Julia Rathgeber named new Texas insurance commissioner

Texas Governor Rick Perry has appointed Julia Rathgeber, formerly deputy chief of staff to Lietenant Governor David Dewhurst, as new Texas Insurance Commissioner.  Commissioner Rathgeber replaces Eleanor Kitzman who failed to win confirmation from the Texas Senate.  In addition to her work for the Lieutenant Governor, she has worked at the state’s General Land Office, the Texas Natural Resource Conservation Commission and at that agency’s successor, Texas Commission on Environmental Quality. Earlier in her career, Ms. Rathgeber worked for six years as Director of the Senate Research Center under Lieutenant Governor Bob Bullock in January, 1992.  The background of Ms. Rathgeber, a 1990 graduate of the University of Texas Law School, in insurance law and regulation is unclear at this point.

Let’s hope Ms. Rathgeber’s lengthy background in Texas politics makes her a quick study.  And let’s hope she receives lots of fair minded assistance. And let’s hope she supports the suggestion of her former boss, Lieutenant Governor Dewhurst, that windstorm insurance reform be added to the agenda for a legislative special session. She takes charge, among many other responsibilities, of the Texas Windstorm Insurance Association, which oversees the largest insurer of property on the Texas coast and whose financial problems might explode if a significant tropical cyclone hits the Texas coast before significant reform occurs.

Also, we did a little web background check on Ms. Rathgeber, who now becomes a bit more of a public figure. She has been involved in Meals on Wheels, the Seton Hospital, and the Shelter for Battered Women and lists various lobbying groups as “Likes” on her Facebook page. One curious fact emerges:  although Ms. Rathgeber passed the Texas bar in 1990 upon her graduation from law school, and although no disciplinary violations are reported against her, she is currently suspended from the practice of law in Texas.  [NOTE ADDENDUM BELOW DATED May 30, 2013]  Possible reasons for this suspension are listed here. It could well be as innocent as failing to pay membership dues or failing to complete Continuing Legal Education requirements.  And, an active license may not have been necessary in her recent jobs as she likely was not representing clients.

ADDENDUM: May 30, 2013.  The Texas bar has changed the status on Ms. Rathgeber.  When I wrote what I did, it is quite true that she was listed as suspended.  But, Ms. Rathgeber is no longer listed as “suspended from the practice of law” but is now listed as “Inactive.”  I do not know whether the earlier designation represented an error by the State Bar or whether Ms. Rathgeber took appropriate steps to get an earlier suspension removed. There is absolutely nothing wrong having an “inactive” law license assuming one is not representing clients.

Texas House, Senate agree on minor windstorm reform bill

Texas Governor Rick Perry

Texas Governor Rick Perry

A bill that modestly affects future eligibility for insurance sold by the Texas Windstorm Insurance Association has now passed the Texas Senate and the Texas House and should be heading to Texas Governor Rick Perry for signature.  S.B. 1702 extends until 2015 the time by which owners of some property that does not comply fully with usual TWIA building standards must obtain “alternative certification.”  Property that has non-compliant roofing, exterior openings and exterior wall coverings may thus gain a reprieve. It also appears to provide, however, that after 2015 property worth more than $250,000 must meet regular certification requirements rather than alternative certification.

The bill, my reconstruction of which is contained in this earlier post, appears to trade somewhat greater TWIA losses in the short run against the possibility of loss reduction in the future.  This is so because under existing law alternative certification would have been required as early as August 30, 2013. By relaxing the time in which non-compliant property must at least obtain alternative certification, the bill would appear to increase slightly TWIA’s exposure to tropical cyclone losses over the next few years at a time when, by all accounts, TWIA’s finances are in very poor condition. If TWIA survives until 2015, however, its exposure to losses thereafter may be somewhat limited since property valued at $250,000 or greater will need to come into full compliance. Either way, however, the effect of S.B. 1702 is likely to be small and should not be confused by anyone with significant reform of this very troubled insurance program.  With the regular session of the 83rd Legislature coming to a close on Monday, however, S.B. 1702 appears to be all that has been accomplished.

We await seeing if Governor Rick Perry adds windstorm insurance reform to the agenda for a special session as his Lieutenant Governor, David Dewhurst, has, in addition to others, now suggested.

Lieutenant Governor David Dewhurst

Lieutenant Governor David Dewhurst