The consumer group Texas Watch has been keeping an eye on recent insurance hearings, and has written about it:

So, just what is a junk insurance policy? Sen. Leticia Van de Putte said she’s been hearing from constituents who are fed up with junk policies with what she called “luscious exclusions” and “skyrocketing” deductibles. She asked Insurance Commissioner Eleanor Kitzman about this at a recent committee hearing. Kitzman was unaware of the problem.

Well, we are aware of the problem. So, we sent Sen. Van de Putte a letter outlining the problem (and we sent a copy to Commissioner Kitzman too).

Texas homeowners paid the most expensive insurance premiums in the country for the second year in a row, although average premiums in the state have not been increasing as sharply as in other states, according to new figures from the National Association of Insurance Commissioners.

The average annual cost of the most commonly sold policy in Texas was $1,511, which is well above the national average of $880 and about $50 more than in the state with the second-highest rates, Florida. Eight states had average premiums above $1,000 a year, and some of those have seen dramatic increases in recent years.

Consumer groups warned that Texas homeowners should not expect any relief soon, while industry representatives noted that premiums in the state are not rising as fast as in other states.

“For as long as anyone can remember, Texas has had among the highest insurance rates in the nation,” said Alex Winslow of Texas Watch, a consumer group active in insurance issues.

“The flip side is that coverage for most homeowners is getting slashed while their rates keep going up. With higher deductibles, expanded exclusions and a growing number of junk policies, Texas policyholders are being forced to pay more for less,” he said. “It’s like being forced to pay Cadillac prices and getting stuck with a clunker.”

Winslow said the situation would not improve until the Legislature beefs up laws regulating insurers and the commissioner of insurance “gets tough” with companies.

Mark Hanna of the Insurance Council of Texas said the premiums listed in the study reflect how catastrophic weather events can affect homeowner rates. He noted that several states with higher premiums were along the hurricane-prone Gulf Coast or in areas that experience a large number of destructive storms.

The ideal way to save money is to exert effort once and automatically reap savings over and over again, every month. That’s why examining your car insurance makes a lot of sense.

Auto insurance prices vary widely. On average, car insurance cost Americans $789 per vehicle annually in 2008, the most recent year of data provided by the National Association of Insurance Commissioners.

But your costs could be far higher or lower because of the state you live in. For example, Florida, New Jersey and New York were among states where the average was more than $1,000 annually. North Dakota’s average expenditure was the lowest at $503. Texas fell in between with an $854 average.

Here are ways to save on car insurance:

Compare

If you think all auto insurance rates within a state are about the same, you’re wrong. Premiums can be different for the exact same policies, depending on what factors an insurer chooses to emphasize in its rate formula.

For the youngest drivers, comparison-shopping could save about $1,100 a year, according to a study by CarInsurance.com. You might think you get better service from higher-priced insurers, but there seems to be no correlation, according to a study by the Consumer Federation of America.

“Many people stick with the same insurance carrier year after year without ever shopping for a better deal,” Consumer Reports says in its guide to car insurance. “Blind loyalty to one insurer can cost you dearly.”

Bundling

Choosing an auto insurer is important, too, because you might want to get your home insurance through the same carrier. Auto rates vary more and probably are more expensive, so let that be the insurance that, well, drives your decision.

Like bundling your pay TV, phone and Internet access with one company, you can get discounts for bundling your insurance with a single insurer, said Jim Fults, associate vice president of auto and personal insurance at Fireman’s Fund Insurance. At Fireman’s, he said, customers can save $400 to $600 a year by bundling auto and home insurance.

Deductibles

A deductible is the part of the bill you pay out-of-pocket before insurance kicks in. The higher the deductible you’re willing to accept, the lower your premiums will be. Changing from a $200 deductible to $1,000 could save you 40 percent, says the Insurance Information Institute.

Fults suggests examining several deductibles to see how they affect premiums.

“I think people would be really surprised, when they looked at changing a deductible of just $500 or $1,000, by what that does to the price [of premiums],” he said. “For some vehicles, it might move it considerably. In other cases, it might not.”

Personal finance experts typically advise choosing the highest deductible you can financially stomach if it will give you big price breaks on premiums.

Discounts

Make sure you’re getting all the discounts you’re entitled to — for driving low miles every year, for example. A teen driver, who can raise rates 50 percent, can get a discount for good grades, typically at least a B average, Toups said.

Taking time annually to review your coverages with your insurer will make sure you’re getting those discounts, Fults said. You’ll not only incorporate your life changes into your auto insurance, but you’ll also learn about the insurer’s new products and pricing, which change often.

Drop collision

It might be worth dropping collision coverage on older cars that aren’t worth much.

Consumer advocate Clark Howard said the time to consider dropping collision is when cars get to be about 8 years old. His rule of thumb: If your annual, not monthly, premium for collision and comprehensive is more than 10 percent of your car’s value, remove collision coverage and just pay the liability premium.

Texans can check companies, compare rates and file complaints with the Texas Department of Insurance: www.tdi.texas.gov.

The look in their eyes is the tip-off after they plow into your car.

The look says, “Sorry, my bad. And, shoot — my insurance expired.”

Many of us have had the rotten luck of meeting these drivers. They’re everywhere in Texas, more than 4 million of them, always wearing that hapless look on their face after they wreck people’s property — or worse — with no way to pay for the damage.

The state has developed a sophisticated net to catch these lawbreakers, but a maddening number continues to slip through. After a 3-year-old program to cut the number of uninsured motorists showed early results, it’s a disappointment that it appears to have stalled out.

Today, better than one in five vehicles in Texas isn’t covered by the legally required, minimum level of liability insurance. Worse, in Dallas County, the percentage is closer to one in four — the highest among the major counties.

The program created a massive database, TexasSure, that street cops and county officials can access to check on a vehicle’s insurance coverage. If there’s no policy, the officer writes a ticket and the county refuses to re-register the vehicle.

Also, TexasSure looks for uninsured drivers in the database and contacts them by mail about being out of compliance.

Problem solved, right? Not really.

First, assume there’s a bedrock of bad actors who will simply risk a fine or jail (in the case of repeat offenses) to duck a basic expense of driving. Then layer on the crummy economy and figure that some normally law-abiding, but newly jobless people felt forced to let their insurance lapse.

Last, consider the workarounds that lawbreakers use — like buying counterfeit inspection or registration stickers instead of buying the real thing, which requires showing proof of insurance.

Lawmakers who created the TexasSure program need to build on its early success in lowering the uninsured percentage by a few points. They should study why some states have uninsured rates that are nearly half of Texas’. What are they doing that we’re not?

The Legislature also needs to replenish the fund that supports counties, like Dallas, that dedicate resources to busting traffickers in counterfeit or illegally obtained inspection stickers. That fund took a hit in the Legislature this year, a short-sighted decision.

On the local level, more cities need to emulate Dallas, Plano and others that authorize police officers to have uninsured cars towed on the spot. That sends an important message.

There’s no quick, neat or easy fix to the problem. It takes a broad approach, especially stepped-up efforts out of Austin, to end this game of Whac-A-Mole with uninsured drivers. Too often it feels like the moles are winning.

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DRIVING WITHOUT INSURANCE

The percentage of vehicles that lacked insurance in July:

Dallas area counties

Dallas: 24.1%

Tarrant: 21.4%

Johnson: 20.3%

Kaufman: 19.4%

Ellis: 18.8%

Rockwall: 17.9%

Denton: 17%

Collin: 16%

Other urban Texas counties

Bexar (San Antonio): 22.9%

Harris (Houston): 22.7%

Statewide: 21.6%

El Paso: 21.5%

Travis (Austin): 20.9%

SOURCE: Texas Department of Insurance

More than one in five Texas motorists lack the insurance that state law requires and the ratio is virtually unchanged from a year ago, a blow to the state’s 3-year-old program to sharply reduce the number of uninsured drivers on the road.

In addition, Dallas County continues to have the largest percentage of uninsured drivers among the state’s six largest counties, with 24.1 percent of cars and trucks lacking insurance coverage. That figure is down slightly from a year ago, state figures show.

Although the TexasSure vehicle insurance verification program showed good results the first two years after it began in 2008, reducing the number of uninsured vehicles from 24.3 percent to 21.6 percent in 2010, new statistics compiled in July show that progress has stagnated.

That means about 4.2 million drivers have no insurance, and law-abiding motorists shell out nearly $1 billion a year to protect themselves from damage done by drivers without insurance, state officials say.

Insurance industry groups say the economy and a decline in publicity for the TexasSure program are factors in the decline. Jerry Hagins, a spokesman for the Texas Department of Insurance, said officials are unsure why the momentum of the first two years has stalled.

The department is sending letters to thousands of drivers found to be uninsured. The letters remind them of the mandatory insurance requirement and ask them to verify their coverage by mail, email or telephone.

Texas’ financial responsibility law, in place for several years, requires drivers to buy insurance that contains at least liability coverage to pay for injuries and damages caused by the driver.

The insurance department hasn’t analyzed why Dallas has such a high percentage of uninsured drivers. Industry representatives said they had no explanation for the trend, either.

TexasSure relies on a massive database containing the names of all insured drivers and their insurance companies — matched to their license plates and vehicle identification numbers. Insurers provide the information.

When a driver is involved in an accident or stopped for an infraction, an officer can enter the license plate number or VIN into the TexasSure system to verify insurance coverage. In addition, the data is available to county tax assessor-collectors to confirm whether a driver has insurance before issuing or renewing a registration sticker.

Those who lack insurance are ticketed, subject to a fine of up $350 on the first offense and up to $1,000 and possible suspension of their license on the second offense. Those who rack up multiple offenses and take no action are subject to arrest.

Some states fine drivers who are found to lack insurance. But in Texas, fines kick in only after a driver is stopped by a law enforcement officer.

“[States] that made the fastest progress in getting their uninsured numbers down had a fine associated with the notification program,” said Hagins of the insurance department, but Texas’ law does not allow for fines.

Considering that a vendor for the state agency is sending out 25,000 letters a week to drivers who are found to have a car registered but no insurance policy, the impact of a fine could be significant, not only in pressuring those drivers to obtain insurance but also producing significant revenue for the effort.

Hagins said an estimated 1.9 million Texas drivers are in the pool of those receiving notification letters. Those who don’t respond are warned that they are subject to fines and can lose their driver’s license if they don’t comply with the law. But those fines can be assessed only if the driver is stopped for another violation.

“The conventional wisdom is that hospitals aggressively seek to shift costs from public insurance programs to private payers such as auto insurance companies,” said Elizabeth Sprinkel, Senior Vice President of the IRC. “With this study, we now have information on the magnitude of cost shifting and a better understanding of the need for supportive state laws and effective tools that will enable auto insurers to pay hospitals appropriately and help control auto injury claim costs,” said Sprinkel.

Door County lawmakers are among the sponsors of companion bills in the Wisconsin Legislature that would roll back increases in auto insurance rates that were approved last year.

Senate Bill 7 and Assembly Bill 4 are scheduled for public hearing before the state Senate Committee on Insurance and Housing and the Assembly Insurance Committee today in Madison. State Sen. Frank Lasee, R-Bellevue, introduced the bill in the Senate and Rep. Garey Bies, R-Sister Bay, is a co-sponsor.

The Democratic-controlled Legislature in 2009 passed budget provisions requiring all Wisconsin drivers to carry insurance and also doubled the minimum allowable coverage to $50,000 for the injury or death of a person, $100,000 for the injury or death of more than one person and $15,000 for property damage.

The new bill would roll the minimum allowable coverages to the previous levels of $25,000, $50,000 and $10,000 respectively. Republicans, who won control of the Senate and Assembly in the November election, argue that the new limits raised premium rates for consumers who can only afford the minimum insurance required by law.

The Wisconsin Association for Justice, formerly the Wisconsin Academy of Trial Lawyers, objected to the rapid scheduling of a hearing on bills that alter what the previous Legislature had dubbed the “Truth in Auto Insurance Law.”

“This means that if a drunk driver crashes into you or a loved one, the drunk driver won’t have as much insurance to pay for your injuries or damages to your car,” said Mike End, president of the association, in a news release. “Responsible drivers will be left holding the bag and not be paid for medical bills and lost wages.”

The minimum limits in Texas have lagged behind inflation for many years, but are now at least showing some movement. The bad news is that this is the last increase mentioned in the law, and it will take a new law to increase the limits further.

The new limits are $30,000 per person, $60,000 per incident, and $25,000 for property damage.

$30,000 doesn’t go very far in paying for even a brief hospital stay, and $25,000 certainly isn’t enough to pay for the damage to a luxury car, but at least we got a small increase from the Legislature.

The latest to announce an increase is Allstate, which is raising premiums across the state by anywhere from 5.4% to 9.7%, effective January 20, 2011. Allstate covers about 625,000 homeowners in Texas. As always, Allstate used the frequency of destructive weather in Texas to justify the rate increases. Allstate also increased its rates in 2009, citing the Texas weather. You’d think maybe after all these years, Allstate would have a little better understanding of Texas weather, and allow for it in their rates. Instead, every year the company is surprised to learn that Texas has wind, rain, and hail.