Texas Insurance Commissioner Jose Montemayor has initiated an investigation of Farmers Insurance Co. to determine whether new homeowners restrictions it put in place violate fair trade practices.
The Austin American-Statesman reports that Farmers recently ceased writing new policies for houses that have had water damage claims in the past three years, and also for houses more than 30 years old that haven’t had their plumbing renovated in the past 10 years.
According to the commissioner, the company did not notify the Texas Department of Insurance (TDI) of the new restrictions. The department is issuing subpoenas for Farmers’ set of underwriting guidelines. Montemayor indicated that subpoenas may be issued for other insurers, also.
According to Farmers spokesman Mark Toohey, however, the company should be lauded for initiating the restrictions being investigated. He contended that such actions are necessary for Farmers to keep writing any business in Texas, and noted that current policyholders would not be affected by the changes.
Montemayor announced the investigation after downplaying allegations that some homeowners have been unable to find coverage, or even sell or buy homes, because of the new restrictions.
Topics Texas Agribusiness Homeowners
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