion.
TWIA will pursue $1.727 billion in reinsurance on the most favorable terms available in the market. This is in addition to $2 billion in statutory funding and $2.5 billion in existing multi-year catastrophe bonds. This brings TWIA’s total funding for the 2025 storm season to $6.227 billion, meeting the statutory minimum.
For reference, the 2024 1:100 PML was $6.5 billion and used a blend of the RMS (weighted at 75%) and AIR (weighted at 25%) models.
ICT members can read a full recap of the meeting on the ICT Member Info Hub. All TWIA meeting materials and an archived recording are available on TWIA’s Meeting Library page.
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Texas FAIR Plan Governing Committee Meets, Updates Member Assessments
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The Texas FAIR Plan Association (TFPA) Governing Committee met on Feb. 24 and revised the member assessments originally approved in August to account for losses from Hurricane Beryl.
At its Aug. 5, 2024, meeting, the committee authorized staff to file a request with the Texas Department of Insurance (TDI) for a $57.655 million member assessment, consisting of two parts: (1) $17.655 million to cover the 2023 calendar year deficit and (2) $40 million for projected retained losses from Hurricane Beryl, which struck in July 2024. On Nov. 7, 2024, Commissioner Brown approved the FAIR Plan to proceed with the $17.655 million assessment for the 2023 deficit, while the $40 million request remained under review. Assessment letters were sent to member companies on Dec. 16, 2024, and as of Feb. 7, 2025, TFPA has collected just over $17.5 million.
Since the original $40 million assessment request is still under review, the Governing Committee had the opportunity to revise the request based on finalized 2024 year-end figures. As of Dec. 31, 2024, the total deficit stood at $60.069 million. The committee approved a motion to adjust the request and seek approval for a $60.069 million assessment, which would be allocated based on 2024 participation figures.
TDI will now review the updated request to ensure it aligns with the information in TFPA’s 2024 annual statutory statement, which must be filed by March 1, 2025.
ICT members can read a full recap of the meeting on the ICT Member Info Hub.
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Save the date for next 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!
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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Texas bill proposes replacing insurance commissioner with three-member panel
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Senate Bill 1642, introduced in the Texas Senate, proposes replacing the state's single insurance commissioner with a three-member Texas Commission of Insurance. The commission would consist of three members with expertise in regulation, consumer advocacy, and insurance administration. If the bill passes, Texas would become the only state to regulate its insurance industry through a commission rather than a single commissioner.
Key points to know:
- The bill proposes a three-member commission, appointed by the governor with Senate approval, to regulate Texas' insurance industry.
- The commission would have staggered six-year terms and a presiding officer with a two-year term limit.
- Members would be prohibited from running for elected office during their tenure.
- The Texas insurance commissioner would remain in office until the new commission is confirmed.
- If passed, Texas would be the only state to use a commission instead of a single insurance commissioner for regulation.
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Houston area homeowners risk
ditching insurance amid
'unsustainable' rates
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John Cobarruvias, a long-time homeowner in Clear Lake, Texas, is facing increases in his home insurance premiums, which have gone from $750 annually in 2000 to $6,000 today. He’s not alone, as many residents are grappling with increased insurance costs amid severe weather events and rising material prices. Some homeowners are considering going without insurance due to the unaffordability of policies, while others are forced into the Texas FAIR Plan, a last-resort option for those unable to find coverage.
Key points to know:
- Home insurance premiums have increased in Texas, with Cobarruvias' claims his premiums increasing by 25% in two consecutive years.
- Texas homeowners are experiencing difficulty securing affordable insurance, with many companies leaving the state or raising prices.
- The Texas FAIR Plan, which provides insurance to those who can't find coverage elsewhere, has grown, with many policies in Harris County.
- Rising material costs, inflation, and more frequent severe weather events contribute to the increasing cost of home insurance in Texas.
- Homeowners who have paid off their homes, like Cobarruvias, are considering dropping insurance altogether due to the unaffordability of premiums.
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Homeowners Insurance: Housing Shortage Collides With Wildfire Risk
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Growth in homeowners insurance was a key focus for many carriers during their fourth-quarter 2024 conference calls, with an emphasis on how to expand in a market complicated by risks like wildfires and housing shortages. Executives are increasingly looking to package homeowners insurance with personal auto policies, but where to grow homeowners policies is a nuanced decision. Analysis by Assured Research indicates that while housing shortages are most severe in the West, insurers face challenges balancing these opportunities with the risks posed by perils like wildfires.
Key points to know:
- Executives are focusing on growing personal auto insurance and packaging it with homeowners insurance as a strategy for expansion.
- Wildfire risk is unavoidable in areas with severe housing shortages, particularly in the West.
- Housing shortages are most acute in the West and Northeast, while the Midwest and South experience less severe shortages.
- There is a positive relationship between housing shortages and wildfire risks, but a negative relationship with tornado risks.
- Insurers may find opportunities for growth in states with high housing shortages, but must manage the associated catastrophe risks, especially wildfires.
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Texas Senate Bill 1246 Proposes State-Run Auto Insurance Program
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Texas lawmakers are attempting to address rising auto insurance premiums and accessibility issues with Senate Bill 1246 (SB 1246), which proposes the creation of a state-administered auto insurance program. Sponsored by State Senator Roland Gutierrez, this bill aims to provide affordable coverage to Texans, challenging the dominance of private insurers. The public option would be managed by the Texas Department of Insurance (TDI) and provide both mandatory liability and optional comprehensive coverage, with premiums adjusted for low-income households.
Key points to know:
- SB 1246 proposes a state-run auto insurance option to make coverage more affordable and competitive.
- The plan includes a sliding scale for premiums based on income and risk, ensuring inclusivity for low-income Texans.
- Auto insurance premiums in Texas have increased by 25% over the last two years, making coverage unaffordable for many.
- The bill aims to reduce the number of uninsured drivers and encourage private insurers to reevaluate their pricing.
- If passed, SB 1246 could provide a competitive, more transparent market that benefits consumers and holds private insurers accountable.
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Texas Lawmakers Introduce Legislation to Address Wildfire Risks and Ignition Sources
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Texas lawmakers have introduced multiple bills aimed at preventing and responding to wildfires, following the devastating blazes that swept through the Panhandle last year. The legislation, led by Republican state Sen. Kevin Sparks and Reps. Ken King and Caroline Fairly, seeks to regulate power lines, increase funding for rural fire departments, and improve emergency response coordination. Investigators found that unmaintained power lines for oilfield equipment ignited at least two of the fires, underscoring the need for regulatory reform.
Key points to know:
- Regulating Power Lines: House Bill 2453 would require the Railroad Commission and Public Utility Commission to notify utilities about unsafe power lines at oilfield sites and request inspections from the state fire marshal.
- Funding Fire Departments: Senate Bill 868 seeks to remove the cap on the Rural Volunteer Fire Department Assistance program, addressing a $200 million funding backlog.
- Tracking Equipment: Senate Bill 767 and House Bill 2063 would create a statewide database of firefighting equipment to improve emergency coordination and response times.
- Addressing Abandoned Wells: House Bill 3091 proposes a fund to clean up abandoned wells, which have been identified as a fire risk due to deteriorating electrical equipment.
- Economic Impact: The Texas A&M Forest Service spent over $16 million responding to the fires, highlighting the financial burden on the state when preventive measures are lacking.
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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
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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