Prior to the massive insurance reform of 2003 the Texas Windstorm Association (TWIA) covered about 6% of the coastal area and was working as it was designed in the 70’s. It might not have been perfect, but it was solvent and able to pay claims, until the Republican Party used it’s magic “Free Market” wand on it. Now everyone in the state, including you, may pay for it.

According to Seth Chandler of the University of Houston Law Center:

“We have less than half a billion dollars in the bank right now. TWIA thinks it can go borrow and get re-insurance and cover about another $3 billion, but I add three billion to a half billion and I get to $3.5 billion. I don’t get to anywhere near the five, 10, 15 billion that a major hit on the Texas coast could cost,” said Chandler.

In 2009 the Tea Party allowed TWIA to tax homeowners across the coastal area in order to cover a major event, no matter where that event took place. They also allowed the taxation of owners of car insurance. Now in the 2015 session they will ask to allow TWIA to tax everyone in the state to cover TWIA’s mismanagement.

State Insurance Representative (SIR) Larry Taylor (Teabagger Friendswood) led the charge to reform TWIA in 2003. Now he is leading the charge to tax Texas property and car owners claiming his district needs the protection because of their economic engine. Unfortunately it may be a hard sell since SIR Larry Taylor was the one that broke the system in the first place. His “free market” allowed his insurance buddies to flee the market, leaving his district with the only provider, TWIA, which is in serious financial trouble.

Lucky for Taylor, he owns an insurance company and makes money from selling TWIA contracts. He also pushed a bill to raise his own commissions from these sales. He isn’t hurting, but everyone in Texas will be soon.

In 2003 the Texas Legislature caved to the home builders of Texas and created the Texas Residential Construction Commission. (TRCC) The Commission was supposedly designed to protect homeowners with construction defects  yet just 6 years later the Texas Sunset Commission called for its abolishment. From the Sunset Report:

The Commission was so flawed even lobbying by Bob Perry, the home builder and owner of the Republican Party at the time, could not save it. It died.

Unfortunately the Texas Windstorm Insurance Association has adopted one of the most worthless parts of the TRCC, the Alternative Dispute Resolution Process. This process which was advertised as the shining star of the TRCC requires homeowners to submit to a lengthy process of inspections, boards, and appeals before filing a suit in court. The supporters of this claim it will help homeowners get their homes fixed in a timely manner instead of having to get an attorney and file a suit. Here is the process defined in a report by TWIA. 

That is exactly what they said about the TRCC and it failed miserably. The process is complicated requiring the help of an attorney. The process is lengthy which will drag on the complaint, by design. And the consequences of not following the process could severely limit your settlement. Instead of demanding that TWIA pay claims, the Texas Teabaggers just simply made it harder for homeowners to sue.

At least they gave the homeowners the right to sell their Constitutional right to a trial by jury for a few dollars. Arbitration is the 21th Century version of snake oil. It is a private, secret, justice system that will require legal representation and additional costs to the homeowner. It is a suckers court. According to the new rules of TWIA: