What is the Texas Windstorm Insurance Association?
The Texas Windstorm Insurance Association, also known as TWIA, is a non-profit insurance-of-last-resort regulated by the State of Texas. Insurance company policies often reduce their types and areas of coverage during and after a storm, leaving many without adequate resources to restore their livelihood from damage. TWIA acts as a measure to defend and reimburse residents as a final option in these events. However, the Texas Windstorm Insurance Association limits their coverage policies and may be much more costly than other insurance providers.
Who Does TWIA Help?
TWIA provides insurance coverage for damage related to winds and hail when residents are not able to afford adequate insurance or residents whose insurance company policies have failed to compensate in these areas. The association grants insurance to 14 counties along the coast of Texas, including:
- Brazoria County
- Colhoun County
- Chambers County
- Galveston County
- Harris County (Morgans Point, La Porte, Shoreacres, Seabrook, and Pasadena)
- Jefferson County
- Kenedy County
- Kleberg County
- Matagorda County
- Nueces County
- Refugio County
- San Patricio County
- Willacy County
TWIA Controversies
Hurricane Ike struck Texas in 2008, claiming thousands of homes. The Texas Department of Insurance (TDI) alleged that TWIA performed “unfair or deceptive” schemes in response to the insurance claims made after Hurricane Ike. In July of 2010, a $189 million settlement was made by TWIA to work out the 2,400 claims (approximate) negotiated in Galveston County.
Since then, lawsuits against the Texas Windstorm Insurance Association have obliged officials to investigate the practices of the organization. As an action against these issues, TWIA created a reform bill that would protect the association against lawsuits regarding deceptive practices. The bill also grants TWIA more funding for claims of up to $2.5 million in damage and losses. This law was signed into action by Governor Perry in July of 2011.