Legislative update

Texas REALTORS® are involved with insurance issues and other topics that impact real estate.

As anticipated, homeowners insurance has garnered much attention early in the 78th Legislature, with almost 80 bills filed on the topic during the first two months. The proposed legislation contains varied approaches that are being studied and debated.

Texas REALTORS® and TAR staff have been working with legislators to promote meaningful insurance reform that gives Texans access to fair, affordable insurance. The need for such change became clear after REALTORS® across the state began experiencing a number of transactions that did not close or were delayed due to problems buyers had obtaining homeowners insurance. In July 2002, a TAR member survey with 2,491 REALTORS® responding showed that more than two-thirds have seen one or more real estate transactions delayed because clients had problems securing coverage, and half of respondents had at least one client who was unable to secure homeowners insurance coverage at all. A third of REALTORS® surveyed said a client’s homeowners policy was canceled within 90 days of being issued. One third also had at least one client who was denied homeowners coverage based on their credit rating.

Among other goals, the Texas Association of REALTORS® is advocating legislation that prohibits or severely limits the use of credit scores to raise insurance rates or deny coverage; stops the practice of stigmatizing properties where homeowners have done the right thing by fixing a legitimate water claim; ends the ability of insurance companies to cancel a policy for any reason within the first 90 days; and provides meaningful rate regulation. Currently, 95%
of homeowners policies are with unregulated Lloyd’s
companies.

REALTORS® and TAR staff have been visiting legislators and testifying before committees to promote this position. Also, the TAR Issues Mobilization Political Action Committee has produced a newspaper and radio campaign to inform the public on this topic and encourage people to contact their legislators in support of the REALTOR® position.

Another legislative goal going into this session was to see that mortgage bankers are regulated by the state, much the way previous legislation called for the regulation of mortgage brokers. Sen. Todd Staples has filed Senate Bill 252, which addresses many of the recommendations regarding mortgage bankers that came forth from a TAR legislative task force.

With the state facing a budget deficit that Comptroller Carole Keeton Strayhorn recently said might be even larger than the previously projected $10 billion, finding new sources of revenue, including a tax on services, may be on the minds of some legislators. As always, your association is monitoring every piece of legislation to ensure no measures pass that would negatively impact your livelihood.

Texas REALTORS® and association staff are involved in many other issues and are monitoring everything that is going on at the Capitol to avoid any unpleasant surprises. The full list of the Texas Association of REALTORS® legislative agenda can be found in the December 2002 issue. Updates on legislative activity that will impact real estate professionals and private property owners will appear in future issues. Texas REALTOR® also will publish a comprehensive recap after the session is over.

Photo by Joel Mathews.

Buyers & sellers, visit www.texasrealestate.com.
REALTORS®, visit www.texasrealtors.com.