ICYMI: TDI's Arbitration Hearing Highlights
For the past two months, we've been sounding the alarms on an insurance industry proposal to force consumers who have been low, slow, or not paid on their valid claims into the secret, biased process of arbitration. Last week, our fight reached the ears of the insurance commissioner in a rare public hearing at the Texas Department of Insurance. Here's what happened:
1. Commissioner David Mattax started the hearing by asking five questions:
VIDEO: Keep the Kangaroo Court Out of Texas Insurance
Dealing with your insurance company is hard enough. Now, insurance lobbyists want to make it even harder for policyholders get their claims paid in full and on time. Their latest scheme would force policyholders into the biased, secretive process of arbitration, a kangaroo court where the decision maker is chosen and paid for by the insurance company.
Internal Documents Reveal Bogus Discount
For years, the Texas Department of Insurance has rightfully stood by Texas consumers and rejected policies with dangerous binding arbitration clauses. But, a policy recently submitted to TDI would strip unaware consumers of their constitutional rights in exchange for a small discount. This month, we talked to Deeia Beck, executive director of the Office of Public Insurance Counsel, about the dangers lurking in the submitted policy.
Arbitration Clause Made Public. It's As Bad As We Thought
After fighting the release of documents related to its request to add pre-dispute arbitration to its home insurance policies, Texas Farm Bureau Insurance relented. So, now the public can see firsthand what the company is up to.
You can see for yourself below, but here are the highlights:
State Policyholder Advocate Opposes Arbitration Proposal
The Office of Public Insurance Counsel has weighed in opposing a proposed pre-dispute binding arbitration provision currently under consideration by the state insurance commissioner. OPIC is the state office tasked with representing policyholders in rate and form filing decisions.
In her letter to Commissioner David Mattax, Public Counsel Deeia Beck writes of arbitration generally:
Don't Sell Our Rights, Commissioner
The Texas insurance commissioner is considering an industry proposal that would allow an insurance company to buy your legal rights for a few dollars a month.
This is unprecedented. Never has the insurance department approved a request to allow an insurance company to include what is called a pre-dispute binding arbitration clause in its policies. In fact, it has been part of the agency's published guidelines to reject any insurance policy that includes such language.
Why Isn't TDI Asking About Insurance Company Misconduct?
The Texas Department of Insurance is asking questions. But, it's what they aren't asking that's the problem.
Insurance lobby groups are pointing to the number of consumer complaints filed with the Texas Department of Insurance as "evidence" that consumers are happy with their insurance companies. But, 75% of consumers filing complaints with TDI in 2015 were never counted.