We Just Can’t Afford Rick Perry
Millions of Texans are paying the price for Rick Perry’s special interest friends—big insurance companies. They’ve charged excessive premium increases, even doubling the increases1 within a single year. Texan homeowners are outraged about these premium increases, and they’ve demanded relief, only to be ignored2 by Governor Perry.
“Under Rick Perry, Texas insurance companies have made over $14 billion in gross profits.—Insurance profits under Rick Perry [$14 Billion]
In Texas alone, insurance companies made massive profits3 off the backs of Texan homeowners while employing over 120 lobbyists4, including former Perry aides, to look out for their best interests at the expense of Texans. Insurance companies also blamed their high premium charges on the weather—except that was found out to be misleading5 by the Dallas Morning News.
“To explain Texas’ high premiums, the insurance industry and state officials cite the state’s severe weather. But a News analysis of national weather data and insurance premiums found that Texas’ premiums were higher than expected given weather damage over the years. In fact, they were 50 percent higher than what they statistically should have been if weather were the determining factor. (See “How we did it” box.)
Texas has more tornadoes and hailstorms than any other state, federal weather data show, but when the state’s land area is taken into account, its ranking drops. Texas ranked fifth in total damage from 1990 to 2007.
“The reality is that other portions of this country have incidents of weather also,” said state Sen. Royce West, D-Dallas. “But their rates are not the same as Texas.”
“Big insurance illegally put hundreds of thousands6 into Texas elections for Perry’s buddies—Illegal contributions $839,500.”
“Then Perry pushed for a law that lets insurance companies raise homeowners’ rates without having to justify the increase.”
Texas Watch, in their report7, explains how insurance companies made out like bandits under the law, Senate Bill 14, which had the support of Governor Perry:
“Insurers asked the Legislature to lessen regulation on rates by doing away with the flex-band system and moving instead to the “file and use” system.
Under the file and use system, insurers must simply inform TDI of any rates it intends to charge, then may begin immediately charging that rate. In exchange for this pro-industry compromise, the Legislature demanded that most insurers submit to rate regulation by closing the Lloyd’s loophole.
Thus TDI by rule in 2002 and the Legislature through SB 14 in 2003 completely deregulated standardized forms and allowed insurers to assess rate increases immediately and without TDI’s approval. Additionally, SB 14 allowed insurers to use credit scoring in all of their companies (not just the high risk mutual companies). This massive overhaul of industry regulation has been a boon to the insurance industry.”
“Now Texas insurance rates are 75% higher than other states—75% higher than other states.”
The most recent data from the National Association of Insurance Commissioners (NAIC), in 2007, shows8 that the average premium for a common policy cost a Texan family $1,448, which is 76% higher than the U.S. average premium of $822. Average insurance premiums continue to skyrocket under Rick Perry’s watch to a 48% increase9 since he became governor ten years ago.
“Thanks, Rick. Imagine what he could do in four more years….”
Sources
1. By Saul Elbein, Texas Observer, “Like A Bad Neighbor,” June 17, 2010. http://www.texasobserver.org/cover-story/like-a-bad-neighbor
2. http://www.wfaa.com/news/politics/White-says-insurers-shouldnt-raise-rates-at-will-101616343.html
3. Spreadsheet from Texas Department of Insurance. http://www.scribd.com/doc/37064892/Gross-Profits
4. Jennifer LaFleur, Dallas Morning News, “Coverage at what cost? Homeowners pay higher insurance premiums, yet many policies limited.” February 15, 2009. http://www.dallasnews.com/sharedcontent/dws/news/nation/stories/DN-son4nuinsurancemain_15pro.ART2.State.Edition1.4c67e2e.html
5. See above.
6. http://www.scribd.com/doc/37064542/TRMPAC
7. Texas Watch, “A Brief Summary of Homeowners’ Insurance In Texas” http://www.texaswatch.org/wordpress/wp-content/uploads/2010/02/Homeowners-History-w-Premium-Chart-PDF.pdf
8. http://www.insurancerate.com/texas-homeowners-insurance-premiums.php
9. Spreadsheet from Texas Department of Insurance: http://www.scribd.com/doc/37065315/Premium-Rates
