Protect Rio Grande Valley homeowners from insurance proposal

[TexasTowelie]

by State Sen. Juan 'Chuy' Hinojosa

Homeowners throughout South Texas could soon be significantly impacted by the outcome of an insurance company proposal that preys on low-income Texans being under-informed and particularly targets our border communities.

Texas Farm Bureau Insurance company has filed a proposal with the Texas Department of Insurance that would allow them to offer a 25 percent reduction on a homeowner’s annual insurance premium in exchange for mandatory binding arbitration to resolve any future disputes. The proposal affects only South Texas counties, most of them along the border region — 14 counties would be offered up to a 25 percent discount in exchange for arbitration instead of suing the insurance company. This includes my entire Texas senate district, consisting of Brooks, Hidalgo, Jim Wells and Nueces counties.

Safeguarding my constituents is a top priority and I fear that many homeowners will readily sign up for a large discount on their homeowner’s premium without understanding the serious consequences. Consequences such as (1) the arbitrator’s decision is final and not appealable; (2) giving up your right to sue your insurance company forever; and (3) giving up your right to a trial by jury. In fact, many states nationwide have banned insurance arbitration clauses because of these concerns.

While the arbitration clause is optional, the reality is that many Texas homeowners are struggling to pay monthly bills, feed their children and can barely afford insurance premiums. So when balanced against a large discount incentive, agreeing to arbitration will often be the easy choice. Unfortunately, the general public often doesn’t understand what “arbitration” means, but they do understand what “discount” means.

Read more: http://www.themonitor.com/opinion/board_of_contributors/commentary-protect-rgv-homeowners-from-insurance-proposal/article_b9bf7f3c-4aed-11e6-b826-fb3494acf8b8.html

[Gothmog]

1. Mandatory arbitration for homeowners policies is a bad idea