Homeowners insurance has been a hot topic in recent years. The Third Court of Appeals in Austin has now determined that a 2003 provision regarding homeowners insurance was unconstitutional. The provision, which was part of the 2003 reform law, required the insurance rates of homeowners to be reduced.
Known as Senate Bill 14, the law had actually required a 12% rate reduction to be implemented by 12 different companies. One of these companies was State Farm Lloyds, which happens to be the largest insurer in the state.
The law was initially passed out of concern regarding skyrocketing insurance rates, which resulted when State Farm and other companies found a loophole in the existing laws that allowed them to avoid having their rates regulated.
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