Senator Eliot Shapleigh - El Paso, Texas

AUSTIN – Senate Democrats blocked action on a major insurance bill Wednesday after Republican sponsors of the measure declined to support several consumer protections, including prior state approval of all rate hikes.

The legislation was delayed until next week after the chamber's 12 Democrats said they would oppose consideration until they can get safeguards to hold the line on home insurance rates.

Studies have shown that Texans pay the highest homeowners premiums in the nation.

"Democrats are fighting to ensure that Texans are no longer required to pay the highest rates in the nation, and we are insisting that the legislation reflects an insurance department that will protect consumers," said Senate Democratic leader Leticia Van de Putte of San Antonio.

Among the two-dozen amendments that have been filed on the bill is one that would require insurers to get prior approval from the state insurance commissioner before increasing rates. Currently, companies can raise rates simply by notifying the insurance department.

The legislation, which would reauthorize the Texas Department of Insurance, was scheduled for debate Wednesday, but Democrats invoked a rule that requires two-thirds of senators' support to consider a bill.

The bill's author, Sen. Glenn Hegar, R-Katy, said he would meet with Democrats on Monday to see if they can strike a deal.

Hegar argued that several of the reforms sought by Democrats are major changes in the law and should be considered in separate bills – not the "sunset" measure that would continue the operation of the insurance department.

The Republican also contended that the current "file-and-use" system – allowing companies to immediately raise rates after notifying the state – has not had a chance to work properly since it was adopted by the Legislature in 2003.

"There has been uncertainty in our regulatory system," Hegar said. "We need to create a stable insurance market in Texas" that will encourage more companies to do business in the state.

Democrats, with the support of consumer groups, also are seeking a change that would require companies to issue immediate refunds when they are found to be overcharging their customers. One of the largest insurers has been battling the state for nearly six years over allegations of excessive rates that total hundreds of millions of dollars.