During a visit to a home construction site, Perry said he would make homeowners insurance an emergency issue when the Legislature convenes Jan. 14. More than 40 bills have already been pre-filed to address the insurance crisis.
Texas homeowners insurance rates, the highest in the nation, were the hottest issue in the recent election. Democrat Tony Sanchez charged Perry had neglected the problem, but the Republican said he had taken legal actions and pushed for reforms.
"Working with legislators of both parties, we will restore fairness to the marketplace, provide greater incentives for competition and lower rates for Texas consumers," Perry said in Houston, reiterating his pledge to push for changes in the Texas law.
Perry called for reforms that would give the state total rate oversight -- including the ability to impose across-the-board rate freezes and to restrict the use of "credit scoring" to set rates. About 95 percent of current policies escape regulation due to a loophole that impacts only homeowners insurance.
"Homeowners insurance reform will be extensively discussed and debated at the state capitol in the months to come, but all proposals share some common goals," he said. "We must lower rates, continue to stabilize the insurance marketplace, end unfair pricing practices, and stop fraud and abuse within the system."
Under Perry's plan, the Texas Department of Insurance would be given the power to review all rates and to impose either a company-specific or an across-the-board rate freeze while the agency completes rate reviews. He also called for a ban on the use of credit histories in setting premium rates, except in instances where there is a direct correlation between consumers' credit history and their insurance risk.
"Some of the proposals don't go far enough and many of them need to be fleshed out a little bit more," said Rob Schneider, senior staff attorney for the Consumer Union's office in Austin. "Ultimately Gov. Perry is going to state his goals for insurance reform and it's up to the Legislature to iron out the details."
Schneider said so-called "reform" legislation will be passed by the Legislature but the question will be whether it will go far enough to ensure there's not another crisis in five or 10 years.
"We think the loopholes have to be closed, but we have to do more than what some people are calling minimal reforms," he said.
Schneider said the important goals are assurance of price stability, fair underwriting guidelines, and fair choice in the marketplace.