OKLAHOMA CITY — The Oklahoma Insurance Department announced a package of preliminary legislative proposals that fail to directly address skyrocketing premiums and suggest measures that would make it more difficult for policyholders to fight back, critics say.
Instead, the proposals announced Dec. 10 seek to expand Oklahoma’s fortified roof program and require insurance companies to cover roofs that are not too old or worn out, presumably to address the types of wind and hail damage that have become a flashpoint in Oklahoma. In addition, the proposals call for shorter response times from companies on claim acknowledgement and decisions and propose a not yet detailed homeowners bill of rights.
Most troubling to critics, the proposals seek to impose new obstacles to policyholders suing insurance companies, on the claim that litigation costs translate to rate increases. Rep. Mark Tedford, R-Jenks, and Sen. Aaron Reinhardt, R-Jenks, in a press release, laid blame for rate hikes on attorneys’ fees in lawsuits rather than the peculiarities of Oklahoma law that permit insurers to raise rates without scrutiny.
Tedford, who in November acknowledged that there had been discussions among politicians about modifying the problematic Property and Casualty Loss Cost Rating Act that governs homeowners insurance, confirmed that the Insurance Department had specifically requested that the law not be altered.
Now writing bills for the upcoming legislative session based on the department’s requests, Tedford expressed preference for third-party adjusters to settle claim disputes.
“I really don’t like litigation in a property claim,” Tedford said. “In my opinion, when there’s litigation it drags the claim out, adding costs to both sides.”
Oklahoma Insurance Department Commissioner Glen Mulready did not respond to an interview request.
Skepticism over legal reforms
Last month, Tulsa Police Lt. Billy Hursh, one of hundreds of State Farm policyholders who have taken legal action after being denied a claim on roof damage, became the public face of the effort to fight back against against what Attorney General Gentner Drummond described, in a Dec. 4 petition to intervene in Hursh’s case, as racketeering in the insurance industry.
Hursh was nonplussed at the proposed new laws.
“Some of it seems encouraging, but the parts about tort reform are concerning,” Hursh said. “Preventing attorney’s fees from being awarded seems like it would make it harder for regular people to bring litigation against insurance companies. Most people don’t have room in their budgets to pay for attorney fees. Insurance companies definitely do.”
The amount of money insurance companies spend on litigation is not publicly available, but spending on lobbying is: from 2014-2023, U.S. insurance companies spent an average $130 million annually.
Republished in partnership with Oklahoma Watch under a Creative Commons license. Free Press publishes this report as a collaborative effort to provide the best coverage of state issues that affect our readers.
JC Hallman covers a variety of topics for Oklahoma Watch. Contact him at jchallman@oklahomawatch.org.
