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Press Release
 
June 1, 2006  
VO CALLS ON STATE OFFICIALS TO REJECT INSURANCE INDUSTRY RATE HIKE REQUEST
Houston Area Still Coping With Hurricane Evacuees, Highest Homeowners' Insurance Rates in Nation

Alief, Texas - On a day that marks the official start of the 2006 hurricane season, State Representative Hubert Vo today called on state officials to immediately reject rate hike requests filed this week with the Texas Department of Insurance by the state's largest home insurer.

"Texas homeowners already pay twice the national average to protect their homes," Vo said. "The state should be demanding that Big Insurance lower its rates, not granting permission to raise them even more."

State Farm, the leading home insurance carrier in Texas, this week asked state officials to approve rate hikes. The increases would be heaviest for homeowners in Fort Bend, Galveston, and Harris counties.

State Farm is in the midst of a court battle to avoid reducing its rates by 12 percent as ordered by the state two years ago.

Vo said the company's request follows on the heels of news last month that Allstate will also raise rates after being forced to lower them slightly as the result of another legal battle.

 

In addition, Allstate has dropped windstorm coverage for coastal residents and is turning away new customers in some areas of the state due to claims related to hurricanes Rita and Katrina.

Vo has been lobbying state officials to free up promised federal funds to help public schools in Alief deal with thousands of students who were evacuated to the area in the wake of last year's storms. The emergency funds are needed to address the unique challenges of the evacuees, including educational disparities, multiple traumas faced by the students, and additional demands on classroom space and educational resources.

Even without such challenges, Vo said, Texas homeowners are paying twice the national average to protect their homes, more than homeowners in comparable states such as Florida and California, where natural disasters are more costly.

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