85th Legislative Session Preview: Litigation Reform

Under the Dome HeaderIIAT’s Governmental Affairs team recently got an early look into one of the issues that will most certainly be addressed when the 85th session of the Texas Legislature convenes in January. The sides have been drawn and it is clear that insurors and trial lawyers have a plan in place when dealing with litigation. At issue is the fact the plans are very different.

The Texas Farm Bureau has filed for approval with TDI, an endorsement that, in return for a reduced premium, would require mediation/arbitration in residential property policies. The underlying matter in this case seems to be whether Texas truly has “form freedom” or not.

While one side argued that such an endorsement would be the beginning of a race by all insurors to file the same or similar forms, many industry representatives disagree with that concern. Another disputed but important point is that arbitration does not waive a person’s right to trial by jury.

As to the issue at hand, Sec. 2301.007(a) of the Insurance Code allows the Commissioner to disapprove or withdraw approval of a form, if the form:

  1. Violates any law, including a rule adopted under the insurance code; or
  2. Contains a provision or has a title or heading this is unjust or deceptive, encourages misrepresentation, or violates public policy.

Those in favor of this endorsement, and more broadly, the ability to file forms freely, argued that this did not violate either of these two points. Those in opposition argued that these would encourage misrepresentation and do violate public policy.

IIAT will be working with Texans for Lawsuit Reform, Texas Civil Justice League and the industry lobby groups to hopefully bring some semblance of sanity to the litigation that has followed catastrophes around our state. IIAT’s position is that excess and unwarranted litigation impairs competition by eroding markets and that is detrimental to our members and their customers.

This entry was posted in Governmental Affairs, Under the Dome and tagged , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s