From the Office of State Senator Rodney Ellis
For Immediate Release
March 8, 2002
Contact: Mike Lavigne, (512) 463-0113
Sen. Rodney Ellis, Rev. Jesse Jackson, Others Hold Townhall Meeting on Race-Based Insurance Pricing
Senator Ellis held a townhall meeting in Houston on Thursday, March 8, 2002 to address two important insurance issues. The two items discussed were Race-Based Insurance Premiums and Upside-Down Pricing.
On the panel with Senator Ellis was Texas Insurance Commissioner Montemayor, Reverend Jesse Jackson, City Councilwoman Ada Edwards, State Representative Sylvester Turner, and other community leaders.
Montemayor explained the two primary issues, after which the panel asked him questions and addressed what future actions will be needed to resolve them. Rev. Jackson gave a brief talk on Race-Based Insurance Premiums and their effect on minority communities.
After the panel discussion, the public was able to ask the panel questions about these and other issues.
Race-Based Insurance pricing is the practice of charging people of different races the same premiums for different face value insurance policies. The policies are generally of a face value under $3,000 and the premiums are often collected door to door. Although most insurance companies no longer sell these policies, many are still collecting premiums on the policies that were issued under racist terms.
Upside-Down Pricing is the practice of structuring small face value insurance policies so that the premiums paid quickly exceed the benefit to be received. This practice is not illegal in Texas at this time. There is a committee that is holding hearings, under authority granted to Commissioner Montemayor under legislation passed by Senator Ellis, that is studying the issue in hearings across the state.
Sen. Rodney Ellis and Rev.Jesse Jackson visit Kashmere High School in Houston
While Rev. Jackson was in Houston on Thurday, he and Sen. Ellis visited Kashmere High School. Rev. Jackson talked to the student body about the importance of a good education and ending violence in the community.