EDITORIAL: Taking away insurance customers’ recourse is not reform

April 24--It may surprise Texas homeowners that the insurance industry is in crisis. Silly them, they probably thought they were the ones in crisis from increasing premiums for increasingly less coverage and higher deductibles.

But, no, the problem is the homeowners and their greedy lawyers, according to the industry. The industry is trying to remedy the situation by doing something it's good at -- asking the Legislature for protection.

The protection sought by the industry is contained in Senate Bill 10, approved last week by a Senate committee. SB 10 would lower the penalty against insurers for deliberately slow payment of claims, require more extensive notice from customers that they plan to sue, and funnel much of the litigation to federal courts. So, in review, that means:

* Insurers would have less incentive to give their customers what's rightfully theirs in a time of need.

* The process for seeking a remedy would become more onerous for those customers.

* And, finally, justice would be denied by virtue of being delayed interminably by the much slower federal court system.

State courts, while not exactly Mustang GTs when it comes to speed, at least don't have a crisis of unfilled openings. That may be the one advantage of electing judges. Appointment of judges takes forever because of Washington, D.C., politics. In Corpus Christi, federal Judge Janis Graham Jack has been retired on paper since 2010, when she went to so-called senior status. She continues to work and to issue rulings that make state and national headlines such as when she declared the state's child protective system broken. The other federal district judge, Nelva Gonzales Ramos, also makes attention-getting rulings on high-profile cases, such as voter ID. SB 10 would add the tort claims against insurers by the residents of Lindale, Schanen Estates, etc., to the loads carried by these two judges. Imagine it happening to every federal district court in Texas.

A recent guest column by insurance industry advocate Beaman Floyd in support of SB 10 cites a Texas Department of Insurance study that says insurers have paid more in claims than they collected in premiums for the past 20 years. We had no idea insurers were charitable organizations providing insurance out of the goodness of their hearts. And at a loss! But, no, wait, another guest column by Texas Watch executive director Ware W. Wendell says the industry took in $4.5 billion in profit in Texas since 2012. To review, that's $4.5 billion in profit, not just premiums. No wonder the insurance industry hasn't abandoned Texas completely.

Notable backers of SB 10 include Dallas businessman Brint Ryan, who the Texas Tribune described as a Republican "megadonor;" billionaires Red McCombs, Ross Perot and Robert McNair; and of course Texans for Lawsuit Reform -- a name that deserves an asterisk pointing out that it all depends on how you define "reform." This list doesn't sound like people in crisis.

There's a reason SB 10 and its House companion, House Bill 1774, are called the blue tarp bills -- because instead of being repaired promptly, property damage would remain covered under blue tarps while insurers exercise their lobbied right to foot-drag at their customers' growing expense.

Some lawyers make millions defending the rights of homeowners. Insurers make billions while squawking that the sky will fall if the Legislature doesn't protect them from those greedy millionaire lawyers and their thousand-aire clients. Lawyers make good villains until who's calling the kettle black is considered.

The so-called remedies of SB 10 are their own indictment. Giving insurers more incentive to delay payments, burying their clients in extra paperwork if they dare seek justice, and dumping extra caseload on overworked federal judges who frankly have bigger priorities, just to gum up the works, doesn't sound much like justice.

Shame on state lawmakers if they don't stop this attempt to turn the American dream into a Texas nightmare.

___

(c)2017 the Corpus Christi Caller-Times (Corpus Christi, Texas)

Visit the Corpus Christi Caller-Times (Corpus Christi, Texas) at www.caller.com

Distributed by Tribune Content Agency, LLC.