Texas Insurance Commissioner Takes Heat From Senate Committee

The Texas Senate Nominations Committee approved the reappointment of José Montemayor as the state’s insurance commissioner, but not before grilling him on sanctions against insurance companies that the committee perceived as being relatively light. The full Senate is expected to approve the committee’s decision without a hitch.

The Austin American-Statesman reported that Sen. Gonzalo Barrientos, D-Austin, led the Nominations Committee in questioning Montemayor on a number of issues, including the insurance commissioner’s commitment to consumers and the difficulty of getting information from the department.

Barrientos asked why automobile insurance companies such as Nationwide Insurance Company had received relatively mild sanctions for discriminatory practices such as limiting access to their insurance products in low income and minority neighborhoods. Referring to a 1999 case in which Nationwide agreed to change its policies and open more sales offices in minority neighborhoods, Barrientos questioned why the company was not required to pay the $10 million fine recommended by a Texas Department of Insurance attorney working on the case. At the time of the settlement, Nationwide estimated that the company would spend more than $9 million in direct costs to satisfy the terms of the agreement.

Barrientos questioned Montemayor about TDI’s delay in resolving a pending case against Farmers Insurance concerning that company’s failure to remove certain surcharges from customers’ premiums after the required surcharge period had expired. A TDI spokesperson said that Farmer self-reported its failure to remove the surcharges and that the company’s difficulty in identifying the customers deserving refunds has delayed resolution of the case.

Sens. Luticia Van de Putte, D-San Antonio, and Mike Moncrief, D-Fort Worth, expressed concerns over Montemayor’s performance. Van de Putte stated that the department’s 38-day average in completing complaint investigations was too slow. Moncrief questioned why the department had taken months to respond to requests by the senator’s health committee for documents relating to nursing homes, insurance claims and liability insurance. He added that some of the information still has not been received.

Montemayor said that he believed the department was fair, but acknowledged that there is always room for improvement.

Topics Texas