June 16, 2009
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The years-long struggle between the State of Texas and State Farm Insurance Company over homeowners insurance overcharges may be coming to a close soon, as Texas Insurance Commissioner Mike Geesling is expected to rule on the case this summer.
Pick a dollar amount between zero and 1 billion. Depending on whom you ask, that's what State Farm Insurance owes its Texas customers for overcharging on homeowner policies dating to 2003.
The Office of Public Insurance Counsel, the state's consumer advocate for insurance, says in documents filed this month that Texas' largest property insurer owes policyholders $785 million plus interest, or nearly $1 billion. State Farm has 1.2 million customers in Texas.
The Texas Department of Insurance calculates the overcharges at about $250 million, plus nearly $100 million more in interest.
State Farm says it owes customers nothing, that it didn't overcharge its customers, and that its rates have always been fair and competitive. The dispute dates to 2003 when Texas ordered State Farm and other companies to reduced premiums the state considered excessive.
Geeslin will have to decide who is right, a ruling that could have significant political implications in next year's campaigns. Geeslin, an appointee of Gov. Rick Perry who held hearings on the case in the spring, is expected to rule this summer.
U.S. Sen. Kay Bailey Hutchison, who is challenging Perry for the Republican nomination for governor, has indicated that she will make insurance rates a major part of her campaign.
"It's a very big deal, no doubt about it," Alex Winslow of Texas Watch, a consumer group active in insurance issues, told The Dallas Morning News. "There are now real questions about whether State Farm will have to give back every penny they owe or whether the commissioner will let them off and order them to pay only pennies on the dollar."
Winslow said any decision by Geeslin that is short of the full billion will be "a slap in the face" for State Farm policyholders. "State Farm should not be allowed to benefit financially in any way from their overcharges, including investment earnings off those overcharges," he added.
State Farm said in its filings that it is not responsible for any refunds.
"Our position has never changed. Our rates have always been fair and reasonable," said Kevin Davis, a spokesman for the company.
The rate dispute began after a massive overhaul of insurance law by the Legislature that year in 2003, which put home insurance rates under state control after a tumultuous period of record premium hikes. The increases were triggered by massive mold and water damage claims across the state.
State Farm was told to cut its rates 12 percent and responded by suing the state in a case that remains unresolved.
In the latest ruling, Geeslin was told to convene a hearing on the allegations of overcharging and hear from the company, the insurance department and the Office of Public Insurance Counsel.
Geeslin is expected to order some refunds though probably less than the $1 billion called for by the public insurance counsel.
A figure that large "would make the largest Texas homeowners insurer insolvent," while the department's proposal would undermine the company's financial condition for several years, State Farm attorney Susan Conway wrote in a document filed this month.
During the hearing in the case, State Farm attorneys said the insurer is still paying off a $1 billion loan that it had to take out from its parent company to stave off bankruptcy six years ago, when mold claims were at their peak.
Information from The Dallas Morning News: www.dallasnews.com
Friday, June 19, 2009
Thursday, June 11, 2009
Nationwide to drop Houston policies
Nationwide Property and Casualty Insurance won’t renew 5,300 Houston-area home insurance policies starting Sept. 17, the company said Friday.
The majority of those customers are in Harris County.
“Nationwide continually reviews its business strategy with the goals of maintaining long-term viability for its customers, and the potential for ongoing hurricane activity is there,” said Mike Switzer, a spokesman for the insurer.
The company is positioning itself as experts predict an increased chance of catastrophic damage in the future, he said.
“We are making changes to reflect these realities,” he said.
The historical data used to project future losses, however, pre-dated Hurricane Ike, he said.
Nationwide, which has 180,000 home insurance policyholders statewide, will notify affected customers 90 days before their policy’s expiration, he said.
Switzer encouraged customers to call their agents, who are working to place customers with other companies.
On Feb. 17, the insurer started hiking rates an average of 8 percent as policies came up for renewal.
The pullback signals a deeper withdrawal from the coast for the company.
Fearing stronger and costlier storms, Nationwide Mutual Insurance Co. in May 2007 dropped windstorm coverage for about 1,000 policyholders. About 600 of those policies were in Galveston County.
The company also decided then not to renew about 870 policies on barrier islands, peninsulas less than two miles across, and property on the mainland within about a half mile of the Gulf of Mexico or its bays.
The majority of those customers are in Harris County.
“Nationwide continually reviews its business strategy with the goals of maintaining long-term viability for its customers, and the potential for ongoing hurricane activity is there,” said Mike Switzer, a spokesman for the insurer.
The company is positioning itself as experts predict an increased chance of catastrophic damage in the future, he said.
“We are making changes to reflect these realities,” he said.
The historical data used to project future losses, however, pre-dated Hurricane Ike, he said.
Nationwide, which has 180,000 home insurance policyholders statewide, will notify affected customers 90 days before their policy’s expiration, he said.
Switzer encouraged customers to call their agents, who are working to place customers with other companies.
On Feb. 17, the insurer started hiking rates an average of 8 percent as policies came up for renewal.
The pullback signals a deeper withdrawal from the coast for the company.
Fearing stronger and costlier storms, Nationwide Mutual Insurance Co. in May 2007 dropped windstorm coverage for about 1,000 policyholders. About 600 of those policies were in Galveston County.
The company also decided then not to renew about 870 policies on barrier islands, peninsulas less than two miles across, and property on the mainland within about a half mile of the Gulf of Mexico or its bays.
Wednesday, June 10, 2009
Oak Forest Elementary School
David Lorms, Farmers Insurance Agent, donated $500 to Oak Forest Elementary School to fund a Perfect Attendance program. Students with Perfect Attendance for the semester had their names placed in a drawing that took place on May 27, 2009. Pictured are the winners, (Front) Andy Turcios and Ja’Terria Southwell, along with Scott Pollack, Principal, David Lorms, and Rachel Pate, Assistant Principal.
Stevens Elementary Rewards Perfect Attendance
Back row: David Lorms, Johnny Herrera, Lucy Anderson
Middle row: Wendy Tello, Oscar Vela, Angel Ali Martinez, Jazmin Montoya, Gilberto Robledo
Front row: Maria Rangel, Kiara Rios, Alfonso Bustamante, Marco Leon, Ethan Zamarrippa
With generous support provided by Farmers Insurance Agent, David Lorms, Stevens Elementary awarded prizes to students with perfect attendance. Students with perfect attendance for the last nine weeks participated in a drawing variety of prizes. David Lorms, our community business partner, came to Stevens for the final drawing and gave each child a handshake and a job well done!
Wednesday, May 20, 2009
Auto Thefts Down Dramatically in Texas But Car Burglaries Rise
May 20, 2009
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Praise the work of auto theft task forces or new car manufacturers or both for the dramatic drop in auto thefts in Texas. Criminals are stealing older vehicles simply because they're finding it harder to bypass anti-theft devices that manufacturers have placed in newer cars.
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In some areas of the state auto thefts have dropped more than 80 percent in the past 15 years. Nationwide, auto thefts have dropped every year since 2003.
"Auto manufacturers continue to implement new anti-theft features making it much more difficult to steal a new car," said Lt. Tommy Hansen, past president of the International Association of Auto Theft Investigators. "But, even if with all of the new anti-theft devices in place, almost 50 percent of vehicles that are stolen still had the keys in the ignition."
Hansen said while auto thefts might be down, auto burglaries are skyrocketing. "When drivers leave their GPS units and laptop computers in plain sight, they are just asking for their vehicle to be burglarized," said Hansen.
Hansen said auto theft is a business and that older vehicles become marketable on the black market because of the need for certain auto parts. He said just because one drives an older car, it's not any less prone to being stolen.
Eight of the top ten most stolen cars are vehicles that are at least ten years old, according to the National Insurance Crime Bureau (NICB). The top three most stolen vehicles are a 1995 Honda Civic, a 1991 Honda Accord and a 1989 Toyota Camry.
"Unfortunately, most owners of older cars have abandoned their comprehensive auto insurance coverage and are only paying for state mandated liability coverage," says Mark Hanna, a spokesman for the Insurance Council of Texas. "This leaves them without any insurance protection if their vehicle is stolen, but there are several anti-theft devices on the market that can help them secure their vehicle."
Financially, auto theft remains a serious problem in Texas. In 2007, thieves made off with 94,000 vehicles worth $859 million.
Statewide in Texas, auto thefts are down 58 percent since the state implemented the Texas Auto Burglary and Theft Prevention Authority (ABTPA) in 1991. However, the Mexican border remains a problem where auto thefts have skyrocketed. Laredo is ranked second in the nation in number of vehicle thefts per 100,000 inhabitants.
Sgt. Eduardo Garcia of the Laredo Auto Theft Task Force says the problem with auto thefts along the Mexican border is completely different from anywhere else. "The criminals here can steal a vehicle and have it across the border in Mexico within three minutes," said Garcia. "They have also learned to bypass the anti-theft systems. All they need is a screw driver and a pair of vice grips."
Garcia said the most stolen vehicles in Laredo are Dodge, Ford and Chevrolet trucks which are used to carry or smuggle people and contraband. He said 90 percent of the vehicles stolen in Laredo are taken into Mexico and the officers' jurisdiction stops at the border.
If thieves are having a hard time stealing a certain vehicle, Garcia said they will take that car into Mexico and dissect it and eventually find a way to be able to steal this vehicle. Garcia called it Auto Theft 101.
Law enforcement officials say a wealth of information is readily available to professional auto thieves who have been able to bypass about every anti-theft device that manufacturers have put into place. The pros either strip the vehicle for parts or change the identification of the vehicle with a title from another car and then sell it.
Tow trucks have also been used to steal vehicles and this bypasses any anti-theft devices put in place.
In an attempt to prevent auto thefts and auto burglaries the Insurance Council of Texas has worked with more than a dozen Texas cities in providing Lock, Take and Hide crime prevention signs for the parking areas of shopping malls, restaurants, business centers and apartment complexes. The signs advise motorists to Lock their cars, Take their keys and Hide their possessions.
"Criminals would have a much harder time in stealing and burglarizing vehicles if all motorists heeded this simple message," said Hanna.
The ABTPA says other preventive measures that have slowed down auto thefts have been etching VIN numbers into vehicle windshields, educating communities on how they can prevent auto thefts and having dedicated law enforcements focused on auto theft.
Source: The Insurance Council of Texas, www.insurancecouncil.org
E-mail this Article Post Comment Print this Article Article Reprints
Praise the work of auto theft task forces or new car manufacturers or both for the dramatic drop in auto thefts in Texas. Criminals are stealing older vehicles simply because they're finding it harder to bypass anti-theft devices that manufacturers have placed in newer cars.
Advertisement
In some areas of the state auto thefts have dropped more than 80 percent in the past 15 years. Nationwide, auto thefts have dropped every year since 2003.
"Auto manufacturers continue to implement new anti-theft features making it much more difficult to steal a new car," said Lt. Tommy Hansen, past president of the International Association of Auto Theft Investigators. "But, even if with all of the new anti-theft devices in place, almost 50 percent of vehicles that are stolen still had the keys in the ignition."
Hansen said while auto thefts might be down, auto burglaries are skyrocketing. "When drivers leave their GPS units and laptop computers in plain sight, they are just asking for their vehicle to be burglarized," said Hansen.
Hansen said auto theft is a business and that older vehicles become marketable on the black market because of the need for certain auto parts. He said just because one drives an older car, it's not any less prone to being stolen.
Eight of the top ten most stolen cars are vehicles that are at least ten years old, according to the National Insurance Crime Bureau (NICB). The top three most stolen vehicles are a 1995 Honda Civic, a 1991 Honda Accord and a 1989 Toyota Camry.
"Unfortunately, most owners of older cars have abandoned their comprehensive auto insurance coverage and are only paying for state mandated liability coverage," says Mark Hanna, a spokesman for the Insurance Council of Texas. "This leaves them without any insurance protection if their vehicle is stolen, but there are several anti-theft devices on the market that can help them secure their vehicle."
Financially, auto theft remains a serious problem in Texas. In 2007, thieves made off with 94,000 vehicles worth $859 million.
Statewide in Texas, auto thefts are down 58 percent since the state implemented the Texas Auto Burglary and Theft Prevention Authority (ABTPA) in 1991. However, the Mexican border remains a problem where auto thefts have skyrocketed. Laredo is ranked second in the nation in number of vehicle thefts per 100,000 inhabitants.
Sgt. Eduardo Garcia of the Laredo Auto Theft Task Force says the problem with auto thefts along the Mexican border is completely different from anywhere else. "The criminals here can steal a vehicle and have it across the border in Mexico within three minutes," said Garcia. "They have also learned to bypass the anti-theft systems. All they need is a screw driver and a pair of vice grips."
Garcia said the most stolen vehicles in Laredo are Dodge, Ford and Chevrolet trucks which are used to carry or smuggle people and contraband. He said 90 percent of the vehicles stolen in Laredo are taken into Mexico and the officers' jurisdiction stops at the border.
If thieves are having a hard time stealing a certain vehicle, Garcia said they will take that car into Mexico and dissect it and eventually find a way to be able to steal this vehicle. Garcia called it Auto Theft 101.
Law enforcement officials say a wealth of information is readily available to professional auto thieves who have been able to bypass about every anti-theft device that manufacturers have put into place. The pros either strip the vehicle for parts or change the identification of the vehicle with a title from another car and then sell it.
Tow trucks have also been used to steal vehicles and this bypasses any anti-theft devices put in place.
In an attempt to prevent auto thefts and auto burglaries the Insurance Council of Texas has worked with more than a dozen Texas cities in providing Lock, Take and Hide crime prevention signs for the parking areas of shopping malls, restaurants, business centers and apartment complexes. The signs advise motorists to Lock their cars, Take their keys and Hide their possessions.
"Criminals would have a much harder time in stealing and burglarizing vehicles if all motorists heeded this simple message," said Hanna.
The ABTPA says other preventive measures that have slowed down auto thefts have been etching VIN numbers into vehicle windshields, educating communities on how they can prevent auto thefts and having dedicated law enforcements focused on auto theft.
Source: The Insurance Council of Texas, www.insurancecouncil.org
6 life insurers qualify for bailout money Story Highlights
Six life insurance companies to receive TARP money, U.S. Treasury says
As of April, about $135 billion remained from original $700 billion allocated for bailout
Industry has suffered amid concerns with capital requirements, growing losses
updated 3:39 a.m. EDT, Fri May 15, 2009Next Article in Politics »
WASHINGTON (CNN) -- Six life insurance companies have qualified to receive billions of dollars in bailout money under the government's Troubled Asset Relief Program, according to the U.S. Treasury Department.
Allstate is one of six life insurance companies who are qualified to receive TARP money.
Treasury Department spokesman Andrew Williams said Allstate, Ameriprise Financial, Hartford Financial Services Group Inc., Lincoln National Corp., Principal Financial and Prudential Financial Inc. have qualified for TARP money.
"These life insurers met the requirements for the Capital Purchase Program because of their bank holding company status and each applied for CPP capital investments by the deadline of November 14, 2008," Williams said.
Williams also said other financial institutions in the Capital Purchase Program "will be reviewed and funded as appropriate on a rolling basis."
In April, about $135 billion remained from the original $700 billion allocated for the bailout last October. No current figures were immediately available.
No funding amounts were announced by the Treasury Department, but Hartford said it had been preliminarily approved for $3.4 billion.
"We are pleased that we received preliminary approval to participate in (the) Treasury's Capital Purchase Program," said Ramani Ayer, chairman and chief executive officer of Hartford. "These funds would further fortify our capital resources and provide us with additional financial flexibility during one of the most volatile market climates in our nation's history."
Investors have been increasingly worried about the health of life insurers, which have been hit hard by worries about capital requirements and growing losses.
A number of insurers that are also bank holding companies or thrifts have been eligible for funds from TARP since last fall.
Last year, the Office of Thrift Supervision approved applications from Hartford and Lincoln to become bank holding companies, because of their planned bank purchases.
Philadelphia, Pennsylvania-based Lincoln is buying Newton County Loan & Savings FSB in Goodland, Indiana. Hartford, based in Hartford, Connecticut, is buying Federal Trust Bank in Sanford, Florida.
As of April, about $135 billion remained from original $700 billion allocated for bailout
Industry has suffered amid concerns with capital requirements, growing losses
updated 3:39 a.m. EDT, Fri May 15, 2009Next Article in Politics »
WASHINGTON (CNN) -- Six life insurance companies have qualified to receive billions of dollars in bailout money under the government's Troubled Asset Relief Program, according to the U.S. Treasury Department.
Allstate is one of six life insurance companies who are qualified to receive TARP money.
Treasury Department spokesman Andrew Williams said Allstate, Ameriprise Financial, Hartford Financial Services Group Inc., Lincoln National Corp., Principal Financial and Prudential Financial Inc. have qualified for TARP money.
"These life insurers met the requirements for the Capital Purchase Program because of their bank holding company status and each applied for CPP capital investments by the deadline of November 14, 2008," Williams said.
Williams also said other financial institutions in the Capital Purchase Program "will be reviewed and funded as appropriate on a rolling basis."
In April, about $135 billion remained from the original $700 billion allocated for the bailout last October. No current figures were immediately available.
No funding amounts were announced by the Treasury Department, but Hartford said it had been preliminarily approved for $3.4 billion.
"We are pleased that we received preliminary approval to participate in (the) Treasury's Capital Purchase Program," said Ramani Ayer, chairman and chief executive officer of Hartford. "These funds would further fortify our capital resources and provide us with additional financial flexibility during one of the most volatile market climates in our nation's history."
Investors have been increasingly worried about the health of life insurers, which have been hit hard by worries about capital requirements and growing losses.
A number of insurers that are also bank holding companies or thrifts have been eligible for funds from TARP since last fall.
Last year, the Office of Thrift Supervision approved applications from Hartford and Lincoln to become bank holding companies, because of their planned bank purchases.
Philadelphia, Pennsylvania-based Lincoln is buying Newton County Loan & Savings FSB in Goodland, Indiana. Hartford, based in Hartford, Connecticut, is buying Federal Trust Bank in Sanford, Florida.
2,300 Houston-area Homes Flooded in April
May 15, 2009
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The count of Houston-area homes flooded during heavy rains in late April totaled about 2,300, among the highest totals since 73,000 homes were damaged by Tropical Storm Allison in 2001.
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More than 11 inches of rain fell in some areas of Houston on April 27 and 28.
Heather Saucier, a spokeswoman for the Harris County flood control district, said more than half of the flooded houses weren't in a mapped flood plain. She said that was a reminder that every property owner in the county is at risk for flooding, the Houston Chronicle reported.
At least 1,350 of the residences were in Houston.
Gov. Rick Perry is waiting for inspectors to continue assessing damage before making a decision on what type of assistance to seek for the area.
E-mail this Article Post Comment Print this Article Article Reprints
The count of Houston-area homes flooded during heavy rains in late April totaled about 2,300, among the highest totals since 73,000 homes were damaged by Tropical Storm Allison in 2001.
Advertisement
More than 11 inches of rain fell in some areas of Houston on April 27 and 28.
Heather Saucier, a spokeswoman for the Harris County flood control district, said more than half of the flooded houses weren't in a mapped flood plain. She said that was a reminder that every property owner in the county is at risk for flooding, the Houston Chronicle reported.
At least 1,350 of the residences were in Houston.
Gov. Rick Perry is waiting for inspectors to continue assessing damage before making a decision on what type of assistance to seek for the area.
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