It’s hardly news: Oklahoma homeowners’ insurance rates are high, perhaps the highest in the nation. A recent Wall Street Journal article, relying heavily on input from Oklahoma Insurance Department Commissioner Glen Mulready, said that hail damage explains the elevated rates.

Puzzled weather experts wondered whether that might be an excuse to stifle questions, as the data used to blame hail shows the opposite: Oklahoma has had less hail than states with lower rates.

The real culprit may be a bit of legislative sleight of hand, performed to cut a loophole in decades-old federal law.

The rubrics vary and the numbers toggle up and down year to year, but the message remains the same: rates are high.

According to a 2025 Bankrate report, Oklahomans pay $4,651 to insure a $300K home, a figure that is more than double the national average but in line with the state’s tornado alley neighbors.

A 2025 Lendingtree report paints a different picture. Based on household income, the study found that Americans nationwide spent an average of 2.41% of their 2024 annual income on homeowners’ insurance. At 6.84%, Oklahoma topped the list by a wide margin, nearly three times the national average.

Neighboring states lagged well behind: Arkansas, 4.39%; Texas, 4.62%; and Kansas, 5.58%.

Still another rubric from the March 16 Wall Street Journal article, “In America’s Insurance Crisis, Hail Hits Harder than Hurricanes and Fires,” found that Oklahoma had a higher rate of insurers refusing to renew 2023 policies than any other landlocked state in the country. From start to finish, the story relied on Mulready to argue that hail explained Oklahoma’s insurance crisis, but remained silent on why rates of non-renewal in southeast Oklahoma had risen to 4% or more while rates remained close to 1% in neighboring Texas counties, with only the Red River or a lonely highway in between.

In fact, the Journal mischaracterized the Senate Budget Committee staff report upon which its analysis was based. The Journal overstated the report’s claims on the role of hail in nonrenewal rates and understated the changes in rates and nonrenewals in much of rural Oklahoma.

Mulready subsequently indicated that his source for hail data was an analysis provided by an insurance brokerage firm, and questioned the committee report.

“I would refute that source,” Mulready said. “I don’t think the data that the Senate Budget Committee received would be statistically valid. There should be an asterisk there.”

Something Seems Rotten in Oklahoma

It’s hard to find data that supports the claim that hail explains why Oklahoma would wind up with rates higher than Texas or Kansas.

The National Oceanic and Atmospheric Administration does not measure hail as a distinct weather factor, and the organization’s data on severe weather events from 1980-2024 do not suggest a significant difference in conditions between Oklahoma and its neighbors to the west, north, and south.

Bruce Thoren, a meteorologist with the National Weather Service Forecast Center in Norman, which monitors events in dozens of counties in western Oklahoma and north Texas, recalled significant damage from a hailstorm in 2023. But Thoren was unaware of any data that indicated a broader uptick of hail incidents peculiar to the state. 

Thoren said that hail could be used as a scapegoat to justify high rates.

“They might just say, ‘Oh, I don’t know, it’s hail,’ just so people stop asking questions,” Thoren said.

Clifton Naife, a Norman insurance attorney, lamented that homeowners could do little to contest rates that were the result of accounting shenanigans.

“That’s right,” Naifeh said, speaking hypothetically. “If they want to raise your rates, and they want to use a ruse to raise your rates, then what’s your remedy?”

Insurance is Weird

Homeowners’ insurance in Oklahoma is strange — suspiciously so — but Tulsa insurance attorney Frank Frasier said the entire history of insurance is peculiar.

“Insurance is an industry unlike any other,” Frasier said.

As far back as 1868, insurance was not classified as commerce, which meant it was local and outside the ability of the federal government to regulate, according to a 1987 Journal of Legislation article by Jeffrey L. Shrader.

In 1944, a Supreme Court case, McCarren v. Ferguson, reversed decades of precedent and established that insurance was commerce after all. In response, states modeled laws on legislation proposed by the National Association of Insurance Commissioners to enable regulation and taxation of the insurance industry.

The industry received a degree of antitrust protection, similar to that granted to Major League Baseball, but President Franklin D. Roosevelt offered assurance that the goal was regulation.

“Congress did not permit private rate fixing, which the Antitrust Act forbids, but was willing to permit actual regulation of rates by affirmative actions of the states,” Roosevelt said.

It didn’t quite work out that way.

State laws fell to either side of a pitched roof. The two options go by a variety of names or descriptions, and subtle differences separate state from state, but it is broadly the case that some states regulate heavily while others attempt to encourage competition by regulating as little as possible.

The Oklahoma Insurance Department will regulate rates if they go too low. But it will not regulate rates if they go up, on the assumption that the free market will bring costs down.

By way of contrast, Texas law stipulates that rates shall be neither inadequate nor excessive.

To many of the attorneys consulted for this story, the actions of the OID tend to come off as political, if not shifty. The OID commissioner is an elected official; insurance companies pay lobbyists handsomely to make their desires known behind closed doors.

“I don’t want to say that I don’t talk to lobbyists, but I don’t talk to lobbyists,” Mulready said. “I’m not at the Capitol with lobbyists. I don’t have regular meetings with lobbyists.”

Mulready may not meet with lobbyists, but the insurance industry has been his greatest financial supporter. Campaign reports from 2011-2023 compiled by Open Secrets show that the insurance industry was Mulready’s top donor in 13 of 15 years, both as a House of Representatives candidate and when running for insurance commissioner. In campaign years, the insurance industry outspent the next closest group, attorneys, by a wide margin, as much as four to one. 

Decades ago, Shrader warned that the insurance industry already resembled a criminal enterprise.

“Critics argue that the insurance industry today uses private ratings bureaus and displays cartel-like behavior, contrary to congressional intent,” Shrader wrote.

Commercial or Not Commercial

In 1999, as he remembered it, then-state senator Kevin Easley — once one of youngest legislators in Oklahoma history, now CEO of New Dominion LLC, a Tulsa-based oil and gas company — was approached with a request bill direct from Carroll Fisher, then the insurance commissioner, who in a few years’ time would be impeached, resign, and be convicted of felony embezzlement.

Fisher needed more competition in the business insurance market, Easley said.

The bill had an unruly name: The Commercial Property and Casualty Competitive Loss Cost Rating Act.

It wasn’t Easley’s area of expertise. But he agreed to shepherd the bill through the Senate while Rep. Tommy Thomas moved it through the House. Thomas did have expertise; he later ran an insurance company and became a lobbyist.

Nevertheless, Thomas claimed to have no recollection of the bill.

“Dude, it was 26 years ago — I’m sorry,” he said. 

The bill passed. Five years later, additional legislation removed the word commercial, and homeowners’ insurance was thrown into the mix.

The bill’s remaining language now forms sections 981-989 of Title 36. Section 984 describes the process by which a competitive market can be contested; if the market is found to be non-competitive, high rates can be regulated.

In other words, someone has to complain before the OID can compel lower rates. 

The effort to complain — to challenge whether the market is competitive — is supposed to begin with an outside party requesting a hearing.

“The burden of proof in any hearing shall be placed on the party or parties advocating the position that competition does not exist,” Section 984 reads.

Notably, none of the insurance attorneys consulted for this story were aware of any challenge to the competitive homeowners’ insurance market having been mounted by an outside party.

“Not to my knowledge,” Frasier said. “It’s laughable.”

Even Oklahoma City insurance attorney Rex Travis, who has worked in insurance law in the state for more than 60 years, could not recall any instance of Section 984 being invoked.

“Absolutely not,” Travis said. “That series of sections never appeared on my radar.”

Regulate by Not Regulating

A persistent refrain from insurance attorneys consulted for this story was that the OID did not do enough to protect consumers.

Mulready disagreed.

“Our number one priority at the Oklahoma Insurance Department is consumer protection,” Mulready said. “State-based regulation — that’s our role, consumer protection. We try to help maintain a connected free market that gives choice.”

A written statement from the OID said that there are 113 insurance companies with active homeowners’ insurance policies in Oklahoma and approximately 60 insurers actively writing business in a very competitive market.

The statement also said that Section 984 had been invoked once, in 2016, when then-commissioner John Doak called for a hearing on earthquake insurance.

At the hearing, Doak ruled there was no competitive market.

In other words, in the single instance in which a competitive market was challenged, the insurance commissioner was both the plaintiff and the judge.

The System Might Not Be Working

Travis was unequivocal: Oklahoma’s abnormally high homeowners’ insurance rates could be attributed to laws designed to regulate by not regulating.

“Oh, no question,” Travis said. “I think that’s true.”

Former senator Easley said that when the law he championed was originally passed, things were different.

“The insurance commissioners would work with the legislators on behalf of consumers,” he said. “I’m not sure that’s happening now.”

Today, Easley owns homes in Norman, Chelsea and Broken Arrow. He recalled a hailstorm from eight years ago, but hadn’t seen much hail since then.

Mulready stuck to his guns. He said he recalled weather reports that showed Oklahoma had, for at least a decade, endured 10 to 20 days of hail measuring two inches in diameter or more.

“All I’m saying is that that is a measure that is taken nationwide and in the states, and Oklahoma is right up there in the top couple states in that measurement, and that measure, 2-inch hail, comes with some pretty serious damage, and that’s where insurance claims stem from,” Mulready said.

Mulready subsequently supplied the data he recalled, which came from a slide presentation delivered in February at the annual meeting of American Farmers & Ranchers, by a representative of Gallagher Re, a full-service global reinsurance brokerage firm.

The presentation, derived from National Weather Service reports, did not suggest that hail in Oklahoma was more severe than in surrounding states. Averaging 16.6 days of 2-inch hail from 2020-2024, Oklahoma trailed significantly behind states that have more hail but pay lower insurance rates, according to the Lendingtree report.

At 37.8 days, Texas received more than double the hail Oklahoma had. Kansas averaged 21.4 days; Nebraska, 22.6 days. 

Beyond fanciful hail claims, Easley was more concerned that the law he originally helped pass had been misapplied.

“This legislation was never intended to apply to homeowners,” he said. “If it’s been used in any fashion to enable these excessive homeowners’ insurance rates, then the commissioner should be going to the Legislature to say, ‘this is what we need to control these rates.’”

Easley did not mask his indignation.

“If they changed a law that was meant to apply to business, and was never meant to apply to homeowners’ insurance, then they can damn sure change it back, can’t they?” Easley said.

Oklahoma City insurance attorney Simone Fulmer sighed audibly and did not deny that there was nothing in Oklahoma law to prevent big insurance companies from raising rates to cover losses incurred in other states.

“They’re not supposed to do that,” Fulmer said.

Fulmer was not without hope, however.

She remembered when Commissioner Doak called for a hearing on earthquake insurance. That effort started from the ground up, with consumers contacting the OID to complain. It began not with attorneys, but with regular people who were fed up that prices had climbed too high.

The OID can be reached at its Oklahoma City and Tulsa offices, at 405-521-2828 and 918-295-3700, respectively. The department can be messaged here.

JC Hallman covers a variety of topics for Oklahoma Watch. Contact him at jchallman@oklahomawatch.org.