Archive for the ‘BULLETINS’ Category


Friday, July 24, 2009 posted by admin


# 1 Priority Rule: DECLINATIONS. Important because it controls every policy, every year:

Contrary to TDI outline, the Rules should NOT:

  • Disallow a ‘nonrenewal’ as a declination, which by definition it is;
  • Be restricted to declinations from insurers writing “new” policies; the law says “writing”;
  • Be disallowed because a different insurer offers voluntary coverage [owner will eagerly accept any such offer without compulsion unless it includes serious disadvantages];
  • Require owner to accept an offer of coverage at rates higher than TWIA. Owners prefer a voluntary policy—even at a marginally higher rate—the ONLY reason to ‘require’ acceptance is to require acceptance of seriously objectionable offers; it would remove all owner defenses—like baby seals for the harvesting;
  • Require agent compliance procedures more extreme than Sec. 2210.202(b).

The TDI outline seems to add onerous language and meanings which are not in the statute.

It should be noted that FAIR Plan 2 year ‘declinations’ procedures are relatively simple, the FAIR Plan policy count has been minimized; TWIA procedures should not be comparably excessive.

#2 Priority Rule: CERTIFICATES OF COMPLIANCE. This already affects almost 20% of TWIA policies; it can be expected to affect a larger fraction of new TWIA policy holders.

· Every owner eligible for this ‘waiver’ of a certificate has been previously insured by a voluntary insurer, proving the property meets ‘normal underwriting standards’—the basic premise for TWIA coverage since 1971.

· Absence of a certificate of compliance [WPI-8] is not proof that the structure is not in fact built ‘to code’;

· The vast majority of properties affected by this program are in north county areas, in which the code is the least stringent;

· Every property will pay a surcharge;

· The program does not create a new exception, it extends an existing program;

· Innocent owners have been unaware of certification because their voluntary insurer did not tell them they needed it—until after they withdrew coverage.

· Sec. 2210.251(f) is crystal clear: TWIA coverage on 9/1/09 is qualification for TWIA coverage indefinitely; no time limit is even suggested.

· Therefore the Rule should not limit the number of renewals;

· The rule should continue the program for new TWIA applicants indefinitely, using the same qualifying criteria;

· Any requirement that a certificate of compliance ever be obtained defeats the primary purpose and value of the program.

#3 Priority Rule: CLASS 2 SECURITIES SURCHARGES. This is an important ‘big deal’, but opens a world unfamiliar to CWIC. Therefore, CWIC merely advocates that the Rule include no ‘surprises’, such as establishing the data on which calculations will be based, or delineating the formula with which surcharges will be calculated. Since it is a known quantity, CWIC considers the manner in which the “Chart” was developed to be the appropriate end result of the Rule. [Copy of Chart attached].

#4 Priority Rule: FLOOD INSURANCE. This is a very big deal, but attaches only to structures in the three classes of “V” zones, built, remodeled, etc. after August 31, 2009; this makes code compliance relatively certain. Cost of insurance for code compliant structures is relatively appropriate. It does have serious implications for costs of the many repairs after a major storm. The only constructive, simple, comment from CWIC is to include “actual cash value” flood coverage as being sufficient to meet TWIA requirements, since that is the maximum collectible under many federal flood policies.

#5 Priority Rule: MINIMUM PREMIUM. This should rarely occur. Adequate ‘exceptions’ should avoid any onerous concerns.


By Lee Otis “Otie” Zapp, Jr. July 21, 2009


CWIC BULLETIN # 7 HB 4409 passes!

Tuesday, June 2, 2009 posted by admin


HB 4409 passes, just hours before


Click Here to view or download Conference Committee Report

Our Coastal team of Senators and Representatives, though less than 1 of  5 in the Senate, and less than 1 of 10 in the House, exerted leadership and determination on behalf of Coastal citizens, fighting off killer bills like, HB 911, and HB 4733, and reducing the problems included in SB 14. The final days saw SB 14 die in the House, then resurected by the Senate–amended to HB 4409, then passed.  The final provisions were hammered out by Conference Committee, including matters first presented to the Conference Committee May 30, and to the public May 31.  Compared to the law it replaces, many of the ‘reforms’ still in the bill are considered helpful to insurers, to the state, to inland Texans, but are troublesome to Coastal Texans.  Many troublesome provisions were removed or limited by our stalwart Coastal Members.  A copy of the final bill is attached.

The biggest success is that action was taken to provide new funding to pay TWIA claims and AVOID a SPECIAL SESSION, with its predictably more dire results.

The most troublesome action is that the new funding is LIMITED, and substantially reduces incentive for insurers to write policies voluntarily in the Catastrophe Area.

A detailed breakdown of the bill and a ‘bullets’ opinion page will be posted on our CWIC website by June 3, 2009.  Please visit for this information.

Also to be listed at are the Coastal Senators and Coastal Representatives who should be thanked for their substantial efforts on our behalf.

CWIC was more organized in 2009 than it has been in quite a few years, but it is still WAY SHORT of what it NEEDS TO BE to adequately support our Members in the Legislature.  Windstorm change is a never ending pendulum swing.  If each of us, whose economic ‘life or death’ is at stake, do not become much more actively involved–enough to match the activism of the insurance industry–we are VICTIMS of our own malaise.

Windstorm legislation is never ‘over’; CWIC is not going to sleep.  Get involved in BUILDING the communications, studies, active involvement in the many annual windstorm actions.  CWIC needs ‘contact’ persons in each Coastal community to build a grassroots ‘Minuteman’ type readiness.  Please let us know of your interest.

Coastal Windstorm Insurance Coalition


Galveston Windstorm Action Committee, Inc., ‘host’ of CWIC

Lee Otis “Otie” Zapp, Jr., President, June 2, 2009

Comments Off on CWIC BULLETIN # 7 HB 4409 passes!

A beautiful sight:
Representatives from the Sabine River to the Rio Grande, including County Judges, Mayors, Council Members, Chamber of Commerce officials, and many dedicated citizens gathered on the South steps of the magnificent Texas Capitol Tuesday, May 5, 2009 to demonstrate that the Texas Coast IS Texas, just as much as any other region of this great state.

Senators and Representatives addressed the crowd, applauding them for taking their day and exerting the effort to come to Austin in person, to leave no doubt about their convictions and the importance of windstorm insurance.  The Legislators assured their constituents that they would spare no effort to assure Fair, Affordable, Available Windstorm Insurance to the people, in the face of the continuing and substantial abandonment of its customers by Texas licensed Insurance Companies.

Deadlines affecting bills not reported out of Committee are narrowing the field of bills which can still become law this session.  The two main bills which remain viable are:

SB 1007, Sen. Hegar, Katy [HB 2233, Isett, Lubbock, companion bill] has passed the Senate, and is ‘pending’ in the House Insurance Committee.  This bill is the Texas Department of Insurnace ‘Sunset’ bill, so it is relatively certain to pass.  Several TWIA provisions were swept into the TDi bill, including:

a.) changes to qualify TWIA for federal ‘tax exempt’ status [the only ‘good’ part]; b.) requirement of 2 insurer  ‘declinations’ annually to obtain a TWIA policy; c.) ‘Firing’ TDI and giving TWIA the job of ‘toughening’ and conducting building code inspection and certification; d.) [slipped in apparently unnoticed] a providion which would recharacterize reinsurance as ‘operating expense’, setting the scene to ‘double charge’ for part of its cost in TWIA rates–unless it can be amended before passing the House..

SB 14 Sen. Fraser, Horseshoe Bay; has been negotiated in the Senate to remove most of its punitive ‘surcharges’, [having no actuarial basis, would have added up to 100% for some properties].  It retains, however, its original provisions which would change the nature of TWIA from its real purpose: a state provided market for property owners abandoned by their Texas licensed Insurance Company.  TWIA would become an adversary contesting Texans access to and affordability of the  last remaining source of windstorm insurance–without which the Coastal Economy will stagnate, to the detriment of the State of Texas. Encourage your Senator and Representative to change this bill completely before it passes the House.

Visit your CWIC website: to find a list of key House and Senate members, and the Senate passed version of SB 14.

For CWIC Lee Otis “Otie” Zapp, Jr. 5/14/09


CWIC BULLETIN #5 To Austin Tuesday MAY 5, 2009

Monday, May 4, 2009 posted by admin

There are only a few days left to make a difference

Click here to download the Bulletin.

Comments Off on CWIC BULLETIN #5 To Austin Tuesday MAY 5, 2009


Monday, April 20, 2009 posted by admin

CWIC [Coastal Windstorm Insurance Coalition] BULLETIN # 3

1.) Please visit, and alert other interested parties to visit, our new website .  This site includes CWIC bulletins, analysis and bullet reports on the major windstorm bills, and links to specifically related information.  A link to the April 7, 2009 House Insurance Committee windstorm bills hearing has been added, which includes debate of many key windstorm issues.

2.) CWIC review of the windstorm bills which could have the most serious impact on policyholders indicates that the following bills should be OPPOSED or SUPPORTED:
SB 14, Fraser
HB 911, Smithee
HB 4733, Smithee
SB 734, Jackson
HB 2467, Eiland
HB 3853, Eiland
HB 3640, Hunter
HB 3648, Hunter
Please address your Representatives and Senators requesting that they Oppose or Support these bills.  An important additional request is to ask that they support any action by Senators Mike Jackson, and Joan Huffman, and Representatives Craig Eiland, Todd Hunter, and Larry Taylor, solidly coastal Members.

There are 45 days left in this 81st Legislative session.  Thanks to the inspired work of our coastal Members, AND the active encouragement of coastal Texans from the Sabine river to the Rio Grande [including calls, faxes, letters, Austin visits and attendance at Committee Hearings], no bill, other than the “Sunset” bill had been voted out of committee.  The [SB 1007, Hegar, and HB 2203, Isett] “Sunset” bill, includes several unhappy provisions, but does not deal with the vital issues of TWIA rates and funding.  It is on the consent calendar in the Senate, and has been left “pending” in the House Insurance Committee.

On April 16, 2009, however, at the end of the Senate session, Chairman Fraser suspended the rules, called a meeting at his desk, and got CSSB 14 out of the Business and Commerce Committee.  This 60 page bill is laced with new costs and many TWIA changes, cumulatively making the “insurer of last resort” much more expensive, and less available to those who are victims of insurers’ abandonment, and have no alternative to TWIA.

The policy holder’s best interest lies wtih the bills authored by Jackson, Eiland, or Hunter.  More importantly, it is critical that NO bill authored by Fraser or Smithee pass either House or Senate.

PLEASE RENEW YOUR EFFORTS TO MAKE SURE YOUR SENATOR AND REPRESENTATIVE KNOWS THAT YOU CARE ABOUT WINDSTORM INSURANCE BILLS. Suggest they consult with and consider following the lead of Representatives Craig Eiland and Todd Hunter, as well as Senator Mike Jackson.

For CWIC: Lee Otis “Otie” Zapp, Jr.

Comments Off on CWIC BULLETIN # 3


Friday, April 3, 2009 posted by admin


Please make every effort to be present and make your views known at the House Insurance Committee Windstorm Insurance hearing TUESDAY, APRIL 7, 2009, at 2:00 pm [or on adjournment/recess of the House of Representatives] in room E2.026 in the Capitol Extension in Austin.
The committee chair, Rep. John Smithee has posted an agenda which includes these windstorm bills only:
HB 3640 Hunter (R) Corpus Christi, relating to TWIA operation and funding;
HB 2648 Hunter, relating to TWIA operation and funding, and transfer of state revenue to reserves;
HB 3853, Eiland, (D), Galveston, relating to TWIA operation and funding; and
HB 4733, Smithee (R), Amarillo, TWIA operation and funding and issuance of public securities.
This hearing, and the resulting committee action, will strongly effect the outcome of all House action on windstorm insurance in the 81st Legislature.
Note that Chairman Smithee, the author of HB 911, has not included HB 911 on his agenda.  His HB 4733, apparently a ‘substitute’ for HB 911, has been called a resurection of Mr. Smithee’s SB 2960 which almost passed into law in 2007.  HB 2960 posed seriously harmful changes to TWIA; now HB 4733 has CHANGED HB2960 INTO AN even WORSE BILL! Also, bills can be amended, and the new number does not insure that HB 911 problems will not be added to the already damaging HB 4733.
Additional detail about these bills will follow this bulletin.  In the meantime, please arrange to attend, to bring other intersted persons, to request associations to which you belong and others to the April 7, 2009 hearing.  [A few weeks ago, the hearing was expected to be called, but was not.  THIS TIME, THE AGENDA HAS BEEN OFFICIALLY POSTED].
April 3, 2009, CWIC, Lee Otis “Otie” Zapp, Jr.
visit us at our new website:

Comments Off on BULLETIN # 2


Friday, April 3, 2009 posted by admin

BULLETIN # 1, TO ALL “CWIC” [Coastal Windstorm Insurance Coalition] supporters along the whole coast of Texas

The agenda posted for the House Insurance Committee for Tuesday, March 31, 2009 does NOT include HB 911 or other major windstorm insurance bills.

HOWEVER, at 9:00 am on Tuesday, March 31, 2009, the Senate Business and Commerce Committee expects to hear SB 14, by Senator Troy Fraser, Chair of the committee.  Attached is a one page ‘bullets’ sheet, and a 4 page analysis of this long and complex bill.  Rumors indicate that there is likely to be a ‘substitute’ filed by Senator Fraser, but no copies have been made available to us at this time.

As filed, SB 14 seems not to disenfranchise thousands of property owners as HB 911 would.  It imposes some responsibility on insurers for withdrawal of their products from coastal Texans.  BUT it seems nonetheless to impose a potentially unbearable cost burden on coastal Texans.

Please review these attachments.  Consider what action you wish to take: Fax, call or write your Senator, [and any other Senator who respects you] the Business and Commerce Committee members, OR, attend in person to make the greatest impression possible.

Lee Otis “Otie” Zapp, Jr.

NOTE: Mississippi Congressman Gene Taylor has been publicizing his Multi Peril Insurance bill, which, if ever passed by Congress, would offer optional wind peril  with  flood  coverage under FEDERAL flood insurance policies.  This is completely separate from Texas legislation. First, we must  address TEXAS Windstorm, before the 81st Legislature ends June 1, 2009.

Comments Off on BULLETIN # 1