Gilbert Proposes Bold, Comprehensive Insurance Reform Plan

Calls For Premium Rollback, Prior Approval Of Rate Hikes, Elected Insurance Commissioner

HOUSTON—Democratic gubernatorial candidate Hank Gilbert (D-Whitehouse) called for bold and comprehensive insurance reform including a 20 percent insurance premium rollback and an elected insurance commissioner during a press conference in Houston.

“Insurance companies are putting the squeeze on Texans with high premiums while offering less coverage. We need bold, common sense reforms to protect Texas consumers and their pocketbooks,” Gilbert said.

“Insurance has an impact on the lives and pocketbooks of millions of Texans. The state mandates minimum coverage for drivers, and homeowners need it to insure their property from loss. The industry has taken advantage of Texans’ need for insurance and used that to drive prices so high that Texans are paying far to much for minimal coverage,” he said.

The economic impact insurance has on Texas consumers is a key reason Texans need a voice in selecting the Insurance Commissioner, Gilbert said.

“Texans need to elect the person who oversees this industry in Texas. The Texas Department of Insurance should work for consumers, not the insurance companies,” he continued.

In calling for a state mandated 20 percent across-the-board premium reduction for homeowners’ and auto insurance, Gilbert said that “Texans need immediate relief from skyrocketing insurance premiums.”

Gilbert also called for other common sense reforms, including mandating that any rate hikes by insurance companies get prior approval from the Texas Department of Insurance. This is not required under current law. “Insurance companies can decide they want to hike their premiums, send their lawyers down to TDI and file a notice, and immediately start charging consumers the new higher premium,” Gilbert said. “That is not common sense regulation of the industry,” he continued.

In his reform plan, Gilbert also proposed:

• Requiring insurance companies to provide detailed financial justification for rate increases including cost justification exclusive to Texas without Texas income diverted out of state. In addition, all financial justification must be transparent and lobbying expenses would not be allowed to be included in cost justifications to support rate increases.
• Requiring insurance companies to offer a minimum number of standard policies to allow consumers to make better informed decisions through being able to compare policies offering identical protections side by side.
• Banning the use of credit scoring, data mining, and pattern recognition by insurance companies.
• Mandating the end to use of any rating territories in Texas except individual counties, and setting a 15 percent limit on the amount insurers may vary premiums within a single county excluding counties to which greater variances would be justified because of weather-related risks.
• Making it illegal for an insurer to base adverse underwriting or rating decisions on consumer inquiries.
• Mandating the collection and public reporting of claim denial rates on all types of insurance policies.
• A blue-ribbon commission to reassess tort reform legislation.
• A mandatory 20 percent “good driver” on auto insurance.
• Capping deductibles for auto insurance at $500 and homeowner’s insurance at $2,500.
• Requiring homeowner’s insurance rate freezes for the disabled and persons 65 years of age and above.

Although Gilbert favors a public option at the federal level, he did propose a number of reforms relating to health insurance offered by insurance companies in Texas including improved mammography and prostate cancer screening coverage; and improved coverage for mental illness including mandating coverage for eating disorders.

To view the PDF copy of the plan, you will need Acrobat Reader. Download it from Adobe’s website.