![]() Rates skyrocketed (more than 30 percent in some cases) and consumers found fewer choices as insurance companies left Texas when unpredicted losses led to financial instability. That was created by rampant litigation of “toxic” mold claims between 19 and hurt both consumers and insurance companies. What we’re seeing today is reminiscent of the “mold crisis” that created turmoil in the state’s insurance marketplace in the early 2000s. We can’t do much about the weather therefore, litigation abuse must be addressed. The unavoidable result - already being seen in hail litigation hotspots - is market destabilization, rate increases and lack of policy options. For insurers, the increased expenses resulting from this lawsuit spike is colliding with already high long-term losses that come with operating in Texas: averaged over the past 20 years, insurers in Texas have paid out more in claims than they have collected in premiums. The report found an unprecedented 1,400 percent increase in litigation in parts of the state that had been hit by devastating hailstorms. TDI’s recently issued report confirmed that the state is on the edge of an insurance crisis. In 2015, growing awareness of this issue led the Texas Legislature to direct the Texas Department of Insurance, or TDI, to conduct an in-depth study of both litigation and market data related to homeowners’ insurance. ![]() ![]() ![]() Their well-documented techniques - if left unchecked by the Texas Legislature - threaten to impact all Texans with higher insurance rates, fewer insurance choices and damaged dispute processes. But in recent years, a different kind of threat has emerged: a systematic effort by certain lawyers and their associates to abuse both the insurance claims system and the court system for narrow personal gain. The Texas homeowners’ insurance marketplace is always under stress from our state’s severe weather, from hail to tornadoes to wildfire, even to earthquakes. ![]()
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