Issue Position: Windstorm Insurance

Issue Position

Senate Bill 900 will ensure that the Texas Windstorm Insurance Association is prepared to cover the loss of a 1 in 100 year storm. The agency will also have $4.9 billion through a combination of $600 million in premiums and Catastrophe Reserve Trust Fund; $1 billion in Class 1, 2, and 3 public securities; $1 billion in insurance company assessments; and $2.3 billion in reinsurance. Under SB 900, Class 1, 2, and 3 public securities are repaid from TWIA premiums and surcharges on TWIA policyholders. If necessary for issuance, Class 2 and 3 securities may also be repaid from surcharges on coastal policyholders. This bill reconfigures the Board of Directors to have equal representation, giving no clear interest or majority. It keeps a 9-member board but goes from a 5-4 industry/coastal representation to a 3-3-3 industry/coastal/ inland representation composition. It authorizes the TDI Commissioner to privatize the Associations management if the commissioner determines it is in the best interest of the policyholders and the public while directing TDI to place greater emphasis on depopulation.

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