Coastal residents find alternatives to windstorm insurance shortfall
Sept. 12, 2012 at 4:12 a.m.
Updated Sept. 13, 2012 at 4:13 a.m.
A Calhoun real estate broker and member of the Coastal Bend Windstorm Committee is among a group of Texas coastal residents helping to brainstorm options to ensure windstorm insurance provision for people who can't get private property insurance.
Russell Cain, of Russell Cain Real Estate, said because the financial sustainability of the state-funded Texas Windstorm Insurance Association is uncertain, which could affect coastal residents' ability to obtain windstorm insurance in the future, lawmakers and committee members are meeting every few weeks to prepare a plan before the Texas legislative season begins in January.
"It's been a big issue for a long time, the cost of windstorm insurance in the state. It's based on claims, and with (Hurricanes) Katrina and Ike, we've had too much damage, which increased the claims and drained the funds," Cain said. "That's what all these meetings are about - to come up with an alternative that's equitable and fair to Texas citizens."
Cain said the new alternative plan could include coverage for hail and tornado damage.
Another setback to the windstorm insurance shortfall is the effect it may have on the real estate market. If home buyers are denied windstorm insurance, they may be less likely to buy homes in areas where coastal property sales thrive, such as Port O'Connor.
"This will hurt real estate," Cain said. "That's why they're trying to handle this problem before it becomes a catastrophe ... Texas would have to find a way to subsidize windstorm insurance."
Representatives from 17 coastal counties are on the committee, Cain said.