The Texas Attorney General ordered insurer Travelers Cos. Inc. to stop running a television advertisement that he called deceptive. Attorney General Greg Abbott said that the Travelers ad improperly tells Texas homeowners that they should buy additional automobile insurance to prevent losing their homes.
“Texans are protected by robust homestead laws that insulate homeowners from the losses depicted in Travelers’ advertisements,” Abbott said in the release.
The Texas Constitution (Article 16, Section 50) strictly prohibits the forced sale of a person’s homestead except in narrow circumstances, clearly protecting homeowners from just the type of situation outlined in the Travelers television ad.
If Travelers continues to air the ad, the company will face legal action by the state, Abbott said. Abbott’s action comes two days after Texas Watch, a consumer advocacy group, asked Abbott and Texas Insurance Commissioner Mike Geeslin to take action against the company.
Alex Winslow, Texas Watch’s executive director, said in a statement that Abbott did the right thing. “This ad is deceptive and misleading,” said Winslow. “During our nation’s current economic crisis, it is shameful that an insurance company would prey on the fears of families who are already concerned about being able to make their mortgage payments just to sell more overpriced insurance.”
The Texas Department of Insurance also contacted Travelers. The department said the ad violated the state insurance code and asked the company to remove it.
Travelers media representatives did not immediately comment on the issue.