Texas insurance regulators looking to restructure state’s Windstorm Insurance Association

insurance newsThe Texas Department of Insurance is looking to restructure the state’s Windstorm Insurance Association. The state-run insurance group provides protection from wind damage, something that many of the state’s private insurance companies do not offer. Like similar organizations in other states, the Windstorm Insurance Association has fallen prey to mounting debt. Insurance Commissioner Eleanor Kitzman is now looking for approval from legislators to hire a private consultant to aid in the program’s restructuring.

The program was originally meant to be a last resort for state residents who could not find appropriate coverage from other insurers. It quickly became one of the most popular options for protection in Texas. The program offers policies priced well below the state average, which has lead to some financial problems as it can no longer provide support for extensive damage caused by wind storms.

Commissioner Kitzman is looking at multiple options for a restructure of the program. One of these options is to include participation from reinsurance groups, giving the program the ability to recover from costly disasters more easily. Another option is to allow private insurance companies to take part in the program, enabling them to take on some of the policies and augment the program’s ability to serve consumers.

The plan will depend on whether Kitzman is successful in her search for a consultant well versed in restructuring an insurance program of this magnitude.

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