With only days before the 2013 Hurricane Season begins, the state’s insurer of last resort may have to file for bankruptcy, and one Texas lawmaker says attempts to save the agency have been killed by a Houston trial attorney.
State Sen. Larry Taylor (R-Friendswood) claims that a proposed bill to reform the Texas Windstorm Insurance Association was killed by Democratic senators who were pressured by attorney Steve Mostyn.
"Our windstorm bill (SB 1700) we've been working on all session died uncerimoniously on the senate floor," Taylor said.
Taylor said Senate Bill 1700 has been supported by numerous chambers of commerce and consumer advocacy groups along the coast because it provides stable funding and better service for TWIA policyholders.
"Our efforts to reform the coastal windstorm insurance program (TWIA) have been frustrated by the delaying and obstructionist tactics being employed by the Texas Trial Lawyers' Association in the final days of this session,” Taylor said.
He said that specifically, the trial lawyers objected to a single provision that would have provided more professional claims handling.
“In an effort to get the bill out of the senate I agreed to compromise and remove the provision from SB 1700,” Taylor said. “Just as TTLA pledged to stop opposing the bill, word got to me that trial lawyer and Democratic mega-donor Steve Mostyn alone was pressuring senate members to block a vote.”
Mostyn has filed thousands of lawsuits against TWIA on behalf of coastal residents who claim the insurer failed to adequately compensate them for damages from Hurricane Rita and Hurricane Ike. Some reports show that he has made more than $100 million from the litigation. The Houston attorney is also one of the country's largest donors to the Democratic Party, and has supported candidates on the state and national level, including Barack Obama.
Taylor said Mostyn “wields a pretty big stick among my Democratic colleagues here in the Senate.”
The state’s insurance commissioner could put TWIA into receivership, which would leave about 60 percent of property owners on the Texas coast with no windstorm coverage at all.
"This is a sad day for my constituents and other residents and business owners along the Texas Coast as one selfish trial lawyer has put his interests above all others,” Taylor said.
“At the end of the day, I think Mostyn just did this because of me, which is unfortunate because he puts the people along the coast, their good well being and benefit against his own, and he chose his own self-interests just for purely selfish purposes,” Taylor said in an interview with The Bay Area Citizen.
“The insurance companies didn’t kill it. It was pretty much trial lawyers. The insurance companies know me well enough to know we were going to work on it more in the House,” said Taylor.
But in a response to The Citizen, Mostyn said it is a “way far stretch to say I killed that bill."
“Everything that happens that is Larry Taylor’s inability to get something done is blamed on me,” Mostyn said.
Taylor said he would not stop fighting until he sees “meaningful TWIA reform” and feels confident that losses from future storms will be covered.
The senator says he will ask Gov. Rick Perry for a special session to address the TWIA reforms.