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A Follow-up Audit Report on the Financial Responsibility Verification Program (TexasSure) at the Department of Insurance

September 2012

Report Number 13-002

Overall Conclusion

The Department of Insurance (Department) has fully or substantially implemented 5 (63 percent) of 8 recommendations that auditors issued to the Department in An Audit Report on the Financial Responsibility Verification Program (TexasSure) (State Auditor's Office Report No. 10-016, November 2009). The 2009 audit report cited weaknesses related to the Department's collection of information regarding insurance policies for commercial vehicles and security over motorist information.

Since the 2009 audit, the Department developed written policies and procedures for monitoring TexasSure, including (1) a procedure for reviewing quarterly Texas Insurance Checking Office reports to help ensure that vehicle insurance information in TexasSure is complete and (2) change management procedures to help ensure that only authorized changes are made to the TexasSure system. In conjunction with HDI Solutions, Inc. (HDI), the contractor supporting the TexasSure system, the Department also developed a formal process for granting and revoking user access to TexasSure, and it has considered other opportunities to enhance TexasSure.

The Department's efforts to establish a schedule for insurance companies to submit information regarding all commercial vehicle insurance policies to TexasSure remain incomplete. Insurance companies voluntarily submitted information regarding approximately 120,000 commercial vehicle insurance policies to TexasSure in May 2012 (0.61 percent of all registered vehicles in TexasSure as of May 2012). That represented a slight increase when compared to the approximately 101,400 commercial vehicle insurance policies voluntarily submitted to TexasSure in October 2009 (0.56 percent of all registered vehicles in TexasSure as of October 2009).

The Department also should (1) log instances in which it receives erroneous or inconsistent information and (2) retain logs that document the weekly process for updating TexasSure. The Department has not yet had an opportunity to implement the process it developed for reviewing and approving modifications to its contract with HDI within 60 days.

Auditors communicated other, less significant issues related to the operation of TexasSure to the Department's management separately in writing.

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