Will a Major Texas Wind Insurer Be Able to Pay Out After a Big Storm?

Some are worried that the Texas Windstorm Insurance Association doesn’t have funds to cover a major windstorm.

By Michael MarksAugust 30, 2016 10:10 am

A storm system is brewing off the coast of Florida. Tropical Depression Nine is about 160 miles southwest of Key West.

Meteorologists forecast it will intensify and hit the Gulf Coast in just a couple of days, bringing heavy rain to our eastern neighbors. But it’s likely to miss the Lone Star State.

That could be good news for Texans. In the event of a major wind catastrophe, the insurer of last resort here in Texas might not have the cash to pay claims.

Andrea Rumbaugh, a reporter with the Houston Chronicle, says that the Insurance Council of Texas has warned the Texas Windstorm Insurance Association – the state’s insurer of last resort – that if they don’t rase their rates, they won’t be able to pay out.

“(The Insurance Council of Texas) came out with a press release saying that TWIA should be increasing the rates still, because they can’t be overconfident that if a big storm comes and wipes out their reserves, or if we have multiple storms in one year, they might not be able to pay their claims,” Rumbaugh says.

What you’ll hear in this interview:

– What the TWIA is

– Why the Insurance Council of Texas is concerned

– How this could affect people statewide – not just on the coast