Farmers deal irks Sanchez
Posted on 09/25/2002 3:00:26 AM PDT by MeekOneGOP
Farmers deal irks Sanchez
Perry says rival is 'short on solutions' for state's insurance troubles
09/25/2002
HOUSTON - A state proposal to settle a pricing dispute with Farmers Insurance roiled the governor's race Tuesday as Democrat Tony Sanchez said the offer shortchanges consumers.
Mr. Sanchez, a Laredo businessman, said the proposed settlement between the insurance regulators and Farmers was "terrible and shameful" and excuses the company's treatment of its customers.
Republican Gov. Rick Perry, also campaigning in Houston, said Mr. Sanchez "is short on solutions, long on criticism" and is avoiding joint appearances with him before voters.
When the Legislature convenes in January, Mr. Perry said, he plans to issue an emergency declaration, which would allow bills to combat rising insurance costs to be considered and passed quickly.
The Department of Insurance last month ordered Farmers, the state's second-largest homeowner insurer, to stop what it called unfair pricing practices. Officials also said it would seek restitution for Farmers' customers.
The proposed settlement the department offered Monday would let Farmers settle its dispute with the state if the company changes the way it prices its policies and refunds alleged overcharges to customers.
The department also said that under certain conditions, it would waive proposed penalties of $25,000 for each individual harmed.
The company has denied any wrongdoing. A Farmers spokesman said he had not seen the settlement proposal and could not comment on the specifics.
Mr. Sanchez directed his criticism at the proposal to waive certain penalties, saying that "the only message the state is sending is that Rick Perry is going to continue to side with the insurance companies over Texas homeowners."
"It is clear that the insurance industry's million dollar investment in Rick Perry continues to pay off," Mr. Sanchez said, a reference to donations the governor has received.
Mr. Perry has rejected that, saying political contributions do not factor in his administration's decisions.
And his spokesman, Ray Sullivan, said, "Only a member of the insurance industry, like Mr. Sanchez, would find fault with attempts to crack down on illegal insurance practices and lower homeowners' insurance rates."
While in Houston, Mr. Sanchez declined to address the Greater Houston Partnership alongside Mr. Perry - saying it did not fit into his schedule.
"I'm gonna get a haircut," Mr. Sanchez said, explaining he was committed to a visit to a community center, a rally at his Houston campaign headquarters and an afternoon stop at a barbershop. All three appearances were close to downtown, where Mr. Perry spoke to a noontime crowd.
Mr. Sanchez didn't end up getting a haircut but toured the southeast Houston barbershop and visited with the patrons inside after telling those at his campaign headquarters that the pressure is on to sign up more volunteers as Election Day nears.
Mr. Perry, speaking to about 250 people at the Partnership luncheon, said of his rival, "His action today is not a slight to me, but a slight to you.
"I think Texas deserves more than just a campaign of television sound bites. You deserve candidates for governor who will answer the tough questions."
The Sanchez campaign said he plans on Monday to address the group of Houston business and community leaders who make up the Greater Houston Partnership.
The two candidates also clashed over a Securities and Exchange Commission request regarding a deal made by Zix Corp., a Dallas computer software company that Mr. Sanchez has invested heavily in and serves as a director for.
Mr. Sanchez played down the SEC request as routine.
"Rick Perry is making an issue of this because he is panicked," he said.
Mr. Perry said of the Democrat, "I think he is off the mark as he usually is."
Now Perry has only been governor for how long? He couldn't have done all that in that short of time. Someone posted and it would be nice to know for sure that the latest figures given on the insurance rates was 1998. He hasn't been in there long enough to effect such changes.
The black mold payments are responsibile for a lot of this. Black mold payments are not small 2 or 3 thousand dollar payments. It costs 10's of thousands of dollars to strip ahouse and treat for mold. Black mold can be due to a builder's mistake - green lumber, or unattended water leaks. There was a couple in AZ my daughter knew who moved into their newly built home, they all became sick. They moved out afater 3 weeks. The builder is denying it is his fault and their lawyer says they will have to sue the insurance company as they have the largest pockets.
There are the, 'my water heater leaked and ruined my carpet'. You are responsible for keeping check on your water heater, water pipes, icemaker,shower pan, etc. ' These are not accidents, these are carelessness and irresponsibility and the other policyholders should not have to pay for that.
And of course, the lawyers - let's don't leave them out.
The insurance companies are not in this to lose money. They are not a charity. IF they cannot make a profit, they will simply leave the state. Many already have. Farmer's has stated they will write no new homeowner's policies after October. Allstate has stated it will no longer cover water damage - high time!
Anytime lawmakers pass laws in the heat of a campaign, the consumer's or taxpayers loose. The insurance company is not going to lose - they will just leave, and less competition is not good for consumers.
That's because Sanchez is in mortal fear of having his picture taken standing next to Perry - and only coming up to about Perry's belt buckle!
Well, the premise that black mold claim was legitimate is bogus. Black mold is caused either by 'bad housekeeping', as in not taking care of your property and checking on pipes, etc. or on using green lumber. Sometimes it has occurred when foreign lumber was used. I don't know how many times. But it is simply not a legitimate claim.
I did not know the insurance companies were forced to pay these claims. I thought they did it just to keep down bad publicity. If they were forced, it is even worse, and I applaud the insurance company for attempting to protect me as a policyholder from irresponsible people.
I just heard of a case that the insurance company is paying over 100,000 to strip a house. They are paying $170.00 a day for family to live in a apartment while their house is being completely redone. It was caused by a leaky hose to an icemaker. Now congratulations, we will all pay for that persons neglect.
Now I am not defending Perry, he is bought and paid for, by a lot of interests and certainly he may be by the insurance lobby. He lost me when he promoted and supported the hate crimes bill. That told me a lot about the makeup of his spine. But if he gets laws passed because of the heat he is taking in this campaign, you can bet it will not be in the best interests of the consumers. It never is. It is not in the best interests of the consumer to decrease the competition for our dollars.
I agree with you on it is sorry when we can only choose between two crooks. But 'twas ever thus'. That is always the story. Doesn't make it go down any better.
AS for the rate comparison, I won't say it is so, but someone posted these figures were from 1998. If so, Perry is not too much involved. (Well, of course, he was Lt. Gov.)
Now, yes, the claims should have come out of the profits, but insurance companies are there to make a profit. That is the nature of the business. We all share in the misfortunes, or irresponsbility of others, that is also the nature of the business, and in this case, it was irresponsibility, and we, as responsible homeowner's, should not have had to share in the cost of their neglect.
If we sued the courts everytime they make an incorrect ruling, well -enough said.
Regardless of what the court says, in my very humble opinion, if a builder builds a house incorrectly, or from green or incorrect lumber, or a homeowner allows his pipes to leak, and mold develops, it is not a legitimate insurance claim. It should not be paid by an insurance company - read that the other policyholders.
Now everyone can blame the politicians (rightly so, possibly), they can blame the insurance companies (rightly so, possibly), but when it comes to black mold or or most water damage, it is the fault of the homeowner - certainly not mine.
The courts wanted Farmer's to pay a penalty of 25,000 to each homeowner who had been overcharged. Now I don't know about you, but I think that is just ridiculous, to attempt to force a company (which will pass the costs on to us) to pay 25,000 to a homeowner because they overcharged them a most a couple of hundred dollars on their policy. There is no excuse for a company doing what they are accused of doing, but there is no excuse for some court to make such a ridiculous ruling - when he knows you and I will pick up the tab.
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