Know your rights on insurance rates

AUSTIN (KXAN) - Sitting right beside his driveway underneath a long, tall carport is Roy Minshew's home away from home.

"I seriously don't like staying in hotels and I really don't like restaurant food," said Minshew, who contacted the KXAN Tipline.

The shiny recreational vehicle is resting up for the next road trip. He and his wife have been "motorhoming" for the last 20 years. Minshew, 74, is close to retirement and looking forward to traveling full time.

But sticker shock hit when his insurance bill arrived in the mail earlier this year. It jumped from $569 a year to $727 -- a 27-percent increase.

Minshew says a customer service representative told him it is a direct result of the company's losses in the Bastrop County wildfire, which inflicted tens of millions of dollars worth of damage on nearly 2,000 homes.

"We are some of the safest clients that they have, and for them to take advantage of us like that to cover something else -- there's something wrong with that," said Minshew.

The insurance company told KXAN a different story.

An out-of-state spokesperson said "we are not allowed to recoup past losses" and "rates are never based solely on one event."

Reasoning behind rate hikes

According to the Texas Department of Insurance , the same rules apply to all insurance companies because it is the law.

The state agency has to sign off on all rate hikes. TDI spokesman Jerry Hagins said the department did approve an increase that affected Minshew, but he was hit even harder because he dropped his motorcycle insurance with the company and is no longer getting a multi-policy discount.

After inquiries by KXAN, Minshew received a letter from his company that also tied his rate hike to his age and an upward trend in RV policies.

Local insurance agent Brent Allen, not associated with Minshew's company, said explaining to customers why costs are rising is not easy.

"The problem is it's hard to put your finger on it. It's not an exact science," said Allen.

Companies do look at a combination of past disasters to plan for the future.

Hurricanes, hail and fire

When it comes to homeowners insurance, Allen said there are some obvious reasons rates in Texas have jumped 21 percent since 2009: Hurricane Ike, several hail storms in Central and North Texas and the Bastrop County wildfires.

"As these events happen construction costs go up," said Allen. "Roof costs have actually gone up 90 percent in the last five years."

The events have made it harder for insurance companies to cover claims.

But in the end, the customer has the power to stay or shop around for a cheaper rate.

The state offers a free website to help Texans shop for the best rate on car, homeowners and renters insurance. The site also includes general information to help consumers make sense of different insurance plans.

Click here to go to Helpinsure.com

Insurance customers can also file complaints with the state by calling 800-252-3439.