Number of Complaints Against Insurers Continues to Drop in Texas

For the fifth year in a row Texas consumers filed fewer complaints against their insurance companies with the Texas Department of Insurance (TDI), the Insurance Council of Texas reported. The total number of closed complaints was recently released in Commissioner Mike Geeslin’s Annual Report to the Texas Legislature.

Since 2003 the number of complaints against Texas insurers has dropped by more than 50 percent. The number of complaints filed in 2008 is the lowest number of complaints filed against the insurance industry since 1998.

Mark Hanna, a spokesman for the Insurance Council of Texas, says two things are happening. “Consumers don’t file complaints when insurance representatives handle their claims correctly and Texas insurers have gotten a lot of practice in settling claims because of the numerous catastrophes the state has experienced.”

The number of complaints dropped from 21,676 in 2007 to 20,375 in 2008 or a decline of 6 percent. TDI’s fiscal year runs from Sept. 1, 2007, to Aug. 31, 2008.

The lack of complaints has not been for the lack of claims. During the past fiscal year thousands of Texans filed claims from the damage caused by Hurricane Dolly, Tropical Storm Edouard and damaging thunderstorms that raked north and central Texas earlier this year. According to the 2008 Annual Report, Texas insurers paid out more than $64 billion last year in all lines of coverage.

The largest decline in complaints occurred in homeowners coverage with a 16 percent drop from last year. In the past two years homeowner complaints have fallen 48 percent. Complaints against accident and health insurers continue to lead the list followed by complaints against auto insurers.

In the homeowners line, complaints dropped from 1,842 in 2007 to 1,549. In the auto insurance line, there was a 1 percent increase in 2008: 6,889 complaints in 2008 compared with 6,811 in 2007.

“If consumers have a problem in settling their claim, we advise them to first contact their insurance agent or representative,” said Hanna. “Our experience shows that more than 99 percent of the time, consumers and their insurers are able to work things out.”

TDI’s Total Number of Closed Insurance Complaints from 1997 to Present

1997 – 17,650
1998 – 18,829
1999 – 22,472
2000 – 28,005
2001 – 28,996
2002 – 34,364
2003 – 41,294
2004 – 29,505
2005 – 24,132
2006 – 24,122
2007 – 21,676
2008 – 20,375

Consumers can call, write, fax or e-mail their complaints to the Texas Department of Insurance. TDI’s toll-free Consumer Protection Help-line is 1-800-252-3439 and TDI’s Web site is www.tdi.state.tx.us.

Source: The Insurance Council of Texas, www.insurancecouncil.org.